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Execution Copy
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SETTLEMENT AGREEMENT
SETTLEMENT AGREEMENT (the "Agreement") dated as of July 2, 2004 by and
between INNOVATIVE SOFTWARE TECHNOLOGIES, INC., a California corporation, JAMES
R. GARN and ETHAN A. WILLIS, both individuals, and ETHAN AND RANDY, LC, a Utah
limited liability company, ("E & R").
RECITALS
A. INNOVATIVE SOFTWARE TECHNOLOGIES, INC., including its subsidiary,
ENERGY PROFESSIONAL MARKETING GROUP CORPORATION (collectively "IST"), engage in
the business of marketing technology, business-to-consumer informational
software solutions and consulting services, and training applications in areas
such as personal finance, business development and financing for small to
mid-size companies and related matters.
B. James R. Garn and Ethan A. Willis (the "Principals"), who have engaged
in activities similar to IST's business for more than five years, sold all of
the outstanding stock of ENERGY PROFESSIONAL MARKETING GROUP CORPORATION
("EPMG") to IST pursuant to a Stock Purchase Agreement dated December 31, 2001.
C. The consideration for such sale was the issuance and delivery of an
aggregate of 1,500,000 shares of IST Series A Preferred Stock and 3,529,412
shares of IST common stock.
D. The Principals have since asserted a number of claims against IST and
its president and former chairman with respect to IST's acquisition of EPMG, all
of which are denied by IST and its president.
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E. In order to resolve their differences, the Principals have agreed to
return to IST all shares of IST stock currently owned by the Principals, and
pursuant to paragraph 2 below, IST will release and disclaim competition and
solicitation restrictions so that E & R and their Related Persons and affiliates
are free to engage in the business previously engaged in by them.
WITNESSETH
In consideration of the mutual covenants and agreements hereinafter set
forth, the parties hereby agree as follows:
1. Terms of Settlement.
Subject to the conditions and upon the terms set forth in this Agreement,
E & R hereby assigns and returns to IST all of the IST stock owned by E & R and
the Principals, consisting of 1,200,500 shares of Series A Preferred Stock,
80,000 shares of Series B Preferred Stock and 6,784,762 shares of Common Stock
(the "Principals' Stock"),
2. Deliveries at Closing.
The Closing of the Transactions (including assignments, transfers,
deliveries and related events) has been held on the date hereof and shall be
deemed to be effective as of the close of business on June 26, 2004 ("the
Settlement Date") at the offices of Holme Roberts & Owen LLP in Salt Lake City,
Utah. Any prorations or allocations among the parties hereto which are
prescribed by this Agreement shall be made as of the Settlement Date. At the
Closing:
(a) E & R has delivered to IST certificates representing all of the
shares of the Principals' Stock described in paragraph 1 above, duly endorsed in
favor of IST or accompanied by one or more properly endorsed stock powers.
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(b) IST has delivered and transferred to E & R (i) the EPMG card
services, Discover, American Express and Echo merchant accounts, including their
associated reserves and the associated EPMG bank accounts at First Regional Bank
and Zion's Bank (subject to receiving the necessary consents), in accordance
with the Exhibit A attached hereto; (ii) the fixed assets of EPMG located in
Utah described in Exhibit B attached hereto; (iii) the CMS and WebBuilder
software code comprising the database management system, the website builder and
the real estate module; and (iv) joint ownership (together with IST) of all
confidential information and intangible property utilized by EPMG in serving its
existing and future clients; provided that statements that are subject to the
attorney-client privilege of the Principals and their affiliates and each asset
listed on Exhibit B hereto are confidential and proprietary to E&R; and provided
further, that EPMG has received from E & R a perpetual license to use the
January 1, 2004 version of the CMS and WebBuilder software for internal usage
and certain other rights that are further described in the License Agreement
attached hereto as Exhibit C. For purposes of clause (iv) of this paragraph
2(b), "intangible property" will not include causes of action, legal claims or
rights against third parties, trademark rights and trade names, and accounts
receivable and other rights to receive payment. To the extent of any conflict
between the preceding sentence and Exhibit B, the parties agree that Exhibit B
shall control.
(c) E & R and IST shall take the following actions with respect to
customer service and coaching session obligations:
(i) E & R hereby assumes responsibility to provide for
fulfillment to all existing customer service and coaching session obligations
related to EPMG and to provide for web hosting for all current EPMG website
hosting customers, the payment of all returns and allowances (including
associated refunds and chargebacks) for existing and former customers of EPMG
plus customers engaged by IST Kansas City prior to February 1, 2004 (provided
that E & R shall have no liability for refunds, returns or allowances on IST
sales that were originally processed through a merchant credit card account that
has not been transferred to E & R under paragraph 2(b) above). E & R will
receive from IST all EPMG customer data that is required to fulfill these
services.
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(ii) In exchange for this commitment by E & R, IST has paid to
E & R $300,000 in cash on the date hereof and hereby assigns and delivers to E &
R the on going monthly web hosting related subscription services revenue. IST
will also pay to E & R a fee in the amount of $125,000 payable monthly in twelve
equal payments of 10,416.67 with the first payment due August 1, 2004.
(iii) The obligation of E & R will continue for as long as IST
is not in breach or violation of this Agreement and such breach remains uncured
for a period of 14 calendar days after E & R delivers notice of the breach to
IST (which notice shall specify the nature of the breach).
(iv) IST will expend reasonable efforts to assist in a smooth
transition of the existing customers of EPMG to E & R and affirms that IST and
its affiliates do not own any lead data provided by third-party lead sources who
have provided leads to EPMG. IST will satisfy its contractual obligations with
its lead providers, although E&R will indemnify IST and EPMG against any
liabilities suffered by IST or EPMG under contracts with lead providers by
reason of IST's or EPMG's delivery of lead data to E&R pursuant to this
Agreement without the consent of such lead providers (except that E&R will have
fourteen (14) days from the date hereof to obtain all necessary consents from
such lead providers, and the foregoing indemnification shall only apply to lead
providers for whom consents are not obtained within said 14-day period). For a
period of 120 days after the date hereof, IST and its affiliates will not
(either directly or indirectly through the use of associates) market to those
EPMG customers who are currently engaged in coaching sessions and who have
purchased such coaching sessions during the one-year period prior to the date
hereof, as listed on Exhibit D hereto (the "Restricted Customers").
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(d) E & R confirms that ESI, Inc. has issued to IST a credit memo
for $251,846 which reduces the amount due to ESI, Inc. from IST.
(e) IST has paid the following:
(i) $400,000 in cash client reserves to the clients (the
"Designated Clients") specified on Exhibit E hereto; and
(ii) to each of James R. Garn and Ethan A. Willis $183,333 as
full payment of bonuses due them for their services to IST in the past.
(iii) IST has paid one-half of the $50,000 bonus payable to
David Bird (with E&R having paid the other half).
(f) E & R and IST have executed and delivered Product/Leads
Agreements in the forms attached as Exhibits F and G, respectively.
(g) IST hereby releases and waives any rights it or its affiliates
may have that restrict the solicitation of customers or competition of current
and former employees of EPMG. E & R intends to cause an affiliated entity to
offer to hire EPMG employees effective as of the Settlement Date. E & R assumes
all employee related expenses incurred by EPMG after the Settlement Date with
respect to those EPMG employees who accept employment with the E&R affiliate.
EPMG will comply with all applicable employment laws and regulations (including
those relating to the payment of wages, benefits and other employee-related
expenses) and historical company practices for liabilities accruing through the
Settlement Date relating to the EPMG employees who accept employment with E &
R's affiliate.
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(h) IST, E & R, Ethan Willis, and Randy Garn have all entered into a
mutual releases in the form attached as Exhibit H hereto.
(i) IST has delivered to E & R a copy of the resolutions of the
board of directors of IST, certified as accurate by a duly authorized IST
officer, approving and ratifying the execution of this Agreement by IST and the
performance of IST of its obligations set forth herein.
Except as provided herein, all such documents, deliveries, assignments and
transfers (i) are free and clear of all liens and encumbrances, and (ii) are in
form and substance satisfactory to counsel for IST and E & R, as appropriate.
All of the foregoing payments, deliveries, assignments and transfers shall be
deemed to have occurred simultaneously as of the Settlement Date.
3. Representations and Warranties of IST.
IST represents and warrants to, and covenants to and for the benefit of, E
& R, that the following statements are true, correct and complete:
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3.1 Organization and Good Standing. IST is a corporation duly organized,
validly existing and in good standing under the laws of California, with full
corporate power to perform all of its obligations under this Agreement. IST is
duly qualified to do business as a foreign corporation and is in good standing
under the laws of each jurisdiction in which either the ownership or use of the
properties owned or used by it, or the nature of the activities conducted by it,
require such qualification.
3.2 Authority; No Conflict. This Agreement constitutes the legal, valid
and binding obligation of IST, enforceable against it in accordance with its
terms. IST has the absolute and unrestricted right, power, authority and
capacity to execute and deliver this Agreement and to perform its obligations
under it. IST is not required to give any notice to or obtain any consent from
any Person in connection with the execution and delivery of this Agreement or
the performance of the Transactions.
3.3 Legal Proceedings. To IST's Knowledge, except as described in IST's
filings with the U.S. Securities and Exchange Commission: (a) there is no
pending Proceeding that (1) has been commenced by or against IST; or (2)
challenges, or that may have the effect of preventing, delaying, making illegal,
or otherwise interfering with, the Transactions; (b) no such Proceeding has been
Threatened; and (c) no event has occurred or circumstance exists that may give
rise to or serve as a basis for the commencement of any such Proceeding. IST has
delivered to E & R copies of all pleadings, correspondence, and other documents
relating to each Proceeding now affecting IST.
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3.4 Financial Statements.
(a) The financial statements of IST (hereinafter collectively called
the "Financial Statements"), as filed with the United States Securities and
Exchange Commission on or as of the dates set forth below, are complete and
correct, have been prepared in accordance with generally accepted accounting
principles consistently applied and fairly present the financial condition of
the Company as at their respective dates and the results of its operations for
the periods covered thereby: (i) the audited consolidated balance sheet of IST
and its subsidiaries as of December 31, 2003, and the related consolidated
statements of earnings and source and application of funds for the year then
ended; and (ii) an unaudited balance sheet of IST as of March 31, 2004 and the
related statements of earnings and source and application of funds for the three
months then ended. The Financial Statements include all adjustments (which
consist only of normal recurring accruals) necessary for fair presentations.
(b) Absence of Undisclosed Liabilities. Except as and to the extent
reflected in or reserved against on the face of IST's March 31, 2004 Balance
Sheet, to IST's Knowledge, IST has no debts, liabilities or obligations (whether
absolute, accrued, contingent or otherwise) of any nature whatsoever, except for
liabilities and obligations incurred in the Ordinary Course of Business, none of
which is material, or liabilities or obligations incurred by or at the direction
of Ethan Willis or Randy Garn;
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(c) Absence of Changes or Events. Except as specifically
contemplated by this Agreement or except as included in IST's filings with the
Securities and Exchange Commission, since March 31, 2004, IST has conducted its
business only in the ordinary course consistent with its prior practices and,
except for matters and events that will have no effect on its business or
prospects, has not:
(i) declared or made any distribution to its shareholders or
purchased, retired or redeemed, or obligated itself to purchase, retire or
redeem, any capital or equity interest in the Company;
(ii) experience any damage to or destruction or loss of any
material asset or property of IST, whether or not covered by insurance;
3.5 Taxes. To IST's Knowledge, IST has paid or made provision for the
payment of all taxes that have or may become due pursuant to all tax returns due
on or before the date hereof. The charges, accruals and reserves with respect to
taxes on the Financial Statements are adequate.
3.6 Title to Assets. At the date hereof, IST has good and valid title to
all of the assets transferred to E & R, free and clear of all liens, claims and
encumbrances. Upon the closing, as contemplated hereby, E & R will receive good
and valid title to the assets transferred to E & R, free and clear of all liens,
claims and encumbrances attributable to IST. Notwithstanding the foregoing, the
assets transferred to E & R are "as is" and with no warranties of any type or
kind, including without limitation warranties of merchantability or fitness for
a particular purpose.
3.7 Brokers or Finders. IST has incurred no obligation or liability,
contingent or otherwise, for brokerage or finders' fees or agents' commissions
or other similar payment in connection with this Agreement.
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3.8 Disclosure. No representation, warranty or covenant by IST contained
in this Agreement, nor any written statement or certificate furnished or to be
furnished by IST to E & R in connection herewith or pursuant hereto, contains
any untrue statement of a material fact, or omits to state any material fact
required to make the statements herein or therein not misleading.
3.9 E & R's Representations and Warranties. IST has no Knowledge of any
fact, event, circumstance, or condition that would constitute, either currently
or with the passage of time, a breach of any representation, warranty, or
covenant of E & R under this Agreement.
3.10 Kansas City Assets. IST acknowledges that it is responsible for all
costs, expenditures, leases and other obligations incurred at or with respect to
the operations and activities of IST and its Representatives at or with respect
to its Kansas City facilities, including all costs, refunds, returns,
allowances, expenses and other obligations related to employees, consultants and
agents who are working there immediately prior to the Closing, except that the
obligations of E & R under paragraph 2(c) above will apply to any sales made by
IST. IST will be entitled to all revenues, rights, interests, and other benefits
from such operations.
3.11 Noncontravention. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby, will
violate any constitution, statute, regulation, rule, injunction, judgment,
order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which a party is subject or any provision of
its charter or other organization documents or bylaws.
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4. Representations and Warranties of E & R
E & R represents and warrants to IST as follows:
4.1 Authority; No Conflict.
(a) Each Principal is an individual residing in the State of Utah,
U.S.A.
(b) This Agreement constitutes the legal, valid, and binding
obligation of E & R, enforceable against E & R in accordance with its terms. E &
R has the absolute and unrestricted right, power, and authority to execute and
deliver this Agreement and the documents referred to herein and to perform its
obligations under each of them.
(c) Neither the execution and delivery of this Agreement, nor the
consummation or performance of the Transactions by E & R, will contravene,
conflict with or result in a violation of any Governmental Requirement, Material
Contract or Organizational Document applicable to E & R, or give any Person the
right to prevent, delay, or otherwise interfere with the Transactions pursuant
to:
(i) any Legal Requirement or Order to which E & R may be
subject; or
(ii) any contract to which E & R is a party or by which a
Principal may be bound.
E & R will not be required to obtain any consent from any Person in
connection with the execution and delivery of this Agreement or the consummation
or performance of the Transactions.
4.2 Certain Proceedings. There is no Threatened Proceeding that has been
commenced against E & R or either Principal that challenges, or may have the
effect of preventing, delaying, making illegal, or otherwise interfering with,
the Contemplated Transaction.
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4.3 Brokers or Finders. E & R has incurred no obligation or liability,
contingent or otherwise, for brokerage or finder's fees or agent's commissions
or other similar payments in connection with this Agreement.
4.4 Title to Principals' Stock. At the date hereof, E & R, or the
Principals, as the case may be, will have good and valid title to all of the
Principals' Stock, free and clear of all liens, claims and encumbrances. Upon
the closing, as contemplated hereby, IST will receive good and valid title to
the Principals' Stock, free and clear of all liens, claims and encumbrances
attributable to E & R or the Principals. Other than the Principals' Stock, none
of the Principals, Private Mentoring Group, Inc., or ESI, Inc. beneficially own
any equity securities issued of IST.
4.5 IST's Representations and Warranties. Except as set forth on Exhibit I
hereto, or for matters referenced in the Recitals to this Agreement, neither the
Principals nor E & R have any Knowledge of any fact, event, circumstance, or
condition that would constitute, either currently or with the passage of time, a
breach of any representation, warranty, or covenant of IST under this Agreement.
4.6 Compliance with Legal Requirements and Contracts. To the Principals'
Knowledge, the Principals have at all times, as employees, directors, officers
or agents of the Company, complied in all material respects with all applicable
Legal Requirements relating to IST's business and operations of EPMG.
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4.7 Disclosure. No representation, warranty or covenant by E & R contained
in this Agreement, nor any written statement or certificate furnished or to be
furnished by E & R to IST in connection herewith or pursuant hereto, contains
any untrue statement of a material fact, or omits to state any material fact
required to make the statements herein or therein not misleading.
5. Covenants of Parties
5.1 Approvals of Governmental Bodies. Each party will, and will cause each
Related Person to, cooperate with all other parties with respect to all filings
and consents that either party is required by Legal Requirements to make in
connection with the Transactions, but this provision will not require any party
to dispose of or make any change in any portion of its business or to incur any
financial burden.
5.2 Access to Records. After the Closing, for good cause shown E & R and
IST will, upon at least five (5) days advance notice, provide the
Representatives of a party with access to such financial records of IST or EPMG
(or records relating to EPMG customers or sales) which, is reasonably necessary
to enable a party to complete any financial audit, complete and make filings
required by law, determine any tax liability, or otherwise comply with any Legal
Requirement or defend any legal action.
5.3 Transactions.
(a) Except for payments to the Designated Clients, IST will pay all
of its client reserves existing as of the date hereof in accordance with the (i)
existing contracts between IST and its Clients, or if none (ii) any historical
practice of IST that has been consistently applied and documented; provided,
that if E & R has not delivered to IST as of the date hereof copies of all lead
contracts between IST and/or EPMG (on the one hand) and their clients (on the
other hand), as well as documentation regarding IST's and/or EPMG's historical
practice of paying client reserves, then IST will not be responsible for its
failure to pay client reserves in accordance with any such contract or
historical practice with which it is not aware.
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(b) IST covenants and agrees that it will pay all accrued
liabilities as of the date of Closing that are due and owing to employees,
clients, customers, service providers and vendors arising from sales made prior
to the Closing for which payment has been received by EPMG prior to the Closing,
excluding any accrued liabilities which are being contested by EPMG in good
faith and accrued liabilities that are subject to offset. Concurrently with the
execution of this Agreement, IST and E & R shall jointly execute instruction
letters to Zions National Bank and First Regional Bank regarding the payment of
certain payables, including the amounts described in paragraphs 2(c)(ii) and
2(e).
(c) EPMG is entitled to all revenues and benefits from all sales
made by EPMG prior to the Settlement Date , including sales that, as of the
Settlement Date , have been authorized, are in process, or are awaiting
settlement under applicable credit card arrangements. If E & R or its affiliates
receives the proceeds of any such sale, then E & R will immediately deliver such
proceeds to IST. Similarly, if IST or its affiliates receives proceeds of sales
by E & R (including its affiliates) after the Settlement Date, then IST will
immediately deliver such proceeds to E & R. In addition, E&R will reimburse EPMG
for all EPMG expenses incurred in the ordinary course of business that accrue
between the Settlement Date and the date of Closing, unless EPMG is otherwise
relieved of such liability. IST and E&R will work together in good faith to
reconcile all sales and expense allocations prescribed by this paragraph, and
the parties agree to cooperate to prepare a weekly reconciliation report and
make any required refunds or reimbursements on a weekly basis.
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5.4 SEC Filings. Promptly after the Closing IST will file with the
Securities and Exchange Commission a Form 8-K (or other appropriate filing)
which accurately described the terms hereof and the transactions.
5.5 Abandonment. Upon request by E & R, IST will deliver a notice to E & R
to the effect that IST has relinquished and ceded to E & R any right to utilize
any lead data existing as of the Settlement Date that has been provided to EPMG
by third-party lead sources on or prior to the Settlement Date. In addition, for
a six-month period following the Closing, neither of IST or EPMG will solicit or
market to any of the lead providers listed on Exhibit K hereto (the "Restricted
Lead Providers"). It shall not be a breach of the foregoing sentence if IST or
its affiliates acquires (through merger, stock purchase, asset purchase, or
similar transaction) any business that, on or before the date of such
acquisition, obtained leads from any of the Restricted Lead Providers, so long
as such acquisition does not take place within the first four months following
Closing. Notwithstanding the foregoing, IST will at all times continue to have
the right to receive leads from Preforeclosure.com, Foreclosure World, Real
Estate Toolkit, Fast Cash, Foreclosurenet.net, and Nightingale Connant.
5.6 Utah Leases. E & R will assume the leases of property located in Utah
that are described on Exhibit J attached hereto.
5.7 Cooperation. E & R and the Principals will cooperate with IST in good
faith in connection with ascertaining the fair market value of the Principals'
Stock and the assets transferred hereunder to E & R.
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6. Indemnification: Remedies
6.1 Survival. Except as provided in paragraph 6.5, all representations,
warranties, covenants, and obligations in this Agreement, will survive the
Closing only until December 31, 2005.
6.2 Indemnification and Payment of Damages by IST. IST shall indemnify and
hold harmless E & R and its Representatives for, and shall pay to E & R and its
Representatives the amount of, any loss, liability, claim, damage (excluding
incidental and consequential damages) or expense (including reasonable costs of
investigation and defense and reasonable attorneys' fees), whether or not
involving a third-party claim (collectively, "Damages"), arising, directly or
indirectly, from or in connection with: (i) any breach of any representation or
warranty made by IST in this Agreement or in any certificate delivered by IST
pursuant to this Agreement, and (ii) any breach by IST of any covenant or
obligation of IST in this Agreement, and (iii) the failure of IST to perform any
of the obligations assumed by IST pursuant to this Agreement, including pursuant
to Article 2 hereof.
6.3 Indemnification and Payment of Damages by E & R. E & R shall indemnify
and hold harmless IST and its Representatives, and shall pay IST and its
Representatives, for the amount of any Damages arising, directly or indirectly,
from or in connection with (i) any breach of any representation or warranty made
by E & R in this Agreement or in any certificate delivered by E & R pursuant to
this Agreement, and (ii) any breach by E & R of any covenant or obligation of E
& R in this Agreement, and (iii) the failure of E & R to perform any of the
obligations assumed by E & R pursuant to Agreement, including pursuant to
Article 2 hereof.
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6.4 Remedies; Specific Performance. The remedies provided in this
paragraph 6 will be the exclusive remedy with respect to the matters described
in paragraphs 6.2 and 6.3 hereof, except IST and E & R shall each have the right
to seek specific performance with respect to the Transactions.
6.5 Time Limitations. Except as provided below, IST and E & R will have no
liability (for indemnification or otherwise) with respect to any representation
or warranty, or covenant or obligation to be performed and complied with prior
to the Closing Date, unless on or before December 31, 2005, the aggrieved party
notifies the other party of a claim specifying the factual basis of that claim
in reasonable detail. The exceptions to the preceding sentence shall be
representations, warranties, covenants or obligations related to stock
ownership, taxes, ERISA and environmental issues; these exceptions will continue
in effect for the terms of the relevant statutes of limitations, including
extensions.
6.6 Limitations on Amount. Neither IST nor E & R will have any liability
(for indemnification or otherwise) with respect to the matters described in
paragraph 6 until the total of all Damages with respect to such matter exceeds
$50,000, and then only for the amount by which such Damages exceed $50,000. In
no event shall the aggregate amount of Damages for which either E & R or IST
(including their Representatives and Affiliates, taken collectively), have the
right to seek indemnification from the other party in excess of $675,000.
6.7 Procedure for Indemnification--Third Party Claims.
(a) Promptly after receipt by an indemnified party under paragraph 6
of notice of the commencement of any Proceeding against it, such indemnified
party will, if a claim is to be made against an indemnifying party under such
paragraph, give notice to the indemnifying party of the commencement of such
claim, but the failure to notify the indemnifying party will not relieve the
indemnifying party of any liability that it may have to any indemnified party,
except to the extent that the indemnifying party demonstrates that the defense
of such action is prejudiced by the indemnified party's failure to give such
notice.
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(b) If any Proceeding referred to in paragraph 6 is brought against
an indemnified party and the indemnified party gives notice to the indemnifying
party of the commencement of such Proceeding, the indemnifying party will,
unless (i) the claim involves taxes, be entitled to participate in such
Proceeding and, to the extent that it wishes (unless the indemnifying party is
also a party to such Proceeding and the indemnified party determines in good
faith that joint representation would be inappropriate, or (ii) the indemnifying
party fails to provide reasonable assurance to the indemnified party of its
financial capacity to defend such Proceeding and provide indemnification with
respect to such Proceeding), to assume the defense of such Proceeding with
counsel satisfactory to the indemnified party and, after notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such Proceeding, the indemnifying party will not, as long as it
diligently conducts such defense, be liable to the indemnified party under this
paragraph 6 for any fees of other counsel or any other expenses with respect to
the defense of such Proceeding, in each case subsequently incurred by the
indemnified party in connection with the defense of such Proceeding, other than
reasonable costs of investigation. If the indemnifying party assumes the defense
of a Proceeding, (i) it will be conclusively established for purposes of this
Agreement that the claims made in that Proceeding are within the scope of and
subject to indemnification; (ii) no compromise or settlement of such claims may
be effected by the indemnifying party without the indemnified party's consent
unless (A) there is no finding or admission of any violation of Legal
Requirements or any violation of the rights of any Person and no effect on any
other claims that may be made against the indemnified party, and (B) the sole
relief provided is monetary damages that are paid in full by the indemnifying
party; and (iii) the indemnified party will have no liability with respect to
any compromise or settlement of such claims effected without its consent. If
notice is given to an indemnifying party of the commencement of any Proceeding
and the indemnifying party does not, within ten days after the indemnified
party's notice is given, give notice to the indemnified party of its election to
assume the defense of such Proceeding, the indemnifying party will be bound by
any determination made in such Proceeding or any compromise or settlement
effected by the indemnified party.
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(c) Notwithstanding the foregoing, if an indemnified party
determines in good faith that there is a reasonable probability that a
Proceeding may adversely affect it or its affiliates other than as a result of
monetary damages for which it would be entitled to indemnification under this
Agreement, the indemnified party may, by notice to the indemnifying party,
assume the exclusive right to defend, compromise, or settle such Proceeding, but
the indemnifying party will not be bound by any determination of a Proceeding so
defended or any compromise or settlement effected without its consent (which may
not be unreasonably withheld).
6.8 Procedure for Indemnification--Other Claims. A claim for
indemnification for any matter not involving a third-party claim may be asserted
by notice as provided herein to the party from whom indemnification is sought.
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7. General Provisions
7.1 Expenses. Each party to this Agreement will bear its expenses incurred
in connection with the preparation, execution, and performance of this Agreement
and the Transactions, including all fees and expenses of agents,
representatives, counsel, and accountants. In the event of termination of this
Agreement, the obligation of each party to pay its own expenses will be subject
to any rights of a party arising from a breach of this Agreement by another
party.
7.2 Public Announcements. The parties will promptly make a public
announcement with respect to the Transactions.
7.3 Confidentiality. In connection with their business operations, each of
IST and E & R may have disclosed all or a portion of its Confidential
Information to another party. Each of E & R and IST shall cause its officers,
directors, members, agents and Representatives to hold in trust and confidence,
and shall not use or permit the use of, the Confidential Information of each
other party (including their affiliates). The undertakings and obligations of
the parties under this paragraph 7.3 shall not apply to any Confidential
Information of the other party that the receiving party can show (i) is or
becomes disclosed within the public domain through no fault of the receiving
party, (ii) is disclosed to a third party by the disclosing party without
restriction on such party, (iii) is approved for release by written
authorization of the disclosing party, (iv) is developed independently by a
Representative of the receiving party that does not have access to the
Confidential Information, (v) becomes known to the receiving party from a source
other than the disclosing party through no breach of any obligation of
confidentiality, or (vi) must be disclosed by the receiving party under subpoena
or other governmental compulsion.
20
7.4 Notices. All notices, consents, waivers, and other communications
under this Agreement must be in writing and will be deemed to have been duly
given when (i) delivered by hand (with written confirmation of receipt), (ii)
when received by the addressee, if sent by a nationally recognized overnight
delivery service (receipt requested), in each case to the appropriate addresses
set forth below (or to such other addresses as a party may designate by notice
to the other parties):
IST: Innovative Software Technologies, Inc.
204 N.W. Platte Valley Drive
Riverside, MO 64150
Attention: Curt P. Creely
Senior Counsel
Foley & Lardner LLP
100 N. Tampa Street, Suite 2700
Tampa, FL 33602
(not to be considered as notice)
E & R (and Company after the 5072 North 300 West
Closing): Provo, UT 84604
with a copy to: J. Gordon Hansen Holme Roberts & Owen LLP 299 South Main
Street, Suite 1800 Salt Lake City, UT 84111 (not to be considered as notice)
7.5 Remedies.
(a) Dispute Resolution. If the Closing has occurred and there is a
controversy, claim or dispute (a "Dispute") under this Agreement, the
disagreeing parties shall promptly meet with one another and diligently attempt
to resolve their disagreements. If they are unable to do so, then any party to
the Dispute may notify each other party that a Dispute exists (a "Notice of
Dispute").
21
(b) Mediation. If the dispute has not been resolved by negotiation
within twenty days of the delivery of a Notice of Dispute, the parties shall
endeavor to settle the dispute by mediation under the then current CPR Model
Mediation Procedure for Business Disputes ("CPR Rules") or the comparable
provisions of the American Arbitration Association ("AAA Rules") as the parties
determine. Unless otherwise agreed, the parties shall agree upon a mediator or,
if they cannot agree upon a mediator within five days of commencement of the
mediation procedure, then they shall select a mediator pursuant to the CPR or
AAA Rules, as appropriate. Expenses of mediation shall be divided equally
between the parties to the Dispute.
(c) Arbitration.
(i) Assuming the inability of the parties to resolve their
differences as provided in subparagraphs (a) and (b), the Dispute (including any
question as to whether or not any Dispute falls within the terms of this
paragraph or the selection of an arbitrator) shall be settled by arbitration in
Salt Lake City, Utah in accordance with the CPR Rules, by a single arbitrator
mutually acceptable to the parties, or by the comparable AAA Rules, as the
parties shall agree, or as designated by the initiating party. Any party may
initiate arbitration from and after 60 days following the delivery of a Notice
of Dispute if the dispute has not then been settled by negotiation or mediation.
The arbitration procedure shall be governed by the United States Arbitration
Act, 9 U.S.C. ss.ss. 1-16, and the award rendered by the arbitrator shall be
final and binding on the parties and may be entered in any court having
jurisdiction thereof.
(ii) Each party shall have discovery rights as provided by the
Federal Rules of Civil Procedure; provided, however, that all such discovery
shall be commenced and concluded within forty-five (45) days of the initiation
of arbitration.
22
(iii) It is the intent of the parties that any arbitration
shall be concluded as quickly as reasonably practicable. Unless the parties
otherwise agree, once commenced, the hearing on the disputed matters shall be
held at least four days a week until concluded, with each hearing date to begin
at 9:00 a.m. and to conclude at 5:00 p.m. The arbitrator shall use all
reasonable efforts to issue the final award or awards within a period of five
business days after closure of the proceedings. Failure of the arbitrator to
meet the time limits of this paragraph 7.5(c) shall not be a basis for
challenging the award. The parties shall maintain as confidential the existence
and result of the mediation and arbitration.
(iv) The arbitrator may instruct the non-prevailing party to
pay all costs of the proceedings, including the fees and expenses of the
arbitrator and the reasonable attorneys' fees and expenses of the prevailing
party, but only if the prevailing party shall have complied with the provisions
of subparagraphs (a) and (b). In the absence of such instruction, the parties
shall bear their own costs and share equally the fees and expenses of the
arbitrator.
(d) Ancillary Proceedings. Any legal proceeding instituted to
enforce an arbitration award hereunder may be brought in a court of competent
jurisdiction (either state or federal) in Salt Lake City or Provo, Utah. Each
party hereby submits to personal jurisdiction in either location, irrevocably
waives any objection as to venue, and further agrees not to plead or claim in
any such court that any such proceeding has been brought in an inconvenient
forum. Nothing herein shall be construed to prevent any party from seeking
equitable relief in such courts to restrain or prohibit any breach or threatened
breach of any covenant of a party set forth in this Agreement, whether or not
the parties have first sought to resolve the dispute through negotiation,
mediation or arbitration.
23
7.6 Further Assurances. The parties will (i) furnish upon request to each
other such further information, (ii) execute and deliver to each such other
documents, and (iii) perform such other acts and things, all as the other party
may reasonably request (and without delivery of additional consideration) for
the purpose of carrying out the intent of this Agreement and the documents
referred to in this Agreement. To the extent reasonably required, after Closing,
IST shall permit E & R access to the pertinent parts of any Company records
(including audit work papers) which are not delivered to E & R at Closing.
7.7 Waiver. Neither the failure nor any delay by any party in exercising
any right, power, or privilege under this Agreement or the documents referred to
in this Agreement will operate as a waiver of such right, power, or privilege,
and no single or partial exercise of any such right, power, or privilege will
preclude any other or further exercise of such right, power, or privilege or the
exercise of any other right, power, or privilege. To the maximum extent
permitted by applicable law, (i) no claim or right arising out of this Agreement
or the documents referred to in this Agreement can be discharged by one party,
in whole or in part, by a waiver or renunciation of the claim or right unless in
writing signed by the other party; (ii) no waiver that may be given by a party
will be applicable except in the specific instance for which it is given; and
(iii) no notice to or demand on one party will be deemed to be a waiver of any
obligation of such party or of the right of the party giving such notice or
demand to take further action without notice or demand as provided in this
Agreement or the documents referred to in this Agreement.
7.8 Entire Agreement and Modification. This Agreement supersedes all prior
agreements between the parties with respect to its subject matter and, including
the Disclosure Schedules, Exhibits and other documents referred to in this
Agreement, constitutes the complete and exclusive statement of the terms of the
Agreement with respect to its subject matter. This Agreement may not be amended
except by a written agreement executed by the party to be charged with the
amendment.
24
7.9 Assignments, Successors, and No Third-Party Rights. No party may
assign any of its rights or obligations under this Agreement without the prior
consent of the other parties. Subject to the preceding sentence, this Agreement
will apply to, be binding in all respects upon, and inure to the benefit of the
successors and permitted assigns of the parties. Nothing expressed or referred
to in this Agreement will be construed to give any Person other than the parties
to this Agreement any legal or equitable right, remedy, or claim under or with
respect to this Agreement or any provision of this Agreement. This Agreement and
all of its provisions and conditions are for the sole and exclusive benefit of
the parties to this Agreement and their successors and assigns.
7.10 Severability. If any provision of this Agreement is held invalid or
unenforceable by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision of this
Agreement held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.
7.11 Construction. All words used in this Agreement will be construed to
be of such gender or number as the circumstances require. Unless otherwise
expressly provided, the word "including" does not limit the preceding words or
terms.
7.12 Governing Law. This Agreement will be governed by the laws of the
State of Utah, without regard to its conflicts of laws principles.
25
7.13 Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
8. Definitions.
For purposes of this Agreement the following terms have the meanings
specified or referred to in this paragraph 8:
"Closing" - as defined in paragraph 1 above.
"Closing Date" - the date first above shown.
"Confidential Information" - all research, products, services,
developments, components, parts, documents, information, drawings, processes,
electronic files, data, business plans, programs, specifications, techniques,
processes, tradesecrets, inventions, know-how, business plans, marketing and
financial information, employee information, and other information of a secret,
confidential or proprietary nature which has been developed by or for the
benefit of a party. The Confidential Information of E&R shall include its
proprietary interest in, and access to, existing EPMG lead data and e-mail
messages written to or from EPMG employees, subject to paragraph 5.2 hereof. A
party's Confidential Information shall include such portions of the Confidential
Information of another party as shall be transferred to the transferee party
pursuant to the terms of this Agreement.
"Damages" - as defined in paragraph 6 above.
"Designated Clients" - as defined in paragraph 2(f)(ii) above.
26
"Dispute" - as defined in paragraph 7.5(a) above.
"Financial Statements" - as defined in paragraph 3.3 above.
"Governmental Authorization" - any approval, consent, license, permit,
waiver, or other authorization issued, granted, or otherwise made available by
or under the authority of any governmental body or pursuant to any Legal
Requirement.
"Knowledge" - an individual will be deemed to have "Knowledge" of a
particular fact or other matter if such individual is actually aware of such
fact or other matter.
A Person (other than an individual) will be deemed to have "Knowledge" of
a particular fact or other matter if any of the following individual has, or at
any time had, actual Knowledge of such fact or other matter: The Persons are
William Chipman, Christopher J. Floyd, Shane Hackett, Pete Justin, Linda
Kerecman, Will Leatham, and Pete Peterson for IST and the Principals for E & R.
"Legal Requirement" - any federal, state, local, foreign, or other
administrative order, law, ordinance, regulation, statute, or treaty.
"Notice of Dispute" - as defined in paragraph 7.5(a) above.
"Order" - any award, decision, injunction, judgment, order, ruling, or
verdict entered, issued, made, or rendered by any court, administrative agency,
or other governmental body or by any arbitrator.
"Ordinary Course of Business" - an action taken by a Person will be deemed
to have been taken in the "Ordinary Course of Business" only if: (a) such action
is consistent with the past practices of such Person and is taken in the
ordinary course of the normal day-to-day operations of such Person; and (b) such
action is not required to be authorized by the governing board of such Person
and is not required to be specifically authorized by the parent company (if any)
of such Person.
27
"Person" - any individual, corporation, general, limited or limited
liability partnership, limited liability company, joint venture, estate, trust,
association, labor union, or other entity or governmental body.
"Principals" - as defined in paragraph B of the Recitals.
"Principals' Stock" - as defined in paragraph 1 above.
"Proceeding" - any legal action, arbitration, audit, investigation, or
litigation, commenced, brought, conducted, or heard by or before, or otherwise
involving, any governmental body or arbitrator.
"Related Person" - with respect to a particular individual: (a) each other
member of such individual's Family; (b) any Person that is directly or
indirectly controlled by such individual or members of such individual's Family;
(c) any Person in which such individual or members of such individual's Family
hold (individually or in the aggregate) a Material Interest; and (d) any Person
with respect to which such individual or one or more members of such
individual's Family serves as a director, officer, partner, executor, or trustee
(or in a similar capacity).
With respect to a specified Person other than an individual: (a) any
Person that directly or indirectly controls, is directly or indirectly
controlled by, or is directly or indirectly under common control with such
specified Person; (b) any Person that holds a Material Interest in such
specified Person; (c) each Person that serves as a director, officer, partner,
executor, or trustee of such specified Person (or in a similar capacity); (d)
any Person in which such specified Person holds a Material Interest; (d) any
Person with respect to which such specified Person serves as a general partner
or a trustee (or in a similar capacity); and (f) any Related Person of any
individual described in clause (b) or (c).
28
For purposes of this definition, (a) the "Family" of an individual
includes (i) the individual, (ii) the individual's spouse, (iii) any other
natural Person who is related to the individual or the individual's spouse
within the second degree of consanguinity, and (iv) any other natural Person who
resides with such individual, and (b) "Material Interest" means direct or
indirect beneficial ownership (as defined in Rule 13d-3 under the Securities
Exchange Act of 1934) of voting securities or other voting interests
representing at least 10% of the outstanding voting power of a Person or equity
securities or other equity interests representing at least 10% of the
outstanding equity securities or equity interests in a Person.
"Representative" - with respect to a particular Person, any director,
officer, employee, agent, advisor, or other representative of such Person.
"Settlement Date" - is defined in the introductory portion of paragraph 2
"Threatened" - a claim, Proceeding, dispute, action, or other matter will
be deemed to have been "Threatened" if any demand or statement has been made
(orally or in writing) or any notice has been given (orally or in writing).
29
"Transactions" - all of the transactions contemplated by this Agreement,
including: (a) the transfer to IST of the shares described in paragraph 1, (b)
the performance of E & R and IST of their respective covenants and obligations
under this Agreement; and (c) the parties performance of the various covenants
set forth herein. IN WITNESS WHEREOF, the parties have executed and delivered
this Agreement as of the date first written above. IST: E & R:
INNOVATIVE SOFTWARE TECHNOLOGIES, INC., ETHAN AND RANDY, LC,
a California corporation a Utah limited liability company
By: /s/ Douglas S. Hackett By: /s/ Ethan A. Willis
------------------------------ ------------------------------
Name: Douglas S. Hackett Name: Ethan A. Willis
Title: Chief Executive Officer Title:
JOINDER FOR PURPOSES ONLY OF ANY INDIVIDUAL OBLIGATION OF THE
PRINCIPALS NAMED BELOW.
By: /s/ James R. Garn By: /s/ Ethan A. Willis
--------------------- -----------------------
Name: James R. Garn Name: Ethan A. Willis
--------------------- -----------------------
* Exhibits D, E, and K are omitted, and the registrant agrees that it will
furnish supplementally a copy of such exhibits to the Commission upon the
Commission's request.
30
EXHIBIT "A"
1. First Regional Bank Account Numbers 775209836 (pledged as security for
Electronic Clearing House (ECHO) Account Numbers: 801-3710755;
801-3710756; 801-3710757; and 801-3710758) and 775113561)
2. Card Services Merchant Account Number 2671-2125-5884
3. Discover Merchant Account Number 6011-0130-4825-266
4. American Express Merchant Account Number 543-001-497-7
5. Zions National Bank Account Number 041032301
EXHIBIT "B"
NAME DESCRIPTION QTY
- -------------------------------------------------------------------------------------------
Server CRT Monitors 3
- -------------------------------------------------------------------------------------------
Desktop Computers Etc Each Monitors, CPU's, Keyboards, Mouse, Some are 99
old and mostly parts
- -------------------------------------------------------------------------------------------
Firewalls Etc Linux (1), Netscreen (2); hardware and warranty 3
- -------------------------------------------------------------------------------------------
Routers Etc Cisco - hardware and warranty(3), All CSU's At Left
- -------------------------------------------------------------------------------------------
Switches Nortell Baystack (6), Cisco (1), Misc (6) 13
- -------------------------------------------------------------------------------------------
Backup Hardware Etc Iomega backup drive, all media, backup veritas 1
software and licenses
- -------------------------------------------------------------------------------------------
All Software Licenses Microsoft Server 2003 CAL's (50), Microsoft At Left
Server 2000 (2), Microsoft Exchange Server (1)
and Exchange 2003 CAL's (125), Microsoft 2003
Server (2), All Inode CAL's and Server licenses
and training, Norton Anti-Virus server and CAL
licenses, All Microsoft OS Licenses, All
Microsoft Office Licenses, All Adobe and
Macromedia software & licenses, Quick Book
software and License
- -------------------------------------------------------------------------------------------
APC power backups All APC power backup hardware in Provo Location At Left
- -------------------------------------------------------------------------------------------
Web Software Products WEMS (webbuilder) and REEMS (real At Left
estate builder) web software code,
database structure and data
- -------------------------------------------------------------------------------------------
Accounting Software Quick books license and software 1
- -------------------------------------------------------------------------------------------
Laptop Computers Dell (7), Sony (4), Toshiba (3), Compaq (2), 19
Velocity (2), IBM (1), all data on computers
including software licenses, email data, files,
software
- -------------------------------------------------------------------------------------------
Phone Systems Etc Phone system (3), All handsets/phones, At Left
virtual observer server (1) and CAL (5),
Record now licenses (6), headsets/amplifiers
(185), Marketel Dialers (2)
- -------------------------------------------------------------------------------------------
Furniture Sales Floor Cubicles (103), All At Left
Cubicles and furniture in Storage,
All EPMG desks and chairs in Provo
and Orem office, Provo and Orem
receptionist desks, All other misc
furniture
- -------------------------------------------------------------------------------------------
Servers Etc All server computers and warranties, server 7
racks, files, domain structure & data, database
structure & data, Microsoft Server Licenses on
server
- -------------------------------------------------------------------------------------------
All Printers,
Fax Machines, Copiers HP, Pitney Bowes, Brother At Left
- -------------------------------------------------------------------------------------------
All domain
names and content pmgmentors.com, onlineachiever.com, At Left
infoachiever.com, pmgtech.com, ideaachiever.com,
unimachiever.com, vermotion.com, vermotion.net,
vermotion.info, vermotion.biz, vermotion.org,
souptech.com, pmgmentors.com emails & data not
jointly owned per the Settlement Agreement, site
content, Site designed by Media Rain, and logo
designed by RRO Design
- --------------------------------------------------------------------------------------------
Misc. Inventory All Product Library At Left
inventory at Provo and Orem
Office, All Office supplies
at Provo and Orem Office,
4realestateleads.com codes
- --------------------------------------------------------------------------------------------
Projectors Overhead projectors at Provo and Orem offices 2
- --------------------------------------------------------------------------------------------
Company Automobiles Cameron's Range Rover, Lawson's Cadillac At Left
- --------------------------------------------------------------------------------------------
Television Equipment 2 TV's, 1 Plasma display At Left
- --------------------------------------------------------------------------------------------
Cell Phones All cell phones purchased with Sprint and Sprint At Left
agreement
- --------------------------------------------------------------------------------------------
Inventory at ProStar shall be distributed to E&R as follows:
- --------------------------------------------------------------------------------------------
E&R HammerTap (CD)
- --------------------------------------------------------------------------------------------
E&R Tax Vantage (932A)
- --------------------------------------------------------------------------------------------
E&R Real Estate Investing System
- --------------------------------------------------------------------------------------------
E&R Internet Business System
- --------------------------------------------------------------------------------------------
E&R Jay Abraham Inventory
- --------------------------------------------------------------------------------------------
E&R Nightingale Conant Inventory
- --------------------------------------------------------------------------------------------
E&R Robert G. Allen Inventory
- --------------------------------------------------------------------------------------------
E&R Shaun Casey's Asset Protection System
- --------------------------------------------------------------------------------------------
EXHIBIT "C"
LICENSE AGREEMENT
This LICENSE AGREEMENT (the "Agreement") is made and entered into by and
between INNOVATIVE SOFTWARE TECHNOLOGIES, INC. ("IST"), a California
corporation, ENERGY PROFESSIONAL MARKETING GROUP CORPORATION ("EPMG"), a Utah
corporation, and ETHAN AND RANDY, LC ("E & R"), a limited liability company
organized under the laws of the State of Utah, effective as of the Closing, as
that term is defined in that certain Settlement Agreement dated July 2, 2004,
between and among the parties hereto (the "Settlement Agreement"). IST and EPMG
may be referred to collectively herein as the "EPMG Group". The EPMG Group and E
& R may each hereafter be referred to as a "Party", and collectively as the
"Parties".
RECITALS
WHEREAS, pursuant to the terms of the Settlement Agreement, the Parties
have agreed as to the disposition of the Software, as defined below .
WHEREAS, pursuant to such settlement, (i) E & R will own all rights in the
Software, and (ii) EPMG will have a license to use the Software subject to the
restrictions and limitations described herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, the parties hereto agree as follows:
1. Definitions. For purposes of this Agreement:
(a) "Affiliate" means all entities controlled by, controlling or under
common control with the party in question, where the term "control" (and, with
correlative meaning, "controlled by" and "under control with") means the
ownership of 50% or more of the voting securities of the party in question, or
the right to elect the majority of the board of directors (or similar management
group) by contract or otherwise.
(b) "Cut-off Date" means January 1, 2004.
(c) "Improvements" means all modifications, changes, additions,
enhancements, alterations or upgrades to the Software after the Cut-off Date.
(d) "Object Code" means the machine-readable form of the Software.
(e) "Software" means the programming codes, in both Object Code and
Source Code, for the "CMS" and "WebBuilder" computer programs used by the EPMG
Group in their business operations and consisting of a database management
module, a website builder module and a real estate module, as the same were in
existence as of the Cut-off Date.
(f) "Source Code" means the human-readable form of the Software.
2. Software Transfers.
(a) Transfer to E & R. Each of EPMG and IST hereby relinquishes,
assigns and transfers to E & R all right, title and interest it holds in the
Software.
(b) License from E & R. Subject to the terms of this Agreement, E &
R hereby grants to the EPMG and its Affiliates, a non-exclusive, irrevocable,
perpetual, royalty-free, worldwide license in and to the Software (the
"License"), subject to the following conditions and limitations:
(i) the License shall include the right (A) to utilize the
website builder module of the Software for internal usage and also for usage by
customers and clients of EPMG or its Affiliates who purchase websites through
EPMG or its Affiliates, and (B) to sublicense the database management and the
real estate modules of the Software to third parties.
(ii) Except as set forth in clause (i) above or pursuant to
Section 10 below, the License shall not be transferable by EPMG or its
Affiliates, in whole or in part, through sale, assignment, pledge, lease or
other disposition event.
(c) Ownership and Use of Improvements. Each of EPMG and E & R shall
own all of their own Improvements to the Software subsequent to the Cut-off
Date. The rights of EPMG and its Affiliates to use or exploit EPMG's
Improvements shall be subject to the same restrictions as apply to the License
as described in Section 2(b) above.
(d) Source Code. EPMG Group shall be entitled to retain possession
of the Source Code for the database management and real estate modules of the
Software. Concurrently with the execution of this Agreement, the EPMG Group
shall deliver to E & R all copies of the Source Code in their possession or
control relating to the website builder module of the Software. The EPMG group
shall be entitled to retain one copy of the Object Code.
3. Representations.
(a) Each of IST, EPMG and E & R represents and warrants to the other
parties that it has all requisite power and authority to enter into this
Agreement and that this Agreement is a valid and binding obligation of such
party, enforceable in accordance with its terms.
(b) The EPMG Group hereby represents and warrants to E & R, that
they have made no assignment, transfer or other disposition of all or any
portion of their interest in the Software to any party prior to the date hereof,
or otherwise previously granted any rights in the Software to any third party
that are inconsistent to the rights granted herein.
4. Infringement. Each of the EPMG Group and E & R will inform the other
promptly in writing of any alleged infringement of the Software by a third party
and of any available evidence thereof. E & R shall have the first right, but not
the obligation, to enforce any rights held by it in the Software against such
infringement, at its own expense and by any means appropriate, including filing
suit or by obtaining a settlement. Any recovery received by E & R pursuant to
such suit or action shall be retained by E & R. If, within 90 days after having
been notified of an alleged infringement, or any such shorter period if
necessary to avoid materially prejudicing EPMG's rights with respect to any
response to such alleged infringement, E & R has not brought, or no longer is
diligently prosecuting, an infringement action against such infringement, and
has not otherwise caused the infringement to cease (such as by settlement or
grant of a sublicense), or if E & R notifies EPMG at any time prior thereto of
its intention not to bring or continue suit against any alleged infringer, then
(and only under such circumstances) EPMG will have the right, but will not be
obligated, to prosecute at its own expense any action with respect to such
infringement of the Software. If EPMG brings such an infringement action, E & R
will have the right to participate in that action at its own expense; provided,
however, that regardless of E & R's participation, no settlement, consent
judgment or other voluntary final disposition of the suit or action may be
entered into that negatively and materially affects E & R's use of the Software
without E & R's prior written consent. Any recovery received by EPMG pursuant to
such an action shall be used to reimburse EPMG and E & R (if it participates in
the suit or action), pari passu, for their costs and expenses of the action, and
the balance shall be retained 75% by EPMG and 25% by E & R. In any infringement
suit or action, the other party not defending or bringing such suit or action
will, at the request and expense of the party initiating or defending such suit
or action, cooperate in all respects and, to the extent possible, have its
employees testify when requested and make available relevant records, papers,
information, samples, specimens and the like.
5. Notices. All notices, consents, waivers, and other communications under
this Agreement must be in writing and will be deemed to have been duly given
when delivered pursuant to the notice provisions set forth in paragraph 7.4 of
the Settlement Agreement.
6. Dispute Resolution. If the Closing has occurred and there is a
controversy, claim or dispute (a "Dispute") under this Agreement, the Parties
shall resolve the Dispute pursuant to the remedies provisions set forth in
paragraph 7.5 of the Settlement Agreement.
7. Further Assurances. Each Party will (i) furnish upon request by other
Parties such further information, (ii) execute and deliver to each such Party
other documents, and (iii) perform such other acts and things, all as the other
Party or Parties hereto may reasonably request (and without delivery of
additional consideration) for the purpose of carrying out the intent of this
Agreement and the documents referred to in this Agreement.
8. Waiver. Neither the failure nor any delay by any Party in exercising
any right, power, or privilege under this Agreement or the documents referred to
in this Agreement will operate as a waiver of such right, power, or privilege,
and no single or partial exercise of any such right, power, or privilege will
preclude any other or further exercise of such right, power, or privilege or the
exercise of any other right, power, or privilege. To the maximum extent
permitted by applicable law, (i) no claim or right arising out of this Agreement
or the documents referred to in this Agreement can be discharged by one Party,
in whole or in part, by a waiver or renunciation of the claim or right unless in
writing signed by the another Party; (ii) no waiver that may be given by a Party
will be applicable except in the specific instance for which it is given; and
(iii) no notice to or demand on one Party will be deemed to be a waiver of any
obligation of such Party or of the right of the Party giving such notice or
demand to take further action without notice or demand as provided in this
Agreement or the documents referred to in this Agreement.
9. Entire Agreement and Modification. This Agreement supersedes all prior
agreements between the Parties with respect to its subject matter and
constitutes the complete and exclusive statement of the terms of the Agreement
with respect to its subject matter. This Agreement may not be amended except by
a written agreement executed by the Party to be charged with the amendment.
10. Assignments, Successors, and No Third-Party Rights. Except for a
transfer to an Affiliate, neither party may assign any of its rights or
obligations under this Agreement without the prior consent of each other Party,
except that either party may assign this Agreement to a third party as a part of
a sale or transfer of all or substantially all of its assets (whether through
merger, sale of assets, stock purchase, or otherwise). Subject to the preceding
sentence, this Agreement will apply to, be binding in all respects upon, and
inure to the benefit of the successors and permitted assigns of the Parties.
Nothing expressed or referred to in this Agreement will be construed to give any
person other than the Parties to this Agreement any legal or equitable right,
remedy, or claim under or with respect to this Agreement or any provision of
this Agreement. This Agreement and all of its provisions and conditions are for
the sole and exclusive benefit of the Parties and their permitted successors and
assigns.
11. Severability. If any provision of this Agreement is held invalid or
unenforceable by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision of this
Agreement held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.
12. Construction. All words used in this Agreement will be construed to be
of such gender or number as the circumstances require. Unless otherwise
expressly provided, the word "including" does not limit the preceding words or
terms.
13. Governing Law. This Agreement will be governed by the laws of the
State of Utah, without regard to its conflicts of laws principles.
14. Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
IN WITNESS WHEREOF, this Agreement has been executed as of the date first
set forth above.
INNOVATIVE: E & R:
INNOVATIVE SOFTWARE TECHNOLOGIES, INC ETHAN AND RANDY, LC
By: _________________________ By: _______________________
Name: _________________________ Name: _______________________
Title: _________________________ Member:: _______________________
EPMG:
ENERGY PROFESSIONAL MARKETING GROUP CORPORATION
By: _____________________________
Name: _____________________________
Title: _____________________________
EXHIBIT "F"
PRODUCT MARKETING AGREEMENT
PRIVATE MENTORING GROUP
PRODUCT/LEAD MARKETING AGREEMENT
THIS AGREEMENT is made and entered into as of this 30TH day of JUNE, 2004,
by and between and PRIVATE MENTORING GROUP, INC., a Utah corporation ("Private
Mentoring Group, Inc."), with its principal place of business at 5072 North 300
West, Provo, Utah 84604 and ENERGY PROFESSIONAL MARKETING GROUP, INC AND
INNOVATIVE SOFTWARE TECHNOLOGIES, INC (Collectively, "EPMG"), with its principal
place of business at 204 NORTH WEST PLATT VALLEY DRIVE, KANSAS CITY, MO, 64150
RECITALS
WHEREAS, EPMG, INC, AND PRIVATE MENTORING GROUP are in the business of
generating leads and/or marketing COACHING Products and Services and various
products, (herein referred to as the "Services") by reference made apart hereof
and
WHEREAS, PRIVATE MENTORING GROUP, INC AND PRIVATE MENTORING GROUP are in
the business of fulfilling COACHING services including but not limited to: REAL
ESTATE, INTERNET, STOCK AND MARKETING coaching, merchant accounts, website
building tools, BUSINESS marketing tools and services in the United States.
WHEREAS, PRIVATE MENTORING GROUP, INC. desires to engage EPMG, INC. to
market COACHING products and services, (herein referred to as "Products and
Services") owned by or contracted through PRIVATE MENTORING GROUP.
NOW THEREFORE, in consideration of the mutual promises contained herein,
and other good and valuable consideration, the receipt of which is acknowledged
by Private Mentoring Group, Inc., and therefore the Parties hereto agree to be
bound and abide by the following terms and conditions:
1. APPOINTMENT
A. Subject to the terms and conditions of this Agreement and the continuing
performance by Private Mentoring Group, Inc. of its obligations hereunder,
PRIVATE MENTORING GROUP, INC. grants to during the term of this Agreement,
the non-exclusive right to database market through telemarketing and
conference calls in the United States, all Services and related products
of Private Mentoring Group, Inc. to leads provided by Private Mentoring
Group.
B. has, or will obtain, and will maintain the knowledge, capital, facilities
and personnel necessary to sell the Services in the Territory.
C. This Agreement is effective as of the date first written above and shall
continue from year-to-year unless sooner terminated as provided in Article
7 herein.
D. DECRIPTION OF PRODUCT OR LEAD
COACHING PRODUCTS AND SERVICES,
AND ADDITION PRODUCTS AS DETERMINED TO BE USED BY BOTH PARTIES
E. PRODUCT COST
1. Individual product costs shall not exceed 10% for either Party
incurring the cost. Individual product cost will be determined and
authorized by both Parties prior to incurring the expense.
2. EPMG, INC. RESPONSIBILITIES
A. EPMG shall, at its expense, in good faith, use its best efforts and devote
time as is necessary to promote, sell, and distribute and otherwise sell
the Services in the Territory.
B. Except as expressly provided herein, EPMG shall conduct its business as an
independent contractor of PRIVATE MENTORING GROUP, in such manner as it
sees fit, using its own marketing plan.
C. EPMG shall not make any false or misleading representation with regard to
Products and Services.
D. EPMG shall notify PRIVATE MENTORING GROUP, INC. promptly of any existing
or possible litigation, which may be brought against EPMG regarding the
Services provided to PRIVATE MENTORING GROUP or to any other customer or
clients of Private Mentoring Group, Inc.
E. EPMG will, at its expense, comply with all applicable laws, ordinances,
rules and regulations pertaining to the operation of its business.
F. EPMG shall be responsible for all costs of its doing business including,
without limitation, all taxes, rent, utilities, withholding, postage,
telephone, photocopying, salaries, travel, and all other direct and
indirect overhead costs.
G. EPMG shall Record sales verifications for compliance and maintain records.
I. EPMG shall submit a list of all products and services sold to Private
Mentoring Groups Leads.
J. EPMG, INC. must obtain the approval of Private Mentoring Group, Inc. on
marketing sales material including; email copy and layout, direct mail
campaign copy and layout, and telephone scripts. Approvals may not be
withheld unreasonably.
K. EPMG INC. shall use reasonable commercial efforts, at its cost, to timely
fill and ship customer orders of product provided by Private Mentoring
Group, to resolve customer questions and complaints relating to its
product and to defend lawsuits and other claims from customers concerning
product solely or exclusively sold by Private Mentoring Group satisfaction
concerning same.
L. EPMG, Inc.. shall be responsible for all support related to product as
outlined in Section 1-D. In the event that support provided does not meet
the terms of this agreement it is agreed that and Private Mentoring Group,
Inc. reserve the right to terminate this agreement.
3. RESPONSIBILITIES OF PRIVATE MENTORING GROUP, INC.
A. As mutually agreed on a case by case basis, Private Mentoring Group, Inc.
will provide such promotional, sales and technical information, literature
and brochures, catalog sheets, price lists, order forms and other
information and sales aids from Private Mentoring Group, Inc. for products
and services as may be available for use by .
B. PRIVATE MENTORING GROUP, INC. shall be responsible for all costs of its
doing business including, without limitation, all taxes, rent, utilities,
withholding, postage, telephone, photocopying, salaries, travel, and all
other direct and indirect overhead costs.
C. PRIVATE MENTORING GROUP, INC. shall use reasonable commercial efforts, at
its cost, to timely fill and ship customer orders of product provided by
Private Mentoring Group, to resolve customer questions and complaints
relating to its product and to defend lawsuits and other claims from
customers concerning product solely or exclusively sold by and
satisfaction concerning same.
D. PRIVATE MENTORING GROUP, INC. shall be responsible for all support related
to product as outlined in Section 1-D. In the event that support provided
does not meet the terms of this agreement it is agreed that and Private
Mentoring Group, Inc. reserve the right to terminate this agreement.
F. PRIVATE MENTORING GROUP, INC. agrees to furnish EPMG with information
concerning new, related, modified or changed Services. The Parties agree
that EPMG will have the right to sell only such Services as agreed to in
advance by Private Mentoring Group, Inc. and EPMG.
4. COMPENSATION AND PAYMENTS
NOW, THEREFORE, in consideration of the mutual promises, covenants and
undertakings of the Parties hereto and for other good and valuable
consideration, it is agreed as follows:
A. PRIVATE MENTORING GROUP, INC. currently has certain rights, sales copy and
agreements with their own proprietary products and copy and with various
other companies. These contracts with PRIVATE MENTORING GROUP, INC. will
generate leads, which then can be used by EPMG to market additional
products and services.
B. PRIVATE MENTORING GROUP, INC. and EPMG will share proceeds from Net Sales
in a 40%-60% split. Net Sales are defined as Gross Sales less
Refunds/Cancellations and allowed allocations as specified below.
ALLOCATION CODE DESCRIPTION Percentage
- ---------- ----- ----------- ----------
Refund Reserve Account RRA Set aside from all Gross Sales and 10
reserved by PMG relative to the
revenue share model indicated
in this agreement
Merchant Account & MAP Set aside from all Gross Sales
and paid to Party providing
processing services 6
Processing
Product Cost PC Set aside from all Gross Sales 10
and paid to Party incurring the
expense and/or providing product
Each item/component contained in the Program (i.e. home study course,
coaching service, training camp, etc.) will be figured separately within
each sales package, and product cost allocations calculated on each
component sold and paid to the party who owns the product.
C. All leads provided by PRIVATE MENTORING GROUP, INC. to EPMG that purchase
Program through EPMG shall become joint property of both parties, Inc. at
the point of sale.
D. EPMG. will remit to Private Mentoring Group each Friday a settlement for
sales made during the previous week.
E. EPMG, Inc. will remit to Private Mentoring Group each Friday a settlement
for sales made during the previous week.
5. MERCHANT ACCOUNTS AND REFUNDS
EPMG will utilize their Merchant Accounts when booking sales made by their Sales
Staff under this agreement.
From the percentage of Gross Sales a reserve will be set aside in a "Refund
Reserve Account" from all sales closed within the confines of this agreement
during its Term. The Refund Reserve Account will be a six month rolling reserve.
Whereas the retainer of the first months reserve will be paid out on the
Seventh month, and any successive month will be paid six months after
Actual refunds processed will be deducted from Gross Sales as each payment is
calculated from period to period, and such refund expense will be shared as
stated above in Recital 4.B, between Private Mentoring Group, Inc. and .
At the end of the Term of this agreement, refund reserve accounts, related
policies, calculations and audit processes will be reviewed by the financial
officers of Private Mentoring Group, Inc. and , and an ongoing policy for the
maintenance of refund reserve accounts will be determined as agreed between the
Parties.
6. RIGHT OF TERMINATION
In addition to the other rights of termination, they may have at law or equity
or as contained in this Agreement, either Party may terminate this Agreement, at
any time for any reason, with or without cause upon 30 days prior written notice
to the other.
7. RIGHT OF TERMINATION
In addition to the other rights of termination, set forth herein, either Party
may terminate this Agreement, at any time for any reason, with or without cause
upon 30 days prior written notice to the other.
8. OBLIGATIONS UPON TERMINATION OR EXPIRATION
A. Upon expiration or termination of this Agreement, EPMG shall:
(1) Cease selling the Services;
(2) Immediately cease and desist from using or displaying any forms of
advertising indicative of the Services.
9. INDEMNIFICATION
PRIVATE MENTORING GROUP, INC. shall protect, indemnify and save harmless the
EPMG from and against any and all claims, costs, losses, damages, liabilities,
obligations and legal fees incurred by or its officers and directors arising
from or resulting from any act, including an alleged or actual violation or any
state or federal regulatory actions or inquiries, a neglect or omission of
Private Mentoring Group, Inc., its servants, distributors, employees, agents or
guests, and as a result of an breach by EPMG of this agreement as set forth.
This indemnification will equally apply to Private Mentoring Group, Inc. and .
Private Mentoring Group, Inc reserves the right to retain whatever funds due to
EPMG under this Agreement until such suit(s), action(s) or claim(s) for injuries
or damages are settled, and satisfactory evidence to that effect is provided to
Private Mentoring Group, Inc.
10. NOTICES
All notices permitted or required under this Agreement shall be in writing and
shall be delivered as follows with notice deemed given as indicated (i) by
overnight courier upon written verification of receipt, (ii) by telecopy or
facsimile transmission when confirmed by telecopier or facsimile transmission,
or (iii) by certified registered mail, return receipt requested, five (5) days
after deposit in the mail postage prepaid addressed as follows:
To EPMG, Inc.: Energy Professional Marketing Group, Inc.
204 Northwest Platt Valley Drive
Kansas City, MO, 64150
To PMG, Inc.: Private Mentoring Group, Inc.
5072 N. 300 W.
Provo UT, 84003
11. MISCELLANEOUS
A. Independent Contractors. The Parties hereto are independent contractors
and nothing contained in this Agreement shall be construed to create the
relationship of partners, Private Mentoring Group, Inc. acknowledges that
it does not have, and shall not make any representations to any third
Party, either directly or indirectly, that Private Mentoring Group, Inc.
has any authority to obligate or legally bind in any way whatsoever except
as expressly provided herein.
B. Severability. To the extent that any of the provisions set forth herein,
or any word, phrase, clause or sentence thereof, shall be found to be
unenforceable for any reason, such provision, word, clause, phrase, or
sentence shall be modified or deleted so as to make it as modified, legal
and unenforceable under applicable laws, and the remainder of the
Agreement shall not be affected thereby, the balance being construed as
severable and independent.
C. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the state of Utah. Each Party irrevocable
accepts and submits to the jurisdiction and venue of such courts.
D. Representations and Warranties of. Private Mentoring Group, Inc. hereby
makes the following representations and warranties to , which
representations and warranties shall survive the termination of this
Agreement.
(e) Private Mentoring Group, Inc. has the power and authority to enter
into this Agreement and to perform it's obligating hereunder.
(f) (i) Private Mentoring Group, Inc. is duly qualified to provide the
services set forth herein, (ii) Private Mentoring Group, Inc. has
received no notice that it is subject to any claims alleging
violations of any applicable laws; (iii) there are no actions or
claims against Private Mentoring Group, Inc. being currently
prosecuted; (iv) Private Mentoring Group, Inc. has received no
notice that Private Mentoring Group, Inc. fails to comply with any
applicable governmental regulations (v) all Private Mentoring Group,
Inc.'s services to be provided pursuant to this Agreement are in
compliance with all applicable federal, state or local laws, rules
and standards.
(g) No fact or condition exists which would prevent or result in the
inability of Private Mentoring Group, Inc. to perform the services
agreed to herein.
E. Default. An Event of Default hereunder shall occur if any representation
or warranty made by Private Mentoring Group, Inc. proves untrue in any
material respect as of the date made and throughout the term of this
Agreement. Upon the occurrence of a breach of this agreement, may, in its
discretion, elect to terminate this Agreement upon five (5) days written
notice to Private Mentoring Group, Inc., and may exercise all its legal
rights available to seek and collect damages as a result of breach of any
representations or warranties.
F. Waiver. The failure of either Party to enforce, at anytime or for any
period of time, any provision of this Agreement shall not be construed to
be a waiver of such provision or the right of such Party thereafter to
enforce such provision.
G. Amendment. This Agreement may be amended only by a written instrument
signed by duly authorized representatives of each of the Parties.
H. Headings - References. The headings of the Paragraphs hereof are for
convenience of reference only and do not constitute a part hereof.
References to Exhibits herein shall refer to the Exhibits attached hereto
if any, and by this reference made a part hereof.
I. Entire Agreement. This Agreement, contains the entire Agreement and only
understanding between the Parties with respect to the subject matter
hereof and supersedes all previous negotiations of the Parties in
connection with the subject matter covered herein, whether oral or
written, and any warranty, representation, promise or condition in
connection therewith not incorporated herein shall not be binding upon
either Party.
J. Binding. This Agreement shall be binding upon the Parties and their heirs,
executors, assigns and administrators, and shall insure to the benefit of
each Party, its successors and assigns.
K. Force Majure. Neither Party shall be liable hereunder by reason of any
failure or delay in the performance of its obligations hereunder on
account of strikes, shortages, riots, insurrection, fires, flood, storm,
explosion, acts of God, war, labor conditions, earthquakes or any other
cause, which is beyond reasonable control of such Party.
L. Costs and Attorney's Fees. If or Private Mentoring Group, Inc. is required
to enforce this Agreement in a judicial proceeding, the Party prevailing
in such proceeding shall be entitled to recover its costs and expenses,
including reasonable accounting and legal fees from the other Party.
M. Confidentiality. All information at anytime delivered between the Parties
hereto regarding their respective business plans, marketing practices and
policies, employees at seminar and workshop events, and all other related
and similar information not known to the general public, is and shall be
deemed confidential information, knowledge, data or know-how of the other
respective Party, or any information which is confidential or may be a
trade secret. Any information furnished between the Parties and labeled as
"confidential" shall be confidential information and shall be kept
confidential by the receiving Party.
N. Non-Disclosure. Both Parties agree not to disclose the Confidential
Information to any third Parties or to any employees who do not have a
need to know the Confidential Information. Both Parties agree that they
will only disclose Confidential Information to employees who have signed a
confidentiality agreement containing provisions similar to this agreement.
O. Modification, Amendment, Waiver. No modification, amendment or waiver of
this Agreement shall be effective unless approved in writing by both
Parties hereto.
P. Counterparts. This Agreement may be executed simultaneously in two or more
counterparts any one of which need not contain the signatures of more than
one Party, but all such counterparts taken together shall constitute one
and the same Agreement.
12. DISPUTES AND ARBITRATION.
A. The Parties desire to resolve disputes arising out of this Agreement
without litigation. Accordingly, except for actions to seek temporary
restraining orders or injunctions related to the purposes of this
Agreement, or suit to compel compliance with the dispute resolution
provision, the Parties agree to use the following alternative dispute
procedure as their sole remedy with respect to any controversy or claim
arising out of or relating to this Agreement or its breach.
B. At the written request of a Party, each Party will appoint a
knowledgeable, responsible representative to meet and negotiate in good
faith to resolve any dispute arising under this Agreement. The Parties
intend that non-lawyer, business representatives, conduct these
negotiations. The location, format, frequency, duration and conclusion of
these discussions shall be left to the discretion of the representatives.
Upon agreement between the Parties, the representatives may utilize other
alternative dispute resolution procedures such as mediation to assist in
the negotiations. Discussions and correspondence among the representatives
for the purposes of these negotiations shall be treated as confidential
information developed for the purposes of settlement, exempt from
discovery and concurrence of both Parties. Documents identified in or
provided with such communications, which are not prepared for purposes of
the negotiations, are not so exempted and may, if otherwise admissible, be
admitted in evidence in the arbitration of a lawsuit.
C. If the negotiations do not resolve the dispute within sixty (60) days
after the initial written request, a single arbitrator pursuant to the
Commercial Arbitration Rules of the American Arbitration Association shall
submit the disputes to binding arbitration. A Party may demand such
arbitration in accordance with procedures set out in those rules.
Discovery shall be controlled by the arbitrator and shall be permitted to
the extent set out in this paragraph. Each Party may submit in writing to
a Party, and that Party shall respond, to a maximum of any combination of
thirty-five (35) (none of which may have subplots) of the following:
interrogatories, demands to produce document, and requests for admission.
Each Party is also entitled to tae the oral deposition of one individual
of the other Party. Additional discovery may be permitted upon mutual
agreement of the Parties.
D. The Parties shall contract with the arbitrator to commence the arbitration
hearing within sixty (60) Days of the demand for arbitration. The
arbitration shall be held in Provo, Utah. The arbitrator shall control the
scheduling so as to process the matter expeditiously. The Parties may
submit written briefs. The Parties shall require the arbitrator to rule on
the dispute by issuing a written opinion within thirty (30) days after the
close of the hearings. The times specified in this paragraph may be
extended upon a showing of good cause. Judgment upon the award rendered by
the arbitrator may be entered in any court having jurisdiction.
E. Each Party shall bear its own cost of these procedures. A Party-seeking
discovery shall reimburse to the responding Party the costs of production
of documents (to include search time and reproduction costs). The Parties
shall equally split the fees of the mediation and the arbitration.
IN WITNESS WHEREOF, ENERGY PROFESSIONAL MARKETING GROUP, INC. and Private
Mentoring Group, Inc., have respectively entered into this Agreement as of the
day and year first above written.
PRIVATE MENTORING GROUP, INC.
By ____________________
Its ____________________
5072 North 300 West
Provo, Utah 84604
EPMG, INC.
By ____________________
Its ____________________
204 Northwest Platt Valley Drive
Kansas City, MO 64150
EXHIBIT "G"
PRIVATE MENTORING GROUP
PRODUCT/LEAD MARKETING AGREEMENT
THIS AGREEMENT is made and entered into as of this 30TH day of JUNE, 2004,
by and between and PRIVATE MENTORING GROUP, INC., a Utah corporation
("EPMG-IST."), with its principal place of business at 5072 North 300 West,
Provo, Utah 84604 and ENERGY PROFESSIONAL MARKETING GROUP, INC AND INNOVATIVE
SOFTWARE TECHNOLOGIES, INC (Collectively, "EPMG-IST"), with its principal place
of business at 204 NORTH WEST PLATT VALLEY DRIVE, KANSAS City, MO, 64150
RECITALS
WHEREAS, PRIVATE MENTORING GROUP, INC, INC, AND EPMG-IST are in the
business of generating leads and/or marketing COACHING Products and Services and
various products, (herein referred to as the "Services") by reference made apart
hereof and
WHEREAS, EPMG-IST AND PRIVATE MENTORING GROUP are in the business of
fulfilling COACHING services including but not limited to: REAL ESTATE,
INTERNET, STOCK AND MARKETING coaching, merchant accounts, website building
tools, BUSINESS marketing tools and services in the United States.
WHEREAS, EPMG-IST. desires to engage PRIVATE MENTORING GROUP, INC to
market COACHING products and services, (herein referred to as "Products and
Services") owned by or contracted through EPMG-IST.
NOW THEREFORE, in consideration of the mutual promises contained herein,
and other good and valuable consideration, the receipt of which is acknowledged
by EPMG-IST, and therefore the Parties hereto agree to be bound and abide by the
following terms and conditions:
1. APPOINTMENT
A. Subject to the terms and conditions of this Agreement and the continuing
performance by EPMG-IST. of its obligations hereunder, EPMG-IST. grants to
during the term of this Agreement, the non-exclusive right to database
market through telemarketing and conference calls in the United States,
all Services and related products of EPMG-IST. to leads provided by
Private Mentoring Group.
B. has, or will obtain, and will maintain the knowledge, capital, facilities
and personnel necessary to sell the Services in the Territory.
C. This Agreement is effective as of the date first written above and shall
continue from year-to-year unless sooner terminated as provided in Article
7 herein.
D. DECRIPTION OF PRODUCT OR LEAD
COACHING PRODUCTS AND SERVICES,
AND ADDITION PRODUCTS AS DETERMINED TO BE USED BY BOTH PARTIES
E. PRODUCT COST
1. Individual product costs shall not exceed 10% for either Party
incurring the cost. Individual product cost will be determined and
authorized by both Parties prior to incurring the expense.
2. PRIVATE MENTORING GROUP, INC. RESPONSIBILITIES
A. PRIVATE MENTORING GROUP shall, at its expense, in good faith, use its best
efforts and devote time as is necessary to promote, sell, and distribute
and otherwise sell the Services in the Territory.
B. Except as expressly provided herein, PRIVATE MENTORING GROUP shall conduct
its business as an independent contractor of PRIVATE MENTORING GROUP, in
such manner as it sees fit, using its own marketing plan.
C. PRIVATE MENTORING GROUP shall not make any false or misleading
representation with regard to Products and Services.
D. PRIVATE MENTORING GROUP shall notify EPMG-IST. promptly of any existing or
possible litigation, which may be brought against PRIVATE MENTORING GROUP
regarding the Services provided to PRIVATE MENTORING GROUP or to any other
customer or clients of EPMG-IST.
E. PRIVATE MENTORING GROUP will, at its expense, comply with all applicable
laws, ordinances, rules and regulations pertaining to the operation of its
business.
F. PRIVATE MENTORING GROUP shall be responsible for all costs of its doing
business including, without limitation, all taxes, rent, utilities,
withholding, postage, telephone, photocopying, salaries, travel, and all
other direct and indirect overhead costs.
G. PRIVATE MENTORING GROUP shall Record sales verifications for compliance
and maintain records.
I. PRIVATE MENTORING GROUP shall submit a list of all products and services
sold to Private Mentoring Groups Leads.
J. PRIVATE MENTORING GROUP must obtain the approval of EPMG-IST. on marketing
sales material including; email copy and layout, direct mail campaign copy
and layout, and telephone scripts. Approvals may not be withheld
unreasonably.
K. Private Mentoring Group shall use reasonable commercial efforts, at its
cost, to timely fill and ship customer orders of product provided by
Private Mentoring Group, to resolve customer questions and complaints
relating to its product and to defend lawsuits and other claims from
customers concerning product solely or exclusively sold by Private
Mentoring Group satisfaction concerning same.
L. PRIVATE MENTORING GROUP, Inc.. shall be responsible for all support
related to product as outlined in Section 1-D. In the event that support
provided does not meet the terms of this agreement it is agreed that and
EPMG-IST. reserve the right to terminate this agreement.
3. RESPONSIBILITIES OF EPMG-IST.
A. As mutually agreed on a case by case basis, EPMG-IST. will provide such
promotional, sales and technical information, literature and brochures,
catalog sheets, price lists, order forms and other information and sales
aids from EPMG-IST. for products and services as may be available for use
by.
B. EPMG-IST. shall be responsible for all costs of its doing business
including, without limitation, all taxes, rent, utilities, withholding,
postage, telephone, photocopying, salaries, travel, and all other direct
and indirect overhead costs.
C. EPMG-IST. shall use reasonable commercial efforts, at its cost, to timely
fill and ship customer orders of product provided by Private Mentoring
Group, to resolve customer questions and complaints relating to its
product and to defend lawsuits and other claims from customers concerning
product solely or exclusively sold by and satisfaction concerning same.
D. EPMG-IST. shall be responsible for all support related to product as
outlined in Section 1-D. In the event that support provided does not meet
the terms of this agreement it is agreed that and EPMG-IST. reserve the
right to terminate this agreement.
F. EPMG-IST. agrees to furnish PRIVATE MENTORING GROUP with information
concerning new, related, modified or changed Services. The Parties agree
that PRIVATE MENTORING GROUP will have the right to sell only such
Services as agreed to in advance by EPMG-IST. and PRIVATE MENTORING GROUP.
4. COMPENSATION AND PAYMENTS
NOW, THEREFORE, in consideration of the mutual promises, covenants and
undertakings of the Parties hereto and for other good and valuable
consideration, it is agreed as follows:
A. EPMG-IST. currently has certain rights, sales copy and agreements with
their own proprietary products and copy and with various other companies.
These contracts with EPMG-IST. will generate leads, which then can be used
by PRIVATE MENTORING GROUP to market additional products and services.
B. EPMG-IST. and PRIVATE MENTORING GROUP will share proceeds from Net Sales
in a 40%-60% split. Net Sales are defined as Gross Sales less
Refunds/Cancellations and allowed allocations as specified below.
ALLOCATION CODE DESCRIPTION Percentage
- ---------- ---- ----------- ----------
Refund Reserve Account RRA Set aside from all Gross Sales and 10
reserved by PMG relative to the
revenue share model indicated in
this agreement
Merchant Account & MAP Set aside from all Gross Sales and 6
paid to Party providing processing
Processing services
Product Cost PC Set aside from all Gross Sales and 10
paid to Party incurring the expense
and/or providing product
Each item/component contained in the Program (i.e. home study course,
coaching service, training camp, etc.) will be figured separately within
each sales package, and product cost allocations calculated on each
component sold and paid to the party who owns the product.
C. All leads provided by EPMG-IST to PRIVATE MENTORING GROUP that purchase
Program through shall become joint property of both parties, Inc. at the
point of sale.
D. PRIVATE MENTORING GROUP. will remit to Private Mentoring Group each Friday
a settlement for sales made during the previous week.
E. PRIVATE MENTORING GROUP, Inc. will remit to Private Mentoring Group each
Friday a settlement for sales made during the previous week.
5. MERCHANT ACCOUNTS AND REFUNDS
PRIVATE MENTORING GROUP will utilize their Merchant Accounts when booking sales
made by their Sales Staff under this agreement.
From the percentage of Gross Sales a reserve will be set aside in a "Refund
Reserve Account" from all sales closed within the confines of this agreement
during its Term. The Refund Reserve Account will be a six month rolling reserve.
Whereas the retainer of the first months reserve will be paid out on the
Seventh month, and any successive month will be paid six months after
Actual refunds processed will be deducted from Gross Sales as each payment is
calculated from period to period, and such refund expense will be shared as
stated above in Recital 4.B, between EPMG-IST. and .
At the end of the Term of this agreement, refund reserve accounts, related
policies, calculations and audit processes will be reviewed by the financial
officers of EPMG-IST. and , and an ongoing policy for the maintenance of refund
reserve accounts will be determined as agreed between the Parties.
6. RIGHT OF TERMINATION
In addition to the other rights of termination, they may have at law or equity
or as contained in this Agreement, either Party may terminate this Agreement, at
any time for any reason, with or without cause upon 30 days prior written notice
to the other.
7. RIGHT OF TERMINATION
In addition to the other rights of termination, set forth herein, either Party
may terminate this Agreement, at any time for any reason, with or without cause
upon 30 days prior written notice to the other.
8. OBLIGATIONS UPON TERMINATION OR EXPIRATION
A. Upon expiration or termination of this Agreement, PRIVATE MENTORING GROUP
shall:
(1) Cease selling the Services;
(2) Immediately cease and desist from using or displaying any forms of
advertising indicative of the Services.
9. INDEMNIFICATION
EPMG-IST. shall protect, indemnify and save harmless the PRIVATE MENTORING GROUP
from and against any and all claims, costs, losses, damages, liabilities,
obligations and legal fees incurred by or its officers and directors arising
from or resulting from any act, including an alleged or actual violation or any
state or federal regulatory actions or inquiries, a neglect or omission of
EPMG-IST., its servants, distributors, employees, agents or guests, and as a
result of an breach by PRIVATE MENTORING GROUP of this agreement as set forth.
This indemnification will equally apply to EPMG-IST. and .
EPMG-IST reserves the right to retain whatever funds due to PRIVATE MENTORING
GROUP under this Agreement until such suit(s), action(s) or claim(s) for
injuries or damages are settled, and satisfactory evidence to that effect is
provided to EPMG-IST.
10. NOTICES
All notices permitted or required under this Agreement shall be in writing and
shall be delivered as follows with notice deemed given as indicated (i) by
overnight courier upon written verification of receipt, (ii) by telecopy or
facsimile transmission when confirmed by telecopier or facsimile transmission,
or (iii) by certified registered mail, return receipt requested, five (5) days
after deposit in the mail postage prepaid addressed as follows:
To EPMG, Inc.: Energy Professional Marketing Group, Inc.
204 Northwest Platt Valley Drive
Kansas City, MO, 64150
To Private Mentoring: Private Mentoring Group, Inc.
5072 N. 300 W.
Provo UT, 84003
11. MISCELLANEOUS
A. Independent Contractors. The Parties hereto are independent contractors
and nothing contained in this Agreement shall be construed to create the
relationship of partners, EPMG-IST. acknowledges that it does not have,
and shall not make any representations to any third Party, either directly
or indirectly, that EPMG-IST. has any authority to obligate or legally
bind in any way whatsoever except as expressly provided herein.
B. Severability. To the extent that any of the provisions set forth herein,
or any word, phrase, clause or sentence thereof, shall be found to be
unenforceable for any reason, such provision, word, clause, phrase, or
sentence shall be modified or deleted so as to make it as modified, legal
and unenforceable under applicable laws, and the remainder of the
Agreement shall not be affected thereby, the balance being construed as
severable and independent.
C. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the state of Utah. Each Party irrevocable
accepts and submits to the jurisdiction and venue of such courts.
D. Representations and Warranties of. EPMG-IST. hereby makes the following
representations and warranties to , which representations and warranties
shall survive the termination of this Agreement.
(e) EPMG-IST. has the power and authority to enter into this Agreement
and to perform it's obligating hereunder.
(f) (i) EPMG-IST. is duly qualified to provide the services set forth
herein, (ii) EPMG-IST. has received no notice that it is subject to
any claims alleging violations of any applicable laws; (iii) there
are no actions or claims against EPMG-IST. being currently
prosecuted; (iv) EPMG-IST. has received no notice that EPMG-IST.
fails to comply with any applicable governmental regulations (v) all
PRIVATE MENTORING GROUP-IST.'s services to be provided pursuant to
this Agreement are in compliance with all applicable federal, state
or local laws, rules and standards.
(g) No fact or condition exists which would prevent or result in the
inability of EPMG-IST. to perform the services agreed to herein.
E. Default. An Event of Default hereunder shall occur if any representation
or warranty made by EPMG-IST. proves untrue in any material respect as of
the date made and throughout the term of this Agreement. Upon the
occurrence of a breach of this agreement, may, in its discretion, elect to
terminate this Agreement upon five (5) days written notice to EPMG-IST.,
and may exercise all its legal rights available to seek and collect
damages as a result of breach of any representations or warranties.
F. Waiver. The failure of either Party to enforce, at anytime or for any
period of time, any provision of this Agreement shall not be construed to
be a waiver of such provision or the right of such Party thereafter to
enforce such provision.
G. Amendment. This Agreement may be amended only by a written instrument
signed by duly authorized representatives of each of the Parties.
H. Headings - References. The headings of the Paragraphs hereof are for
convenience of reference only and do not constitute a part hereof.
References to Exhibits herein shall refer to the Exhibits attached hereto
if any, and by this reference made a part hereof.
I. Entire Agreement. This Agreement, contains the entire Agreement and only
understanding between the Parties with respect to the subject matter
hereof and supersedes all previous negotiations of the Parties in
connection with the subject matter covered herein, whether oral or
written, and any warranty, representation, promise or condition in
connection therewith not incorporated herein shall not be binding upon
either Party.
J. Binding. This Agreement shall be binding upon the Parties and their heirs,
executors, assigns and administrators, and shall insure to the benefit of
each Party, its successors and assigns.
K. Force Majure. Neither Party shall be liable hereunder by reason of any
failure or delay in the performance of its obligations hereunder on
account of strikes, shortages, riots, insurrection, fires, flood, storm,
explosion, acts of God, war, labor conditions, earthquakes or any other
cause, which is beyond reasonable control of such Party.
L. Costs and Attorney's Fees. If or EPMG-IST. is required to enforce this
Agreement in a judicial proceeding, the Party prevailing in such
proceeding shall be entitled to recover its costs and expenses, including
reasonable accounting and legal fees from the other Party.
M. Confidentiality. All information at anytime delivered between the Parties
hereto regarding their respective business plans, marketing practices and
policies, employees at seminar and workshop events, and all other related
and similar information not known to the general public, is and shall be
deemed confidential information, knowledge, data or know-how of the other
respective Party, or any information which is confidential or may be a
trade secret. Any information furnished between the Parties and labeled as
"confidential" shall be confidential information and shall be kept
confidential by the receiving Party.
N. Non-Disclosure. Both Parties agree not to disclose the Confidential
Information to any third Parties or to any employees who do not have a
need to know the Confidential Information. Both Parties agree that they
will only disclose Confidential Information to employees who have signed a
confidentiality agreement containing provisions similar to this agreement.
O. Modification, Amendment, Waiver. No modification, amendment or waiver of
this Agreement shall be effective unless approved in writing by both
Parties hereto.
P. Counterparts. This Agreement may be executed simultaneously in two or more
counterparts any one of which need not contain the signatures of more than
one Party, but all such counterparts taken together shall constitute one
and the same Agreement.
12. DISPUTES AND ARBITRATION.
A. The Parties desire to resolve disputes arising out of this Agreement
without litigation. Accordingly, except for actions to seek temporary
restraining orders or injunctions related to the purposes of this
Agreement, or suit to compel compliance with the dispute resolution
provision, the Parties agree to use the following alternative dispute
procedure as their sole remedy with respect to any controversy or claim
arising out of or relating to this Agreement or its breach.
B. At the written request of a Party, each Party will appoint a
knowledgeable, responsible representative to meet and negotiate in good
faith to resolve any dispute arising under this Agreement. The Parties
intend that non-lawyer, business representatives, conduct these
negotiations. The location, format, frequency, duration and conclusion of
these discussions shall be left to the discretion of the representatives.
Upon agreement between the Parties, the representatives may utilize other
alternative dispute resolution procedures such as mediation to assist in
the negotiations. Discussions and correspondence among the representatives
for the purposes of these negotiations shall be treated as confidential
information developed for the purposes of settlement, exempt from
discovery and concurrence of both Parties. Documents identified in or
provided with such communications, which are not prepared for purposes of
the negotiations, are not so exempted and may, if otherwise admissible, be
admitted in evidence in the arbitration of a lawsuit.
C. If the negotiations do not resolve the dispute within sixty (60) days
after the initial written request, a single arbitrator pursuant to the
Commercial Arbitration Rules of the American Arbitration Association shall
submit the disputes to binding arbitration. A Party may demand such
arbitration in accordance with procedures set out in those rules.
Discovery shall be controlled by the arbitrator and shall be permitted to
the extent set out in this paragraph. Each Party may submit in writing to
a Party, and that Party shall respond, to a maximum of any combination of
thirty-five (35) (none of which may have subplots) of the following:
interrogatories, demands to produce document, and requests for admission.
Each Party is also entitled to tae the oral deposition of one individual
of the other Party. Additional discovery may be permitted upon mutual
agreement of the Parties.
D. The Parties shall contract with the arbitrator to commence the arbitration
hearing within sixty (60) Days of the demand for arbitration. The
arbitration shall be held in Provo, Utah. The arbitrator shall control the
scheduling so as to process the matter expeditiously. The Parties may
submit written briefs. The Parties shall require the arbitrator to rule on
the dispute by issuing a written opinion within thirty (30) days after the
close of the hearings. The times specified in this paragraph may be
extended upon a showing of good cause. Judgment upon the award rendered by
the arbitrator may be entered in any court having jurisdiction.
E. Each Party shall bear its own cost of these procedures. A Party-seeking
discovery shall reimburse to the responding Party the costs of production
of documents (to include search time and reproduction costs). The Parties
shall equally split the fees of the mediation and the arbitration.
IN WITNESS WHEREOF, PRIVATE MENTOR GROUP, INC. and EPMG-IST, have
respectively entered into this Agreement as of the day and year first above
written.
PRIVATE MENTOR GROUP, INC.
By ____________________
Its ___________________
5072 North 300 West
Provo, Utah 84604
ENERGY PROFESSIONAL MARKETING GROUP, INC.
By ____________________
Its ___________________
204 Northwest Platt Valley Drive
Kansas City, MO 64150
EXHIBIT H
RELEASE AGREEMENT
THIS RELEASE AGREEMENT ("Agreement") is entered into as of the 2nd day of
July, 2004, by and among INNOVATIVE SOFTWARE TECHNOLOGIES, INC. ("IST"), a
California corporation, ETHAN AND RANDY, LC, a Utah limited liability company,
JAMES R. GARN ("Garn") and ETHAN A. WILLIS ("Willis") with reference to the
following:
WHEREAS, IST purchased ENERGY PROFESSIONAL MARKETING GROUP CORPORATION
("EPMG"), a Utah corporation, from Garn and Willis, effective December 31, 2001;
WHEREAS, disputes have arisen between and among the parties hereto
relating to the purchase of EPMG and other matters, and the parties desire to
resolve their disputes by entering in to this agreement (the "Agreement"); and
WHEREAS, IST and the "Ethan and Randy, LC Parties" (comprised of Garn,
Willis, EPMG and Ethan and Randy, LC) have entered into an agreement of even
date herewith that settles and resolves such disputes (the "Settlement
Agreement"); and
WHEREAS, the Settlement Agreement requires that such parties exchange
mutual releases;
NOW, THEREFORE, in consideration of the promises made herein (including
the release of claims), and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. Mutual Release. IST (on its behalf and on behalf of all parties
claiming by or through it) hereby releases and discharges the Ethan and Randy,
LC Parties, and the Ethan and Randy, LC Parties (on their behalf and on behalf
of all parties claiming by or through them) hereby release and discharge IST, in
each case together with each such released party's officers, members, directors,
affiliates, employees, agents, accountants, shareholders, principals,
successors, attorneys, heirs and assigns, as appropriate, of and from any all
liabilities, debts, sums, claims, counterclaims, actions, causes of action,
demands, damages, rights, suits, disputes and controversies of any kind
whatsoever, whether contingent, accrued, known or unknown, arising from or
relating in any way to the purchase, ownership and operation of EPMG and of IST.
Each releasing party intends that the releases set forth in this paragraph be
interpreted as broadly as possible, so as to include all actions of, whatever
nature, whether direct or indirect, both past and present, and whether or not
known, suspected or claimed. Notwithstanding the generality of the foregoing,
the releases set forth in this paragraph shall not include (i) any rights
accruing to a releasing party under the terms of this Agreement, (ii) any rights
accruing to a releasing party under the terms of the Settlement Agreement and
related agreements executed by the parties hereto in connection with and as
contemplated by the terms of the Settlement Agreement other than this Agreement,
(iii) any rights arising among or between the parties after the date hereof with
respect to any matter, or (iv) any rights which, as a matter of law, cannot be
released or waived by a releasing party.
2. Representations and Warranties. Each of IST and the Randy and Ethan, LC
Parties hereby represents and warrants to the other parties hereto, with the
understanding that the other parties are entering into this Agreement in
reliance upon such representations and warranties, as follows:
(a) He or it has not previously assigned or transferred, or
attempted to assign or transfer, to any third party any of the claims he or it
purports to waive and release herein;
(b) This Agreement is his or its valid and binding obligation which
is enforceable against him or it in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency or other laws affecting
creditor's rights generally and by general principles of equity; and
(c) He or it has full power and authority to enter into this
Agreement and to carry out the transactions contemplated by it and, in the case
of a party which is an entity, it has received all appropriate corporate
(including shareholder, if applicable) authorizations and approvals to enter
into, deliver and perform this Agreement.
3. Condition to Effectiveness of Agreement. The obligations and rights of
the parties hereunder shall be subject to, and conditioned upon, the closing of
the transaction contemplated by the Settlement Agreement.
4. Waiver and Remedies. No failure on the part of any party to exercise,
and no delay in exercising a right, remedy, power or privilege hereunder, shall
operate as a waiver hereof, except to the extent specifically provided for
herein, nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise of any other right,
remedy or power, and no such waiver shall be valid unless it is in writing
signed by the party to be bound or charged.
5. Notices. Any notice required or prevented under this Agreement shall be
in writing and shall be sufficient if delivered personally or by reputable
courier (such as UPS or Federal Express) with receipt returned, or mailed by
registered or certified mail, postage prepaid and return receipt requested,
addressed to the appropriate recipient as set forth in the signature lines
below, or such other address as the recipient shall designate by written notice,
as provided herein, from time to time. Any notice which is delivered personally
or by courier shall be deemed effective on the date of delivery (or refusal to
accept delivery). Any notice which is mailed shall be deemed delivered on the
third business day after mailing.
6. Governing Law. The general rights and obligations of the parties
pursuant to this Agreement shall be governed by and construed in accordance with
the substantive laws of the state of Utah, without application of its conflict
of laws rules.
7. Mutual Release Agreement. This Agreement (and the documents referred to
herein) constitute the entire agreement between and among the parties pertaining
to the subject matter herein and supersedes all prior and contemporaneous
agreements, representations and understandings of the parties in connection with
the transactions contemplated thereby. No supplement, modification or amendment
of this Agreement shall be binding unless executed in writing by all of the
parties.
8. Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be considered an original instrument and all of
which shall together be considered one and the same agreement. Delivery and
receipt of executed pages by facsimile transmission shall constitute effective
and binding execution and delivery of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
INNOVATIVE SOFTWARE TECHNOLOGIES, INC., a California
corporation
By: _______________________________
_______________________________
Name: _______________________________
Title: _______________________________
204 NW Platte Valley Drive, Riverside, MO
64150
ETHAN AND RANDY, LC, a Utah limited liability company
By: _______________________________
_______________________________
Name: _______________________________
Title: Manager
5072 North 300 West
Provo, UT 84604
_______________________________
James R. Garn
5072 North 300 West
Provo, UT 84604
_______________________________
Ethan A. Willis
5072 North 300 West
Provo, UT 84604
EXHIBIT I
EXCEPTIONS TO REPRES ENTATION
Between January 1, 2004 and the date hereof, the parties and their
associates and counsel have exchanged threatening letters and verbal threats.
The parties have also contacted several banks and their correspondents with whom
the Company and IST may have had business relationships.
EXHIBIT "J"
1. Lease for Corporate Office which is described as follows:
a. Building Located at 5072 North 300 West Provo, UT 84604, North 1/2
of said building, its specific area as well as common areas and core
factor.
b. Building Located at 5072 North 300 West Provo, UT 84604, Main Floor
Northeast, Approximately 2/3 of said NE Main Floor, approximately
5357 square foot, its specific area as well as common areas and core
factor.
c. Building Located at 5072 North 300 West Provo, UT 84604, space
located just East of the West Conference Room and is approximately
700 +/- Square Feet, includeing core factor as well as common area,
West Conference Room on the Main Floor. The aforementioned West
Conference Room and the Main Floor Training Rooms are on an "upon
availability basis" be scheduled with the Building's Receptionist.
2. Lease for Coaching Office which is a Class A office building in the
ParkView Plaza office complex, with an address of 625 South State Street,
Orem, UT 84058. Lease includes a portion of the main floor of the office
building (approximately 5,000 square feet comprising not including common
areas).
3. Key Bank Equipment Lease Account Number KP0021916
4. Key Bank Phone System Lease Account Number KP00024195
5. Citicorp Pitney Bowes Copier/Printer Lease, Citicorp account number
3405830