EXHIBIT 10.18
ADMINISTRATIVE AND
CONSULTING SERVICES AGREEMENT
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This Administrative and Consulting Services Agreement is made effective the
29th day of July, 1996, between Distributor Services, L.L.C., an Illinois
Limited Liability Company ("DS"), with its principal offices at 0000 Xxxxx
Xxxxxx Xxxxxx, Xxxxx, Xxxxxxxx 00000, and Nutrition for Life International,
Inc., a Texas corporation ("NFLI"), with its principal offices at 9101 Jameel,
Dallas, Texas.
RECITALS:
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WHEREAS, NFLI, a network marketing company which sells and promotes
nutritional aids, vitamins, supplements and related products, desires to engage
DS to provide certain administrative and consulting services as provided herein
and DS desires to provide those services on the terms reflected herein;
In exchange for the mutual provisions and agreements set forth below, the
parties agree as follows:
PROVISION OF SERVICES
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1. Except to the extent that NFLI produces its own material in-house, DS
shall have the exclusive right to produce and sell, at its own expense, all NFLI
recruiting and training material and in consideration for DS producing and
marketing those materials in a manner which promotes NFLI's interests, DS shall
be entitled to all revenues received from the sale thereof;
2. DS shall have the exclusive right to produce, organize and sell, at its
own expense, admission to all NFLI-sponsored recruiting or promotional events
and in consideration for DS producing and organizing these meetings in a manner
which promotes NFLI's interests, that DS shall be entitled to all revenues
received from those sales of admission thereto.
3. NFLI shall have the exclusive right of approval over the content of all
material and meetings produced, organized or sold pursuant to this Agreement.
DS shall use its best efforts to ensure that all materials and program content
submitted to NFLI for approval are consistent with NFLI's policies and
practices.
4. NFLI shall provide DS on an ongoing and current basis with the names and
addresses of and all other relevant information regarding NFLI distributors,
together with such other information as is reasonably necessary to assist DS in
the provision of services pursuant to this Agreement.
5. DS will produce and provide to NFL each month at least four master
cassettes for reproduction and sale by NFLI in NFLI's Master Developer series,
which tapes shall be consistent with NFLI's policies, and the purposes of the
Master Developer series, and promote the best interest of NFLI. In
consideration for the foregoing, commencing September 15, 1996, for sales made
in August, 1996, NFLI will pay DS $17 per month per Master Developer subscriber.
Said payments shall be made on the 15th day of every month for sales made the
preceding month, shall be adjusted for returns, and shall be subject to an
annual accounting to be conducted at DS's option and expense.
6. DS and NFLI shall own a joint copyright in and other proprietary
ownership of all material produced by DS and approved by NFLI pursuant to this
Agreement.
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Nothing herein shall affect copyright ownership of material which is
first produced or created for a commercial purpose distinct from meeting DS's
obligations under this agreement, but which is thereafter supplied to NFLI
pursuant to this Agreement.
7. In consideration for the terms of this Agreement, and in the interests
of promoting consistency in NFLI and DS's marketing programs, DS shall provide
consulting services to NFLI, without additional compensation, with respect to
NFLI's marketing strategy and program, including comments and suggestions with
respect to NFLI's television show, weekly teleconference, distributor success
kit, catalogues, new products, product sales flyers, magazines, distributor
applications, product order forms and other communications with distributors.
8. Warranties. NFLI and DS represent that they have the power and authority
to enter into this Agreement and that entering into this Agreement will not
violate any prior understandings or agreements, and that they will comply with
all applicable federal, state and local laws and regulations in connection with
or related in any way to its distributors, potential distributors, its products
and the means and methods of the sale of those products, including any
assurances of voluntary compliance entered into by NFLI.
9. Term. The term of this Agreement shall commence on July 29, 1996, and
shall continue for a period of fifteen (15) years. The parties shall thereafter
negotiate successive fifteen year terms on substantially the same terms,
negotiating in good faith only those modifications which are appropriate in
light of any intervening change in circumstance. Either party may terminate
this Agreement for breaches of any material obligation by the other, which is
not cured within twenty (20) days after notice from the non-breaching party that
specifies the
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nature of the breach in reasonable detail. Notwithstanding the foregoing,
however, if the breach is subject to cure, the breaching party shall not be
deemed to be in default if it diligently begins to cure that breach within
forty-eight (48) hours of notice, and actually cures that breach within forty-
five (45) days therefrom.
10. Force Majeure. Neither party will be in default of this Agreement if
such party's performance is prevented by an external cause beyond its reasonable
control; provided that such party gives prompt written notice to the other party
and the time for such party's performance under this Agreement will be extended
by the period of time equal to the duration of the cause that prevented such
performance.
11. Assignment. No party will assign this Agreement or any portion thereof
to any third party without the prior written consent of the other, except that
either party may assign this Agreement to the other entities which are owned or
controlled by the same persons that own or control it at the time of the
assignment.
12. Notices. Any notice required or permitted to be given under this
Agreement will be given in writing to the parties at their respective address as
set forth below:
A. DS
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Attn: Xx. Xxxxx XxXxxxxx
B. NFLI
9101 Jameel
Xxxxxxx, Xxxxx 00000
Attn: Mr. Xxxxx Xxxxxxxx, President
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Any such notice will be deemed given on the earlier of (i) the date when it is
actually received, or (ii) five (5) days after mailing to the address of the
receiving party or any new address that the party has provided.
13. Entire Agreement. This Agreement constitutes the entire agreement and
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understanding between the parties with respect to the subject matter and
supersedes all prior understandings, proposals and communications on the subject
matter.
14. Amendment Waiver. This Agreement may not be amended or modified without
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the written consent of both parties. No rights of any party will be waived
except in writing signed by such party. No waiver of any right in this Agreement
will imply or constitute any future waiver or such right.
15. Attorneys' Fees. In the event of any legal action to enforce this
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Agreement, the party that prevails in such action will be entitled, in addition
to any other relief granted, to recover from the other party the costs and
expenses of such enforcement, including reasonable attorneys' fees and the fees
and expenses of expert witnesses.
16. Governing Law. This Agreement will be governed and construed in
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accordance with the laws of the State of Illinois. Each party irrevocably
consents to the personal jurisdiction and placement of venue in the state and
federal courts located within the City of Chicago, Illinois for the purposes of
enforcing this Agreement, and agrees that such courts will exclusively
constitute the permitted forums for resolving disputes under or in connection
with this Agreement.
17. Severability. If any provision of this Agreement or portion of any such
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provision is held invalid or unenforceable as written by a court of competent
jurisdiction, such
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provision or portion thereof affected by such holding will be modified, to the
extent possible, by reducing its scope or duration so that it is enforceable to
the maximum extent permissible. If said modification is not possible, the
affected provision or portion thereof will be stricken, and all remaining
provisions of this Agreement will continue in full force and effect.
18. Independent Contractors. The parties are independent contractors, and
nothing in this Agreement will be deemed to place the parties in the
relationship of employer-employee, principal-agent, or partners or joint
venturers. Neither party will under any circumstances be liable for any
withholding taxes, payroll taxes, disability insurance payments, unemployment
taxes and other similar taxes or charges on the payments made by the other party
to such other party's personnel.
19. Counterparts. This Agreement may be executed in counterparts.
The parties have executed this Agreement as of the effective date.
DISTRIBUTOR SERVICES, L.L.C. NUTRITION FOR LIFE
INTERNATIONAL, INC.
By: _______________________________ By: _______________________________
Dated: ____________________________ Dated: ____________________________
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