EXHIBIT 10.5
1
Alloy Online, Inc. has omitted from this Exhibit 10.5 portions of the Agreement
for which Alloy Online, Inc. has requested confidential treatment from the
Securities and Exchange Commission. The portions of the Agreement for which
confidential treatment has been requested have been filed separately with the
Securities and Exchange Commission. Such omitted portions have been marked with
an asterisk.
EXHIBIT 10.5
SECOND AMENDMENT TO
FULFILLMENT SERVICES AGREEMENT
This Second Amendment to Fulfillment Services Agreement (the "AMENDMENT")
dated as of October 9, 1998, by and between Xxxxxxxx Fulfillment Services, Inc.,
a Tennessee corporation ("HFS"), and Alloy Designs, Inc., a Delaware corporation
(the "COMPANY").
WITNESSETH
WHEREAS, the parties hereto have previously entered into that certain
Fulfillment Services agreement dated as of July 23, 1997 (the "AGREEMENT")
pursuant to which HFS has agreed to provide direct marketing services to Company
for its direct marketing program for the sale of various merchandise sold
through the Alloy Catalog (respectively, the "MERCHANDISE" and the "CATALOG");
and
WHEREAS, the parties amended the Agreement pursuant to that certain
Amendment to Fulfillment Services Agreement dated as of September 1, 1997 to
provide for catalog request processing and the pricing therefor; and
WHEREAS, the parties desire that the Agreement be further amended as
described herein.
NOW, THEREFORE, in consideration of the mutual promises and conditions
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:
1. EFFECTIVE DATE AND EXPIRATION DATE. The effective date of this
amendment shall be October 9, 1998 (the "EFFECTIVE DATE") and Section 16(a) of
the
2
Agreement is hereby amended to provided that the Initial Term shall expire on
July 31, 2003.
2. TRANSACTION FEES. Section 5(b)(i) of the Agreement shall be deleted in
its entirety and the following shall be inserted in lieu thereof:
(b) TRANSACTION FEES. The Company shall pay HFS transaction fees
("TRANSACTION FEES") structured on a tiered basis determined quarterly in
January, April, July and October based on an annualization of the order
volume experienced during the three month period ending on the last day of
the calendar month immediately thereto. The applicable transaction rates at
each order volume tier are set forth in new EXHIBITS D/a-1 through D/a-4
(collectively with original EXHIBIT D, the "TRANSACTION RATE EXHIBITS"). In
the event that the annualized volume for any particular three month period
is less than 150,000, then the transaction rates for such period shall be
the rates set forth in original EXHIBIT D. The transaction rates shall be
adjusted from time to time by the C.P.I. Adjustment and Forecast Adjustment
described below (the transaction rates described herein as adjusted by the
C.P.I. Adjustment and Forecast Adjustment are referred to herein as the
"TRANSACTION RATES"). In the event that quarterly order volumes e qual or
exceed 1,000,000 orders, the parties shall negotiate in good faith to
determine mutually acceptable Transaction Rates for such volume levels.
3. FORECAST ADJUSTMENT. Section 5(b)(ii)B. shall be deleted in its
entirety and the following shall be inserted in lieu thereof:
B. From and after the Effective Date the Transaction Rates shall
also be subject to adjustment (the "FORECAST ADJUSTMENT") as follows:
1. In the event that the number of phone orders or items shipped
(each a "COMPONENT") during any calendar month varies below the amount
forecasted for such Component in the applicable Quarterly Forecast (or a
Revised Quarterly Forecast which has been delivered to HFS by no later than
least fifteen (15) days prior to the commencement of such month) by more
than ten percent (10%) but less than twenty-five percent (25%), then the
Transaction Rates for such month shall be increased by ten percent (10%).
2. In the event that a Component level during any calendar month
varies below the amount forecasted for such Component in the applicable
Quarterly Forecast (or a Revised Quarterly Forecast which has been
delivered to HFS by no later than least fifteen (15) days prior to the
commencement of such month) by more than twenty-five percent (25%), then
the Transaction Rates for such month shall be increased by twenty percent
(20%).
3
4. PAYMENT OF TRANSACTION FEES. Section 6(b) shall be deleted in its
entirety and the following shall be inserted in lieu thereof:
(b) TRANSACTION FEES. HFS shall, on a weekly basis, issue to the Company an
invoice for estimated transaction fees (the "ESTIMATED TRANSACTION FEES")
in the amount equal to the product of (i) the estimated number of orders
taken by HFS during that week and (ii) the per order price prescribed by
the applicable Transaction Rate Exhibit as determined by the Quarterly
Forecast or Revised Quarterly Forecast applicable to such week (the
"ASSUMED PER ORDER PRICE"). Such invoice shall be due and payable within
ten (10) Business Days. HFS shall, on a monthly basis, issue to the Company
an invoice setting forth the difference between the Estimated Transaction
Fees paid during the previous month and the actual Transaction Fees
incurred in respect of confirmed transactions serviced by HFS and based on
the forecasted Transaction Rates (the "FORECAST TRANSACTION FEES") during
the prior month. Any payments owing to HFS pursuant to such reconciliation
of the Estimated Transaction Amount with the Forecast Transaction Fee s
shall be due and payable within thirty (30) days following receipt of such
invoice issued by HFS. If at the end of the applicable month there is a
balance due the Company, HFS shall offset such balance against the
following month's invoice. HFS shall, on a quarterly basis, issue to the
Company an invoice reconciling the difference between the Forecast
Transaction Fees paid during the previous quarter and the actual
Transaction Fees incurred in respect of Services performed by HFS based on
the applicable Transaction Rates for the actual transaction volume
experience for such quarter, as determined from the Transaction Rate
Exhibits, and as adjusted by the C.P.I. Adjustment and/or Forecast
Adjustment, if any (the "ACTUAL TRANSACTION FEES"). Any payments owing to
HFS pursuant to such reconciliation of the Forecast Transaction Amount with
the Actual Transaction Fees shall be due and payable within thirty (30)
days following receipt of such invoice issued by HFS. If at the end of the
applicable quarter there i s a balance due the Company, HFS shall offset
such balance against the following month's invoice.
5. CLOSE DOWN FEE PAYMENT. Section 6(d) of the Agreement shall be amended
by deleting the phrase "ten (10) Business Days" in every instance in which it
appears and inserting the phrase "thirty (30) days" in lieu thereof.
6. EARLY TERMINATION RIGHTS. (a) Section 16(b)(v) shall be deleted in its
entirety and the following shall be inserted in lieu thereof:
4
(v) OTHER COMPANY TERMINATION RIGHTS. The Company shall have the
right to terminate this Agreement at any time after July 31, 1999 by
providing HFS with written notice thereof at least one hundred eighty
(180) days prior to such termination and payment of the unamortized
amounts described in Section 6(c) hereof.
(b) The following shall be inserted as a new Section 16(c):
(c) EARLY TERMINATION PAYMENTS. In connection with the Transaction
Rate and other changes contemplated by this Amendment, HFS will be
making certain capital investments and asset additions which the
parties believe are necessary to allow HFS to provide Services at the
increased order volumes anticipated to be experienced after the
Effective Date. In addition, HFS agreement to modify the Transaction
rates is based on the expectation of such order volume increase.
Consequently the parties agree that in the e vent that this Agreement
is terminated prior to the end of the Initial Term as a result of a
Default by the Company or as a result of the exercise by the Company
of its right to terminate under Section 16(b)(v), that HFS shall be
entitled to recoup its unamortized portion of the asset additions and
recoup the foregone revenues resulting from the reduction in
Transaction rates. Consequently, in the event of a termination of this
Agreement prior to the end of the Initial Term as a result of (i) a
Default by Company or (ii) an election by the Company pursuant to
Section 16(b)(v), in addition to any other rights which HFS may have
under this Agreement, the Company shall pay HFS an amount equal to sum
of (A) the unamortized value of the fixed asset expenditures directly
incurred by HFS to provide the Services to the Company plus (B) the
product of (x) the difference between the original EXHIBIT D
Transaction Rates and the revised Transaction Rates set forth in the
other Transaction Rate Exhibits and (y) the actual transactions
occurring between the Effective Date of this Amendment and [July 31,
1999] as more fully explained in the examples set forth in EXHIBIT H.
HFS shall provide the Company a minimum of ninety (90) days notice
prior to the purchase of such additional assets which will be involved
in the calculation set forth in this Section 16(c) during which time
the Company shall review the decision to add any such assets and
inform HFS as to whether to delay or cancel the addition. Any such
failure by the Company to notify HFS of its desire to cancel or delay
any asset acquisition shall be deemed to be a consent by the Company
to such asset acquisition. In the event of such cancellation or delay,
HFS shall be obligated to use its reasonable best efforts to meet
Service Levels but will otherwise be relieved from delivering Services
at Service Levels not reasonably obtainable in the absence such asset
additions. In the event of a termination requiring payment to be made
to HFS under this Section 16(c), the Company may obtain valid offers
and arrange for the disposal of the asset to a third party, and the
proceeds therefrom may be applied against the amount owing to HFS
hereunder
5
with any remaining deficiency being the obligation of the Company.
Upon receipt of a bona fide offer to purchase any such asset from a
third party. The Company shall deliver a copy of such bona fide offer
to HFS and HFS shall have ____ business days to agree to retain such
asset(s) and offset the amount owing to HFS by the Company under this
Section 16(c) by the price set forth in the bona fide offer of the
third party
6. EXHIBIT A ADDITIONS. The following shall be added to Exhibit A as
additional Services to be provided:
37. A dedicated service group for the Company will be
established.
38. Account executives and support staff will be provided in the
following numbers for the respective forecasted volume tiers:
TIER STAFF
Exhibit D 1 Account Representative
Exhibit D/a- 1 2 Account Representatives
Exhibit D/a-2 2 Account Representatives and
one clerical support person
Exhibit D/a-3,a-4 3 Account Representatives and
one clerical support person
7. BINDING EFFECT AND BENEFIT. The parties agree that this Amendment
is in full compliance with Section 26 of the Agreement and is a valid
modification and supplement to the Agreement which shall inure to the benefit
of, and shall be binding upon, the parties, their heirs, successors and
permitted assigns. All provisions of the Agreement not specifically amended
hereby shall remain in full force and effect but shall be read so as to give
effect to the foregoing amendments however, no further changes shall be effected
by this Amendment.
6
IN WITNESS WHEREOF, the Company has executed this Agreement effective the
date first above written and HFS has executed and accepted this Agreement
effective the same date.
COMPANY:
ALLOY DESIGNS, INC.
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Director, Finance & Administration
HFS:
XXXXXXXX FULFILLMENT SERVICES, INC.
By: /s/ Xxx Xxxxxxx
----------------------------------
Name: Xxx Xxxxxxx
Title: President
7
Exhibit D/1a
EXHIBIT D
Alloy Designs, Inc.
150 Thousand Orders
Transaction Rates
----------------------------------------------------------------------------------------------
Revised Date 09/17/98 Current Date 09/29/98
9:00AM Current Time 6:39 PM
----------------------------------------------------------------------------------------------
FEES
-----------------------------------------------------------------------------------------------------------------
ORDERS Phone orders (per minute charge) $ [ ]* each minute
-------------------
Mail Orders/Fax Orders (includes two (2)) line $ [ ]* each
items/order
-------------------
Check Verifications $ [ ]* each
Minimum $[ ]* per month
-------------------
Check Verification and recovery [ ]* each
Minimum $[ ]* per month
-------------------
Check Verification and Check Guarantee $ [ ]* each
Minimum $[ ]* per month
-------------------
Transmittal orders (includes all line items) $ [ ]* each
-------------------
Additional line items per order (Mail Order/Fax Orders $ [ ]* each
Only)
-------------------
Credit card Authorization $ [ ]* each
-------------------
Manual Credit Card Authorization $ [ ]* each
-------------------
Check/Cash/Money Order processing $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
KITTING Includes 3 items per kit $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
SHIPMENTS Catalog Shipments (includes 2 line items/shipment) $ [ ]* shipment
-------------------
Catalog Shipment line items greater than two (2) $ [ ]* line item
-----------------------------------------------------------------------------------------------------------------
-------------------
Guaranteed same-day shipment (optional) $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
RECEIVING/STOCKING Receiving/Inspecting $ [ ]* each
-------------------
Stocking/recording into inventory $ [ ]* each
-------------------
Inventory storage Reserve Warehouse (Calculated from $ [ ]* per cubic foot/mo
peak day of the month on actual space utilized)
-------------------
Inventory Storage Active Peak (Calculated on cubic foot $ [ ]* per cubic foot/mo
of pick location)
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
RETURNS/EXCHANGES Returns to Xxxxxxxx Fulfillment Services $ [ ]* each
-------------------
Exchange processing $ [ ]* each
-------------------
Returns/Exchanges on freighted items additional $ [ ]* each
-------------------
Return to vendor $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
CALL TAGS/TRACERS UPS call tags $ [ ]* each
-------------------
Tracers $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
GIFTS Gift Wrap $ [ ]* each
-------------------
Gift Cards $ [ ]*
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
CUSTOMER SERVICE Calls
Marketing lead calls (inbound) $ [ ]* each
-------------------
Non-order calls (inbound) $ [ ]* each minute
-------------------
Inbound Catalog Request (Alloy specified-Live $ [ ]* each minute
Operator)
-------------------
Inbound Catalog Request (Voice Mail) (Customer $ [ ]* each minute
Talk Time)
-------------------
Non-order calls (outbound) $ [ ]* each minute
-------------------
Non-Order correspondence
-------------------
Customer Service Letters $ [ ]* each
Chargebacks $ [ ]* each
NSF Check Collection $ [ ]* each
AR Manual Payments $ [ ]* each
Order Research $ [ ]* each hour
Remote Monitoring $ [ ]* each hour
-----------------------------------------------------------------------------------------------------------------
8
Exhibit D/1a
-----------------------------------------------------------------------------------------------------------------
MAIL ROOM Catalog Request $ [ ]* each
-------------------
Fax transmissions $ [ ]* each
-------------------
Copies $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
FIXED FEES Dedicated Services Management Fee (DSG) $ [ ]* week
-------------------
Administrative fees $ [ ]* week
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
ACCOUNTS RECEIVABLE BILLING Invoices Manual (Institutional purchase order billing) $ [ ]* each
-------------------
Credit card statement processing (manual) each
-------------------
Credit card automated processing (Authorizations each
payments)
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
PRINT MAIL Marketing lead package (announcements/advances) $ [ ]* each
-------------------
Monthly news letters $ [ ]* each
-------------------
Automated Statement/past due notices $ [ ]* each
-------------------
Automated FTC Notices and Correspondence $ [ ]* each
-------------------
Automated Shipments invoices $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
BANKING Lock Box Check processing US (regular) $ [ ]* each
-------------------
Lock Box Check processing CAN (us funds) $ [ ]* each
-------------------
Canadian Checks drawn on Canadian Bank $ [ ]*
-------------------
PO Box Rental $ [ ]* per year
-------------------
Returned Checks/Recleared Checks and Cash Payments $ [ ]* each
-------------------
Research $ [ ]* per request
-------------------
Deposits and Deposit balancing $ [ ]* each
----------------------------------------------------------------------------
FDIC DDA Maintenance $ [ ]* monthly
-------------------
Additional DDA Statements $ [ ]* each
-------------------
Foreign Collection Expense $ [ ]* each
-------------------
Wire Transfers (debit) $ [ ]* each
-------------------
ASH transfers (debit) $ [ ]* each
-------------------
These fees are ased on charges by the
Federal Reserve, FDIC and/or other
depository institutions and are
subject to change when the respective
expense is changed. You will be
notified promptly of any changes in
prices for these services.
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
OPTIONAL SERVICES Optional Services:
-------------------
Weekly Customer Satisfaction Survey: $ [ ]* per month
-------------------
Quarterly Business Reviews: $ [ ]* per review
-------------------
Upsell: $ [ ]*
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
SPECIAL PROJECTS FEES Special Projects Fees:*
Special projects include physical
inventory, customer
service/telemarketing operator
training, special inventory processing
(assembly, rework, refurbishment,
etc.) and close down service
All special projects are estimated by
HFS and must be approved in writing by
client before project commencement.
Labor PER HOUR
-------------------
Office, Regular $ [ ]* hour
-------------------
Office, Overtime $ [ ]* hour
-------------------
Office, Sunday/Holiday $ [ ]* hour
-------------------
Warehouse, Regular $ [ ]* hour
-------------------
Warehouse, Overtime $ [ ]* hour
-------------------
Warehouse, Sunday/Holiday $ [ ]* hour
-------------------
Supervisory, Regular $ [ ]* hour
-------------------
Supervisory, Overtime $ [ ]* hour
-------------------
Supervisory, Sunday/Holiday $ [ ]* hour
-------------------
Consulting Services $ [ ]* hour
-------------------
Executive Consulting Services $ [ ]* day
-------------------
Approved HFS travel $ [ ]*
-----------------------------------------------------------------------------------------------------------------
9
Exhibit D/1a
-----------------------------------------------------------------------------------------------------------------
DATA BASE SELECTION Initial Customer file/order file load per thousand $ [ ]* per thousand
records
-------------------
Selection Table Set Up (Source Codes) (output id) $ [ ]*
-------------------
Test Selection With No Output $ [ ]*
-------------------
Live Execution of Data Base $ [ ]*
-------------------
Build Negative Option Order File $ [ ]* per order
-------------------
File Downloads $ [ ]* per record
-------------------
Interface to third party data base and drop shippers $ [ ]* per order
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
DATA PROCESSING Data processing support $ [ ]* order
-------------------
EDI Interface transactions (order status, returns, $ [ ]* each
cancels, etc.)
-------------------
Computer programming services $ [ ]* per hour
-------------------
Computer script changes (report distribution changes, $ [ ]* per hour
tape set-up, job changes, etc.)
-------------------
Data Storage:
-------------------
House file customer account record with inactivity >12 $ [ ]* per month
months
-------------------
Order record (includes supplementary detail records) per record
-----------------------------------------------------------------------------------------------------------------
competed >12 months $ [ ]* per month
per record
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
OTHER Other:
-------------------
Supplies $ [ ]*
-------------------
Materials $ [ ]*
-------------------
Stationery $ [ ]*
-------------------
Special Packaging Materials $ [ ]*
-------------------
Postage and Courier $ [ ]*
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
COMMUNICATIONS Remote communications lines and hardware $ [ ]*
Telephone hardware (minimum lines = to number of 800 $ [ ]* each line
numbers)
-------------------
(Regular lines rate is calculated by dividing the peak
hour in a month by 15 calls per hour)
-------------------
(Request lines rate is calculated by dividing the peak
hour in a month by 60 calls per hour)
-------------------
Outbound long distance usage $ [ ]* hour
-------------------
Toll free 800 usage (WATS charges) First 25,000 hours $ [ ]* hour
annually
-------------------
Toll free 800 usage (WATS charges) Hours in excess of $ [ ]* hour
25,000 annually
-------------------
Canadian toll free usage (WATS charges) Cost varies on $ [ ]*
usage & province
-----------------------------------------------------------------------------------------------------------------
ASSUMPTIONS The following assumptions were made in compiling the transaction rates:
Orders
------------------ ------------------
(Positive Option) [ ]* Non-Order Call outs [ ]%*
------------------ ------------------
Telephone Percentage [ ]%* Non-Order Calls in [ ]%*
------------------ ------------------
Mail Percentage [ ]%* Catalog Request Phone [ ]%*
------------------ ------------------
Transmitted Percentage [ ]%* Non-Order [ ]%*
------------------ correspondence
Shipments per order [ ]* ------------------
------------------ Call Tags [ ]%*
Items per order [ ]* ------------------
------------------ Tracers [ ]%*
Returns/exchanges to HFS [ ]%* ------------------
------------------ Drop Ship % [ ]%*
Returns Electronic [ ]%* ------------------
------------------
Receiving [ ]%* ------------------
------------------ Catalog Request Mail [ ]%*
Gift Wrap Percentage [ ]%* ------------------
------------------ Advances (Neg. Option) [ ]%*
Gift Card Percentage [ ]%* ------------------
------------------
The pricing was developed to these base assumptions and is subject to
change if the assumptions change. Transaction rates are double for the
following holidays: Christmas Eve, Christmas Day, New Year's Day,
Memorial Day, Easter, July 4th, Labor day, Thanksgiving.
APPROVED CARRIERS Approved Carriers: UPS, USPS, RPS, FEDX
Any Business Partner requesting non-approved carriers will result in
an additional charge of [ ]* a shipment.
Any Business Partner requesting freight shipments will be charged a
per-shipment charge.
prepared by Xxxxxxx X. Xxxxxxxxx
10
Exhibit D/1b
ALLOY DESIGN, INC
THREE CONSECUTIVE MONTHS CUMULATIVE ORDERS GREATER THAN 150,000
TRANSACTION RATES
----------------------------------------------------------------------------------------------
Revised Date 09/28/98 Current Date 09/29/98
9:00 AM Current Time 6:41 PM
----------------------------------------------------------------------------------------------
FEES
-----------------------------------------------------------------------------------------------------------------
ORDERS Phone orders (per minute charge) $ [ ]* each minute
-------------------
Mail Orders/Fax Orders (includes two (2)) line $ [ ]* each
items/order
-------------------
Check Verifications $ [ ]* each
Minimum $[ ]* per month
-------------------
Check Verification and recovery [ ]* each
Minimum $[ ]* per month
-------------------
Check Verification and Check Guarantee $ [ ]* each
Minimum $[ ]* per month
-------------------
Transmittal orders (includes all line items) $ [ ]* each
-------------------
Additional line items per order (Mail Order/Fax Orders $ [ ]* each
Only)
-------------------
Credit card Authorization $ [ ]* each
-------------------
Manual Credit Card Authorization $ [ ]* each
-------------------
Check/Cash/Money Order processing $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
KITTING Includes 3 items per kit $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
SHIPMENTS Catalog Shipments (includes 2 line items/shipment) $ [ ]* shipment
-------------------
Catalog Shipment line items greater than two (2) $ [ ]* line item
-----------------------------------------------------------------------------------------------------------------
-------------------
Guaranteed same-day shipment (optional) $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
RECEIVING/STOCKING Receiving/Inspecting $ [ ]* each
-------------------
Stocking/recording into inventory $ [ ]* each
-------------------
Inventory storage Reserve Warehouse (Calculated from $ [ ]* per cubic foot/mo
peak day of the month on actual space utilized)
-------------------
Inventory Storage Active Peak (Calculated on cubic foot $ [ ]* per cubic foot/mo
of pick location)
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
RETURNS/EXCHANGES Returns to Xxxxxxxx Fulfillment Services $ [ ]* each
-------------------
Exchange processing $ [ ]* each
-------------------
Returns/Exchanges on freighted items additional $ [ ]* each
-------------------
Return to vendor $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
CALL TAGS/TRACERS UPS call tags $ [ ]* each
-------------------
Tracers $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
GIFTS Gift Wrap $ [ ]* each
-------------------
Gift Cards $ [ ]*
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
CUSTOMER SERVICE Calls
Marketing lead calls (inbound) $ [ ]* each
-------------------
Non-order calls (inbound) $ [ ]* each minute
-------------------
Inbound Catalog Request (Alloy specified-Live $ [ ]* each minute
Operator)
-------------------
Inbound Catalog Request (Voice Mail) (Customer $ [ ]* each minute
Talk Time)
-------------------
Non-order calls (outbound) $ [ ]* each minute
-------------------
Non-Order correspondence
-------------------
Customer Service Letters $ [ ]* each
Chargebacks $ [ ]* each
NSF Check Collection $ [ ]* each
AR Manual Payments $ [ ]* each
Order Research $ [ ]* each hour
Remote Monitoring $ [ ]* each hour
-----------------------------------------------------------------------------------------------------------------
11
Exhibit D/1b
-----------------------------------------------------------------------------------------------------------------
MAIL ROOM Catalog Request $ [ ]* each
-------------------
Fax transmissions $ [ ]* each
-------------------
Copies $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
FIXED FEES Dedicated Services Management Fee (DSG) $ [ ]* week
-------------------
Administrative fees $ [ ]* week
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
ACCOUNTS RECEIVABLE BILLING Invoices Manual (Institutional purchase order billing) $ [ ]* each
-------------------
Credit card statement processing (manual) each
-------------------
Credit card automated processing (Authorizations each
payments)
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
PRINT MAIL Marketing lead package (announcements/advances) $ [ ]* each
-------------------
Monthly news letters $ [ ]* each
-------------------
Automated Statement/past due notices $ [ ]* each
-------------------
Automated FTC Notices and Correspondence $ [ ]* each
-------------------
Automated Shipments invoices $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
BANKING Lock Box Check processing US (regular) $ [ ]* each
-------------------
Lock Box Check processing CAN (us funds) $ [ ]* each
-------------------
Canadian Checks drawn on Canadian Bank $ [ ]*
-------------------
PO Box Rental $ [ ]* per year
-------------------
Returned Checks/Recleared Checks and Cash Payments $ [ ]* each
-------------------
Research $ [ ]* per request
-------------------
Deposits and Deposit balancing $ [ ]* each
----------------------------------------------------------------------------
FDIC DDA Maintenance $ [ ]* monthly
-------------------
Additional DDA Statements $ [ ]* each
-------------------
Foreign Collection Expense $ [ ]* each
-------------------
Wire Transfers (debit) $ [ ]* each
-------------------
ASH transfers (debit) $ [ ]* each
-------------------
These fees are ased on charges by the
Federal Reserve, FDIC and/or other
depository institutions and are
subject to change when the respective
expense is changed. You will be
notified promptly of any changes in
prices for these services.
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
OPTIONAL SERVICES Optional Services:
-------------------
Weekly Customer Satisfaction Survey: $ [ ]* per month
-------------------
Quarterly Business Reviews: $ [ ]* per review
-------------------
Upsell: $ [ ]*
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
SPECIAL PROJECTS FEES Special Projects Fees:*
Special projects include physical
inventory, customer
service/telemarketing operator
training, special inventory processing
(assembly, rework, refurbishment,
etc.) and close down service
All special projects are estimated by
HFS and must be approved in writing by
client before project commencement.
Labor PER HOUR
-------------------
Office, Regular $ [ ]* hour
-------------------
Office, Overtime $ [ ]* hour
-------------------
Office, Sunday/Holiday $ [ ]* hour
-------------------
Warehouse, Regular $ [ ]* hour
-------------------
Warehouse, Overtime $ [ ]* hour
-------------------
Warehouse, Sunday/Holiday $ [ ]* hour
-------------------
Supervisory, Regular $ [ ]* hour
-------------------
Supervisory, Overtime $ [ ]* hour
-------------------
Supervisory, Sunday/Holiday $ [ ]* hour
-------------------
Consulting Services $ [ ]* hour
-------------------
Executive Consulting Services $ [ ]* day
-------------------
Approved HFS travel $ [ ]*
-----------------------------------------------------------------------------------------------------------------
12
Exhibit D/1b
-----------------------------------------------------------------------------------------------------------------
DATA BASE SELECTION Initial Customer file/order file load per thousand $ [ ]* per thousand
records
-------------------
Selection Table Set Up (Source Codes) (output id) $ [ ]*
-------------------
Test Selection With No Output $ [ ]*
-------------------
Live Execution of Data Base $ [ ]*
-------------------
Build Negative Option Order File $ [ ]* per order
-------------------
File Downloads $ [ ]* per record
-------------------
Interface to third party data base and drop shippers $ [ ]* per order
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
DATA PROCESSING Data processing support $ [ ]* order
-------------------
EDI Interface transactions (order status, returns, $ [ ]* each
cancels, etc.)
-------------------
Computer programming services $ [ ]* per hour
-------------------
Computer script changes (report distribution changes, $ [ ]* per hour
tape set-up, job changes, etc.)
-------------------
Data Storage:
-------------------
House file customer account record with inactivity >12 $ [ ]* per month
months
-------------------
Order record (includes supplementary detail records) per record
-----------------------------------------------------------------------------------------------------------------
competed >12 months $ [ ]* per month
per record
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
OTHER Other:
-------------------
Supplies $ [ ]*
-------------------
Materials $ [ ]*
-------------------
Stationery $ [ ]*
-------------------
Special Packaging Materials $ [ ]*
-------------------
Postage and Courier $ [ ]*
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
COMMUNICATIONS Remote communications lines and hardware $ [ ]*
Telephone hardware (minimum lines = to number of 800 $ [ ]* each line
numbers)
-------------------
(Regular lines rate is calculated by dividing the peak
hour in a month by 15 calls per hour)
-------------------
(Request lines rate is calculated by dividing the peak
hour in a month by 60 calls per hour)
-------------------
Outbound long distance usage $ [ ]* hour
-------------------
Toll free 800 usage (WATS charges) First 25,000 hours $ [ ]* hour
annually
-------------------
Toll free 800 usage (WATS charges) Hours in excess of $ [ ]* hour
25,000 annually
-------------------
Canadian toll free usage (WATS charges) Cost varies on $ [ ]*
usage & province
-----------------------------------------------------------------------------------------------------------------
ASSUMPTIONS The following assumptions were made in compiling the transaction rates:
Orders
------------------ ------------------
(Positive Option) [ ]* Non-Order Call outs [ ]%*
------------------ ------------------
Telephone Percentage [ ]%* Non-Order Calls in [ ]%*
------------------ ------------------
Mail Percentage [ ]%* Catalog Request Phone [ ]%*
------------------ ------------------
Transmitted Percentage [ ]%* Non-Order [ ]%*
------------------ correspondence
Shipments per order [ ]* ------------------
------------------ Call Tags [ ]%*
Items per order [ ]* ------------------
------------------ Tracers [ ]%*
Returns/exchanges to HFS [ ]%* ------------------
------------------ Drop Ship % [ ]%*
Returns Electronic [ ]%* ------------------
------------------
Receiving [ ]%* ------------------
------------------ Catalog Request Mail [ ]%*
Gift Wrap Percentage [ ]%* ------------------
------------------ Advances (Neg. Option) [ ]%*
Gift Card Percentage [ ]%* ------------------
------------------
The pricing was developed to these base assumptions and is subject to
change if the assumptions change. Transaction rates are double for the
following holidays: Christmas Eve, Christmas Day, New Year's Day,
Memorial Day, Easter, July 4th, Labor day, Thanksgiving.
APPROVED CARRIERS Approved Carriers: UPS, USPS, RPS, FEDX
Any Business Partner requesting non-approved carriers will result in
an additional charge of [ ]* a shipment.
Any Business Partner requesting freight shipments will be charged a
per-shipment charge.
prepared by Xxxxxxx X. Xxxxxxxxx
13
Exhibit D/1c
ALLOY DESIGN, INC
THREE CONSECUTIVE MONTHS CUMULATIVE ORDERS GREATER THAN 300,000
TRANSACTION RATES
Revised Date 09/28/98 Current Date 09/29/98
9:00 AM Current Time 6:42 PM
----------------------------------------------------------------------------------------------
FEES
-----------------------------------------------------------------------------------------------------------------
ORDERS Phone orders (per minute charge) $ [ ]* each minute
-------------------
Mail Orders/Fax Orders (includes two (2)) line $ [ ]* each
items/order
-------------------
Check Verifications $ [ ]* each
Minimum $[ ]* per month
-------------------
Check Verification and recovery [ ]* each
Minimum $[ ]* per month
-------------------
Check Verification and Check Guarantee $ [ ]* each
Minimum $[ ]* per month
-------------------
Transmittal orders (includes all line items) $ [ ]* each
-------------------
Additional line items per order (Mail Order/Fax Orders $ [ ]* each
Only)
-------------------
Credit card Authorization $ [ ]* each
-------------------
Manual Credit Card Authorization $ [ ]* each
-------------------
Check/Cash/Money Order processing $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
KITTING Includes 3 items per kit $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
SHIPMENTS Catalog Shipments (includes 2 line items/shipment) $ [ ]* shipment
-------------------
Catalog Shipment line items greater than two (2) $ [ ]* line item
-----------------------------------------------------------------------------------------------------------------
-------------------
Guaranteed same-day shipment (optional) $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
RECEIVING/STOCKING Receiving/Inspecting $ [ ]* each
-------------------
Stocking/recording into inventory $ [ ]* each
-------------------
Inventory storage Reserve Warehouse (Calculated from $ [ ]* per cubic foot/mo
peak day of the month on actual space utilized)
-------------------
Inventory Storage Active Peak (Calculated on cubic foot $ [ ]* per cubic foot/mo
of pick location)
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
RETURNS/EXCHANGES Returns to Xxxxxxxx Fulfillment Services $ [ ]* each
-------------------
Exchange processing $ [ ]* each
-------------------
Returns/Exchanges on freighted items additional $ [ ]* each
-------------------
Return to vendor $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
CALL TAGS/TRACERS UPS call tags $ [ ]* each
-------------------
Tracers $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
GIFTS Gift Wrap $ [ ]* each
-------------------
Gift Cards $ [ ]*
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
CUSTOMER SERVICE Calls
Marketing lead calls (inbound) $ [ ]* each
-------------------
Non-order calls (inbound) $ [ ]* each minute
-------------------
Inbound Catalog Request (Alloy specified-Live $ [ ]* each minute
Operator)
-------------------
Inbound Catalog Request (Voice Mail) (Customer $ [ ]* each minute
Talk Time)
-------------------
Non-order calls (outbound) $ [ ]* each minute
-------------------
Non-Order correspondence
-------------------
Customer Service Letters $ [ ]* each
Chargebacks $ [ ]* each
NSF Check Collection $ [ ]* each
AR Manual Payments $ [ ]* each
Order Research $ [ ]* each hour
Remote Monitoring $ [ ]* each hour
-----------------------------------------------------------------------------------------------------------------
14
Exhibit D/1c
-----------------------------------------------------------------------------------------------------------------
MAIL ROOM Catalog Request $ [ ]* each
-------------------
Fax transmissions $ [ ]* each
-------------------
Copies $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
FIXED FEES Dedicated Services Management Fee (DSG) $ [ ]* week
-------------------
Administrative fees $ [ ]* week
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
ACCOUNTS RECEIVABLE BILLING Invoices Manual (Institutional purchase order billing) $ [ ]* each
-------------------
Credit card statement processing (manual) each
-------------------
Credit card automated processing (Authorizations each
payments)
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
PRINT MAIL Marketing lead package (announcements/advances) $ [ ]* each
-------------------
Monthly news letters $ [ ]* each
-------------------
Automated Statement/past due notices $ [ ]* each
-------------------
Automated FTC Notices and Correspondence $ [ ]* each
-------------------
Automated Shipments invoices $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
BANKING Lock Box Check processing US (regular) $ [ ]* each
-------------------
Lock Box Check processing CAN (us funds) $ [ ]* each
-------------------
Canadian Checks drawn on Canadian Bank $ [ ]*
-------------------
PO Box Rental $ [ ]* per year
-------------------
Returned Checks/Recleared Checks and Cash Payments $ [ ]* each
-------------------
Research $ [ ]* per request
-------------------
Deposits and Deposit balancing $ [ ]* each
----------------------------------------------------------------------------
FDIC DDA Maintenance $ [ ]* monthly
-------------------
Additional DDA Statements $ [ ]* each
-------------------
Foreign Collection Expense $ [ ]* each
-------------------
Wire Transfers (debit) $ [ ]* each
-------------------
ASH transfers (debit) $ [ ]* each
-------------------
These fees are ased on charges by the
Federal Reserve, FDIC and/or other
depository institutions and are
subject to change when the respective
expense is changed. You will be
notified promptly of any changes in
prices for these services.
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
OPTIONAL SERVICES Optional Services:
-------------------
Weekly Customer Satisfaction Survey: $ [ ]* per month
-------------------
Quarterly Business Reviews: $ [ ]* per review
-------------------
Upsell: $ [ ]*
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
SPECIAL PROJECTS FEES Special Projects Fees:*
Special projects include physical
inventory, customer
service/telemarketing operator
training, special inventory processing
(assembly, rework, refurbishment,
etc.) and close down service
All special projects are estimated by
HFS and must be approved in writing by
client before project commencement.
Labor PER HOUR
-------------------
Office, Regular $ [ ]* hour
-------------------
Office, Overtime $ [ ]* hour
-------------------
Office, Sunday/Holiday $ [ ]* hour
-------------------
Warehouse, Regular $ [ ]* hour
-------------------
Warehouse, Overtime $ [ ]* hour
-------------------
Warehouse, Sunday/Holiday $ [ ]* hour
-------------------
Supervisory, Regular $ [ ]* hour
-------------------
Supervisory, Overtime $ [ ]* hour
-------------------
Supervisory, Sunday/Holiday $ [ ]* hour
-------------------
Consulting Services $ [ ]* hour
-------------------
Executive Consulting Services $ [ ]* day
-------------------
Approved HFS travel $ [ ]*
-----------------------------------------------------------------------------------------------------------------
15
Exhibit D/1c
-----------------------------------------------------------------------------------------------------------------
DATA BASE SELECTION Initial Customer file/order file load per thousand $ [ ]* per thousand
records
-------------------
Selection Table Set Up (Source Codes) (output id) $ [ ]*
-------------------
Test Selection With No Output $ [ ]*
-------------------
Live Execution of Data Base $ [ ]*
-------------------
Build Negative Option Order File $ [ ]* per order
-------------------
File Downloads $ [ ]* per record
-------------------
Interface to third party data base and drop shippers $ [ ]* per order
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
DATA PROCESSING Data processing support $ [ ]* order
-------------------
EDI Interface transactions (order status, returns, $ [ ]* each
cancels, etc.)
-------------------
Computer programming services $ [ ]* per hour
-------------------
Computer script changes (report distribution changes, $ [ ]* per hour
tape set-up, job changes, etc.)
-------------------
Data Storage:
-------------------
House file customer account record with inactivity >12 $ [ ]* per month
months
-------------------
Order record (includes supplementary detail records) per record
-----------------------------------------------------------------------------------------------------------------
competed >12 months $ [ ]* per month
per record
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
OTHER Other:
-------------------
Supplies $ [ ]*
-------------------
Materials $ [ ]*
-------------------
Stationery $ [ ]*
-------------------
Special Packaging Materials $ [ ]*
-------------------
Postage and Courier $ [ ]*
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
COMMUNICATIONS Remote communications lines and hardware $ [ ]*
Telephone hardware (minimum lines = to number of 800 $ [ ]* each line
numbers)
-------------------
(Regular lines rate is calculated by dividing the peak
hour in a month by 15 calls per hour)
-------------------
(Request lines rate is calculated by dividing the peak
hour in a month by 60 calls per hour)
-------------------
Outbound long distance usage $ [ ]* hour
-------------------
Toll free 800 usage (WATS charges) First 25,000 hours $ [ ]* hour
annually
-------------------
Toll free 800 usage (WATS charges) Hours in excess of $ [ ]* hour
25,000 annually
-------------------
Canadian toll free usage (WATS charges) Cost varies on $ [ ]*
usage & province
-----------------------------------------------------------------------------------------------------------------
ASSUMPTIONS The following assumptions were made in compiling the transaction rates:
Orders
------------------ ------------------
(Positive Option) [ ]* Non-Order Call outs [ ]%*
------------------ ------------------
Telephone Percentage [ ]%* Non-Order Calls in [ ]%*
------------------ ------------------
Mail Percentage [ ]%* Catalog Request Phone [ ]%*
------------------ ------------------
Transmitted Percentage [ ]%* Non-Order [ ]%*
------------------ correspondence
Shipments per order [ ]* ------------------
------------------ Call Tags [ ]%*
Items per order [ ]* ------------------
------------------ Tracers [ ]%*
Returns/exchanges to HFS [ ]%* ------------------
------------------ Drop Ship % [ ]%*
Returns Electronic [ ]%* ------------------
------------------
Receiving [ ]%* ------------------
------------------ Catalog Request Mail [ ]%*
Gift Wrap Percentage [ ]%* ------------------
------------------ Advances (Neg. Option) [ ]%*
Gift Card Percentage [ ]%* ------------------
------------------
The pricing was developed to these base assumptions and is subject to
change if the assumptions change. Transaction rates are double for the
following holidays: Christmas Eve, Christmas Day, New Year's Day,
Memorial Day, Easter, July 4th, Labor day, Thanksgiving.
APPROVED CARRIERS Approved Carriers: UPS, USPS, RPS, FEDX
Any Business Partner requesting non-approved carriers will result in
an additional charge of [ ]* a shipment.
Any Business Partner requesting freight shipments will be charged a
per-shipment charge.
prepared by Xxxxxxx X. Xxxxxxxxx
16
Exhibit D/1d
ALLOY DESIGN, INC.
THREE CONSECUTIVE MONTHS CUMULATIVE ORDERS GREATER THAN 600,000
TRANSACTION RATES
----------------------------------------------------------------------------------------------
REVISED DATE 09/28/98 CURRENT DATE 09/29/98
9:00 AM CURRENT TIME 6:45 PM
----------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
ORDERS Phone orders (per minute charge) $ [ ]* each minute
-------------------
Mail Orders/Fax Orders (includes two (2)) line $ [ ]* each
items/order
-------------------
Check Verifications $ [ ]* each
Minimum $[ ]* per month
-------------------
Check Verification and recovery [ ]* each
Minimum $[ ]* per month
-------------------
Check Verification and Check Guarantee $ [ ]* each
Minimum $[ ]* per month
-------------------
Transmittal orders (includes all line items) $ [ ]* each
-------------------
Additional line items per order (Mail Order/Fax Orders $ [ ]* each
Only)
-------------------
Credit card Authorization $ [ ]* each
-------------------
Manual Credit Card Authorization $ [ ]* each
-------------------
Check/Cash/Money Order processing $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
KITTING Includes 3 items per kit $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
SHIPMENTS Catalog Shipments (includes 2 line items/shipment) $ [ ]* shipment
-------------------
Catalog Shipment line items greater than two (2) $ [ ]* line item
-----------------------------------------------------------------------------------------------------------------
-------------------
Guaranteed same-day shipment (optional) $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
RECEIVING/STOCKING Receiving/Inspecting $ [ ]* each
-------------------
Stocking/recording into inventory $ [ ]* each
-------------------
Inventory storage Reserve Warehouse (Calculated from $ [ ]* per cubic foot/mo
peak day of the month on actual space utilized)
-------------------
Inventory Storage Active Peak (Calculated on cubic foot $ [ ]* per cubic foot/mo
of pick location)
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
RETURNS/EXCHANGES Returns to Xxxxxxxx Fulfillment Services $ [ ]* each
-------------------
Exchange processing $ [ ]* each
-------------------
Returns/Exchanges on freighted items additional $ [ ]* each
-------------------
Return to vendor $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
CALL TAGS/TRACERS UPS call tags $ [ ]* each
-------------------
Tracers $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
GIFTS Gift Wrap $ [ ]* each
-------------------
Gift Cards $ [ ]*
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
CUSTOMER SERVICE Calls
Marketing lead calls (inbound) $ [ ]* each
-------------------
Non-order calls (inbound) $ [ ]* each minute
-------------------
Inbound Catalog Request (Alloy specified-Live $ [ ]* each minute
Operator)
-------------------
Inbound Catalog Request (Voice Mail) (Customer $ [ ]* each minute
Talk Time)
-------------------
Non-order calls (outbound) $ [ ]* each minute
-------------------
Non-Order correspondence
-------------------
Customer Service Letters $ [ ]* each
Chargebacks $ [ ]* each
NSF Check Collection $ [ ]* each
AR Manual Payments $ [ ]* each
Order Research $ [ ]* each hour
Remote Monitoring $ [ ]* each hour
-----------------------------------------------------------------------------------------------------------------
17
Exhibit D/1d
-----------------------------------------------------------------------------------------------------------------
MAIL ROOM Catalog Request $ [ ]* each
-------------------
Fax transmissions $ [ ]* each
-------------------
Copies $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
FIXED FEES Dedicated Services Management Fee (DSG) $ [ ]* week
-------------------
Administrative fees $ [ ]* week
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
ACCOUNTS RECEIVABLE BILLING Invoices Manual (Institutional purchase order billing) $ [ ]* each
-------------------
Credit card statement processing (manual) each
-------------------
Credit card automated processing (Authorizations each
payments)
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
PRINT MAIL Marketing lead package (announcements/advances) $ [ ]* each
-------------------
Monthly news letters $ [ ]* each
-------------------
Automated Statement/past due notices $ [ ]* each
-------------------
Automated FTC Notices and Correspondence $ [ ]* each
-------------------
Automated Shipments invoices $ [ ]* each
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
BANKING Lock Box Check processing US (regular) $ [ ]* each
-------------------
Lock Box Check processing CAN (us funds) $ [ ]* each
-------------------
Canadian Checks drawn on Canadian Bank $ [ ]*
-------------------
PO Box Rental $ [ ]* per year
-------------------
Returned Checks/Recleared Checks and Cash Payments $ [ ]* each
-------------------
Research $ [ ]* per request
-------------------
Deposits and Deposit balancing $ [ ]* each
----------------------------------------------------------------------------
FDIC DDA Maintenance $ [ ]* monthly
-------------------
Additional DDA Statements $ [ ]* each
-------------------
Foreign Collection Expense $ [ ]* each
-------------------
Wire Transfers (debit) $ [ ]* each
-------------------
ASH transfers (debit) $ [ ]* each
-------------------
These fees are based on charges by the
Federal Reserve, FDIC and/or other
depository institutions and are
subject to change when the respective
expense is changed. You will be
notified promptly of any changes in
prices for these services.
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
OPTIONAL SERVICES Optional Services:
-------------------
Weekly Customer Satisfaction Survey: $ [ ]* per month
-------------------
Quarterly Business Reviews: $ [ ]* per review
-------------------
Upsell: $ [ ]*
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
SPECIAL PROJECTS FEES Special Projects Fees:*
Special projects include physical
inventory, customer
service/telemarketing operator
training, special inventory processing
(assembly, rework, refurbishment,
etc.) and close down service
All special projects are estimated by
HFS and must be approved in writing by
client before project commencement.
Labor PER HOUR
-------------------
Office, Regular $ [ ]* hour
-------------------
Office, Overtime $ [ ]* hour
-------------------
Office, Sunday/Holiday $ [ ]* hour
-------------------
Warehouse, Regular $ [ ]* hour
-------------------
Warehouse, Overtime $ [ ]* hour
-------------------
Warehouse, Sunday/Holiday $ [ ]* hour
-------------------
Supervisory, Regular $ [ ]* hour
-------------------
Supervisory, Overtime $ [ ]* hour
-------------------
Supervisory, Sunday/Holiday $ [ ]* hour
-------------------
Consulting Services $ [ ]* hour
-------------------
Executive Consulting Services $ [ ]* day
-------------------
Approved HFS travel $ [ ]*
-----------------------------------------------------------------------------------------------------------------
18
Exhibit D/1d
-----------------------------------------------------------------------------------------------------------------
DATA BASE SELECTION Initial Customer file/order file load per thousand $ [ ]* per thousand
records
-------------------
Selection Table Set Up (Source Codes) (output id) $ [ ]*
-------------------
Test Selection With No Output $ [ ]*
-------------------
Live Execution of Data Base $ [ ]*
-------------------
Build Negative Option Order File $ [ ]* per order
-------------------
File Downloads $ [ ]* per record
-------------------
Interface to third party data base and drop shippers $ [ ]* per order
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
DATA PROCESSING Data processing support $ [ ]* order
-------------------
EDI Interface transactions (order status, returns, $ [ ]* each
cancels, etc.)
-------------------
Computer programming services $ [ ]* per hour
-------------------
Computer script changes (report distribution changes, $ [ ]* per hour
tape set-up, job changes, etc.)
-------------------
Data Storage:
-------------------
House file customer account record with inactivity >12 $ [ ]* per month
months
-------------------
Order record (includes supplementary detail records) per record
-----------------------------------------------------------------------------------------------------------------
competed >12 months $ [ ]* per month
per record
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
OTHER Other:
-------------------
Supplies $ [ ]*
-------------------
Materials $ [ ]*
-------------------
Stationery $ [ ]*
-------------------
Special Packaging Materials $ [ ]*
-------------------
Postage and Courier $ [ ]*
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
COMMUNICATIONS Remote communications lines and hardware $ [ ]*
Telephone hardware (minimum lines = to number of 800 $ [ ]* each line
numbers)
-------------------
(Regular lines rate is calculated by dividing the peak
hour in a month by 15 calls per hour)
-------------------
(Request lines rate is calculated by dividing the peak
hour in a month by 60 calls per hour)
-------------------
Outbound long distance usage $ [ ]* hour
-------------------
Toll free 800 usage (WATS charges) First 25,000 hours $ [ ]* hour
annually
-------------------
Toll free 800 usage (WATS charges) Hours in excess of $ [ ]* hour
25,000 annually
-------------------
Canadian toll free usage (WATS charges) Cost varies on $ [ ]*
usage & province
-----------------------------------------------------------------------------------------------------------------
ASSUMPTIONS The following assumptions were made in compiling the transaction rates:
Orders
------------------ ------------------
(Positive Option) [ ]* Non-Order Call outs [ ]%*
------------------ ------------------
Telephone Percentage [ ]%* Non-Order Calls in [ ]%*
------------------ ------------------
Mail Percentage [ ]%* Catalog Request Phone [ ]%*
------------------ ------------------
Transmitted Percentage [ ]%* Non-Order [ ]%*
------------------ correspondence
Shipments per order [ ]* ------------------
------------------ Call Tags [ ]%*
Items per order [ ]* ------------------
------------------ Tracers [ ]%*
Returns/exchanges to HFS [ ]%* ------------------
------------------ Drop Ship % [ ]%*
Returns Electronic [ ]%* ------------------
------------------
Receiving [ ]%* ------------------
------------------ Catalog Request Mail [ ]%*
Gift Wrap Percentage [ ]%* ------------------
------------------ Advances (Neg. Option) [ ]%*
Gift Card Percentage [ ]%* ------------------
------------------
The pricing was developed to these base assumptions and is subject to
change if the assumptions change. Transaction rates are double for the
following holidays: Christmas Eve, Christmas Day, New Year's Day,
Memorial Day, Easter, July 4th, Labor day, Thanksgiving.
APPROVED CARRIERS Approved Carriers: UPS, USPS, RPS, FEDX
Any Business Partner requesting non-approved carriers will result in
an additional charge of [ ]* a shipment.
Any Business Partner requesting freight shipments will be charged a
per-shipment charge.
prepared by Xxxxxxx X. Xxxxxxxxx
19
ALLOY DESIGNS, INC.
EXHIBIT H
AMORTIZATION OF TRANSACTION SAVINGS AND FIXED ASSET ADDITIONS
TRANSACTION RATE CHARGES: In the event of a termination of this
agreement the difference in transaction rates charged via the second amendment
(schedules D/1a, D/1b, D/1c and D/1d) and the prior transaction rate schedule
(D) multiplied by the actual transactions for the period August 8, 1998 through
July 31, 1999, shall be amortized on a straight-line basis. The following
additional points are to be incorporated into this amoritization.
* Amortization period to be four years (from August 1, 1999 through July 31,
2003).
* For purposes of the calculation of the transaction rate savings, Exhibit D
telephone charges are defined to be $[ ]* per minute. Calls on the catalog
request line are defined to be $[ ]* /minute.
* For purposes of the calculation of the transaction rate savings for catalog
request calls, the difference between the rate charged and the $[ ]*
/minute (defined rate for Schedule D) will be multiplied by actual
transactions (minutes) billed then multiplied by [ ]*%. (Only [ ]*% of the
savings will be included in the calculation of the amount to be
amortized.).
Regarding Additions:
* Additions will be amortized over the remaining life of the contract on a
straight-line basis.
ESTIMATED VALUE OF PRESENT CONTRACT CHANGES. This is an example to
demonstrate the calculation of buy-out cost to Alloy in the event of a contract
change. (Note that while the example below assumes a cost per order for
calculation purposes, the actual calculation will be based on the individual
transaction components of the xxxx).
20
-------------------------------------------------------------------------------------------
Time Period Total Orders Cost/Order Old Cost/Order New Difference Value
-------------------------------------------------------------------------------------------
June-Jan [ ]* $[ ]* $[ ]* $[ ]* $[ ]*
-------------------------------------------------------------------------------------------
Feb-July 99 [ ]* $[ ]* $[ ]* $[ ]* $[ ]*
-------------------------------------------------------------------------------------------
TOTAL [ ]* $[ ]*
-------------------------------------------------------------------------------------------
Estimated Additions to support Alloy Designs growth.
----------------------------------------------------------------------------
Additions Timing Cost
----------------------------------------------------------------------------
Call Center Seats (50) Summer 1999 $[ ]*
----------------------------------------------------------------------------
DC-packing line diverter, OH scan, return Summer 1999 $[ ]*
lines
----------------------------------------------------------------------------
Call Center Seats (50) Summer 2000 $[ ]*
----------------------------------------------------------------------------
TRANSACTION SAVINGS/ADDITION AMORTIZATION SCHEDULE
This schedule is for example only; the value of contract proposal to be
calculated will be based on actual transaction xxxxxxxx for the period from
contract extension through July 1999, Amortization to be done on a monthly
basis (versus the half year that is shown).
--------------------------------------------------------------------------------------------
DATE INVESTMENTS AMORTIZATION UNAMORTIZED BALANCE
--------------------------------------------------------------------------------------------
Transaction Savings Period prior $[ ] $[ ] $[ ]
to 7/99
--------------------------------------------------------------------------------------------
Additions prior 7/99 $[ ]* $[ ]* $[ ]*
--------------------------------------------------------------------------------------------
Jan 2000 $[ ]* $[ ]* $[ ]*
--------------------------------------------------------------------------------------------
July 2000 $[ ]* $[ ]* $[ ]*
--------------------------------------------------------------------------------------------
Jan 2001 $[ ]* $[ ]* $[ ]*
--------------------------------------------------------------------------------------------
July 2001 $[ ]* $[ ]* $[ ]*
--------------------------------------------------------------------------------------------
Jan 2002 $[ ]* $[ ]* $[ ]*
--------------------------------------------------------------------------------------------
July 2002 $[ ]* $[ ]* $[ ]*
--------------------------------------------------------------------------------------------
Jan 2003 $[ ]* $[ ]* $[ ]*
--------------------------------------------------------------------------------------------
July 2003 $[ ]* $[ ]* $[ ]*
--------------------------------------------------------------------------------------------
