Annual Report — Form 10-K
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-K Gt Interactive Software Corp. 69 427K
2: EX-10.50 Warehouse Services Contract 16 52K
3: EX-10.51 Letter Agreement 2 11K
4: EX-10.52 Agreement With Ronald Chaimowitz 2± 11K
5: EX-10.53 Employment Agreement 14 66K
6: EX-10.54 Amendment to Employment Agreement With Chemerow 2 12K
7: EX-21.1 Subsidiaries of the Registrant 2 8K
8: EX-23.1 Consent of Arthur Andersen LLP 1 6K
9: EX-27.1 Financial Data Schedule 1 7K
EX-10.50 — Warehouse Services Contract
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EXHIBIT 10.50
WAREHOUSING SERVICES CONTRACT
THIS AGREEMENT (the "Agreement"), made and entered into this
2nd day of March, 1999, by and between GT INTERACTIVE SOFTWARE CORP.
(hereinafter "GT Interactive" or "Depositor"), a Delaware corporation, with a
place of business at 417 5TH AVENUE, NEW YORK, NY 10016, and ARNOLD
TRANSPORTATION SERVICES, INC.,t/d/b/a ARNOLD LOGISTICS (hereafter
"Warehouseman"), a Pennsylvania corporation with a place of business at 4410
INDUSTRIAL PARK ROAD, CAMP HILL, PA 17011.
WITNESSETH:
WHEREAS, Warehouseman operates a commercial warehousing operation at its above
stated place of business and at the facilities (hereinafter, the "Facilities")
described on APPENDIX A hereto (which APPENDIX A, together with APPENDIX B and
the Exhibits hereto, is incorporated by reference in and shall for all purposes
be deemed a part of this Agreement); and
WHEREAS, the Facilities are located on two parcels of land (individually a
"Parcel", and collectively the "Parcels"), title to each of which is in the name
of Warehouseman; and
WHEREAS, the parties hereto desire that Depositor shall store certain goods and
materials at the Facilities and that Warehouseman shall perform certain services
for Depositor in connection therewith; and
WHEREAS, the parties hereto desire to enter into an agreement covering all such
goods and materials placed in storage at the Facilities and all such services to
be performed by Warehouseman.
NOW, THEREFORE, the parties hereto agree as follows:
GENERAL
1. Warehouseman is and shall be at all times an independent contractor and
shall have exclusive control and direction of Warehouseman's employees
engaged in performing services for Depositor. Neither Warehouseman nor
its employees, agents and/or representatives will be treated as an
employee of Depositor for any purpose whatsoever. Warehouseman assumes
full responsibility for the payment of local, state and federal payroll
taxes or contributions or taxes for unemployment insurance, old age
pensions, worker's compensation, or other social security and related
protection, and any other expenses whatsoever that might arise with
respect to Warehouseman's employees, independent contractors or agents
engaged in the performance of such services and agrees to comply with
applicable rules and regulations promulgated under such laws.
Warehouseman shall, at its sole cost and expense, comply with all laws,
regulations and ordinances, and all agreements by which it is bound,
applicable to its performance of services hereunder and shall procure
and maintain all such consents, licenses and permits as may be required
by local, state or federal authorities or other third parties with
respect to such performance.
In performing its obligations under this Agreement Warehouseman shall
employ a standard of care commensurate with the highest standards for
the industry.
Warehouseman shall have no authority to enter into any agreement or
make any representation, commitment or warranty binding upon Depositor
or to incur any liability or obligation on behalf of Depositor.
At Depositor's request Warehouseman shall allow a representative or
representatives of Depositor access to the Facilities to monitor the
performance of the services to be provided hereunder.
Warehouseman shall promptly notify Depositor of any material
development, including, without limitation, the commencement of any
suit, action, investigation or other proceeding which in Warehouseman's
reasonable judgment could have a material adverse effect on
Warehouseman's ability to perform its obligations hereunder.
Depositor shall tender for storage only goods and materials that are of
the nature and type contemplated by the parties upon execution of this
Agreement, including, without limitation: computer software, books and
manuals and other goods and materials currently used or sold by
Depositor in the ordinary course of its computer software business.
None of the goods and materials tendered shall be of a toxic or
hazardous nature unless Depositor has given Warehouseman ninety (90)
days advance written notice of the toxic or hazardous nature of the
materials and Depositor has agreed in writing to accept the materials,
provided, however, that additional charges may be assessed by
Warehouseman for storage of such materials. None of the goods and
materials tendered for storage shall constitute illegal contraband or
paraphernalia, the possession and/or storage of which is prohibited
under state or Federal law. Depositor warrants that all goods and
materials will be in compliance with all state and Federal copyright
and trademark laws and will not be subject to seizure for violation of
any such laws.
EQUAL OPPORTUNITY
2. Warehouseman's implementation of this agreement will be carried out in
compliance with all federal and state laws regulating discrimination in
employment. Specifically, Warehouseman agrees that it will not
discriminate by reason of race, color, creed, religion, national
origin, age or gender.
SETTING UP OF SYSTEM
2A Warehouseman shall purchase and cause to be installed in the Facilities
a Dorner Manufacturing Corp. Sortation System as specified in Dorner's
proposal number 2137, a copy of which has been delivered to Depositor,
(the "Sortation System"). Warehouseman covenants that the Sortation
System will be capable of performing Warehouseman's obligations under
this Agreement. Warehouseman agrees that if such Sortation System has
not been installed and is not fully operational by July 15, 1999,
Depositor shall have the right, in its sole discretion, to terminate
this Agreement without payment of any Termination Premium, any Asset
Payment or any other payment of any kind.
The parties agree that they will cooperate fully in establishing the
electronic interfaces necessary to communicate such order, inventory
and other information as may be necessary to implement the procedures
described in and otherwise effect the purposes of this Agreement. The
parties understand that the electronic communication system must allow
Depositor to access Warehouseman's computer system directly from
Depositor's computer system, to the extent, but only to the extent,
necessary for Depositor to verify the completeness and accuracy of
Warehouseman's records in connection with the performance of its
obligations hereunder.
Depositor shall install a frame relay circuit running from Depositor's
principal place of business in New York City to Warehouseman's computer
center in Lebanon, Pennsylvania. Depositor shall further provide an NT
Server and hub for facilitating electronic communications between the
parties, with the server to be installed at Warehouseman's computer
center in Lebanon, Pennsylvania, on the public side of Warehouseman's
computer security "firewall." Warehouseman's internal communications
network shall connect the NT server and hub to Warehouseman's IBM AS400
on the private side of Warehouseman's computer security "firewall." The
conduit from the public side of the security firewall to the private
side of the security firewall shall remain open as required to permit
full performance of the parties' obligations under this agreement.
STORAGE AND HANDLING
3. In consideration of the storage and handling charges herein provided,
Warehouseman agrees to receive, handle, store and distribute goods and
materials of Depositor at and from Warehouseman's Facilities.
Warehouseman shall provide sufficient and suitable personnel, equipment
and other accessories necessary or incidental to the efficient and safe
performance of such receiving, handling, storage and distribution
services in accordance with the terms hereof. Except as otherwise
expressly agreed to by Depositor in this Agreement, Warehouseman shall
be responsible for all expenses it incurs directly or indirectly, in
the performance of this Agreement, and shall not incur any expense for
Depositor's account. Warehouseman shall promptly unload inbound
carriers and load carriers for outbound shipments.
SPACE AVAILABLE
4. Warehouseman guarantees that the quantity of space set forth on
APPENDIX A shall be available for Depositor's goods and materials and
that such amount represents the entire amount of space available at the
Facilities. It is understood, however, that there may be times when
Depositor's goods and materials will not occupy the entire space
available at the Facilities. In the event that space is available in
the Facilities, Warehouseman shall have the right to use the available
space for the storage and handling of goods and material of persons
other than Depositor (an "Alternative Use"); provided, however, that no
such Alternative Use shall be allowed without Depositor's advance
written consent, which shall not be unreasonably withheld. It is
further understood that reasonable causes for Depositor's refusal to
allow an Alternative Use shall include, but not be limited to, the
following: (i) Depositor's expectation that it will use the space
itself during the time of the proposed Alternative Use, or at any time
after the Alternative Use where Depositor's expected use would be
adversely affected by such Alternative Use; and (ii) Depositor's belief
that the proposed Alternative Use would create a hazard or otherwise
increase the likelihood of damage to Depositor's goods and materials.
As of the date hereof, Warehouseman has good and valid title to the
Facilities, including the real property on which they are located, free
and clear of any lien, pledge, mortgage, security interest, charge,
restriction, adverse claim or other encumbrance of any kind or nature
whatsoever ("Encumbrances"), other than those Encumbrances set forth on
Schedule 4 to this Agreement.
Warehouseman agrees that it will not sell, or otherwise transfer either
Parcel, or pledge, mortgage, hypothecate or otherwise subject either
Parcel to any Encumbrance, unless (i) the other Parcel is
simultaneously sold, otherwise transferred, pledged, mortgaged,
hypothecated or otherwise subjected to an Encumbrance to the same party
on the same terms and (ii) such party agrees in writing to be bound by
the terms of this Agreement.
Notwithstanding any other provisions of this Agreement to the contrary,
Warehouseman may not assign its obligations to provide the services
described in this Agreement without the prior written consent of
Depositor.
Immediately upon the execution of this Agreement Warehouseman shall
file, or caused to be filed, in the Office of the Recorder of Deeds,
Lancaster County Courthouse, 50 North Duke Street, Lancaster, PA 17603,
a Memorandum of Agreement, pursuant to Title 21, Section 405 of the
Pennsylvania Statutes (21 P.S. Section 405), in substantially the form
of Exhibit A hereto.
(SEE APPENDIX A FOR OUTLINE OF STORAGE CHARGES)
RATES AND SERVICES
5. Warehouseman will submit weekly statements for services performed for
Depositor for the period covered by each statement. Payment is due 30
days after invoice date, subject to a 1% per month late charge after an
additional 30 days.
Failure to pay within 60 days of invoice date shall at Warehouseman's
option be cause for termination, except where the Depositor is
contesting such invoice in good faith. Termination Premium and Asset
Payment (SEE APPENDIX A) will apply in the event of termination by
Warehouseman for such failure to pay, which shall constitute a
termination by Warehouseman with Cause hereunder, and Warehouseman
shall be relieved of any obligation it may have to perform services
hereunder.
Depositor will arrange to provide for the benefit of Warehouseman a
$500,000 Letter of Credit in substantially the form of Exhibit B
hereto. Warehouseman covenants that it will provide whatever
documentation may be required to waive any liens it may have on any of
Depositor's goods and materials to actual or potential lenders to
Depositor.
Rates are firm for years 1 & 2 of contract. At the beginning of each of
years 3, 4 and 5 rates may be increased by the lesser of (i) any
increase in the Consumer Price Index for All Urban Consumers for the
U.S. City Average for All Items, 1982-84=100 (the "CPI"), and (ii) 5%.
(SEE APPENDIX A FOR OUTLINE OF RATES AND SERVICES)
ROUTING OF SHIPMENTS
6. Shipments of goods and materials are to be consigned to Depositor in
care of Warehouseman. The bill of lading and manifest of contents are
to be received by Warehouseman before arrival of the shipment.
LIENS
7. All goods and materials of depositor that are stored at Warehouseman's
Facilities or otherwise in Warehouseman's possession shall at all times
remain the property of Depositor for all purposes, and neither
Warehouseman nor any creditor of Warehouseman shall have a lien on such
goods and materials, and Warehouseman hereby waives any and all liens
or other interests in such goods and materials it may have as a matter
of law or otherwise. Warehouseman shall return to Depositor any and all
goods and materials requested by Depositor as soon as reasonably
practicable after such request. Warehouseman shall not sell, assign,
loan, lease, borrow against, pledge or mortgage such goods and
materials to any other person or entity. All Depositor's goods and
materials shall be clearly and prominently labelled as Depositor's
property and shall be maintained by Warehouseman in a designated area,
segregated from other materials or products. Warehouseman shall not
represent to
any person that such goods and materials are Warehouseman's own
property or the property of a third party.
DELIVERY REQUIREMENTS
8. No goods or materials shall be delivered or transferred except upon
receipt by the Warehouseman of complete instructions from the
Depositor. When no negotiable receipt is outstanding, goods and
materials may be delivered upon instructions by telephone or electronic
mail as set forth on APPENDIX A hereto. When a negotiable receipt has
been issued, no goods or materials covered by that receipt shall be
delivered, or transferred on the books of the Warehouseman, unless the
receipt, properly endorsed, is surrendered for cancellation, or for
endorsement of partial delivery thereon.
When goods and materials are ordered out, Warehouseman shall carry out
instructions as described in APPENDIX A, and, if he is unable because
of acts of God, or any reason beyond the Warehouseman's reasonable
control, or because of loss or destruction of the goods and materials
for which Warehouseman is not liable (SEE APPENDIX A FOR DETAILS), the
Warehouseman shall not be liable for failure to carry out such
instructions, but the goods and materials remaining in storage contrary
to such instructions will be held at no cost to the Depositor.
Warehouseman will not be responsible for misdeliveries made in good
faith in reliance on orders given by ostensible or alleged agents,
representatives or employees of Depositor when such orders are given in
the manner prescribed in this Agreement.
Warehouseman will not be responsible for loss or damage occasioned by
any misunderstanding of orders or instructions received or taken by
telephone in the manner prescribed in this Agreement.
ACCEPTANCE
9. In the event that goods and materials other than computer software,
books and manuals and other goods and materials used or sold by
Depositor in the ordinary course of its business are tendered for
storage, Warehouseman may refuse to accept such goods and materials for
storage if in its reasonable judgment storage of such goods and
materials would be dangerous or prejudicial to other goods in storage
in the Facilities owned by someone other than Depositor. If
Warehouseman accepts such goods and materials for storage, Depositor
agrees to the rates and charges set forth in APPENDIX A and the billing
and other terms of this Agreement.
TENDER FOR STORAGE
10. All goods and materials for storage at the Facilities shall be
delivered at the Facilities properly marked and packaged for handling.
The Depositor shall furnish at or prior to such delivery by electronic
means or otherwise a manifest showing marks, brands,
or sizes to be kept accounted for separately and the class of storage
and other services desired, if any and otherwise complying with the
provisions of APPENDIX A.
TRANSFER, TERMINATION OF STORAGE, REMOVAL OF GOODS
11. Instructions to transfer goods or materials on the books of the
Warehouseman are not effective until delivered to and accepted by
Warehouseman, and all charges up to the time of receipt of instructions
to transfer are chargeable to the Depositor. If transfer involves
rehandling the goods and materials such will be subject to the charges
described on APPENDIX A.
All Depositor's goods and materials shall be stored in the space as
described in Section 4 hereof. Notwithstanding the immediately
preceding sentence, with the prior approval of Depositor, Warehouseman
may move the goods and materials herein described between Depositor
exclusive storage rooms within the Facilities or remove said goods and
materials to any other warehouse operated by it. If in Warehouseman's
reasonable judgment at any time during the bailment the continued
storage of Depositor's goods and materials shall pose a material risk
to the Facilities or to Warehouseman's Employees, Warehouseman may
terminate the bailment by notifying Depositor of such termination, and
requiring the removal of such goods and materials. Depositor agrees
that within one hundred-eighty (180) days after receipt of such notices
it will provide transportation for the removal of said goods and
materials. Any such termination shall be considered a termination by
Warehouseman with Cause.
TRANSITION PROVISIONS
11.A The parties agree that notwithstanding the expiration or any
termination of this Agreement (other than a termination by Warehouseman
with Cause pursuant to Section 5 hereof), during the time before (i)
the final removal of Depositor's goods and materials from the
Facilities, or (ii) the full assumption of Warehouseman's duties
hereunder by Depositor or its designee, as the case may be, the parties
will perform their obligations under this Agreement in good faith, so
that there will be no disruption in the ordinary course of Depositor's
business.
The parties further agree that, in the event that Warehouseman shall
cease to perform its duties hereunder, Warehouseman shall nonetheless,
upon the request of Depositor, cooperate fully in providing such
liaison and assistance as may be reasonably necessary to enable
Depositor or its designee to provide the services provided by
Warehouseman pursuant to this Agreement and to effect an orderly and
efficient transition of such services. Depositor will pay Warehouseman
the then current rates under this Agreement for any services
Warehouseman continues to provide hereunder at Depositor's request
after termination or expiration of this Agreement.
Warehouseman understands that in the event it requires Depositor to
remove Depositor's goods and materials from the Facilities Depositor's
business will be
significantly disrupted, and Warehouseman therefore agrees that in the
event it shall terminate this Agreement without Cause it shall pay
Depositor the sum of $1,000,000.
Unless this Agreement specifies otherwise (as for example, with respect
to a termination by Warehouseman with Cause pursuant to Section 5
hereof), any termination of this Agreement by Warehouseman shall be
considered a termination without Cause.
SPECIAL SERVICES
12. Warehouseman will not be responsible for any special service not
expressly undertaken by him in writing.
VALUE OF MERCHANDISE
13. The rates charged have been fixed on the basis that for the purpose of
fixing the maximum limit of the amount of any liability the
Warehouseman may incur as a result of loss or damage to goods, the
value of the commodities stored is agreed not to exceed an amount equal
to FIVE DOLLARS PER POUND or the actual value of the commodities,
whichever is the smaller amount. Total liability of Warehouseman is
limited to FIFTY MILLION DOLLARS ($50,000,000.00) PER WAREHOUSE, OR ONE
HUNDRED MILLION DOLLARS ($100,000,000.00) IN TOTAL. Depositor may
declare in writing a higher value, but for the purpose of fixing the
maximum limit of the Warehouseman's liability for loss or damage, the
value of the goods shall in no event be deemed to exceed their actual
value.
INSURANCE
14. Rates do not include fire or other insurance covering the goods. Other
than with respect to the insurance listed on the Certificate of
Insurance, Warehouseman will not arrange for insurance unless
instructed to do so in writing and all premiums incurred with respect
to such insurance shall be borne by Depositor. Warehouseman agrees to
provide and maintain type and amounts set forth on the Certificate of
Insurance attached hereto as Exhibit C.
RESPONSIBILITY FOR LOSS
15. Warehouseman is not responsible for loss or damage caused by fires,
riots, strikes, insurrections, or from inherent or perishable
quantities of the merchandise, or other causes beyond his control
unless such loss or damage be caused by the failure of the Warehouseman
to exercise the ordinary care and diligence required of it by law.
Warehouseman shall maintain and preserve Depositor's goods and
materials stored on its premises in as good condition as that they were
in when received and shall take all reasonable actions as may be
necessary to protect such goods and materials from damage or loss, and
shall at all times meet the levels of inventory accuracy, shrinkage,
damage and other Measurements set forth on APPENDIX A.
Upon request of Depositor and after reasonable notice to Warehouseman,
Depositor shall be allowed to make, at Depositor's expense, on site
audits of Depositor's goods and materials stored at Warehouseman's
Facilities, and Warehouseman shall allow Depositor and its agents,
attorneys and accountants access to the Facilities for such purpose;
provided that such audits and inspections are conducted by Depositor's
personnel or authorized representatives in a manner and at a time
reasonably convenient to both parties.
CLAIMS
16. As a condition precedent to recovery, claims for loss or damage must be
made in writing within ninety (90) days after the merchandise is
delivered from the Facilities or, in the case of failure to make
delivery, then within ninety (90) days after delivery of the last
package of the lot in Warehouseman's apparent possession.
Claims for loss, damage or delay (when applicable) shall be paid or
denied by Warehouseman within sixty (60) days of filing by Depositor.
CONVERSIONS
17. As a condition of storage, the failure of Warehouseman to deliver goods
to any person entitled thereto shall not constitute a conversion of
goods nor subject Warehouseman to any liability whatsoever when such
non-delivery results from causes arising from strikes, lockouts, work
stoppages, or restraints of labor from whatever cause. In cases of
non-delivery or suspension of services for such causes, Warehouseman
shall use its best efforts to restore service as soon as practicable,
provided, however, that if such suspension continues for five (5)
consecutive days, or for ten (10) days in any twenty (20) day period,
Depositor may terminate this Agreement without any liability upon
written notice to Warehouseman. Depositor agrees that within two
hundred and seventy (270) days after the giving of this termination
notice it will provide transportation for the removal of its goods and
materials stored at the Facilities. Depositor will be responsible for
paying Warehouseman all charges and costs incurred by Warehouseman,
that are otherwise payable to Warehouseman pursuant to the terms of
this Agreement, to the date the last of Depositor's goods and materials
are removed from the Facility (the "Removal Date"). The parties agree
that, notwithstanding the giving of the termination notice, they shall
perform their obligations under this Agreement in good faith, so that
there will be no disruption of the ordinary course of Depositor's
business, until the Removal Date.
NOTICES
18. All notices required to be given under the terms of this Agreement or
which either party hereto may desire to give to the other, unless
pursuant to the terms of this Agreement such notice may be given by
electronic means, shall be in writing signed by or on behalf of the
party giving the same and sent by certified mail to the
addresses set forth below or at such other address as either party may
furnish to the other in writing.
If to Depositor, to:
GT Interactive Software Corp.
417 5th Avenue
New York, NY 10016
Attn: Alan Behr, Esq.
Peter White
with a copy to:
Kramer Levin Naftalis & Frankel LLP
919 Third Avenue
New York, NY 10022
Attn: David P. Levin, Esq.
If to Warehouseman, to:
Arnold Logistics
4410 Industrial Park Road
Camp Hill, PA 17011
Attn: Douglas Enck, VP/General Manager
with a copy to:
Keefer Wood Allen & Rahal, LLP
210 Walnut Street
Harrisburg, PA 17101
Attn: Eugene E. Pepinsky, Esq.
Gary E. French, Esq.
BINDING EFFECT
19. The provisions of this Agreement, and the attached schedules, shall
apply to and bind Depositor and Warehouseman, their heirs, personal
representatives, successors and permitted assigns. This Agreement may
not be assigned by Warehouseman, whether by operation of law and
otherwise, without the prior written consent of Depositor.
CONFIDENTIALITY
20. Warehouseman understands and agrees that the terms and conditions of
this Agreement, all documents referenced herein, communications between
the parties regarding this Agreement or the services to be provided
hereunder, all plans, designs, drawings, trade secrets, customers,
suppliers, and the terms of any agreements with
customers or suppliers, business and other proprietary information of
Depositor which is disclosed in connection with this Agreement (all
such information, collectively, "Confidential Information"), shall at
all times, except as provided herein, be held in strict confidence and
be protected from disclosure to any third party, provided, however that
Warehouseman may disclose such Confidential Information to those of its
employees, agents and advisors who are required to use such
Confidential Information in connection with the activities contemplated
by this Agreement and who are advised of this Agreement and agree to be
bound by the confidentiality provisions hereof. Warehouseman agrees
that it shall, and it shall cause its directors, officers, employees,
independent contractors and other agents who may receive Confidential
Information to, (i) use the Confidential Information only for the
purposes set forth in this Agreement, (ii) refrain from reproducing
such Confidential Information in any form or from orally communicating
such Confidential Information except as required to perform
Warehouseman's obligations under this Agreement. All Confidential
Information shall remain the property of the Depositor. For purposes of
this Agreement "Confidential Information" shall not include information
that has been or is (i) was generally known or generally available to
the public prior to its disclosure to Warehouseman, (ii) becomes
generally known or generally available to the public subsequent to its
disclosure to Warehouseman through no wrongful act of any person, or
(iii) which Warehouseman is required to disclose by rules, statutes and
regulations (provided that Warehouseman provides Depositor with prior
notice of the contemplated disclosure and reasonably cooperates with
Depositor at Depositor's expense in seeking a protective order or other
appropriate protection of such information). Warehouseman further
agrees that it shall return such Confidential Information and any
copies thereof to Depositor upon Depositor's written request or, in any
event upon termination of this Agreement.
The parties agree that neither party will issue any public statement
announcing the existence of this Agreement without the prior consent of
the other party, which shall not be unreasonably withheld, except as
such party believes in good faith (upon advice of counsel) is required
by law and following notice to the other party.
SPECIFIC PERFORMANCE; INJUNCTIVE RELIEF
21. Each of the parties hereto acknowledges and agrees that the other party
would be damaged irreparably in the event any of the covenants
contained in this Agreement are not performed in accordance with their
specific terms or otherwise are breached. Accordingly, each of the
parties hereto agrees that the other party shall be entitled (without
posting any bond or proving that monetary damages would not be
adequate) to an injunction or injunctions to prevent breaches of the
covenants contained in this Agreement and to enforce specifically this
Agreement and the covenants herein, in addition to any other remedy to
which such other party may be entitled at law or in equity.
YEAR 2000 COMPLIANCE
22. Warehouseman covenants and agrees that software products or services
owned, provided or otherwise developed by Warehouseman, or used in the
fulfillment of Warehouseman's obligations hereunder, which incorporate
any date-related information or otherwise process any date-related
information, will, on or before August 1, 1999, and at all times
thereafter until the termination of this Agreement, provide, among
other things, the following functionality: (i) accurate processing of
date-related information before, during and after January 1, 2000,
including accepting the date input, providing the date output, and
performing calculations on dates or portions of dates; (ii) accurate
functioning without interruption before, during and after January 1,
2000 without any change in operation associated with the advent of the
new century; (iii) ability to respond to two-digit input in a way that
resolves any ambiguity as to century in a disclosed, defined and
predetermined manner; and (iv) the ability to store and provide output
date information in ways that are unambiguous as to the century.
REPRESENTATIONS AND WARRANTIES OF THE PARTIES
23. Each party hereby represents and warrants (with respect to itself) to
the other party that:
i. It has full power and authority to enter into and perform its
obligations under this Agreement;
ii. This Agreement has been duly and validly authorized, executed
and delivered on behalf of such party and is a legal, valid
and binding agreement of such party enforceable in accordance
with its terms;
iii. The execution and delivery of this Agreement, the incurrence
of the obligations set forth in this Agreement and the
performance of such obligations will not violate, or
constitute a breach of or default under, the governing
documents of such party or any material agreement or
instrument by which it or any of its property is bound, or to
the best of such party's knowledge, any law, rule, regulation,
order, license, permit, consent, authorization or approval
applicable to such party of any local, state or federal
governmental authority or administrative agency or
self-regulatory authority having jurisdiction over such party
or its property.
iv. There is not pending, nor, to the best of such party's
knowledge, threatened, any action, suit or proceeding before
or by any court or other local, state or federal governmental
authority or administrative agency or self-regulatory agency
which might reasonably be expected to have a material adverse
effect on such party's ability to perform its obligations
under this Agreement.
v. No consent, approval, authorization or order of any local,
state or federal governmental authority or administrative
agency, or any third party is required on the part of such
party for the execution, delivery and performance of this
Agreement by such party.
INDEMNIFICATION
23A. Warehouseman shall indemnify and hold harmless Depositor and its
officers, directors, employees and affiliates from and against any
liability, damage, loss, cost or expense including, without limitation,
reasonable attorney's fees and expenses arising out of or resulting
from Warehouseman's negligence, willful misconduct or breach of any of
its representations, warranties or obligations under this Agreement.
Depositor shall indemnify and hold harmless Warehouseman and its
officers, directors, employees and affiliates from and against any
liability, damage, loss, cost or expense including, without limitation,
reasonable attorney's fees and expenses arising out of or resulting
from Depositor's negligence, willful misconduct or breach of any of its
representations, warranties or obligations under this Agreement.
INVALIDITY OF PROVISIONS
24. Should any part of this agreement for any reason be declared by any
court of competent jurisdiction to be invalid, such decision shall not
affect the validity of any remaining portion, which remaining portion
shall continue in full force and effect as if this agreement had been
executed with the invalid portion hereof eliminated, it being the
intention of the parties that they would have executed the remaining
portion of this agreement without including any such part, parts or
portions which may for any reason be hereafter declared invalid.
DISPUTE RESOLUTION
25. Any controversy or claim that may arise between the Depositor and
Warehouseman relating to the services provided hereunder, including
performance or lack thereof, by either party in which the claimed
amount is fifty thousand dollars ($50,000) or less shall be settled by
arbitration administered by the American Arbitration Association before
a sole arbitrator in accordance with its Commercial Rules and judgment
upon the award rendered by the arbitrator may be entered in any court
having jurisdiction thereof. In the event of any dispute or claim
having a value greater than fifty thousand dollars ($50,000), either
party may initiate litigation.
WAIVER AND DISCHARGE
26. This agreement may not be released, discharged, abandoned, changed or
modified in any manner except by an instrument in writing signed on
behalf of each of the parties hereto by their duly authorized
representatives. The failure of any party hereto to
enforce at any time any of the provisions of this agreement shall in no
way be construed as a waiver of any such provision, or in any way to
affect the validity of this agreement or any part thereof or the right
of any party thereafter to enforce each and every provision. No waiver
of any breach of this agreement shall be held to be a waiver of any
other or subsequent breach
TERM
27. The Term of this Agreement shall commence on the date hereof and,
unless sooner terminated pursuant to the terms hereof shall continue in
effect until August 1, 2004 (the "Initial Period"), and thereafter
shall be extended for two successive 12-month periods (each an
"Extended Period") unless either party gives the other written notice
at least six months prior to the end of such period that the term shall
not be extended. Unless otherwise agreed by the parties in writing the
rates and charges payable pursuant hereto during any Extended Period
shall be equal to the rates and charges for the immediately preceding
12-month period.
SURVIVAL
28. The expiration or termination of this Agreement shall not release the
parties from liabilities and obligations accrued as to the date
thereof. In the event of such expiration or termination the
indemnification and confidentiality obligations of the parties and any
other obligations of the parties which by their terms are to be
performed or complied with subsequent to the expiration or termination
of this Agreement shall survive and continue in effect.
NO THIRD PARTY RIGHTS
29. The provisions of this Agreement are for the exclusive benefit of the
parties to this Agreement, and no other person (including without
limitation any creditor of any party to this Agreement) shall have any
right or claim against any party to this Agreement by reason of those
provisions or be entitled to enforce any of those provisions against
any party to this Agreement.
RELATIONSHIP OF THE PARTIES
30. This Agreement shall not constitute or be construed as creating a
partnership or joint venture between the parties and neither party
shall be liable for any debts or obligations of the other party.
Neither party shall be in any way considered as being an agent or
representative of the other party in any dealings with any third party,
and neither party may act for, or bind, the other party in any such
dealings.
TIME OF THE ESSENCE
31. Time is of the essence in the performance of this Agreement.
FURTHER ASSURANCES
32. Each party agrees to execute and deliver any and all such other and
additional instruments and documents and do any and all such other acts
and things as may be necessary or expedient to effectuate more fully
this Agreement and to carry out the business contemplated by this
Agreement.
ENTIRE AGREEMENT
33. This Agreement, including the Schedules and Appendices attached hereto,
contains every obligation and understanding between the parties
relating to the subject hereof and merges all prior discussions,
negotiations and agreements, if any, between the parties, and neither
party shall be bound by any conditions, definitions, understandings,
warranties or representations other than as expressly provided or
referred to herein.
GOVERNING LAW
34. This Agreement shall be governed by the laws of the State of New York,
without regard to the conflict of laws provisions thereof.
COUNTERPARTS
35. This Agreement may be executed in two counterparts which when taken
together shall constitute one and the same agreement. Signatures may be
by facsimile.
DEPOSITOR AND WAREHOUSEMAN HAVE HERE UNTO SET THEIR HANDS AND SEALS THE DATE AND
YEAR ABOVE WRITTEN, AND HEREBY ACKNOWLEDGE HAVING READ THIS AGREEMENT,
UNDERSTANDING ITS LANGUAGE AND AGREEING TO ITS CONDITIONS.
GT INTERACTIVE SOFTWARE CORP.
By: /s/ DAVID CHEMEROW
----------------------------------------
David Chemerow
President and Chief Operation Officer
ARNOLD TRANSPORTATION SERVICES, INC.,
t/d/b/a AS ARNOLD LOGISTICS
By: /s/ DOUGLAS B. ENCK
-----------------------------------------
Douglas B. Enck
Vice President/ General Manager
Dates Referenced Herein and Documents Incorporated by Reference
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