Exhibit 10.9
PROFESSIONAL SERVICES
AGREEMENT
This Professional Services Agreement
(the “Agreement”) is made and entered into as of
February 25, 2005 (“Effective Date”) by and
between Specialized Marketing Services, Inc.
(“SMS”), a California corporation, with offices located
at 17809 Gillette Avenue, Irvine, California 92614-6501 and
Amerikal Nutraceutical Corp. (“Amerikal”), a California
corporation, with its principal place of business located at 17751
Mitchell Avenue, Irvine, California 92614.
WHEREAS, Amerikal desires to procure services in the area
of marketing fulfillment (the “Services”) and wishes to
retain Services of SMS as set forth in this Agreement.
WHEREAS, SMS wishes to provide Services to Amerikal on
the terms and conditions as set forth in this Agreement.
NOW THEREFORE,
in consideration of the mutual
covenants set forth in this Agreement, the receipt and sufficiency
of which are hereby expressly acknowledged, the parties agree as
follows:
1.
Professional Services
. SMS agrees to provide
Amerikal with the Services as set forth in Exhibit A attached
hereto or any other Exhibits as from time to time may be added to
this Professional Services Agreement.
2.
Fees . In consideration for the Services to be
performed under this Agreement, Amerikal hereby agrees to pay SMS
the fees set forth in Exhibit A below or any other Exhibits as
from time to time may be added to this Professional Services
Agreement. SMS will submit invoices to Amerikal on a monthly basis
for Services provided in the previous month. Amerikal will pay such
invoices ten (15) days after receipt. In the event that Amerikal
disputes any invoice submitted, Amerikal shall provide written
notice to SMS within ten (10) days of the receipt of invoice,
detailing the reason for the disputed amounts. Notwithstanding the
foregoing, Amerikal shall pay SMS for any undisputed amounts due.
Past due accounts are subject to a one and one half percent (1.5%)
finance charge per month or the maximum allowed by law for each
month that payment remains outstanding. Funds for postage or
shipping shall be kept on deposit at SMS and requests for deposits
will be payable upon receipt.
3.
Confidentiality
. The parties entered into a
certain Mutual Confidentiality and Non-Disclosure Agreement
(“NDA”) dated February 25, 2005 of which the terms
and conditions are hereby incorporated herein.
4.
Term and Termination
. This Agreement is effective
as of the date first written above, and will continue in effect for
a period of one (1) year from the Effective Date, unless
terminated earlier in accordance with the terms of this Agreement.
Thereafter, this Agreement shall renew for additional 12 month
periods.
(a)
Amerikal may terminate this
Agreement, with or without cause, upon sixty (60) days prior
written notice to SMS. SMS may terminate this Agreement, with or
without cause, upon sixty (60) days prior written notice to
Amerikal. Upon any termination of this Agreement, it is
Amerikal’s obligation to pay SMS the fees due for Services
completed prior to such termination. Furthermore Amerikal
acknowledges and agrees to pay SMS for costs related to closing out
Amerikal’s account with SMS which shall consist of:
(i) extracting data from the system and providing such data to
Amerikal; (ii) performing an inventory cycle count, preparing
outstanding orders for shipping, dumping, or recycling;
(iii) coordinating the
transfer of materials and
information; (iv) dumping and/or recycling fees; and
(v) any additional services requested in writing by
Amerikal.
(b)
SMS may terminate the Agreement
immediately in the event Amerikal fails to pay any invoice within
sixty (60) days of receipt of invoice.
(c)
Where agreement, approval,
acceptance, or consent by either party is required by any provision
of this Agreement, such action shall not be unreasonably delayed or
withheld.
(d)
Sections 2, 3, 4, 5, 7, 11, 13 and
14 shall survive any termination or expiration of this
Agreement.
5.
Indemnification
.
A.
Indemnification
: To the fullest extent permitted by law, Amerikal
shall, at Amerikal’s sole expense and with counsel reasonably
acceptable to SMS, indemnify, defend, and hold harmless SMS from
and against all Claims arising from any cause, directly or
indirectly arising out of or relation to this Contract, or the
Product without limitation; (a) the use of the Product by any
other party; (b) the negligence or misconduct of Amerikal or
of any employee, agent or contractor of Amerikal;
(c) Amerikal’s conduct of business; (d) any breach
or default in performance of any obligation on Amerikal’s
part to be performed under this Contract, whether before or during
the Contract Term or after its expiration and/or termination. The
foregoing indemnification extends to and includes claims for:
(a) injury to any persons (including death); (b) loss of,
injury or damage to, or destruction of property (including all loss
of use); and (c) all economic losses and consequential or
resulting damage of any kind. Amerikal’s insurance
obligations under this Contract are independent of Amerikal’s
exculpation, indemnification, and other obligations under this
Contract and shall not be construed or interpreted in any way to
restrict, limit, or modify Amerikal’s exculpation,
indemnification, and such obligations of Amerikal or to limit
Amerikal’s liability under this Contract.
B.
Duty to Defend
: Amerikal’s duty to defend SMS is separate
and independent of Amerikal’s duty to indemnify SMS. The duty
to defend includes claims for which SMS may be liable without fault
or strictly liable. The duty to defend applies regardless of
whether the issues of negligence, liability, fault, default, or
other obligation on the part of Amerikal have been determined. The
duty to defend applies immediately, regardless of whether SMS has
paid any sums or incurred any detriment arising out of or relating
(directly or indirectly) to any Claims. It is the express intention
of the parties that SMS be entitled to summary adjudication or
summary judgment regarding Amerikal’s duty to defend SMS at
any stage or any claim of suit within the scope of
Section 13.
C.
Exculpation
: To the fullest extent permitted by law, Amerikal
waives all Claims (in law, equity or otherwise) against SMS arising
out of, and agrees that SMS shall not be liable to Amerikal for
(and Amerikal knowingly and voluntarily assumes the risk of) the
following: (a) injury to or death of any person; (b) loss
of, injury or damage to, or destruction of any tangible or
intangible property, including the resulting loss of use, economic
losses and consequential or resulting damages of any kind form any
cause. This exculpation clause shall not apply to claims against
SMS to the extent that a final judgment of a court of competent
jurisdiction established that the injury, loss, damage
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or destruction was proximately
caused by SMS’ fraud, gross negligence, willful injury to
person or property, or violation of law.
D.
Survival
: The indemnification and exculpation provisions
of Section 13 shall survive the expiration or termination of
this Contract until all Claims contemplated by these provisions are
fully, finally and absolutely barred by the applicable statute of
limitations.
E. Damages : In
no event shall SMS be liable to Amerikal for any consequential
losses, claims, damages or liabilities.
6.
Insurance . SMS is to be named as additional insured
on Amerikal’s Product Liability Policy. Proof of insurance to
be forwarded to SMS within thirty days of this agreement. Amerikal
is responsible to provide their own insurance for product loss and
fire while stored or in transit to the SMS warehouse on designated
warehouse facility.
7.
Notice . Any notice or other communication
required or permitted to be given by either party under this
Agreement shall be given in writing, by personal delivery, or by
registered or certified mail, return receipt requested, addressed
to each respective party at its current address as set forth above,
or to such other address as either party shall indicate by proper
notice to the other in the manner provided herein. All notices will
be deemed to be given when received in accordance with the
provisions of this Section 7.
8.
Assignment
. This Agreement may not be
assigned by either party without written consent of the
other.
9.
Relationship of the
Parties . It is
understood that SMS is an independent contractor, and that this
Agreement does not create any agency, employment, partnership,
joint venture or similar relationship between the parties, and
neither Amerikal nor SMS has any authority to bind the other with
respect to any matter. Under no circumstances shall either SMS or
Amerikal have the right or authority to act or make any commitment
of any kind to any third party on behalf of the other party or to
represent the other party in any way as an agent.
10.
Force Majeure
. Neither party shall be in
default by reason of failure in performance of this Agreement if
such failure arises, directly or indirectly, out of causes
reasonably beyond the control or foreseeability of either party,
including but not limited to, default by suppliers, acts of God or
the public enemy, U.S. or foreign governmental acts in either a
sovereign or contractual capacity, transportation contingencies,
fire flood, epidemic, restrictions and strikes.
11.
Waiver and
Severability . No
waiver of any breach of this Agreement shall constitute a waiver of
any other breach of the same or any other provision of this
Agreement, and no waiver shall be effective unless made in writing.
If any provision of this Agreement is held by a court of competent
jurisdiction to be illegal or unenforceable, such provision shall
be severed and the remainder of this Agreement shall continue in
full force and effect. Unless stated otherwise, all remedies
provided for in this Agreement shall be cumulative and in addition
to and not in lieu of any other remedies available to either party
at law, in equity, or otherwise.
12.
Federal Compliance
. The parties agree to comply
with all applicable federal and state laws, regulations and
requirements in regard to all Services provided under this
Agreement.
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13.
Governing Law and
Forum . The
interpretation and construction of this Agreement, and all matters
relating hereto, shall be governed by the laws of the State of
California applicable to agreements executed and to be performed
solely within such state. The parties hereby submit to the
jurisdiction of, and waive any venue objections against, the United
States District Court for the Central District of California,
Orange County Branch and the Superior and Municipal Courts of the
State of California, Orange County in any litigation arising out of
this Agreement. T
