Unassociated Document


    Exhibit
10.3


    WAREHOUSE SERVICES
AGREEMENT

    


    THIS
WAREHOUSE SERVICES AGREEMENT (this “Agreement”), is entered into as of February
22nd, 2009, by and between Active Apparel Group, Inc., a Florida corporation
(“AAG”), and Serec of California, a California corporation
(“Warehouseman”).

     

    I.          
 INITIAL TERM.  The initial term of this Agreement shall commence
on February 22nd, 2009 and shall terminate on December 31st, 2014
(the “Term”). This Agreement shall automatically renew for an additional 2 year
term unless terminated pursuant to section XVII of this Agreement.

    


    II.           WAREHOUSING
AND SERVICES; PAYMENT; SECURITY

    


    a.           During
the Term, Warehouseman shall be the exclusive provider of certain services for
AAG and all affiliated entities (including, without limitation, Total Apparel
Group, Inc., International Apparel Group, Inc. and the entity to be formed to
distribute Kappa merchandise), which shall include, without limitation, receipt,
storage, order selection, shipment, related customer service and administrative
functions and other services described in Schedule A to this Agreement
(collectively, the “Services”) for all goods imported into the United States or
manufactured in the United States. Warehouseman shall furnish all personnel,
materials, equipment, supplies and other accessories necessary to perform safely
and efficiently the Services and the Services shall be performed by Warehouseman
in a good and workmanlike manner.  All other warranties of any kind are
hereby excluded.

    


    b.           Rates
and charges for the Services are as set forth in Schedule B to this
Agreement. AAG and Warehouseman shall review such rates annually.  For
any services not specified in this Agreement or in Schedule A, AAG shall
pay to the Warehouseman such consideration as may be mutually agreed upon in
advance in writing or as standard in the industry. Charges shall be paid by AAG
upon any licensed or unlicensed goods including but not limited to FIFA and
Kappa branded shipped goods payment receipt deposit, according to the lock box
agreement and invoice terms.  Goods will not be shipped without proper
purchase order and invoice documents prior approval of LOC guarantors’
requirements satisfaction. Late payments 15 days or more overdue are subject to
a 5% late fee and interest at the lesser of 18% per annum or the applicable
usury rate.

    


    c.           The
obligations of AAG hereunder are secured by all statutory liens applicable to
warehouses, and in addition, by a junior security interest (subordinate only to
the lien of YGBFKM, LLC) in substantially all of the assets of AAG, and which
security shall include, without limitation, a junior lien on the funds of AAG in
its account no. ___________________ at The Northern Trust Company, which is the
subject of the Account Pledge Agreement between AAG, YGBFKM, LLC and The
Northern Trust Company (and the parties agree to enter into a similar agreement
for the benefit of Warehouseman if said Account Pledge Agreement shall
terminate) and a subordinated Collateral Assignment of the Distribution
Agreement between AAG, Total Apparel Group, Inc. (“TAG”) and Global Brands
(Football) Pte. Ltd.  AAG’s obligations hereunder shall also be
secured by the Guaranties of TAG, Don Jones, Janon Costley and Duarte
DaSilveira, pursuant to the Guaranty attached hereto.  In the event of
a default hereunder by AAG, Warehouseman shall have all remedies available at
law or in equity, including without limitation, all rights under the Uniform
Commercial Code of California.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    III.         WAREHOUSE

    


    a.           AAG
has requested, and Warehouseman has agreed, to provide the Services at one or
more of the warehouse facilities located at 15351 and 15350 East Stafford Street
and15441 East Stafford Street, City of Industry, California 91744 (collectively
the “Warehouse”). Warehouseman shall promptly notify AAG of any condition
respecting the Warehouse which would prevent or otherwise inhibit its
performance of the Services.  The location of AAG’s goods within the
Warehouse shall be determined by Warehouseman.

    


    b.           AAG
shall have access to the Warehouse at all times upon reasonable notice and shall
have the right to examine, inspect, inventory and count all or any of its goods
at its own cost.  If AAG desires access outside of normal business
hours, AAG will coordinate such access with Warehouseman, and may be charged
additional costs, at the election of Warehouseman.

    


    c.           Warehouseman
shall be responsible for all operating expenses and handling fees in connection
with the operation of the Warehouse, except for any expenses incurred due to
AAG’s acts or omissions.

    


    d.           Warehouseman
shall maintain the Warehouse in a good and orderly condition and shall comply
with the storage conditions and sanitation and housekeeping standards as are
required by law or are agreed upon in writing from time to time by both parties
hereto.

    


    e.           AAG
shall be solely responsible for all of its employees and agents which enter the
Warehouse property and shall indemnify Warehouseman from and against any damage
to property or injury to person (including reasonable attorneys’ fees) which are
incurred by such employees and agents on Warehouse property, or which result
from the acts or omissions of such employees or agents.

    


    IV.         RELATIONSHIP;
SHIPPING.  Warehouseman shall operate at all times as a warehouseman
under the Uniform Commercial Code as adopted in the State of California. AAG
shall not ship goods to Warehouseman as a named consignee. Shipments will be
consigned to AAG c/o Warehouseman.

    


    V.           TENDER
FOR STORAGE.  All goods tendered for storage shall be delivered at the
Warehouse in a segregated manner, properly marked and packaged for handling. AAG
shall furnish or cause to be furnished to Warehouseman, at or prior to such
delivery, a manifest showing goods to be kept and accounted for
separately.

    


    VI.        
TRANSFER; REMOVAL OF GOODS.

    


    a.           Instructions
to transfer goods on the books of Warehouseman shall not be effective until
delivered to and received by Warehouseman and all charges and LOC’s, up to the
time transfer is made, shall be prepaid and relieved  by
AAG.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    b.           Warehouseman
may, without notice, move goods within the Warehouse. Warehouseman shall not,
except as provided in Section VII(c), move goods to another location
outside of the Warehouse without the prior written consent of AAG.

    


    c.           If,
as a result of the quality or conditions of goods of which Warehouseman had no
notice at the time of deposit, goods are a hazard to other property, the
Warehouse or persons, Warehouseman shall immediately notify AAG and AAG shall
thereupon claim its interest in such goods and immediately remove them from the
Warehouse at AAG’s expense, and in the event AAG fails to do so, Warehouseman
may remove such goods at AAG’s expense.

    


    VII.        HANDLING

    


    a.           The
handling rates and charges set forth in Schedule B shall cover ordinary
labor and administration involved in receiving goods at the Warehouse door or
dock, placing goods in storage and returning goods to the Warehouse door or
dock.

    


    b.           Receiving
of inbound shipments will be on a mutually agreed upon schedule utilizing drop
trailers. Outbound shipments will be coordinated between AAG, Warehouseman, and
an appropriate transportation services provider.

    


    VIII.       DELIVERY
REQUIREMENTS.  No goods shall be delivered or transferred except upon
receipt by Warehouseman of complete instructions properly authorized and
executed by AAG or its approved affiliate customer EDI orders.

    


    IX.         INBOUND
SHIPMENTS

    


    a.           Warehouseman
shall promptly notify AAG of any known discrepancy on inbound shipments and
shall protect AAG’s interest by placing an appropriate notation on the
delivering carrier’s shipping documents. Returned goods shall be governed by
AAG’s returned goods policy, a copy of which is attached as Schedule C to this
Agreement (TBD).

    


    b.           Warehouseman
shall immediately notify AAG if any goods are tendered that, because of
infestation, contamination or damage, might cause infestation, contamination or
damage to the Warehouse or other goods stored therein. Warehouseman and AAG
shall determine whether any such goods should be refused. Warehouseman shall
have no liability for any demurrage, detention, transportation and other charges
by virtue of any such refusal by AAG, unless the infestation, contamination, or
damage is the result of a negligent action or omission of the Warehouseman or a
violation of the procedures set forth in this Agreement.

    


    X.          LIABILITY

    


    a.           Warehouseman
shall be liable for damages or the loss of or injury to goods stored or handled
and caused by Warehouseman’s failure to exercise such care in regard to the
goods as a reasonably careful warehouseman would exercise under like
circumstances, but only to the extent provided herein.

    


    b.           Warehouseman
shall not be liable for damages for any delay or failure in the performance of
this Agreement resulting from any cause, beyond its control, including without
limitation acts of God, fires, explosions, floods, wars, sabotage, riots or
governmental action.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    c.           The
liability of Warehouseman under this Agreement shall be limited to the cost of
goods of AAG which are damaged (or if less the cost of repair of such goods if
repairable) and in no event shall Warehouseman be liable for any lost profits,
special, incidental or consequential damages, punitive damages or any other loss
of AAG.

    


    XI.         LEGAL
LIABILITY INSURANCE.  During the Term, Warehouseman shall maintain at
its expense a warehouseman’s legal liability insurance policy in commercially
reasonable amounts, including, without limitation, coverage for mysterious
disappearance and employee infidelity. The cancellation or termination of this
Agreement by either party hereto shall not affect the insurance coverage for
losses occurring during the Term. Attached to this Agreement as Schedule D is a
certificate of insurance from an insurance carrier evidencing such insurance
coverage and naming AAG as an additional insured, which certificate shall
provide that such insurance shall not be canceled or altered without
Warehouseman’s (30) days advance written notice to AAG.  AAG shall
maintain primary property insurance on all of the goods stored at the Warehouse
in commercially reasonable amounts, as well as general liability, worker’s
compensation and other appropriate coverages, all in commercially reasonable
amounts.

    


    XII.        NOTICE
OF LOSS; DAMAGE CLAIM

    


    a.           The
Warehouseman shall promptly notify AAG of any loss or damage, howsoever caused,
to goods stored or handled.

    


    b.           All
claims by AAG relating to the losses or damages disclosed as a result of a AAG
physical inventory reconciliation shall be presented in writing to the
Warehouseman.

    


    c.           Warehouseman
shall reimburse AAG for any confirmed losses or damage to goods (to the extent
provided herein), other than those caused by or as a result of the acts or
omissions of AAG or its employees or agents in an amount equal to AAG’s cost of
such goods (or if less, the cost of repair if repairable). Warehouseman will
receive a loss allowance of [_____%] per 1000 items received. This will be
reviewed on an annual basis.

    


    XIII.      RECORDS

    


    a.           Warehouseman
shall use best efforts to maintain an accurate count of all shipments of goods
into and out of the Warehouse. Warehouseman shall report to AAG the count taken
on each inbound and outbound shipment and, once reported to AAG, such count
shall establish the number of cases and/or pallets received or shipped unless
other documentation can prove to the contrary.

    


    b.           Warehouseman
shall maintain complete and accurate books and records, recording all inbound
and outbound shipments, so as to produce a continuous balance that shows the
number of cases or pallets of each AAG product that should be in the Warehouse,
based on the Warehouseman’s count, at any given time.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    c.           Books
and records maintained by Warehouseman shall be reconciled by Warehouseman with
parallel books and records to be maintained by AAG, which reconciliation shall
occur at least once every four (4) weeks, in accordance with AAG’s monthly
financial reporting purposes.

    


    XIV.      INDEPENDENT
CONTRACTOR

    


    a.           Warehouseman
is performing the Services as an independent contractor of AAG. Nothing
contained in this Agreement shall be construed to place AAG and Warehouseman in
a relationship as partners, joint venturers, employer/employee or
principal/agent, nor shall Warehouseman be considered in any sense an affiliate
or subsidiary of AAG. Warehouseman shall not have any authority to create or
assume in AAG’s name or on its behalf any obligation, express or implied, or to
act or purport to act as AAG’s agent or legally empowered representative for any
purpose whatsoever, except as necessary for the provision of Services set forth
herein.

    


    b.           All
of Warehouseman’s personnel shall be considered employees of Warehouseman and
under no circumstances shall they be construed or considered to be employees or
agents of AAG.

    


    c.           Each
party shall pay and discharge, at its own expense, any and all expenses,
charges, fees and taxes arising out of or incidental to the carrying on of its
business including, without limitation, workmen’s compensation, unemployment
insurance and social security taxes levied or assessed with respect to its
respective employees.

    


    XV.        COMPLIANCE
WITH LAWS, ORDINANCES, RULES AND REGULATIONS.

    


    a.           Warehouseman
shall comply with all applicable laws, ordinances, rules and regulations of
federal, state, local and other governmental authorities and entities governing
the performance of the Services.

    


    b.           AAG
shall comply in all material respects with all applicable laws, ordinances,
rules and regulations of federal, state, local and other governmental
authorities with respect to the operation of its business and the import,
export, purchase and sale of the goods located at the Warehouse.

    


    XVI.      REPRESENTATIONS
AND WARRANTIES

    


    a.           AAG
represents and warrants that neither the execution and delivery of this
Agreement, nor any other document, agreement, certificate and instrument to
which it is a party or by which it is bound in connection herewith or therewith,
nor the consummation of the transactions contemplated hereunder or thereunder,
or the compliance with or performance of the terms and conditions herein or
therein will result in the creation or imposition of any material lien, charge
or encumbrance of any nature whatsoever upon any of the property or assets of
Warehouseman except as permitted in or anticipated by this Agreement, or is
prevented by, limited by, conflicts with or will result in the breach or
violation of or a default under the terms, conditions, or provisions of (1) its
certificate or articles of incorporation or by-laws and other organic documents,
(2) any material indenture, evidence of indebtedness, loan or LOC financing
agreement, or other agreement or instrument of whatever nature to which it is a
party or by which it is bound, or (3) any provision of any existing law, rule
regulation, order, writ, injunction or decree of any court or governmental
authority to which AAG is subject.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    b.           AAG
represents and warrants that (l) it is a corporation duly organized and validly
existing under the laws of the State of Florida, and it is authorized to do
business in each other jurisdiction wherein its ownership of property or conduct
of business legally requires such authorization, licensing or qualification, and
(2) it has all requisite power, authority, franchises, permits and licenses to
(a) execute and deliver this Agreement and other document, agreement,
certificate or instrument necessary to consummate the transactions and perform
its obligations hereunder and (b) to own its properties and assets and to carry
on and conduct its business as presently conducted. All necessary action to
authorize the execution, delivery and performance of this Agreement and to
consummate the transactions contemplated hereunder has been taken by
AAG.

    


    c.           Warehouseman
represents and warrants that neither the execution and delivery of this
Agreement, nor any other document, agreement, certificate and instrument to
which it is a party or by which it is bound in connection herewith or therewith,
nor the consummation of the transactions contemplated hereunder or there under
or the compliance with or performance of the terms and conditions herein or
therein will result in the creation or imposition of any material lien, charge
or encumbrance or any nature whatsoever upon any of the property or assets
of  Warehouseman except as permitted in or anticipated by this
Agreement, or is prevented by, limited by, conflicts with or will result in the
breach or violation of or a default under the terms, conditions or provisions of
(1) its certificate or articles of incorporation or by-laws and other organic
documents, (2) any material indenture, evidence of indebtedness, loan or
financing agreement, or other agreement or instrument of whatever nature to
which it is a party of by which it is bound, or (3) any provision of any
existing law, rule, regulation, order, writ, injunction or decree of any court
or governmental authority to which Warehouseman is subject.

    


    d.           Warehouseman
represents and warrants that (1) it is a corporation duly organized and validly
existing under the laws of the State of California, and it is authorized to do
business in each other jurisdiction wherein its ownership of property or conduct
of business legally requires such authorization, licensing or qualification, and
(2) it has all requisite power, authority, franchises, permits and licenses to
(a) execute and deliver this Agreement and any other document, agreement,
certificate or instrument necessary to consummate the transactions and perform
its obligations hereunder and (b) to own its properties and assets and to carry
on and conduct its business as presently conducted or proposed to be conducted.
All necessary action to authorize the execution, delivery, and performance of
this Agreement and to consummate the transactions contemplated hereunder has
been taken by Warehouseman.

    


    XVII.     TERMINATION

    


    a.           Subject
to subsection (d) below, either party may terminate this Agreement if the other
party has failed to perform any material term, condition or obligation hereof to
the satisfaction of the terminating party and has failed to correct the same
within thirty (30) days after receipt of written notice of such failure given by
such terminating party.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    b.           Either
party may terminate this Agreement if the other party (1) fails to vacate an
involuntary bankruptcy, insolvency, or reorganization petition for an agreement
or composition with creditors filed against such party within sixty (60) days
after the date of such filing, or files such petition on a voluntary basis; (2)
makes an assignment or transfer for the benefit of creditors; or (3) fails to
vacate the appointment or a receiver or trustee for such party or for any
interest in such party’s business within sixty (60) days after such
appointment.

    


    c.           Upon
termination of this Agreement pursuant to this Section XVIII and subject to
the payment of all amounts due to Warehouseman hereunder, both parties shall
cooperate fully in the orderly transition of the Services to another
warehouseman.

    


    d.           AAG
may not terminate this Agreement until the Loan and Security Agreement between
AAG, its affiliates and YGBFKM, LLC has been terminated.

    


    XVIII.    ASSIGNMENT.  Neither
party shall, without the prior written consent of the other party (which consent
shall not be unreasonably withheld), assign this Agreement by operation of law
or otherwise. Notwithstanding the foregoing consent requirement, but without
releasing the parties of their obligations under this Agreement, Warehouseman
party may assign this Agreement to any of its affiliates or any owner of the
Warehouse.

    


    XIX.      APPLICABLE
LAW.  This Agreement shall be governed by, enforced, interpreted and
construed under the laws of the State of California. Venue for any action to
enforce this Agreement shall be in the County of Los Angeles, State of
California for any such action filed in state court or in the United States
District Court for the District in which the Warehouse is located for any such
action filed in federal court.

    


    XX.       MEDIATION.  All
disputes, claims and other matters in controversy arising directly or indirectly
out of or related to this Agreement, or the breach thereof, whether contractual
or non-contractual, shall be submitted first to voluntary mediation, by written
notice to the other party or parties. In the mediation process, the parties will
try to resolve their differences voluntarily with the aid of an impartial
mediator, who will attempt to facilitate negotiations. The mediator will be
selected by agreement of the parties. If the parties can not agree on a
mediator, a mediator will be designated by the American Arbitration Association
in the location of Los Angeles, California (“AAA”) at the request of a party.
The mediation will be conducted as specified by the mediator and agreed upon by
the parties. The parties agree to discuss their differences in good faith and to
attempt, with the assistance of the mediator, to reach an amicable resolution of
the dispute. The mediation will be treated as a settlement discussion and,
therefore, will be confidential. The mediator may not testify for either party
in any later proceeding relating to the dispute. No recording or transcript
shall be made of the mediation proceedings. Each party will bear its own costs
in the mediation. The fees and expenses of the mediator will be shared equally
by the parties. If a dispute can not be resolved within ninety days after the
written notice beginning the mediation process (or a longer period, if the
parties agree to extend the mediation), the mediation shall terminate and the
parties shall have the right to file a judicial proceeding in a court with
competent jurisdiction seeking equitable or injunctive relief after the
expiration of said ninety day or extended period.

    


    XXI.      NOTICE.  Any
notice or other communication required or permitted to be given under this
Agreement shall be in writing (including facsimile or similar transmission) and
mailed (by U.S. certified mail, return receipt requested, postage prepaid), sent
or delivered (including by way of overnight courier service):


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    
      
        
          
            
              
                	
                        If
      to AAG, addressed to :

                      	 	
                        with
      a copy to:

                      
	 
      	 	
                          

                      
	
                        Janon
      Costley:

                      	 	
                          

                      
	
                        Active
      Apparel Group, Inc.

                      	 	
                          

                      
	
                          

                      	 	
                        Facsimile:    

                      	
                          

                      
	
                          

                      	 	 
      
	 
      	 	 
      
	
                        If
      to Warehouseman, addressed to:

                      	 	
                        with
      a copy to:

                      
	 
      	 	 
      
	
                        Mr.
      Thomas Farrell

                      	 	
                        William
      G. Daluga Jr., Esq.

                      
	
                        Serec
      of California

                      	 	
                        Nisen
      & Elliott, LLC

                      
	
                        15351
      East Stafford Street

                      	 	
                        200
      West Adams Street, Suite 2500

                      
	
                        City
      of Industry, California 91744

                      	 	
                        Chicago,
      Illinois 60606

                      
	
                        Facsimile:  (626)
      330-8458

                      	 	
                        Facsimile:
      (312)
346-9316

                      


              

            

          

        

      

    

    


    or to
such other address as AAG or Warehouseman shall give notice to the other by like
means. All such notices, demands, and communications, if mailed, shall be
effective upon the earlier of (1) actual receipt by the addressee, (2) the date
shown on the return receipt of such mailing, or (3) three days after deposit in
the mail. All such notices, demands, and communications, if not mailed, shall be
effective upon the earlier of (1) actual receipt by the addressee, (2) with
respect to facsimile and similar electronic transmission, the earlier of (a) the
time that electronic confirmation of a successful transmission is received, or
(b) the date of transmission, if a confirming copy of the transmission is also
mailed as described above on the date of transmission, and (3) with respect to
delivery by overnight courier service, the day after deposit with the courier
service, if delivery on such day by such courier is confirmed with the courier
or the recipient orally or in writing.

    


    XXII.     RIGHT
OF FIRST REFUSAL.  AAG hereby grants, and by executing its Guaranty
below TAG likewise grants Warehouseman a right of first refusal on all other
warehouse services required by such parties, or any affiliates of such parties,
within the United States.  AAG, TAG or their affiliates shall provide
written notice of any such warehousing requirements to Warehouseman and
Warehouseman shall accept or reject to provide such warehouse services in
writing within thirty (30) days thereafter.

    


    XXIII.   MISCELLANEOUS
PROVISIONS

    


    a.           The
headings contained herein are inserted for convenience only and shall not be
deemed to have any substantive meaning.

    


    b.           If
any provision of this Agreement is held by a court of competent jurisdiction to
be invalid, void or unenforceable in any manner, the remaining provisions of
this Agreement shall nonetheless continue in full fume and effect without being
impaired or invalidated in any way. In addition, if any provision of this
Agreement may be modified by a court of competent jurisdiction such that it may
be enforced, then that provision shall be so modified and as modified shall be
fully enforced.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    c.           Except
as otherwise stated in this Agreement, this Agreement contains the entire
understanding of the parties respect to its subject matter, and supersedes all
prior or contemporaneous agreements, understandings and negotiations. No
modification or alteration of this Agreement shall be deemed effective unless in
writing and signed by the parties.

    


    d.           The
terms used in this Agreement, regardless of the number and gender in which they
are used, shall be construed to include the other number (singular or plural),
and other genders (masculine, feminine or neuter), as the context or sense of
this Agreement or any paragraph or clause may require.

    


    e.           This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original and all of which shall constitute one Agreement. The
signature of any party to any counterpart shall be deemed to be a signature to,
any may be appended to, any other counterpart. Telecopied signatures shall be
deemed effective as originals.

    


    f.           Each
party agrees to sign and deliver all documents, instruments, certificates and
applications reasonably necessary to consummate the transactions contemplated by
this Agreement.

    


    g.           Each
of the parties acknowledges that they and their counsel have reviewed this
Agreement and suggested changes to its language. Therefore, any rule of
construction that any ambiguity shall be construed against the drafter of this
Agreement shall not apply in interpreting the provisions of this
Agreement.

    


    h.           This
Agreement is solely for the benefit of the parties hereto and shall not confer
upon third parties any remedy claims or actions or other right.

    


    i.        
   If any party hereto institutes any action or proceeding to
enforce this Agreement, the prevailing party in such action or proceeding is
entitled to recover from the nonprevailing party all legal costs and expenses
incurred by the prevailing party in such action, including, but not limited to,
reasonable attorney fees, paralegal fees, law clerk fees, and other legal costs
and expenses, whether incurred  at or before trial, and whether
incurred at the trial level or in any appellate, bankruptcy, or other legal
proceeding.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    IN
WITNESS WHEREOF, the parties have duly executed this Agreement on the date first
set forth above.

     

    
      
        
          
            
              
                
                  
                    
                      	
                              AAG:

                            	 	
                              WAREHOUSEMAN:

                            
	 
      	 	 
      
	
                              Active
      Apparel Group, Inc.

                            	 	
                              SEREC
      OF CALIFORNIA

                            
	 
      	 	 
      
	
                              By:

                            	 
      	 	
                              By:

                            	 
      
	 
      	 
      	 	 
      	 
      
	
                              Name:

                            	
                              Janon
      Costley

                            	 	
                              Name:

                            	
                              Thomas
      Farrell

                            
	 	 	 	 	 
	
                              Title:

                            	 
      	 	
                              Title:

                            	
                              VP

                            


                    

                  

                

              

            

          

        

      

    

    


    Unconditional
Guaranty

    


    The
undersigned hereby unconditionally guaranty the full and timely performance of
all payment and other obligations of Active Apparel Group, Inc. under the above
Warehouse Services Agreement and waive, to the maximum extent provided by law,
all notices from Warehouseman.  The undersigned agree that this is a
guaranty of payment and not of collection.

    


    
      
        
          
            
              
                
                  
                    
                      	
                              Total
      Apparel Group, Inc.

                            	 	
                                

                            
	 
      	 	
                              Janon
      Costley

                            
	
                              By:

                            	 
      	 	 
      
	 
      	 	
                                

                            
	
                              Its:

                            	 
      	 	
                              Don
      Jones

                            
	 
      	 	 
      
	 
      	 	
                                

                            
	 
      	 	
                              Duarte
      DaSilveira

                            


                    

                  

                

              

            

          

        

      

    

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    


    Schedule
A

    


    Services

    All
receiving, warehousing, shipping, storage, shipping documents, EDI compliance,
and Advanced shipping notices (ASNs).

    


    All
accessorial work will be charged in addition to the 5 % rate. Including but not
limited to bar-coding printing and application, ticketing production and
application, corrugated box charges, B2C order pick & pack handling,
accounting and  back-office services, E-Commerce solutions
development, web services and hosting, transaction processing, related LOC
invoice % fees, offices and show/conference room and all others not
listed.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    Schedule
B

    


    Rates and
Charges

    


    5 % of
invoice from AAG to customers to include: all receiving, warehousing, shipping,
storage ( goods held past 60 days will be charged storage @.04 cents per unit
per _________) , shipping documents, EDI compliance, and Advanced shipping
notices (ASNs).

    


    AAG will
be responsible for all inbound and outbound freight charges.

    


    All
accessorial rates and work will be charged in addition to the above 5 % rate.
I.e. additional bar-coding, ticketing, corrugated box charges, abundant
individual consumer order pick & pack, accounting/ back-office, E-Commerce
solutions development, web services and hosting, offices and show/conference
room.......


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    Schedule
C

    


    Returned
Goods Policy

    TBD by
AAG and Assumed Accessorial In Nature


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    Schedule
D

    


    Certificate
of Insurance

    


    Requested
for Active Apparel Group, Inc. Named Insured