JOINT VENTURE
STOCKHOLDERS AGREEMENT
THIS JOINT VENTURE AGREEMENT, entered into this 26 day of April, 1999 is by and
between the following corporations, collectively referred to herein as "the
partners";
Alottafun! Inc. (Referred to as "AFI"), a Delaware corporation with offices at
000 X. Xxxx Xxxxxx, Xxxxx 000, Xxxx Xxxx, Xxxxxxxxx, 00000;
E-Commerce Fulfillment, L.L.C. (Referred to as "ECF"), with offices at 0000 Xxxx
Xxxxxx Xxx Xxxx, Xxxxxx, Xxxxxxxxx, 00000.
NOW THEREFORE, in consideration of the foregoing and the mutual promises
contained herein, the parties, intending to be legally bound, agree as follows:
ARTICLE I
FORMATION
1.1 Formation &-Ownership. The partners hereby to implement the business as set
forth herein. The Joint Venture shall be a Delaware corporation. There will
only be one class of shares, which shall be issued to the partners so that
ECF owns a thirty three (33.3%) percent share of the Joint Venture and AFI
owns 66.7% of the joint venture, No action by the shareholders shall be
effective unless approved by all parties.
1.2 Name of Joint Venture. The name of the Joint Venture shall be xxxx.xxx.
1.3 Term.The Joint Venture shall commence as of the date hereof and remain in
full force and effect until terminated by the parties in accordance with
the terms of this Agreement.
1.4 Accounting. The books and records of the Joint Venture shall be maintained
jointly by the parties on behalf of the Joint Venture and be available for
inspection by the Joint Venture partners during normal business hours.
1.5 The Joint Venture shall be managed by a Board of Directors consisting of
two members with AFI nominating Xxxxxxx Xxxxxx, and ECF nominating Xxxxxxx
Xxxxx. The Board of Directors shall mutually agree on the budget for all
marketing activities, the selection of officers, and all other
discretionary matters.
1.6 Offices. The Joint Venture shall maintain offices at the following
location:
a. Alottafun!, Inc., 000 X. Xxxx Xxxxxx, Xxxxx 000, Xxxx Xxxx, Wl
53095. Phone 000-000-0000, Fax 000-000-0000.
b. E-Commerce Fulfillment, L.L.C., 0000 X. Xxxxxx Xxx Xxxx, Xxxxxx,
XX 00000. Phone 000-000-0000, Fax 000-000-0000.
1.7 Restriction On Sale. Each of the partners covenants and agrees that it:
shall not mortgage, pledge, sell, assign, hypothecate or otherwise
encumber, transfer or permit to be transferred in any manner or by any
means whatsoever, whether voluntarily or by operation of law all or any
part of its Joint Venture interest without the express written permission
from the other partner.
1.8 Allocation of Profits. All profits of the Joint Venture shall be
distributed as a percentage of ownership to the Joint Venture partners
after all expenses of the Joint Venture are paid. Expenses to include but
not be limited to the cost of products/services and expenditures as
mutually agreed. The profits shall be distributed on a quarterly basis
except such amounts as may be mutually agreed upon the by the Board of
Directors to be retained for purposes of corporate operations.
1.9 Non-Encumbrance. Each of the partners covenants and agrees that it shall
not obligate the other to any third party without written notice to the
other.
ARTICLE II
PARTNER'S OBLIGATION & RESPONSIBILITIES
2.1 ECF's responsibilities and obligations shall include but not be limited to:
To sell at negotiated prices which will not exceed the prices charged to
ECF's regular customers to the Joint Venture sufficient quantities of its
products based on regular availability as the Joint Venture may agree to
market to be paid out of sales receipts of the Joint Venture.
2.2 AFI's responsibilities and obligations shall include but not be limited to:
Management of the marketing strategies, the implementation of which and
budgeting for which are subject to the approval of the Joint Venture
partners, and providing electronic and physical mediums for the sale,
customers support, and fulfillment of products and service for the home and
the office, including toys, games, and party goods.
ARTICLE III
INTELLECTUAL PROPERTY
3.1 Copyrights. Patents, & Trademarks
a. Any and all patents, trademarks and/or copyrights which the Joint Venture
may be entitled to register under state or federal law shall be registered
in the name of the Joint Venture.
b. All pre-existing patents, trademarks and copyrights of the Partners shall
remain their respective property.
3.2 Customer Lists. All customer lists developed by the Joint Venture will be
the property of the Joint Venture.
3.3 Warranty/Indemnification. The parties to this Agreement do hereby warrant
and covenant for itself that its undertaking hereunder does not infringe or
interfere with any Intellectual property or other contract rights of third
parties, and each shall indemnify, save and hold the other party harmless,
including cost of defense, from any suit, demand, claim, liability, or
proceeding founded on such third party's claim or settlement.
ARTICLE IV
TERMINATION
4.1 In the case of any unresolved breach of this Agreement by either party, and
after conformance with the cure provisions as defined in ARTICLE V,
Sub-Section 5.2, Sub-Paragraph f, hereafter, either party may declare this
Agreement terminated as to any further business to which the Joint Venture
is not already obligated. Termination for reasons other then cause shall
require the mutual written agreement of the Board of Directors. Upon
termination, the assets of the Joint Venture including retained earnings,
after payment of all Joint Venture obligations, shall be divided equally
between the partners.
4.2 Either party may terminate this agreement upon thirty (30) days written
notice to the other party in the event that the Joint Venture becomes
insolvent. Insolvent meaning that its assets are less then its liabilities
and it is unable to pay debts as they come due over the following three
month period.
ARTICLE V
MISCELLANEOUS PROVISIONS
5.1 Execution of Other Documents. The parties will execute and deliver all
documents and instruments, which are reasonably necessary to carry out the terms
of this Agreement.
5.2 Miscellaneous.
a. This Agreement represents the entire agreement between the parties and
shall not be changed orally. There are no other contemporaneous oral
Agreements. Any changes to this agreement shall be in the form of a
written addendum to this agreement signed by both parties.
b. This Agreement shall inure to the benefit of the parties together with
their successors and assigns.
c. If any portion of this Agreement is struck down or declared
unenforceable by a court of competent jurisdiction, it shall not affect
the other provisions of this Agreement.
d. The waiver by either party of any right hereunder shall not constitute
a waiver of any other rights, nor shall the waiver of any right in an
instance constitute the waiver of such right on going.
e. Any and all disputes arising under or related to this Agreement shall
be submitted to binding arbitration before the American Arbitration
Association (AAA), in accordance with the rules and regulations then in
effect. Any award may be entered by either party as a judgment or
decree in any court of competent jurisdiction and enforced accordingly.
The parties shall share equally any AAA fees incurred by either party
in connection with any dispute. Any such arbitration shall take place
in Milwaukee, Wisconsin and shall be governed by Wisconsin law.
f. Neither party shall enforce an alleged breach of any provision of this
Agreement without first giving the other party written notice, via the
United States Postal Service, Certified Return Receipt Requested mail,
clearly specifying the nature of the alleged breach, and an opportunity
to cure said alleged breach within THIRTY (30) DAYS of receipt of such
notice.
Notice by fax machine shall not be sufficient.
g. All signatories to this Agreement hereby represent and warrant that
they have the requisite authority to enter into this transaction, and
that the entity which they represent has complied with all necessary
formalities under all applicable by laws or agreements, as well as all
applicable state laws and regulations.
h. Each partner agrees that the other shall at all times be free to
engage in any other business activities.
5/17/99 /s/ Xxxxxxx Xxxxxx
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DATE: Xxxxxxx Xxxxxx - for Alottafun!, Inc.
5/17/99 /s/ Xxxxxxx Xxxxx
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DATE: Xxxxxxx Xxxxx - for E-Commerce Fulfillment, L.L.C.
