I have seen worse. Its not repairable any way that I have ever seen or heard. Not sure I would fully trust them to not slowly loose pressure. But they might. I'd probably take the refund. Or maybe a steep discount and run them on the back.
i wouldnt personally mount those. however ive had a lot worse come in. a lot of people dont know how to mount a 18 inch runflat tire correctly or even at all and a guy came in with on that was ripped a foot long section off of the bead and he never had a problem. he didnt even notice it until we put new tires on it.