EXHIBIT 10.18
AGREEMENT
THIS AGREEMENT is entered into and effective this 3rd day of February 2003
by and between Vital Living, Inc., a Nevada corporation ("VL") and CHG Allied
Inc., ("CHG") a discount health card provider.
RECITALS
1. Vital Living, Inc. (VL) is in the business of among other
things developing and distributing a proprietary line of
nutritional products, including but not limited to Essentum
N.P. for use as a nutritional supplement for "healthy heart,"
Additional products are marketed under the Vital Living
Supplement line and Nature's Dose, (the "Products".) This
"Agreement" is for the sole purpose of the Products and any
other products that may be mutually agreed to by the parties.
2. (CHG) operates a sales organization that sells discount health
cards under different programs.
3. CHG Allied, Inc. (CHGA) was created in 1998 to acquire and
operate a consortium of innovative health care related
companies with a common vision.... to provide fair value and
choices to health care consumers, including health plans and
employer groups. The program utilizes the cash for discount
approach to secure savings health care services, and offers
substantial savings to any cardholder for health care services
not covered by insurance programs. CHGA also provides the
platform for private label programs. Predecessor companies
date back to 1992.
CHGA is the owner of the Comprehensive Health Group
Chiropractic Network, and joint owner of CAM Health Partners,
Inc., a complementary and alternative (CAM) PPO organization
with approximately 25,000 practitioners representing
chiropractic, acupuncture, naturopathy, physical therapy, and
massage therapy, among other disciplines. These two networks
are utilized on CHGA's Card products, its private label
products, and are leased to other sellers of card products.
CHGA also owns and operates a full service general insurance
agency, Employer Assistance Group, which primarily serves the
Employer marketplace.
The parties therefore agree to the following terms and conditions:
TERMS AND CONDITIONS
1. CHG agrees that VL's Products will be the vitamin supplement products
offered to its discount health cardholders. Such Products shall be one of
the primary supplement Products offered to its discount cardholders, as
long as the products continue to meet the standards set forth in 6.,
below.
2. VL agrees to provide to CHG's members a 20% discount off of suggested
retail of all Products
3. CHG agrees to design and print, at CHG's expense, the catalogue and
description of Products to be included in all mailings to CHG's members.
4. VL shall provide a mechanism that enables all CHG members' to be
identified as a CHG cardholder on web site, phone and mail orders.
5. VL agrees to pay CHG a 20% commission on all purchases, less returns
and/or credits, if such payments are made to VL directly. For example
purposes only: If a product retails for $50.00, the CHG cardholder would
be able to purchase the product for $40.00. Upon VL's receipt of the
$40.00, a commission of $8.00 is due to CHG. If payment is made to CHG,
the customer would pay $40.00 and $32.00 would be forwarded to VL. All
payments to outside consultants would be the responsibility of VL. All
shipping and handling charges are the responsibility of the discount
cardholder. The commissions referred to in this paragraph are due and
payable to CHG on or before the 15th day of each month for commissions
earned during the immediately preceding month.
6. Product Manufacture: VL will be solely responsible for manufacturing the
Product in accordance with the specified Product formulations. VL, or VL's
subcontractor, will manufacture all "Products" in accordance with industry
standards for similar products. VL will ensure that the Product meets all
government standards or other regulations for such products, if any. VL
will maintain a reasonable inventory of the Product for marketing and
promotional purposes.
7. Term: The Agreement will continue for three years from the effective date
of this Agreement and will automatically renew for additional one-year
terms unless either party gives notice of its intent not to renew the
agreement not less than sixty (60) days prior to the end of the then
current term. Either party may terminate the Agreement for cause or breach
of material term or condition upon thirty (30) days written notice.
8. Liability: VL will maintain product liability insurance in such amounts as
been historically carried by VL at VL's expense.
9. Confidentiality: In connection with this Agreement, the parties will
develop, acquire, or be granted access to trade secrets and other
information that is confidential and proprietary to the parties or to
third parties. Such information includes but is not limited to patient
lists and information, costs of manufacturing, product formulations,
technical data, methods, processes, expertise, business and marketing
strategies, operations, research and development, business opportunities,
and financial data. The parties will not at any time during or after
termination of this Agreement, directly or indirectly, divulge, use or
permit the use of any confidential or proprietary information of the
other, except as required in the course of this Agreement. Upon
termination of this Agreement, the parties will immediately turn over to
the other all confidential information materials belong to such part,
including all copies thereof or notes relating thereto, in such party's
possession or otherwise subject to its control. Notwithstanding the above,
the following materials will not be deemed confidential:
(i) Information which was in the public domain at the time of
disclosure (provided, however, that collection or compilation
of publicly available information will be considered
proprietary if the disclosing party's collection or
organization of the material would be difficult or
time-consuming to replicate);
(ii) Information which was published or otherwise became part of
the public domain after disclosure to the receiving party
through no fault of the receiving party (but only after, and
only to the extent that, it Is published or otherwise becomes
a part of the public domain); and
(iii) Information, which was, received from a third party who did
not acquire it, directly or indirectly, from the disclosing
party under an obligation of confidence except where required
by law. The receiving party will have the burden of
establishing the existence of these conditions by objective or
verifiable evidence.
(ii) Information which was published or otherwise became part of
the public domain after disclosure to the receiving party
through no fault of the receiving party (but only after, and
only to the extent that, it Is published or otherwise becomes
a part of the public domain); and
(iii) Information, which was, received from a third party who did
not acquire it, directly or indirectly, from the disclosing
party under an obligation of confidence except where required
by law. The receiving party will have the burden of
establishing the existence of these conditions by objective or
verifiable evidence.
For the avoidance of doubt, VL will own all trademarks and other
intellectual property related to the Product, as well as all packaging
and marketing.
10. Notice: Any notice or other communications required or that may be given
pursuant to this Agreement will be in writing and will be delivered personally,
facsimile, electronic mail with confirmation by recognized overnight carrier to
the address of the party as set forth below, or to any other address requested
by the respective parties after giving written notice to the other party.
11. Governing Law: This Agreement will be governed by and construed in accord
with the laws of the State of Arizona. All disputes will be resolved by binding
arbitration under the Commercial Arbitration Rules of the American Arbitration
Association in Phoenix, Arizona, except that either party may apply to a court
of competent jurisdiction solely for interlocutory injunctive relief to maintain
the status quo pending the results of the arbitration. The prevailing party in
any dispute will be entitled to recover its reasonable attorneys' fees and
related costs and expenses incurred in connection therewith.
12. Severability: If any court of competent jurisdiction rules any provision
of this Agreement invalid, illegal, or unenforceable, the validity,
legality, and enforce ability of the remaining provisions will not be
affected or impaired in any way.
13. Entire Agreement: This Agreement constitutes the entire, integrated
agreement among the parties regarding the subject matter hereof and
supersedes any and all prior and agreements, representations, and
understandings of the parties.
14. Assignment: Neither party will assign this Agreement or any of its rights
or obligations without the prior consent of the other party. Provided,
however, that either party may assign this Agreement and its rights and
obligations hereunder, with prior notice to the other party to any person
or entity that purchases all or substantially all of its assets, or that
merges with or into such assigning party, or that is under common
ownership or control of the assigning party, and that agrees in writing to
be bound by the terms hereof.
VITAL LIVING, INC., ________________________________
A Nevada corporation a_______________________________
By: /S/ Xxxxxx X. Xxxxxx By: _____________________________
Printed Name: Xxxxxx X. Xxxxxx Printed Name:____________________
Its: E.V.P. Its:_____________________________
Address: Address:
0000 X. 00xx Xxxxxx, Xxxxx 000 _____________________________
Xxxxx, Xxxxxxx 00000-0000
_____________________________
CHG Allied, Inc. _____________________________
A Georgia corporation _____________________________
By: /S/ Xxx Xxxxxx _____________________________
Printed Name: Xxx Xxxxxx Printed Name:________________
Its: President Its:_________________________
Address: Address:
0000 Xxxxxxx Xxxxxx Xxxx _____________________________
Suite C-2 _____________________________
Xxxxxxxx, Xxxxxxx 00000 _____________________________
