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EXHIBIT 2
SERVICES AGREEMENT
BETWEEN
XXXXXXXXXXXXXXXX.XXX, INC.
AND
XXXXX.XXX CORPORATION
This SERVICES AGREEMENT (the "Agreement") is entered into as of March 7,
2000 (the "Effective Date") by and between Xxxxxxxxxxxxxxxx.xxx, Inc.
("XXX.XXX"), a corporation organized under the laws of the State of Delaware,
having a principal place of business at 0000 Xxxxxx Xxxxxx Xxxx, Xxxxx 000,
Xxxxxx Xxxx, Xxxxxxx 00000, XxXxx.xxx Corporation ("DrAlt"), a corporation
organized under the laws of the State of Delaware having a principal place of
business at 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 and Complete Wellness
Centers, Inc. ("CWC"), a corporation organized under the laws of the State of
Delaware, having a principal place of business at 0000 Xxxxxx Xxxxxx Xxxx, Xxxxx
000, Xxxxxx Xxxx, Xxxxxxx 00000.
WHEREAS, DrAlt was formed and organized for the primary purpose of
providing alternative medicine information and products to practitioners and
consumers;
WHEREAS, DrAlt desires that XXX.XXX provide DrAlt with certain services
to create its web site known as xxx.XxXxx.xxx;
WHEREAS, XXX.XXX desires to change and update the web site known as
xxx.xxxxxxxxxxxxxxxx.xxx;
NOW, THEREFORE, in consideration of the mutual covenants herein, and for
other good and valuable consideration, the receipt and adequacy of which is
hereby acknowledged, the parties hereby agree as follows:
1. XXX.XXX agrees to provide DrAlt with the following services at DrAlt's
reasonable request:
(a) XXX.XXX will provide access to the web site known as
xxx.xxxxxxxxxxxxxxxx.xxx to DrAlt to manage and develop as more
fully described in Items 2 & 3 below.
(b) XXX.XXX will provide access to DrAlt to contract through its
parent company, CWC with the existing and future wholly-owned
subsidiaries of CWC that are medical centers and the related
practitioners for the DrAlt eBusiness web site.
(c) XXX.XXX will provide access to the medical centers and the related
practitioners that are under existing and future consulting
contracts for the DrAlt eBusiness web site.
(d) XXX.XXX will provide access to the seminars and the related
audiences conducted after the Effective Date by CWC and third
party audience.
(e) XXX.XXX, upon request by DrAlt, will assist in the overall
strategic direction for the DrAlt eBusiness web site and the
related product and service offerings to be made on such web site.
(f) XXX.XXX, upon request by DrAlt, will assist in the determination
of appropriate specific content management modules for the DrAlt
eBusiness web site.
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2. DrAlt will review the existing format and functionality of
xxx.xxxxxxxxxxxxxxxx.xxx and incorporate any design features determined
to be valuable in the site redesign. Part of this site analysis will be
search engine effectiveness and competitive analysis. DrAlt will discuss
with XXX.XXX designated personnel the definition of the specific business
objectives of this project. This planning activity converts the business
goals and objectives developed in the planning phase into specific
functional components and includes:
(a) Internet business goals to support overall organizational goals
(b) Identification of audience sets
(c) Identification of goals per audience set
(d) Prioritization of audience sets
(e) Preliminary site map
(f) Front and backend system requirements
(g) Assess business and technical risks with eBusiness
strategy/tactics
3. DrAlt will use its best efforts to review the existing web site,
xxx.xxxxxxxxxxxxxxxx.xxx, and either use this as a baseline for
modification or create a completely new site format, using the effective
and desired visual and navigation components contained in the existing
site. Because everything resides in a customer's first impression of a
web site, it is critical that the front-end interface be consumer
friendly. By that the parties agree that it should be as reasonably easy
to use as practicable and rapid to download, personalized, and invites a
customer to return to the site. The content on the home page should be
updated regularly and anyone should be able to navigate to his or her
desired web page within three clicks. This task in the development phase
includes:
(a) Graphical design of site pages
(b) Definition of static pages
(c) Global navigation development
(d) Local navigation development
(e) Stress testing for link integrity and scalability
4. The term of this Agreement shall be five (5) years and may be extended by
mutual agreement by the parties for a period of five (5) years.
5. DrAlt shall loan to XXX.XXX up to Seven Hundred and Fifty Thousand
Dollars ($750,000) according to a disbursement schedule (attached as an
addendum hereto). DrAlt, its succesors in interest or assigns, shall be
awarded 5 year warrants in CWC (constituting restricted securities under
federal and state securities laws) for the purchase of Three Hundred
Seventy-Five Thousand (375,000) shares of common stock of CWC at $2.00
per share. The amounts earned under those arrangements described as
consideration in Item 6 below can be used as an offset against amounts
owed by DrAlt to XXX.XXX.
If CWC should require additional monies, DrAlt will negotiate in good
faith to loan up to an additional Two Hundred Fifty Thousand Dollars
($250,000) for an additional One Hundred Twenty-five Thousand (125,000)
warrants at $2.00 per share if it, in DrAlt's sole judgement, is
financially able to do so.
6. Dr. Alt shall provide the following additional consideration as follows:
(a) DrAlt will pay to XXX.XXX a one-time fee of $150 per each
practitioner directly referred by CWC to DrAlt and signed during
the first twelve months, $100 per each practitioner directly
referred by CWC to DrAlt and signed during the months thirteen
through eighteen, $50 per each practitioner directly referred by
CWC to DrAlt and signed during months nineteen through
twenty-four, and $25 per each practitioner directly referred by
CWC to DrAlt and signed from month twenty-five through the end of
the
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contract period. The number of practitioners signed with DrAlt at
the end of each month will determine the fee that is due by the
15th of the following month.
(b) Other ancillary net revenue derived by DrAlt related to the
xxx.xxxxxxxxxxxxxxxx.xxx web site or the xxx.XxXxx.xxx web site,
including but not limited to advertising commissions,
traffic-based revenue or affiliate revenue, shall be shared
between XXX.XXX and DrAlt on an equal basis.
(c) Revenues generated by sales of products and/or services originated
through clinics or practitioners on service with DrAlt as a result
of this Agreement, shall be paid commissions as follows:
(1) 10% of collected net sales to contracted clinic or
practitioner
(2) 10% of collected net sales to XXX.XXX.
7. With the exception of the initial payment described in Item 5 above,
payments for the consideration in Item 6 shall be made monthly to
XXX.XXX.
8. DrAlt shall exercise reasonable effort in performing the services to be
provided hereunder but DrAlt shall not be liable for any delays resulting
from circumstances or causes beyond its control, except as such
circumstances or causes pertain to DrAlt's inability to perform services
competently or devote the resources required to accomplish the
obligations of DrAlt.
9. Either party may terminate this Agreement if the other party breaches
this Agreement in any material respect, including but not limited to
nonpayment of fees or nonperformance of services. In the event of such
breach by one party, the other party shall give the non-performing party
written notice specifying in detail the nature of the alleged breach. If
at the end of thirty (30) days the breach has not been cured, the other
party shall give the non-performing party final written notice of its
intention to terminate, and this Agreement shall be terminated five (5)
days after such second notice has been deemed to be received if there is
no response and attempt to cure the breach. Either party may terminate
this Agreement, effective immediately and without notice, if;
(a) The other party becomes insolvent, files a petition seeking any
reorganization, composition or similar relief under any law
regarding insolvency or relief for debtors, makes an assignment
for the benefit of creditors or similar undertaking, or is placed
under liquidation, whether provisionally, finally, compulsorily,
or voluntarily, or if a receiver, trustee, liquidator, or similar
officer is appointed for the business or property of the other
party, or
(b) A third party files a petition in bankruptcy against a party,
files a petition against a party seeking any reorganization,
arrangement, composition or similar relief under any federal or
state law regarding insolvency or relief for debtors or creditors,
or seeks the appointment of a receiver, trustee or similar officer
for the business or property of a party, and none of the foregoing
actions is dismissed within thirty (30) days.
(c) If CWC files a petition for bankruptcy as more fully described
above, the contracts with the clinics and practitioners will be
assignable to DrAlt without encumbrance and the web site known as
xxx.xxxxxxxxxxxxxxxx.xxx or its successor, if any, will be
retained by DrAlt.
10. In the event the merger contemplated in the non-binding letter of intent
between CWC, XXX.XXX and DrAlt dated March 7, 2000 is not consummated,
the following treatment shall be given to the following items:
(a) If the merger is not consummated prior to July 1, 2000 due to the
failure of CWC to raise an approximate $7 to $8 million private
placement or due to a material adverse change in the business of
CWC:
(1) This Service Agreement shall survive only by mutual written
agreement between XXX.XXX, CWC, and DrAlt.
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(2) DrAlt shall retain the warrants described as consideration
in Item 5 above.
(3) XXX.XXX will repay the $750,000 described as consideration
in Item 5 and this shall be a general obligation of CWC. By
mutual written agreement, the amounts earned under those
arrangements described as consideration in Item 6 above can
be used as an offset against amounts owed by DrAlt to
XXX.XXX.
(b) If the merger is not consummated as a result of DrAlt not
providing the payments described in Item 5 above; due to a
material adverse change in the business of DrAlt; or due to
failure of DrAlt to substantially and in good faith perform the
duties described in Items 2 or 3 above:
(1) This Service Agreement shall survive only by mutual written
agreement between XXX.XXX, CWC and DrAlt.
(2) DrAlt shall retain the warrants on a prorata basis with the
funds received and retained by XXX.XXX all described as
consideration in Item 5 above. For example, if DrAlt only
provides and XXX.XXX retains $500,000 or 66.7% of the
$750,000, DrAlt would retain 250,000 warrants.
(3) Once DrAlt is fully repaid, the web site known as
xxx.xxxxxxxxxxxxxxxx.xxx or its successor, if any, would
revert to XXX.XXX in its state of development as of a date
determined in Item 9 above. Such reversion would include
any programming source code and other related information
required to continue the development of the web site
without the assistance of DrAlt.
11. All notices shall be in writing and shall be sent by fax or first-class
certified or registered mail, addressed to the other party. Any notice
sent by fax shall be deemed to have been received on the day it is sent,
or on the first business day thereafter, if it was sent on a non-business
day or if it was sent after 4 p.m. on a business day. Any notice sent by
mail shall be deemed to have been received on the fifth (5th) business
day after the date of posting.
12. DrAlt may use its relationship with XXX.XXX and the projects for
marketing purposes such as case studies, press releases, and other
marketing activities, subject to XXX.XXX's approval, which shall not be
unreasonably withheld or delayed. XXX.XXX agrees that DrAlt can place a
notice and link at the bottom of each web site page, which displays,
"Website developed by Envision Development Corporation".
13. If at any time, the web site known as xxx.xxxxxxxxxxxxxxxx.xxx should
become known as any other domain name, the terms herein shall still
apply.
14. CWC hereby warrants that it owns all rights, titles and interest in the
website known as xxx.xxxxxxxxxxxxxxxx.xxx.
It is understood that XXX.XXX retains title and ownership of all customer
supplied website content. All source codes, trademarks, and patentable
inventions created by DrAlt for XXX.XXX shall be owned solely by XXX.XXX.
DrAlt will use components, which in its sole judgment are useful, from
its Envision Development Library (EDL) in the construction of the web
site. Title and ownership of DrAlt supplied EDL components at all times
remain with DrAlt. DrAlt's proprietary notice shall appear on all copies
of the software, regardless of form, including partial copies and
modifications of the Software. DrAlt grants to XXX.XXX and to CWC and its
subsidiaries and affiliates ("the CWC Group") a non-exclusive,
non-transferable, royalty-free license to use the software furnished to
XXX.XXX first made by DrAlt under this Agreement on all of the CWC
Group's Central Processor Units (CPU's) as required for the web site
operation. DrAlt shall also have a non-exclusive, non-transferable,
royalty-free license to use the web site as required for its general
business purposes.
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Except as otherwise expressly provided, no license or other right is
hereby transferred to XXX.XXX, including any license by implication,
estoppel or otherwise, under any patent, patent application, trade
secret, trademark or copyright.
15. DrAlt, XXX.XXX and CWC shall not disclose any confidential or proprietary
information to any third party, nor use such information for its own
account or for the account of any other person or entity, nor make any
copies of such information, except as required to perform the services
under this agreement. Proprietary information shall mean all confidential
or proprietary information designated as such in writing, whether by
letter or by the use of an appropriate proprietary stamp or legend, prior
to or at the time any such confidential or proprietary information is
disclosed. The obligations of DrAlt, XXX.XXX and CWC shall not apply, and
shall have no further obligations, with respect to any proprietary
information to the extent that such proprietary information: a) Is
generally known to the public at the time of disclosure or becomes
generally known through no wrongful act; b) Is in possession at the time
of disclosure otherwise than as a result of any breach of any legal
obligation; c) Becomes known through disclosure by sources having the
legal right to disclose such proprietary information.
16. It is understood and agreed that DrAlt is a company and that no employee
of DrAlt is an employee of CWC or XXX.XXX. This Agreement shall not be
construed to form a partnership between the parties or to create any form
of employment relationship or any legal association which would impose
liability on the other party for act or failure to act of the other
party.
DrAlt, XXX.XXX and CWC agree not to hire nor solicit the employment of
the other's employees or independent contractors without written
authorization by the respective party, during the term of this Agreement
and continuing for a period of twelve (12) months thereafter.
17. Other general terms governing this relationship per this Agreement are as
follows:
(a) No waiver of any right or remedy with respect to any occurrence or
event on one occasion shall be deemed a waiver of such right or
remedy with respect to such occurrence or event on any other
occasion. All rights and remedies evidenced herein are in addition
and cumulative to rights and remedies available to the parties at
law or under any other agreement between the parties.
(b) The laws of Orange County of the State of Florida will govern this
Agreement.
(c) This Agreement is not assignable without the prior written
approval of the parties.
18. This Agreement constitutes the entire Agreement between the parties with
respect to the subject matter hereof and supersedes all prior proposals,
negotiations and communications, oral or written, between the parties
with respect to the subject matter hereof, and no deviation from these
terms and conditions shall be binding unless in writing and signed by the
party against whom the same is sought to be enforced.
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SERVICES AGREEMENT
BETWEEN
XXXXXXXXXXXXXXXX.XXX, INC.
AND
XXXXX.XXX CORPORATION
Agreed to and accepted as of March ______, 2000.
Xxxxxxxxxxxxxxxx.xxx, Inc.
By: _________________________
Xxxxxx X. Xxxxxxx, Xx.
Chief Executive Officer
Complete Wellness Centers, Inc.
By: _________________________
Xxxxxx X. Xxxxxxx, Xx.
Chief Executive Officer
XxXxx.xxx Corporation
By: __________________________
Xxxx X. Xxxxx
President
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Services Agreement
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