SUPPORT SERVICES AGREEMENT
EXHIBIT
99.2
THIS
SUPPORT SERVICES AGREEMENT (this “Agreement”)
is
made and entered into as of this 6th
day of
December, 2007 (the “Effective
Date”),
by
and between Sleek,
Inc.,
a
Massachusetts corporation (“Sleek”),
and
BSML,
Inc.,
a Utah
corporation (the “Customer”).
RECITALS
WHEREAS,
Sleek has certain expertise and experience in the marketing, management and
operation of medical and aesthetic spas; and
WHEREAS,
the Customer desires to engage Sleek, and Sleek desires to be engaged by the
Customer as an independent contractor to provide certain services upon the
terms
and conditions set forth herein.
NOW,
THEREFORE, in consideration of the agreements and obligations set forth herein
and for other good and valuable consideration, the receipt and sufficiency
of
which are hereby acknowledged, the parties hereby agree as follows:
1. Services.
(a) Performance
of Services.
Sleek
agrees to use commercially reasonable efforts to perform (or cause to be
performed) the services set forth in Exhibit
A
attached
hereto (the “Services”)
according to the specifications (the “Specifications”)
and
schedule set forth thereon.
(b) Personnel.
Sleek
shall assign employees and subcontractors with suitable qualifications to
perform the Services. Sleek may replace or change employees and subcontractors
as required. For the term of this Agreement and for two (2) years thereafter,
the Customer agrees not to solicit or retain the services of any person who
is
an employee of Sleek and who performed Services.
(c) Customer’s
Obligations.
The
Customer acknowledges that the Customer’s timely provision of (and Sleek’s
access to) the Customer assistance, cooperation, and complete and accurate
information and data from the Customer’s officers, agents and employees
(“Cooperation”)
is
essential to the performance of the Services, and that Sleek shall not be liable
for any deficiency in performing the Services if such deficiency results from
the Customer’s failure to provide full Cooperation as required
hereunder.
(d) License.
Subject
to the Customer’s performance of its obligations hereunder, Sleek hereby grants
to the Customer a personal, worldwide, non-exclusive, non-transferable license
during the Term (as defined below) to use, within the Customer’s enterprise
only, any materials developed by Sleek for the Customer under this Agreement
solely for Customer’s business purposes. Any idea, concept, know-how, or
technique that is developed by the parties jointly in the performance of the
Services shall be jointly owned by the parties (with each party owning an equal
and undivided one-half (1/2) interest therein) and may (subject to applicable
patents and copyrights) be freely used by either party without the consent
of
the other party and without accounting to the other party.
2. Payments.
(a) Fees.
The
Customer shall pay to Sleek the compensation set forth on Exhibit B
attached
hereto in accordance with the terms and conditions set forth
thereon.
(b) Expenses.
The
Customer shall reimburse Sleek for all reasonable travel, lodging,
communications, and out-of-pocket expenses actually incurred by Sleek and
without xxxx-up in connection with providing the Services.
(c) Payment
Terms.
Unless
otherwise specified on Exhibit
B
hereto,
Sleek shall submit to the Customer, on a monthly basis, an invoice for all
Services performed and expenses incurred during the prior month. All amounts
payable by the Customer hereunder shall be due and payable as set forth in
Exhibit
B.
The
Customer agrees to pay interest at the rate of one percent (1.0%) per month
(or
the maximum rate permitted by applicable law, whichever is less) for all amounts
not paid within thirty (30) days from the due date.
(d) Taxes.
In
addition to all charges specified in this Agreement, the Customer shall pay
or
reimburse Sleek for all federal, state, local or other taxes, including, without
limitation, sales, use, excise and property taxes, or amounts levied in lieu
thereof, based on charges set forth in this Agreement; provided,
however,
the
Customer shall have no responsibility for taxes imposed on Sleek’s net income by
any taxing authority.
3. Term;
Termination.
(a) Term.
This
Agreement shall commence on the Effective Date and continue in effect for an
initial period of three (3) years (the “Initial
Term”).
Thereafter, this Agreement shall automatically renew for additional consecutive
one (1) year periods (each, a “Renewal
Term”),
unless terminated by either party upon at least ninety (90) days written notice
to the other party prior to the end of the Initial Term or any Renewal Term.
For
purposes of this Agreement, the “Term”
is
the
period commencing on the Effective Date and ending on the termination of the
Agreement.
(b) Termination.
In the
event that either party shall fail to perform its obligations pursuant to this
Agreement and such failure shall continue for a period of thirty (30) days
following written notice from the other party, this Agreement may be terminated
by the non-breaching party by giving a notice of termination to the other party.
The Customer shall pay Sleek for all Services performed and expenses incurred
up
through the termination date. In the event that the Employment Agreement between
the Customer and Xxxxxx Xxxxxxx of even date (the “Employment
Agreement”)
is
terminated as a result of a breach by Xxxxxxx then the Customer may terminate
this Agreement upon ten (10) days written notice to Sleek. The provisions of
Sections
1(b)
(last
sentence only), 2,
3(b),
5,
6,
and
7
shall
survive any expiration or other termination of this Agreement.
4. Limited
Warranty.
(a) Limited
Warranty.
Sleek
hereby represents and warrants to the Customer that the Services will be
performed in a professional and workmanlike manner.
(b) Intellectual
Property.
Sleek
hereby represents and warrants to the Customer that the Services provided
hereunder will in no way breach the intellectual property rights of any third
party.
(c) Organization,
Standing Authorization.
Sleek
is duly organized, validly existing, and in good standing under the laws of
Massachusetts, and has the requisite power and authority to enter into this
Agreement and perform as anticipated by this Agreement. The execution and
delivery of this Agreement by Sleek has been duly authorized by all required
action of Sleek. The person executing, on Sleek’s behalf, this Agreement is duly
authorized to do so.
(d) No
Other Warranties.
EXCEPT
AS SPECIFICALLY PROVIDED IN THIS SECTION 4,
SLEEK
MAKES NO OTHER WARRANTIES, EITHER EXPRESS OR IMPLIED, AS TO ANY OTHER MATTER
WHATSOEVER, INCLUDING, WITHOUT LIMITATION, THE CONDITION OF THE SERVICES OR
ANY
WORK PRODUCT DEVELOPED HEREUNDER, AND SLEEK HEREBY EXPRESSLY DISCLAIMS ANY
IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR ANY PARTICULAR PURPOSE OR
NEED, ACCURACY, NON-INFRINGEMENT OF THIRD PARTY RIGHTS AND TITLE, AND ANY
WARRANTIES THAT MAY ARISE FROM COURSE OF DEALING, COURSE OF PERFORMANCE OR
USAGE
OF TRADE.
5. Limitation
of Liability.
(a) General
Limitation.
Sleek’s
aggregate liability to the Customer for damages in connection with this
Agreement and the Services provided pursuant to this Agreement, regardless
of
the form of action giving rise to such liability (under any theory, whether
in
contract, tort, statutory or otherwise) shall not exceed the aggregate
compensation paid by the Customer to Sleek pursuant to this
Agreement.
(b) Limitation
on Other Damages.
To the
extent permitted by applicable law and notwithstanding anything in this
Agreement to the contrary or any failure of essential purpose of any limited
remedy or limitation of liability, Sleek shall not be liable for any indirect,
exemplary, special, consequential or incidental damages of any kind, or for
any
damages resulting from loss or interruption of business, lost data or lost
profits, arising out of or relating to this Agreement or the subject matter
hereof, however caused, even if Sleek has been advised of or should have know
of
the possibility of such damages.
(c) Contractual
Statute of Limitations.
Except
for actions for nonpayment or breach of Contractor’s proprietary rights by the
Customer, no action, regardless of form, arising out of this Agreement may
be
brought by either party more than two (2) years after the last day of the
Term.
(d) Liability
of Customer to Sleek.
The
Customer’s liability to Sleek shall be limited to the liability to make the
payments to Sleek set out in Section 2
and the
Customer shall have no other liability to Sleek whatsoever.
(e) Acknowledgment.
The
parties acknowledges that the limitations of liability contained in this
Section 5:
(i) are
a
fundamental part of the basis of the bargain hereunder, and that neither party
would enter into this Agreement absent such limitations;
(ii) do
not
apply to any loss arising as a result of a breach of Section 6 below; and
(iii) do
not
apply to any losses arising under the Employment Agreement.
6. Confidentiality.
(a) Confidential
Information.
By
virtue of this Agreement, the parties may have access to information that is
confidential to one another. For purposes of this Agreement, “Confidential
Information”
of
a
party means information, ideas, materials or other subject matter of such party,
whether disclosed orally, in writing or otherwise, that is provided under
circumstances reasonably indicating that it is confidential or proprietary.
Confidential Information includes, without limitation, the terms and conditions
of this Agreement; all business plans, technical information or data, product
ideas, methodologies, calculation algorithms and analytical routines; and all
personnel, customer, contracts and financial information or materials disclosed
or otherwise provided by such party (“Disclosing
Party”)
to the
other party (“Receiving
Party”).
Confidential Information does not include that which (i) is already in the
Receiving Party’s possession at the time of disclosure to the Receiving Party,
(ii) is or becomes part of public knowledge other than as a result of any
action or inaction of the Receiving Party, (iii) is obtained by the
Receiving Party from an unrelated third party without a duty of confidentiality,
or (iv) is independently developed by the Receiving Party. Without limiting
the generality of, and notwithstanding the exclusions described in, the
foregoing, Confidential Information of both parties includes the terms and
pricing under this Agreement.
(b) Restrictions
on Use.
The
Receiving Party shall not use Confidential Information of the Disclosing Party
for any purpose other than in furtherance of this Agreement and the activities
described herein. The Receiving Party shall not disclose Confidential
Information of the Disclosing Party to any third parties except as otherwise
permitted hereunder. The Receiving Party may disclose Confidential Information
of the Disclosing Party only to those employees of Sleek who have a need to
know
such Confidential Information and who are bound to retain the confidentiality
thereof under provisions (including, without limitation, provisions relating
to
nonuse and nondisclosure) no less restrictive than those required by the
Receiving Party for its own Confidential Information. The Receiving Party shall
maintain Confidential Information of the Disclosing Party with at least the
same
degree of care it uses to protect its own proprietary information of a similar
nature or sensitivity, but no less than reasonable care under the circumstances.
Each party shall advise the other party in writing of any misappropriation
or
misuse of Confidential Information of the other party of which the notifying
party becomes aware.
(c) Exclusions.
Notwithstanding the foregoing, this Agreement shall not prevent the Receiving
Party from disclosing Confidential Information of the Disclosing Party to the
extent required by a judicial order or other legal obligation, provided that,
in
such event, the Receiving Party shall promptly notify the Disclosing Party
to
allow intervention (and shall cooperate with the Disclosing Party) to contest
or
minimize the scope of the disclosure (including application for a protective
order). Further, each party may disclose the terms and conditions of this
Agreement: (i) as required by the applicable securities laws, including,
without limitation, requirements to file a copy of this Agreement (redacted
to
the extent reasonably permitted by applicable law) or to disclose information
regarding the provisions hereof or performance hereunder to applicable
regulatory authorities; (ii) in confidence, to legal counsel; (iii) in
confidence, to accountants, banks, and financing sources and their advisors;
and
(iv) in connection with the enforcement of this Agreement or any rights
hereunder.
(d) Equitable
Relief.
Each
party (as Receiving Party) acknowledges that the Disclosing Party considers
its
Confidential Information to contain trade secrets of the Disclosing Party and
that any unauthorized use or disclosure of such information would cause the
Disclosing Party irreparable harm for which its remedies at law would be
inadequate. Accordingly, each party (as Receiving Party) acknowledges and agrees
that the Disclosing Party will be entitled, in addition to any other remedies
available to it at law or in equity, to the issuance of injunctive relief,
without bond, enjoining any breach or threatened breach of the Receiving Party’s
obligations hereunder with respect to the Confidential Information of the
Disclosing Party, and such further relief as any court of competent jurisdiction
may deem just and proper.
(e) Return
of Materials.
Upon
termination of this Agreement, each party (as Receiving Party) will immediately
return to the Disclosing Party all Confidential Information of the Disclosing
Party embodied in tangible (including electronic) form or, at the Disclosing
Party’s discretion, destroy all such Confidential Information and certify in
writing to the Disclosing Party that all such Confidential Information has
been
destroyed.
7. Miscellaneous.
(a) Integration
and Severability.
This
Agreement is the final, complete and exclusive agreement between the parties
relating to the subject matter hereof, and supersedes all prior or
contemporaneous proposals, understandings, representations, warranties, promises
and other communications, whether oral or written, relating to such subject
matter. If any provision of this Agreement is held by a court of competent
jurisdiction to be unenforceable for any reason, the remaining provisions hereof
shall be unaffected and remain in full force and effect.
(b) Governing
Law.
This
Agreement is to be construed in accordance with and governed by the internal
laws of the State of Utah without giving effect to any choice of law rule that
would cause the application of the laws of any jurisdiction other than the
internal laws of the State of Utah to the rights and duties of the
parties.
(c) Jurisdiction
and Venue.
Any
legal suit, action or proceeding arising out of or relating to this Agreement
shall be commenced in a federal court in the federal or state courts located
in
Contra Costa County, California, and each party hereto (i) irrevocably submits
to the exclusive jurisdiction and venue of any such court in any such suit,
action or proceeding, and (ii) irrevocably waives (to the extent permitted
by applicable law) any objection which it now or hereafter may have to the
laying of venue of any such action or proceeding brought in any of the foregoing
courts in and of the State of California, and any objection on the ground that
any such action or proceeding in any such court has been brought in an
inconvenient forum.
(d) Waiver
of Jury Trial.
EACH OF
THE PARTIES HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE
OF
ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, OR THE
TRANSACTIONS CONTEMPLATED HEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION
OF ANY TYPE BROUGHT BY ANY PARTY AGAINST THE OTHER PARTY, WHETHER WITH RESPECT
TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH OF THE PARTIES AGREES THAT
ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A
JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR
RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION
AS TO
ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART,
TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR ANY PROVISION
HEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.
(e) Attorneys’
Fees.
In the
event of any suit, action, or proceeding brought by any party for the breach
of
any term hereof, or to enforce any provisions hereof, the prevailing party
shall
be entitled to reasonable attorneys’ fees in addition to court costs and other
expenses of litigation in said action or proceeding. For purposes of this
Section 7(e),
“prevailing party” includes, without limitation, a party who agrees to dismiss
an action or proceeding upon the other’s payment of sums allegedly due or
performance of the covenants allegedly breached, or who obtains substantially
the relief sought.
(f) Modification
and Waiver.
No
amendment or modification to this Agreement shall be valid or binding upon
the
parties unless in writing and signed by an officer of each party. No failure
or
delay on the part of either party in the exercise of any right or privilege
hereunder shall operate as a waiver thereof or of the exercise of any other
right or privilege hereunder, nor shall any single or partial exercise of any
such right or privilege preclude other or further exercise thereof or of any
other right or privilege.
(g) Non-Assignable.
No
right or obligation of a party under this Agreement may be assigned, delegated
or otherwise transferred, whether by agreement, operation of law or otherwise,
without the express prior written consent of the other party, and any attempt
to
assign, delegate or otherwise transfer any of a party’s rights or obligations
hereunder without such consent shall be void. Subject to the preceding sentence,
this Agreement shall bind each party and its permitted successors and
assigns.
(h) Remedies.
All
rights and remedies hereunder shall be cumulative, may be exercised singularly
or concurrently and, unless otherwise stated herein, shall not be deemed
exclusive. If any legal action is brought to enforce any obligations hereunder,
the prevailing party shall be entitled to receive its attorneys’ fees, court
costs and other collection expenses, in addition to any other relief it may
receive.
(i) Notices.
Any
notice, request, demand or other communication required or permitted hereunder
shall be in writing, shall reference this Agreement and shall be deemed to
be
properly given: (i) when delivered personally; (ii) when sent by
facsimile, with written confirmation of receipt by the sending facsimile
machine; (iii) five (5) business days after having been sent by registered
or certified mail, return receipt requested, postage prepaid; or (iv) two
(2) business days after deposit with a private industry express courier, with
written confirmation of receipt. All notices shall be sent to the address set
forth on the signature page of this Agreement (or to such other address as
may
be designated by a party by giving written notice to the other party in
accordance with this Section 7(i)).
(j) Force
Majeure.
Both
parties shall be excused from performance under this Agreement for any period
to
the extent that a party is prevented from performing any obligation, in whole
or
in part, as a result of causes beyond its reasonable control and without its
negligent or willful misconduct, including without limitation, acts of God,
natural disasters, war or other hostilities, labor disputes, civil disturbances,
governmental acts, orders or regulations, third party nonperformance or failures
or fluctuations in electrical power, heat, light, air conditioning or
telecommunications equipment.
(k) Construction.
The
captions and section and paragraph headings used in this Agreement are inserted
for convenience only and shall not affect the meaning or interpretation of
this
Agreement.
(l) Exhibits.
All
Exhibits attached hereto are hereby incorporated by reference into, and made
a
part of, this Agreement.
(m) Counterparts.
This
Agreement may be executed in several counterparts, all of which shall constitute
one agreement.
(n) Relationship
of Parties.
This
Agreement shall not be construed as creating an agency, partnership, joint
venture or any other form of association, for tax purposes or otherwise, between
the parties, and the parties shall at all times be and remain independent
contractors. Except as expressly agreed by the parties in writing, neither
party
shall have any right or authority, express or implied, to assume or create
any
obligation of any kind, or to make any representation or warranty, on behalf
of
the other party or to bind the other party in any respect whatsoever.
(o) Reservation
of Rights.
Except
as otherwise expressly provided herein, nothing in this Agreement shall be
deemed to grant, directly or by implication, estoppel or otherwise, any right
or
license with respect to any technology or other intellectual property rights,
and each party retains all right, title and interest in and to their respective
technologies and other intellectual property rights.
(p) Parties
in Interest.
Except
as otherwise provided herein to the contrary, nothing in this Agreement shall
confer any rights or remedies under or by reason of this Agreement on any person
other than the parties hereto and their respective permitted successors and
assigns nor shall anything in this Agreement relieve or discharge the obligation
or liability of any third person to any party to this Agreement, nor shall
any
provision give any third person any right of subrogation or action over or
against ay party to this Agreement.
[REMAINDER
OF THE PAGE INTENTIONALLY LEFT BLANK]
IN
WITNESS WHEREOF, the parties have executed this Consulting Services Agreement
as
of the date first written above.
| “SLEEK” | ||
| Sleek, Inc. | ||
| |
|
|
| By: | /s/ X. Xxxxxxx | |
|
|
||
| Its: |
|
|
|
|
Address:
|
|
|
|
||
|
|
||
| "COMPANY" | ||
| BSML, Inc. | ||
| |
|
|
| By: | /s/ X. Xxxxxxx | |
|
|
||
| Title: | CEO
|
|
| Address: | 000 Xxxxx Xxxxx Xxxx | |
| Xxxxxx Xxxxx, Xxxxxxxxxx 00000 | ||
| Attn: Chief Financial Officer | ||
EXHIBIT
A
SERVICES
Description
of Services:
To
provide:
|
(i)
|
Marketing
advice, consulting and strategy for all products and services offered
by
the Customer;
|
|
(ii)
|
Fulfillment
of all product requirements;
|
|
(iii)
|
Training
of the Customer’s personnel;
|
|
(iv)
|
Timely
billing to and collecting from all customers, and accounts receivable;
|
|
(v)
|
Cash
management;
|
|
(vi)
|
Personnel
management;
|
|
(vii)
|
Timely
preparation and filing of the Customer’s tax and regulatory returns and
other necessary governmental
filings;
|
|
(viii)
|
Providing
information technology services;
|
|
(ix)
|
Providing
data processing services;
|
|
(x)
|
Maintenance
of records in accordance with procedures mutually agreed upon by
the
parties; and
|
|
(xi)
|
Providing
technical services for the Customer and its
business.
|
EXHIBIT
B
PAYMENTS
AND OTHER COMPENSATION
The
Customer shall pay Sleek each of the following amounts:
| Equity Compensation: | (a) Subject to the execution and delivery of a subscription agreement therefore, concurrent with the execution and delivery of this Agreement the Customer will issue to Sleek 1,240,000 shares of its restricted common stock. |
|
(b)
Subject to the execution and delivery of a subscription agreement
therefore and the last sentence of this subsection, Sleek shall be
eligible to receive up to 1,240,000 shares of Customer’s restricted common
stock per year for each $1 million of annual incremental increase
in the
Company’s EBITDA (as reported in the Company’s Form 10-K filed with the
United States Securities and Exchange Commission) from a baseline
of
$0.00. By way of example, if reported EBITDA for the period ending
December 31, 2008 is $2,000,000 then such amount would entitle Sleek
to
receive 2,480,000 shares of the Company’s restricted common stock. By way
of further example, if the reported EBITDA for the period ending
December
31, 2009 is $2,900,000, then Sleek would not receive any additional
shares
of the Customer’s restricted common stock for that period, the Company
having compensated Sleek in 2008 for achieving $2,000,000 in EBITDA
and
the Company having failed to achieve at least $3,000,000 in EBITDA
in
2009. By way of further example, if the reported EBITDA for the period
ending December 31, 2010 is $3,700,000, then Sleek would receive
1,240,000
additional shares of the Customer’s restricted common stock for that
period, the Company having compensated Sleek in 2008 for achieving
$2,000,000 in EBITDA and the Company having achieved more than $3,000,000
but less than $4,000,000 in EBITDA in 2010. The annual equity compensation
shall be paid within ten (10) business days after the date in each
year on
which the Company files its Form 10-K for the preceding fiscal year.
The
Customer will not be obligated to issue shares of its restricted
common
stock to Sleek in any amount at such time that Sleek has acquired
an
aggregate of sixty percent (60.0%) of the issued and outstanding
common
stock of the Customer.
|
|
| Administrative Fee: | The Customer shall pay Sleek a monthly administrative fee (the “Administrative Fee”) equal to the aggregate of Sleek’s actual costs, fees, expenses incurred by or on behalf of Sleek in connection with, or related to the provision of the Services under the Agreement, including, without limitation, salaries, wages, and other compensation paid to employees and approved by Sleek to perform the Services, the cost of employee benefits attributable to such approved employees, communications, and any other operating expenses of Sleek (the “Base Costs”). However, in no event shall compensation paid to, and the costs of benefits attributable to, Sleek employees not approved by Customer be included in Base Costs. The Administrative Fee shall be paid on the 1st of every month following the month in which Sleek bills the Customer for Administrative Services during the Term. |
