exv10w10



 







    Exhibit 10.10



 




    MERCHANDISE
    SERVICING AGREEMENT



 



    THIS AGREEMENT is made and entered into as of the
    1st day of April 2002, by and between American
    Consolidation, Inc., 500 Washington Avenue, Carlstadt, New
    Jersey 07512 (“ACI”) and Aeropostale, Inc., 35
    Continental Drive Wayne NJ 07470. (“Customer”).



 




    W I T
    N E S S E T H



 



    WHEREAS, Customer is engaged in the retail business and
    the sale of merchandise customarily available therein; and



 



    WHEREAS, ACI receives, processes, marks, picks,
    consolidates, packs, manifests and loads merchandise at its
    facility located at 500 Washington Avenue, Carlstadt, New Jersey
    (the “ACI Facility”); and



 



    WHEREAS, Customer desires to have ACI perform and ACI is
    willing to provide to Customer all receiving, processing,
    marking, consolidating, picking, packing, manifesting, and
    loading services for Customer’s merchandise sent to ACI at
    Customer’s discretion (the “Merchandise”) subject
    to the terms and conditions specified herein;



 



    NOW, THEREFORE, in consideration of the mutual covenants
    and agreements herein contained, the parties hereto agree as
    follows:



 


		
	
    1.  
	
    Term




 



    The term of this Agreement shall be for an initial term of five
    (5) years commencing as of April 1, 2002 and ending
    March 31, 2007. Customer shall have the option to extend
    this Agreement for an additional five (5) year period
    commencing as of April 1, 2007 and ending March 31,
    2012 upon terms mutually agreed upon. Customer will notify ACI
    with its intent to exercise its option to renew within
    120 days of the expiration of the initial term.



 


		
	
    2.  
	
    Termination




 



    In the event there is a breach of any term of this Agreement by
    ACI, including but not limited to ACI’s failure to provide
    the Services, materials and equipment pursuant to the standards
    set forth herein, Customer shall notify ACI of such breach in
    writing and ACI shall have thirty (30) days to cure such
    breach. In the event ACI has not cured the breach within such
    time, Customer shall have the right to terminate this Agreement
    upon three (3) days notice to ACI.



 



    Customer shall have right to terminate this Agreement:
    (a) upon thirty (30) days notice to ACI, if a
    substantial change in ownership of ACI occurs,
    (b) immediately in the event ACI seeks bankruptcy
    protection or assigns a substantial portion of its assets for
    the benefits of creditors, or (c) immediately after an
    Event of Force Majeure, as hereafter defined in Section 12,
    continues for ninety (90) days.



 



    In addition, in the event Customer terminates this Agreement
    during the initial term prior to March 31, 2007, the
    expiration date set forth in Section 1, other than due to
    ACI’s breach of its obligations under this Agreement,
    Customer agrees to reimburse ACI for the unamortized value of
    the material and equipment upgrades, which material and
    equipment shall be amortized over a five (5) year period,
    made to the ACI Facility at the request of Customer during the
    calendar year 2002.



 


		
	
    3.  
	
    Services,
    Materials and Equipment Provided By ACI




 



    During the term of this Agreement, ACI shall provide the
    distribution services for Customer according to the performance
    standards as set forth in Exhibit A (the
    “Services”), which Exhibit may be amended from time to
    time upon written agreement by both parties hereto.



 



    In addition ACI will provide, at its sole cost and expense, the
    ACI Facility, utilities, insurance, all merchandise handling
    equipment including consolidation, manifesting and sortation
    systems, a Pro Handling rapidpack system




    

    50








 






    and management and labor necessary for the efficient performance
    of its obligations herein. Notwithstanding Section 5(a) of
    this Agreement, the parties understand that ACI is specifically
    providing new scanners, radio frequency or other, manifesting
    and sortation equipment, and software which is part of
    ACI’s new material handling system, which is compatible
    with the Customer’s existing computer hardware and software



 


		
	
    4.  
	
    Representations
    and Warranties of ACI




 



    ACI makes the following representations and warranties to
    Customer on a continuing basis:



 



    (a) ACI is a corporation duly organized, validly existing,
    and in good standing under the laws of the State of New Jersey
    and has the requisite power and authority and the legal right,
    without violating its certificate or articles of incorporation
    or bylaws or any agreement with any third party or any
    applicable law, rule, regulation or governmental or judicial
    decree, to conduct its business as presently conducted and
    hereafter contemplated to be conducted and to execute, deliver
    and perform this Agreement.



 



    (b) This Agreement has been duly executed and delivered by
    ACI and constitutes the legal, valid, and binding obligation of
    ACI.



 



    (c) ACI is Solvent.



 



    (d) No contract, lease agreement, or other instrument to
    which ACI is a party or by which either ACI is bound, and no
    provision of applicable law, materially and adversely affects or
    may so affect the financial condition, business, property or
    prospects of ACI or ACI’s ability to perform this Agreement.



 



    (e) ACI shall comply with all present and future laws,
    statutes, ordinances, rulings, regulations, orders and
    requirements of all federal, state, municipal, county and other
    government agencies and authorities relating to the ACI
    Facility, and shall obtain and keep in full force and effect all
    necessary licenses, permits and similar authorizations from
    governmental authorities required to perform its obligations
    hereunder.



 


		
	
    5.  
	
    Customer’s
    Responsibilities




 



    (a) Customer will provide, at its sole cost, all the
    materials and equipment set forth in Exhibit B attached
    hereto and made a part hereof (the “Customer
    Equipment”). In addition, Customer will be responsible for
    the cost of all inbound and outbound freight associated with the
    processing of its Merchandise.



 



    (b) Customer will provide the personnel to:



 



    (i) Act as an information resource for ACI in the event
    ongoing operational issues arise.



 



    (ii) Handle all systems (AS 400 & Island Pacific)
    problems.



 



    (iii) Handle all communications with vendors regarding
    shipments which are received at the ACI Facility.



 



    (iv) Handle all freight negotiations and payment of freight
    bills.



 


		
	
    6.  
	
    Fees and
    Payment Terms




 



    (a) As ACI’s entire and full compensation for its
    provision of the Services, materials and equipment set forth in
    Section 3 hereof, and any necessary and related costs or
    expenses incurred by ACI in the course of providing the
    Services, materials and equipment, Customer shall pay ACI the
    fees set forth in Exhibit C attached hereto and made a part
    hereof.



 



    (b) Customer shall make payment to ACI of all correctly
    stated amounts within seven (7) days of Customer’s
    receipt of the invoice.



 


		
	
    7.  
	
    Right to
    Audit




 



    ACI agrees to allow Customer’s personnel to inspect and to
    perform an operation field audit of the Services and the ACI
    Facility and to inspect and audit ACI’s invoicing and
    records which relate to the Services performed on the




    

    51








 






    Merchandise as Customer deems necessary in its sole discretion
    at times during any business hours in which ACI operates and
    upon reasonable notice to ACI.



 


		
	
    8.  
	
    Shortages
    and Damages to Merchandise




 



    ACI shall be responsible and liable to Customer for the cost to
    Customer of lost, damaged or misplaced Merchandise. The cost to
    Customer shall be the greater of (i) the book value of the
    Merchandise as determined by the invoice cost plus per unit
    processing cost or (ii) if ACI has been reimbursed by
    virtue of an insurance claim, the total amount of such
    reimbursement. Customer shall notify ACI of any shortage or
    damage to the Merchandise within thirty (30) days of
    ACI’s receipt of the Merchandise.



 


		
	
    9.  
	
    Insurance




 



    ACI shall, at all times during the term of this Agreement, and
    at its sole cost and expense, obtain and maintain the following
    insurance written by insurance companies reasonably acceptable
    to Customer having a minimum rating of A-X in the most recently
    published A.M. Best’s Guide, and admitted and licensed
    to provide insurance in the states in which the Services will be
    performed:



 



    (a) All-risk property insurance upon the Merchandise in
    ACI’s possession in an amount equal to the full replacement
    cost of the Merchandise;



 



    (b) Commercial general liability insurance (including
    contractual liability coverage specifically covering ACI’s
    obligations hereunder) written on an occurrence basis in amounts
    of Five Million Dollars ($5,000,000.00) combined single limit
    per occurrence with respect to bodily injury (including death),
    personal injury and property damage;



 



    (c) Workers’ compensation insurance covering all of
    its employees to the full extent required of all states in which
    ACI performs services under this Agreement;



 



    (d) Employers’ liability insurance with a limit of not
    less than One Million Dollars ($1,000,000.00) for each accident
    and One Million Dollars ($1,000,000.00) for disease.



 



    (e) Business income interruption insurance in an amount not
    to exceed $500,000.00 per occurrence.



 



    The insurance policies, other than the workers’
    compensation insurance policy, shall name Customer as an
    additional insured. Such insurance coverage shall commence as of
    the date of this Agreement and ACI promptly shall deliver to the
    Customer the policies of such insurance, or certificates
    thereof, and with respect to each renewal policy, at least
    thirty (30) days prior to the expiration of the policy it
    renews. All insurance policies maintained by ACI shall provide
    that such policies name Customer as loss payee and shall not be
    amended or canceled without at least thirty (30) days prior
    written notice to Customer. In the event ACI does not obtain the
    insurance required under this Agreement, ACI shall be in default
    of this Agreement and Customer, in addition to its remedies at
    law and equity and as may be found elsewhere in this Agreement,
    may obtain such insurance on behalf of ACI. Customer shall have
    the option of (i) offsetting the cost of such insurance
    against any amounts payable by Customer to ACI until fully
    reimbursed, or (ii) invoicing ACI for such insurance, in
    which event ACI shall pay such invoice within fifteen
    (15) days after the invoice date together with any the
    maximum rate of interest that may be legally charged.



 



    The required liability insurance may be carried under a
    “blanket policy” covering other work of ACI, provided
    that if the blanket policy contains an aggregate limit, the
    limit will apply on a per location basis.



 



    Such policies shall provide for a waiver of any right of
    subrogation that the insurer may acquire against Customer.



 



    It is the express intention of the parties to this Agreement
    that ACI shall cause such insurance coverages to be provided on
    a “primary” basis, regardless of any other insurance
    Customer may elect to purchase and maintain. Accordingly, no
    liability coverage required of ACI shall be subject to an
    “excess” or “pro-rata” type of other
    insurance clause, nor shall any such coverage be subject to any
    clause which would be contrary to the aforesaid intent of the
    parties. Any coverage purchased by Customer will be excess for
    Customer only and not provide any coverage for ACI.




    

    52








 





		
	
    10.  
	
    Indemnification




 



    ACI shall indemnify, defend and hold harmless Customer, its
    affiliates and their respective directors, officers, employees
    and agents from and against any and all damages, costs, losses,
    liability and expenses (including reasonable attorneys fees) in
    connection with any and all actions or threatened actions
    arising out of: (a) the use by ACI of any Customer
    Equipment, (b) the performance by ACI of the Services, or
    (c) the breach of ACI of any term of this Agreement,
    provided that such indemnification obligation shall not arise in
    circumstances where the claim in question arose solely from any
    grossly negligent, intentional, wrongful or unlawful act or
    omission of Customer.



 


		
	
    11.  
	
    Effect of
    Termination




 



    Upon the termination of this Agreement, ACI shall fully perform
    all Services with respect to all Merchandise delivered to ACI
    prior to the effective date of such termination. Customer shall
    pay for all Services performed by ACI prior to the effective
    date of such termination. Each party also agrees to perform all
    other obligations on its part which, by the terms of this
    Agreement, are required to be performed upon termination thereof.



 


		
	
    12.  
	
    Force
    Majeure




 



    Neither party to this Agreement shall be liable for any default
    hereunder due to act of God, riot, accident, strikes, labor
    disputes, work stoppages, fires, floods, acts of a public enemy,
    acts of the United States Government, war or other unforeseeable
    cause beyond its control and without its fault or negligence (an
    “Event of Force Majeure”). Each party hereto shall
    notify the other in writing of any such unforeseeable causes
    beyond its control which may have delayed or may delay the
    performance of its obligations pursuant to this Agreement. When
    ACI has, for any reason, failed to perform the Services
    hereunder because of an Event of Force Majeure or given notice
    hereunder that it will fail to make such delivery because of any
    Event of Force Majeure, Customer shall have the right, for a
    period of not less than thirty (30) days, to have the
    Services performed by sources other than ACI, provided that
    Customer’s commitment to have such Services performed by
    sources other than ACI. Notwithstanding anything contained
    herein to the contrary, in the event any Event of Force Majeure,
    ACI shall have a period of ten (10) days from the date of
    said occurrence to have the Services performed with respect to
    the Merchandise from another source. In the event ACI is unable
    to provide such alternate source to have the Services performed
    within such
    10-day
    period, Customer shall have the right to have the Services
    performed through an alternate source, and any difference in the
    cost of having the Services performed by an alternate source and
    the cost of Services provided under this Agreement shall be
    immediately reimbursed by ACI to Customer. The failure of ACI to
    perform the Services due to an Event of Force Majeure shall not
    be deemed to be a breach of any provision of this Agreement;
    provided that ACI commences performing Services with respect to
    the Merchandise within ninety (90) days after an Event of
    Force Majeure or after notice to Customer of any Event of Force
    Majeure.



 


		
	
    13.  
	
    Alternate
    Dispute Resolution




 



    If there is a controversy or dispute arising out of, related to
    or involving this Agreement that is not resolved by negotiation
    and agreement of the parties within 30 calendar days of the
    controversy or dispute arising, such controversy or dispute
    shall be resolved exclusively through binding, conclusive and
    confidential alternate dispute resolution (“ADR”)
    pursuant to the New Jersey Alternate Procedure for Dispute
    Resolution Act (“NJADR Act”), N.J.S.A. 2A:23A-1
    et seq, by submission to an umpire mutually selected by
    the parties. If the parties are unable to mutually agree upon an
    umpire, each party shall designate a former federal judge or New
    Jersey Supreme Court justice of Superior Court judge and the
    umpire shall be selected as between them by the flip of a coin.
    The ADR shall be held in Wayne, New Jersey, and shall then
    proceed in accordance with the NJADR Act but shall be conducted
    confidentially. The decision of the umpire shall be binding upon
    the parties hereto and the parties hereby waive and relinquish
    right of appeal afforded by the NJADR Act. The cost of the
    umpire shall be borne equally by the parties, unless the umpire
    decides based on equitable principles to apportion such costs in
    a different manner.



 


		
	
    14.  
	
    Confidentiality




 



    ACI shall, from time to time, gain access to certain proprietary
    business information (including, without limitation, information
    relating to Customer’s business activities, cost of doing
    business and the cost of supplies




    

    53








 






    purchased hereunder) (“Proprietary Information”) of
    Customer which is confidential in nature. ACI agrees to hold all
    such Proprietary Information in trust and confidence for the
    exclusive benefit of Customer. ACI shall not disclose or
    divulge, nor permit any disclosure of, any Proprietary
    Information to any entity not a party to this Agreement, nor
    shall ACI appropriate or use any Proprietary Information to
    benefit itself or any other entity. ACI shall also inform any of
    its respective affiliates or subsidiaries and their respective
    directors, officers, employees and agents thereof
    (“Agent”) providing Services hereunder of the terms of
    this Section of this Agreement. ACI shall be responsible for its
    respective Agent’s failure to comply with the terms of this
    Section and any liability arising therefrom.



 



    ACI and Customer agree that any disclosure or use of the
    Proprietary Information other than for the exclusive benefit of
    Customer will cause irreparable harm to Customer and that money
    damages alone would be an inadequate remedy for any disclosure
    or unauthorized use of the Proprietary Information by ACI.
    Therefore, ACI and Customer agree that Customer shall be
    entitled to obtain specific performance, injunctive relief or
    any other remedy available at law or in equity in the event of
    such disclosure or unauthorized use. This Section 14 shall
    survive the termination of this Agreement.



 


		
	
    15.  
	
    Relationship
    of the Parties




 



    The relationship between Customer and ACI under this Agreement
    shall be solely that of vendor and vendee. It is expressly
    understood and agreed by the parties hereto that nothing in this
    Agreement, its provisions, or the transactions and relationships
    contemplated hereby shall constitute either party as an agent,
    employee, partner, or legal representative of the other for any
    purpose whatsoever, nor shall either party hold itself out as
    such. Neither party to this Agreement shall have the authority
    to bind or commit the other party hereto in any manner or for
    any purpose whatsoever but rather each party shall, at all
    times, act and conduct itself in all respects and events as an
    independent contractor. In no event shall the employees or
    contractors of ACI or any other person performing the Services
    hereunder be deemed to be the employees of Customer. This
    Agreement creates no relationships of joint ventures, partners,
    associates, or principal or agents between the parties hereto.
    ACI agrees that neither it nor any of it officers or affiliates
    will at any time, either during or after the termination of this
    Agreement, directly or indirectly, in any manner use the name of
    Customer or any trade, trademark, service mark, or logo of
    Customer without Customer’s prior written permission. In no
    event shall the employees or contractors of ACI or any other
    person performing the Services hereunder be deemed to be the
    employees of Customer.



 


		
	
    16.  
	
    Assignment




 



    This Agreement may not be assigned by either party hereto except
    with the prior written consent of the other party, which consent
    will not unreasonably be withheld or delayed, and any attempted
    assignment in violation of this provision shall be void.



 


		
	
    17.  
	
    Administrative
    Expenses




 



    Each party hereto shall pay all of its own administrative
    expenses (including, without limitation, the fees and expenses
    of their agents, representatives, counsel and accountants,
    incident to the preparation of this Agreement).



 


		
	
    18.  
	
    Successors
    and Assigns




 



    This Agreement shall be binding upon and inure to the benefit of
    the successors and permitted assigns of the parties hereto.



 


		
	
    19.  
	
    Title to
    Merchandise and Customer Equipment




 



    (a) Title to and ownership of the Merchandise shall, at all
    times, rest solely with the Customer. ACI shall not act in a
    manner which is inconsistent with Customer’s title thereto
    including, but not limited to, causing or allowing any lien or
    security interest for the benefit of any ACI creditor to attach
    to the Merchandise. In the event that any such security interest
    or lien attaches to such Merchandise, ACI agrees to pay the same
    and have it discharged of record, promptly, and to take such
    action as may be required to reasonably and legally object to
    such security interest or lien or to have such security interest
    or lien removed from such Merchandise, including, without




    

    54








 






    limitation, completing and signing any documents,
    acknowledgments or other documentation requested by Customer.



 



    ACI hereby waives any right to lien against any Merchandise
    which may be located in the ACI facility. Customer may make, in
    its sole discretion, any and all UCC informational filings
    regarding its ownership interest in its equipment and the
    Merchandise. ACI agrees to cooperate with Customer in making
    such filings and take all reasonable action to complete such
    filings as requested by Customer.



 



    (b) In the event ACI causes or allows any such security
    interest of lien to attach to Customer’s property rights in
    and to the Merchandise, which security interest or lien is not
    removed within thirty (30) days, Customer shall have the
    right to terminate this Agreement immediately after such thirty
    (30) day period cure period.



 



    (c) The Customer Equipment shall at all times remain the
    sole and exclusive property of Customer and shall not be used
    for any purpose except as specifically directed by Customer. ACI
    shall not permit any security interest, lien or other
    encumbrance (“Encumbrance”) to attach to any Customer
    Equipment or Merchandise and in the event any such Encumbrance
    attaches to any Customer Equipment or Merchandise, ACI will pay
    to have it discharged of record promptly, and to take such
    action as may be required to reasonably and legally object to
    such security interest or lien or to have such security interest
    or lien removed from such property. ACI hereby waives any right
    to lien against any property of Customer, including any Customer
    Equipment and Merchandise which may be located at the ACI
    Facility. Customer may make, in its sole discretion, any and all
    UCC informational filings regarding its ownership interest in
    the Customer Equipment and the Merchandise. ACI agrees to
    cooperate with Customer in making such filings and take all
    reasonable action to complete such filings as requested by
    Customer at Customer’s cost and expense. Customer shall be
    responsible for the cost of maintenance of the Customer
    Equipment located at the ACI Facility and ACI agrees to notify
    Customer of the need for any non-routine maintenance on the
    equipment and Customer agrees to keep all of the Customer
    Equipment in a condition which enables ACI to perform the
    Services for Customer herein. Upon termination of this
    Agreement, all such Customer Equipment shall be returned
    forthwith to Customer in the condition such Customer Equipment
    was delivered to ACI, reasonable wear and tear excepted. ACI
    hereby agrees that it will assume all risk of loss on the
    Merchandise and Customer Equipment owned by Customer from the
    time of its receipt of such Merchandise or Customer Equipment
    until such time as Customer subsequently receives such
    Merchandise or Customer Equipment. ACI shall replace or repair,
    at its sole cost and expense, any Customer Equipment which is
    lost, stolen, damaged, destroyed or otherwise unavailable for
    use or return to Customer.



 


		
	
    20.  
	
    Waiver of
    Breach




 



    The waiver by any party to this Agreement of any breach or
    violation of any provision of this Agreement by the other party
    hereto shall not operate or be construed to be a waiver of any
    subsequent breach of violation thereof.



 


		
	
    21.  
	
    Governing
    Law and Severability




 



    This Agreement shall be governed by and interpreted in
    accordance with the substantive and procedural laws of the State
    of New Jersey. The terms and conditions of this Agreement are
    hereby deemed by the parties to be severable, and the invalidity
    or unenforceability of any one or more of the provisions of this
    Agreement shall not affect the validity or enforceability of the
    other provisions hereof.




    

    55








 





		
	
    22.  
	
    Notices




 



    Any notice contemplated by or required or permitted to be given
    under this Agreement shall be sufficient if in writing and if
    delivered personally or sent by nationally recognized carrier or
    by registered or certified mail, return receipt requested, to
    the parties’ respective addresses below, or to such other
    addresses either of the parties hereto may hereinafter designate
    in writing:



 



    American Consolidation, Inc.

    500 Washington Avenue

    Carlstadt, New Jersey 07072

    Attn: Steven Sacharoff, Chief Executive Officer



 



    Aeropostale, Inc.

    35 Continental Drive

    Wayne, New Jersey 07470

    Attn: John Mills, Chief Operating Officer




    

    56








 






    THIS AGREEMENT reflects the complete understanding of the
    parties and constitutes their entire agreement, all prior
    negotiations, representations and statements having been merged
    herein. This Agreement, including the Exhibits hereto, may not
    be changed or amended orally but only in writing signed by both
    parties.



 



    IN WITNESS WHEREOF, the parties have executed this
    Agreement by the signature of their respective, duly authorized
    corporate officers as of the day and year first above written.



 



    AMERICAN CONSOLIDATION, INC.



 


			
	 	    By: 
	
    /s/  Steven Sacharoff













    Steven Sacharoff,




    Its Chief Executive Officer



 



    AEROPOSTALE, INC.



 


			
	 	    By: 
	
    /s/  John S. Mills








    John S. Mills




    Its Chief Operating Officer




    

    57








 





 




    Exhibit A



 




    Services
    and Performance Standards to be Provided by ACI



 




    SERVICES



 



    (a) Schedule deliveries within twenty-four (24) hours
    of request for appointment based upon Customer’s monthly
    plan.



 



    (b) Receive, Check, Mark (where applicable), Pick, Pack,
    Consolidate, Manifest and Ship merchandise in accordance with
    customer’s standard policies and procedures attached hereto
    as Attachment 1 to Exhibit A.



 



    (c) Process all documentation related to the warehouse and
    distribution system including but not limited to, Appointment
    Log, Vendor Invoice, Packing Slip, Bill of Lading, Key Rec
    Panel, Trouble Notification Form, Receiving Worksheet, Receiving
    Manifest, Vendor Chargeback Form and LTA Shipping Manifest, and
    in accordance with customer’s standard policies and
    procedures attached hereto as Attachment 1 to Exhibit A.



 




    PERFORMANCE
    STANDARDS



 



    (a) ACI shall perform the Services in a proper and
    workmanlike manner in accordance with accepted industry
    standards, practices and procedures (“Industry
    Standards”).



 



    (b) ACI shall provide the Services with regard to the
    Merchandise within the following time constraints:



 



    (1) All Merchandise received as Cross-Docked will be
    processed and shipped within 24 hours of receipt of
    Distribution information from Customer.



 



    (2) All other Merchandise will be processed within
    48 hours of receipt of Distribution information from
    Customer.



 



    (c) ACI shall maintain a Quality Level of 99% with respect
    to Merchandise processing accuracy and as defined in the Base
    Plus Kurt Salmon Associates Quality System.




    

    58








 







    Attachment
    1 to Exhibit A



 




    Customer’s
    Standard Policies and Procedures




    

    59








 







    EXHIBIT B



 




    Materials
    and Equipment to be provided by Customer at the ACI
    Facility



 



    (A) ALL CONTROL ROOM EQUIPMENT, TICKET MAKING
    EQUIPMENT, TICKET STOCK, COMPUTER FORMS, LABELS, AND PACKING
    CARTONS.



 



    (B) ALL CONTROL ROOM COMPUTER EQUIPMENT AND DATA
    COMMUNICATION LINES.



 



    (C) ALL PACKING SUPPLIES, HANGERS, POLY BAGS, CARTONS,
    SEALING TAPE, AND LABELS NECESSARY FOR MERCHANDISE PROCESSING.




    

    60








 







    EXHIBIT C



 




    Fees
    Payable to ACI



 




    Rate
    Schedule



 


	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
 
	
 
	
    Cost per Unit
	
 

	

    Service


	
 
	
    2002*
	
 
	
 
	
    2003
	
 
	
 
	
    2004
	
 
	
 
	
    2005
	
 
	
 
	
    2006
	
 
	
 
	
    2007
	
 

	 

	

    Processing Service
    


	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	

    Regular
    


	
 
	
    $
	
    0.316
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
    N/A
	
 
	
 
	
 
	
 
	
 

	

    Pre-Pack
    


	
 
	
    $
	
    0.246
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
    N/A
	
 
	
 
	
 
	
 
	
 

	

    Pre-Ticketed
    


	
 
	
    $
	
    0.251
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
    $
	
    .145
	
 
	
 
	
 
	
 
	
 

	

    Pre-Pack/Pre-Ticketed
    


	
 
	
    $
	
    0.216
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
    $
	
     .11
	
 
	
 
	
 
	
 
	
 

	

    Cross Dock
    


	
 
	
    $
	
    0.050
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
    $
	
     .04
	
 
	
 
	
 
	
 
	
 

	

    Backstock
    


	
 
	
    $
	
    0.120
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
    $
	
     .14
	
 
	
 
	
 
	
 
	
 

	

    Special Projects
    


	
 
	
    $
	
    9.50/hr
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
    $
	
    10.50/hr
	
 
	
 
	
 
	
 
	
 









 





 




			
	
    * 		
    Rates effective 4/1/2002 until 1/31/2003.



 



    All other rates commence on
    2/1
    of the stated year and are effective until
    1/31
    of the following year. New rate structures will be implemented
    each year based upon Aeropostale’s receipt projection.




    

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