Ultimate Sports Entertainment, Inc.
ULTIMATE SPORTS DISTRIBUTION AGREEMENT
This agreement (the "Agreement") is made and entered into as of November 30,
1999 between Ultimate Sports Entertainment, Inc. ("Ultimate Sports") and
Comic Cavalcade ("Cavalcade").
1. ORDER PROCESSING AND RELATED CHARGES.
(a) There is a monthly guatantee of $2,000 that is the floor minimum
charge. This is for Cavalcade having the staff on hand to handle the
orders and our warehousing of your merchandise (in quantities of 2000
units at a time). This charge also covers all customer service costs
for the month (order complaints and re-ships, phone call questions,
address corrections) and there will not be any additional customer
service costs for each month.
(b) For each incoming order, Ultimate Sports will be charged a minimum of
$2.25 per order. That charge will cover up to three (3) products
in that order and costs associated with taking the call, processing
the order, and shipping the order. Cavalcade will xxxx the consumer
$3.95 per order for shipping and handling, all of which is kept by
Cavalcade, that will be used to pay for the actual cost of postage,
packaging, and bagging and boarding each product. Cavalcade will
charge the consumer more for International shipping, but the full
costs of that have not yet been determined. For each additional book
in any given single order, above the first three, Ultimate Sports will
be charged an additional $0.50. The consumer will be charged an
additional $3.00 for shipping and handling if their order exceeds ten
(10) products.
(c) For any given "premium" book sold, Ultimate Sports will be charged
$5.00 additional for special processing, tracking and handling. A
"premium" book is defined as one that has a retail price of greater
than $50.00 or is of significant replacement value cost or limited
nature (such as 1 of 100 copies signed by a famous athlete). These
"premium" books will be fully tracked via UPS or Federal Express and
given special packaging to prevent damage. The consumer will also be
charged an additional $3.95 for shipping and handling on these orders.
(d) Orders will be fulfilled via USPS unless they contain a "premium"
book. These orders will not be insured and certainly some will be
lost or damaged in transit. It is understood that in the case of a
lost or damaged order, Cavalcade will simply send a new one out with
a minimum of questions asked. Ultimate Sports will be responsible for
the cost of the merchandise in these cases, but will not be charged
any additional processing charges from Cavalcade. These customer
service charges are built into the monthly minimum. Orders of
"premium" product will be sent fully tracked and insured. In the
event of a loss, an insurance/damage claim will be submitted to the
carrier that will cover the cost of the merchandise and processing
the order again.
(e) All orders and business by Cavalcade relating to this deal will be
processed under the Ultimate Sports name. Phone calls will be answered
with "Ultimate Sports" and all address labels will be marked with
Ultimate Sports. The end consumer will have the complete illusion of
dealing only with Ultimate Sports. Phones will be manned from 10 AM
until 6 PM and the fax machine will be on all the time. Hours may be
adjusted as traffic warrants.
(f) Cavalcade reserves the right to adjust the shipping and handling
charges as needed or in the event of price increases by the delivery
agents.
2. FINANCIAL TRACKING. Cavalcade will set up an entirely separate bank
account for all Ultimate Sports business through Cavalcade. All bank deposits
as well as electronic credit card deposits will go into this account, and
will be held in trust for Ultimate Sports. All charges related to financial
transactions (bank charges, credit card processing charges, bounced checks,
charge backs on credit cards) will be paid by, and
Initials: Ultimate Sports Cavalcade
ULTIMATE SPORTS ENT. DISTRIBUTION AGREEMENT
deducted from, Ultimate Sports' funds in the account. Cavalcade will work
on monthly cycles for reconciliation of charges and payments. Cavalcade
will send Ultimate Sports an accounting of all expenses and charges along
with a check to Ultimate Sports for its sales minus Cavalcade's expenses
and charges. For the first few months, Ultimate Sports may actually be
cuffing Cavalcade checks if sales are not sufficient to cover the floor
minimum.
3. SHIPPING TO STADIUMS. Cavalcade will handle shipping to stadiums from the
commencement of this Agreement or Ultimate Sports can have Cavalcade handle
that after it has full warehouse capabilities. Cavalcade will ship ground
UPS to stadiums unless otherwise requested. Cavalcade will charge exact
shipping cost (as billed to its UPS account) plus 20% to cover labor and
new packaging required. All of these shipments will be fully insured and
trackable.
4. TIME TABLE. An 888 phone line and fax line are being installed at this
time and will be operational on September 1, 1999. As of now, Cavalcade has
an Internet connection and address (xxxxxxxxx@xxx00.xxx) operational and
will have a system in place to begin fulfillment by September 1, 1999.
5. START UP COSTS. Cavalcade will need $1,000 in on-refundable start up costs
upon acceptance of this deal. This will handle bringing in new phone
lines, setting up bank accounts, credit card terminals, fax machines, of
fice space, etc. Cavalcade will also ask for the last month of service
guarantee paid in advance ($2,000) as well as September's guarantee of
$2,000 on September 1, 1999.
6. LENGTH OF DEAL. The Agreement is for a two-year deal, commencing September
1, 1999. Early termination can be done by Ultimate Sports with 30 days
notice. Upon early termination by Ultimate Sports, Ultimate Sports shall
pay Cavalcade a kill fee equal to $250 times the number of months remaining
in the two-year term. Obviously, Cavalcade expects any problems or
concerns to be worked through easily, but colossal issues should be
resolved through binding arbitration conducted under the rules of the
American Arbitration Association.
ULTIMATE SPORTS ENTERTAINMENT, INC. COMIC CAVALCADE
By: /s/Xxxx Xxxxxxxxx By: /s/Xxxxxxx Xxxxxxxxxxx
-------------------------- ---------------------------
Xxxx Xxxxxxxxx, Publisher Xxxxxxx Xxxxxxxxxxx, President
0000 Xxxxxxxx Xxxx. #000 9 Triumph Dr.
Santa Monica, CA 90403 Xxxxxx, XX 00000
Phone: (000) 000-0000 Phone: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
Initials: Ultimate Sports Cavalcade
