Affiliated Foods, Inc., A Corporation - Page 7




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               Several weeks before each food show, petitioner sent                   
          invitations to member stores and vendors.  Attendance at the                
          shows by members, and participation in the shows by vendors, was            
          voluntary.  A vendor wishing to participate in a food show                  
          entered into an agreement with petitioner under which the vendor            
          agreed to pay a participation fee, rent and decorate a booth at             
          the show, and offer to member stores discounts on the products              
          that the vendor offered at the show.  Those discounts, although             
          negotiable, were subject to petitioner’s approval and had to be             
          greater than the usual discounts.  The special show discounts,              
          although limited to orders placed at the food shows, were, like             
          the usual discounts, based on the quantity of merchandise                   
          ordered.                                                                    
               Also, in preparation for each food show, each participating            
          vendor provided petitioner with a “deal data sheet”, which, among           
          other things, showed the products the vendor was promoting and              
          the per-unit show discount (referred to by petitioner as “show              
          money” (show money)) offered for each product.  Petitioner had              
          the right to reject individual product items.  Vendors had                  
          discretion to make show money available to member stores in one             
          of two ways: (1) a credit against the purchase price of the                 
          product to be reflected on the invoice to be issued to the member           
          store by petitioner on fulfillment of the order after the food              
          show (i.e., an off-invoice discount), or (2) an immediate payment           







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Last modified: November 10, 2007