EXHIBIT 10.13
JOINT VENTURE AGREEMENT
Collectible Concepts Group, Inc. ("CCGI") and Pivotal Self Service Tech, Inc.
("PVSS"), (the "Parties" or "Joint Venturers" if referred to collectively, or
the "Party" or Joint Venturer" if referred to singularly), by this Agreement
associate themselves as business associates, and not as partners, in the
formation of a joint venture (the "Joint Venture"), for the purpose of engaging
generally in the business provided for by terms and provisions of this
Agreement.
1. Name of the Joint Venture. The name of the Joint Venture will be MightyCell
Batteries, and may sometimes be referred to as "MightyCell" or the "Joint
Venture" in this Agreement. The principal office and place of business
shall be located in 0000 Xxxxx Xxxxx Xxxx, Xxxxxxxxxx, XX 00000.
2. Scope of the Joint Venture Business. The Joint Venture is formed for the
purpose of engaging generally in the business of marketing batteries and
related products, (the "Products") that include the display of licensed
logos, images, brand names and other labels that differentiate them from
the branding (the "PVSS Products") under which PVSS and/or its affiliates,
sell to retailers and distributors in the normal course of their business.
Without in any way limiting the generality of the foregoing, the business
of the Joint Venture shall include:
(a) The purchase of Products for resale;
(b) The acquisition of a license(s) permitting the use of selected
images in the Products;
(c) The sale and distribution of the Products to retailers and
distributors; and,
(d) The transaction of such other and further business as is
necessary, advisable, or incidental to the business of the Joint
Venture.
(e) Develop a global marketing program for licensed Products
Exhibit A attached hereto, describes by way of example but not limitation
the responsibilities of the Joint Venturers
3. Capital Contributions. Except as agreed upon by mutual consent, the Joint
Venturers shall not be required to make any capital contribution to the
Joint Venture.
4. Offices of the Joint Venture. The principal place of business of the Joint
Venture shall be at 0000 Xxxxx Xxxxx Xxxx, in the City of Doylestown, Bucks
County, Pennsylvania, but may maintain such other offices as the Joint
Venturers may deem advisable at any other place or places within or without
the Commonwealth of Pennsylvania.
5. Powers and Authority of the Joint Venturers. The Joint Venturers shall have
full and complete charge of all affairs of the Joint Venture. The Joint
Venturers recognize that both of the Joint Venturers are and will continue
to be engaged in the conduct of their respective businesses for their own
account. Neither Joint Venturer shall be entitled to compensation for
services rendered to the Joint Venture as such, but each Joint Venturer
shall be reimbursed for all direct expenses, including travel, office, and
all other out-of-pocket expenses incurred in the operation of the affairs
of the Joint Venture and the promotion of its businesses.
It is agreed that either Joint Venturer shall, except as provided for
below, have authority to execute instruments of any character relating to
the affairs of the Joint Venture; provided, that without the written
consent or approval of both of the Joint Venturers: (i) the Joint Venture
shall incur no liability of any sort, nor any indebtedness for borrowed
funds; (ii) no assets owned in the name of the Joint Venture be disposed
of; and (iii) no commitment to purchase any item for the Joint Venture
shall be made.
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6. Division of Income and Losses. All income and credits, and all losses and
deductions shall be owned and shared among the Joint Venturers as follows:
50% to Collectible Concepts Group, Inc.
50% to Pivotal Self Service Tech, Inc.
Depreciation and all other charges and expenses, which are not expressly
apportioned by this Agreement, shall be apportioned in accordance with
generally accepted accounting principles, consistently applied.
7. Accounting Provisions. The Joint Venturers shall maintain adequate books
and records to be kept of all the Joint Venture activities and affairs
conducted pursuant to the terms of this Agreement. All direct costs and
expenses, which shall include any insurance costs in connection with the
distribution of the Products or operations of the Joint Venture, or if the
business of the Joint Venture requires additional office facilities than
those now presently maintained by each Joint Venturer, such item shall be
paid by the Joint Venture. The fiscal year of the Joint Venture shall be
the calendar year, and shall use the cash basis of accounting. If requested
by a Joint Venturer, the Joint Venture books and records shall be audited
as of the close of each year by an independent accountant acceptable to
both Joint Venturers. All books and records of every kind and character, of
the Joint Venture, and other information, shall be kept at the principal
office of the Joint Venture, or at such other place or places as may be
agreed upon by the Joint Venturers, and shall be fully available to each
Joint Venturer or his duly authorized representative, all at reasonable
times. The books of the Joint Venture shall represent the complete record
and report of business operations, including a balance sheet and income and
expense statements reflecting all receipts and disbursements of the Joint
Venture, and such reports shall be submitted to the Joint Venturers on a
regular basis.
8. Term of Joint Venture. The Joint Venture shall commence on the 1st of
March, 2003, and shall be effective until February 28, 2004 unless extended
by written agreement of the Joint Venturers not less than thirty (30) days
prior to scheduled termination.
9. Distributions. During the term of the Joint Venture, no interest shall be
allowed to any Joint Venturer upon the amount of his contribution. No Joint
Venturer shall withdraw, transfer or have paid to him in any manner any
part of his capital contribution or account, or any other funds or property
of the Joint Venture without the consent of both Joint Venturers; provided,
however, there may be distributed to the Joint Venturers, from time to
time, so much of the gross income of the Joint Venture as shall not be
needed to defray the necessary and expected costs and expenses of the Joint
Venture business. Distributions may only be made if after any distribution
is made, the Joint Venture assets are in excess of all liabilities of the
Joint Venture. Each distribution shall be made ratably to the Joint
Venturers according to their prorata interest in the Joint Venture as shown
in Section 6.
10. Internal Revenue Code Election. The Joint Venturers agree and declare that
this association for the carrying on of a joint venture business operation
does not, and is not intended to create a partnership, for either legal or
United States income tax purposes, each Party recognizing that the other is
willing and able to contribute capital, labor, and services for the
operation of a successful joint venture business. Further, each Party
elects under the authority of Section 761(a) of the Internal Revenue Code
of 1986 (the "Code"), as amended and all successor statutes, to be excluded
from the application of all of the provisions of Subchapter K of Chapter 1
of the Subtitle A of the Code, and the Parties agree that the election out
of Subchapter K of Chapter 1 of Subtitle A of the Code shall, if necessary,
be manifested by their execution and filing of all appropriate
documentation. The Parties also declare that they are not making any
agreement to undertake any business other than that set forth in this
Agreement; and nothing in this Agreement is to be construed as a limitation
of the powers or rights of either Party to carry on his separate business
for his sole benefit; provided, however, the Parties shall cooperate with
each other according to the terms and spirit of this Agreement in the
performance of their joint venture business operation.
11. Procedure on Termination and Liquidation. On any termination of the Joint
Venture, its debt shall be paid or provided for in a manner satisfactory to
the Joint Venturers. Then, any unexpended portion of Joint Venture funds
shall be distributed to the Joint Venturers in accordance with their
prorata ownership in the Joint Venture and all other assets of the Joint
Venture shall be distributed as undivided interests to the Joint Venturers
ratably according to their prorata interests in the Joint Venture as set
forth in Section 6. If any asset is not capable of being distributed on an
undivided basis, the Parties shall agree on a price for such asset and it
shall be distributed to one Party and a corresponding balance, in cash or
property, shall be made of the Joint Venture assets so that each Party
receives his proportionate share of all the Joint Venture assets.
12. Sale or Purchase of Interest of Joint Venturer Prohibited. No Joint
Venturer shall be authorized or empowered to mortgage, hypothecate, pledge,
sell, or transfer, an interest in the Joint Venture, nor confer on any
successor or assignee the right to become a Joint Venturer without the
consent of the other Joint Venturer.
13. Notice. Any notice which a Joint Venturer shall have occasion to give to
the other Joint Venturer shall be deemed sufficient notice for all purposes
as to its contents if given in writing, hand delivered, by fax, or prepaid
mail, to the address of such Joint Venturer as set out below his signature.
14. Construction. The Joint Venturers declare that in entering into this
Agreement, they have contracted with reference to the laws of the
Commonwealth of Pennsylvania, and the construction and interpretation of
the terms and provisions of this Agreement shall be interpreted and
construed under the laws of the Commonwealth of Pennsylvania, except in
such cases and to such extent as the laws of another jurisdiction shall
necessarily control.
15. Benefit. This Agreement shall be binding on the Joint Venturers and their
respective heirs, successors, executors, administrators, and assigns.
16. Counterparts. This Agreement may be signed in counterparts and shall be
deemed one original instrument.
For Collectible Concepts Group, Inc.
By: ____________________________________
Its: ____________________________________
Date: ___________________________________
For Pivotal Self Service Tech, Inc.
By: ___________________________________
Its: ____________________________________
Date: __________________________________
EXHIBIT A
GENERAL RESPONSIBILITIES OF THE PARTIES
Collectible Concepts Group will:
1) Obtain any licenses deemed by the Joint Venturers to add value in the
marketing of the Products
2) Prepare any artwork necessary for the reproduction of licensed or
branded images for the purpose of manufacturing the Products and / or
packaging
3) In concert with PVSS, appoint appropriate sales agents and / or
representatives and distributors to sell the Products into specific
retail channels
4) Prepare marketing materials for sales agents', representatives' and
distributors' use in presentations to prospective clients
5) Engage in any support activities required to promote and sell the
Products
6) Provide fulfillment services through affiliates for final distribution
of the Products
Pivotal Self Service Tech, Inc. will:
1) Provide the Products in accordance with the specifications and
quantities and time frames designated by CCGI
2) Provision any additional Products deemed by the Joint Venturers to be
salable through the channels established by CCGI
3) Negotiate such favorable pricing and terms with the suppliers of the
Products so as to assure the viability of the Joint Venture offerings
and the continuity of Product availability to the customers of the
Joint Venture
4) Provide alternate fulfillment and distribution services of the
Products as backup to those provided by CCGI
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