EX-10.2



 






Exhibit 10.2




SERVICE AGREEMENT



THIS AGREEMENT (the “Agreement”) is made and entered into this 1st day of January, 2005
by and between ELITE FINANCIAL COMMUNICATIONS GROUP, LLC, located at 605 Crescent Executive Court,
Suite 124, Lake Mary, Florida 32746, (hereinafter referred to as “ELITE”) and INTEGRATED BUSINESS
SYSTEMS & SERVICES, INC., located at 1607 Shop Road, Suite E, Columbia, South Carolina 29201,
(hereinafter referred to as the “Company”).




WITNESSETH:



For and consideration of the mutual promises and covenants contained herein, the parties hereto
agree as follows:





	1.  	EMPLOYMENT




Company hereby hires and employs ELITE as an independent contractor, and ELITE does hereby accept
its position as an independent contractor to the Company upon the terms and conditions hereinafter
set forth.





	2.  	TERM




The term of this Agreement shall be for twelve (12) months.





	3.  	DUTIES AND OBLIGATIONS OF ELITE






	 	3.1  	ELITE will review and analyze various aspects of the Company’s goals and make
recommendations on feasibility and achievement of desired goals.
	 
	 	3.2  	Through its Tele-Market Relations Group, ELITE will provide exposure to its
network of firms and brokers that may be interested in participating with the Company,
schedule and conduct the necessary due diligence, and obtain the required approvals
necessary for those firms to participate. ELITE will also interview and make
determinations on any brokerage or institutional firm referred by the Company with
regard to their participation.
	 
	 	3.3  	At the Company’s request, ELITE will be available to field any calls from
firms, individual investors/shareholders and brokers inquiring about the Company. In
addition, ELITE will assist the Company in preparing its quarterly communications
relative to its financial results and coordinate corresponding news announcements,
conference calls and simulcasts on the Internet in accordance with Regulation FD.
	 
	 	3.4  	ELITE will feature the Company on the Internet via ELITE’s home web site
(www.efcg.net) within the Elite Financial Forum which will feature comprehensive
information relative to the Company’s fundamental and technical





 








 






	 	   	strengths, as well as industry and corporate overviews; management biographies;
stock trading history; market making activity; conference call/webcast archives; and
other information meaningful to the investment community. The Forum will be updated
routinely and provide for site visitors to request ongoing information about the
Company as it is released.
	 
	 	3.5  	ELITE shall write, produce and/or assist the Company in preparing and releasing
all news announcements. The Company shall be solely responsible for paying all fees
associated with the actual release(s) through BusinessWire, PR Newswire, or any other
comparable news dissemination source. ELITE will create, build and continually enhance
a database of all brokers, investors, analysts and media contacts who have expressed an
interest in receiving ongoing information on the Company and manage the ongoing
distribution of news announcements and/or other Company approved communications.
	 
	 	3.6  	ELITE shall serve as the Company’s publicist and will strive to obtain coverage
in both national and industry publications, in financial newsletters, on financial
radio and television programming and via traditional press mediums. Specifically,
ELITE will facilitate an ongoing outreach program to an intelligently targeted universe
of media professionals. Further, ELITE will track published articles and in
association with Burrelles provide monthly clippings of those articles/mentions
featuring the Company.
	 
	 	3.7  	At the Company’s request, strive to obtain the Company analyst coverage and/or
investment banking sponsorship.
	 
	 	3.8  	ELITE shall arrange for a series of due diligence meetings with select
broker/dealers, institutional investors and analysts at predetermined dates throughout
the campaign term, while remaining compliant with the rules and regulations associated
with Regulation FD.
	 
	 	3.9  	ELITE shall develop customized, high-quality, high-impact and fully integrated
financial communications programs and platforms, and leverage our strategic resources
to enhance general product/service marketing programs initiated by the Company.
	 
	 	3.10  	ALL OF THE FOREGOING ELITE-PREPARED DOCUMENTATION CONCERNING THE COMPANY,
INCLUDING, BUT NOT LIMITED TO, INFORMATIONAL WRITE-UPS, NEWS ANNOUNCEMENTS, SHAREHOLDER
LETTERS, ET AL, SHALL BE PREPARED BY ELITE USING MATERIALS SUPPLIED TO IT BY THE
COMPANY AND SHALL BE APPROVED BY THE COMPANY PRIOR TO DISSEMINATION BY ELITE.






	4.  	ELITE’S COMPENSATION






	 	4.1  	$5,000 cash, payable per month with the first payment of $5,000 due immediately
following execution of this Agreement and subsequent monthly payments due





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	 	   	every 30 days thereafter for the term of the Agreement. The Company agrees to make
all monthly payments on the applicable due date and in no event beyond five (5) days
past the due date. For every five (5) days past the applicable payment due date,
the Company shall be assessed a late fee equal to 10% of the outstanding amount
until the payment is received by ELITE.
	 
	 	4.2  	ELITE would also be entitled to receive an option or warrant to purchase up to
200,000 common shares of the Company’s common stock, exercisable as follows:






	 	4.2.1  	50,000 shares exercisable at $0.10 per share, which shall vest
immediately;
	 
	 	4.2.2  	50,000 shares exercisable at $0.15 per share, which shall vest
on the 91st day following execution of this Agreement;
	 
	 	4.2.3  	50,000 shares exercisable at $0.20 per share, which shall vest
on the 181st day following execution of this Agreement; and
	 
	 	4.2.4  	50,000 shares exercisable at $0.25 per share, which shall vest
on the 271st day following execution of this Agreement






	 	4.3  	The Company shall agree to issue ELITE piggyback registration rights for the
common shares underlying the option/warrant listed above, whereby these shares will be
registered for resale by ELITE on the first applicable Registration Statement filed by
the Company with the U.S. Securities & Exchange Commission; said underlying shares
common shares shall be held by the Company until such time as ELITE elects to exercise
its option or warrant to purchase the common shares. The term of the option/warrant
shall expire 24 months from the date the Registration Statement registering the shares
underlying the option/warrant is deemed effective.






	5.  	ELITE’S EXPENSES




Company shall pay all reasonable costs and expenses incurred by ELITE, its directors, officers,
employees and agents, in carrying out its duties and obligations pursuant to the provisions of this
Agreement, excluding ELITE’s general and administrative expenses and costs, but including and not
limited to the following costs and expenses; provided all costs and expense items in excess of
$1.00 (One Dollar) must be approved by the Company in writing prior to ELITE’s incurrence of the
same:





	 	5.1  	Travel expenses, including but not limited to transportation, lodging and food
expenses, when such travel is conducted on behalf of the Company.
	 
	 	5.2  	Seminars, expositions, money and investment shows.
	 
	 	5.3  	Radio and television time and print media advertising costs, when applicable.





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	 	5.4  	Subcontract fees and costs incurred in preparation of research reports, when
applicable.
	 
	 	5.5  	Cost of on-site due diligence meetings, if applicable.
	 
	 	5.6  	Printing and publication costs of brochures and marketing materials, which are
not supplied an by the Company.
	 
	 	5.7  	Corporate web site development costs.
	 
	 	5.8  	Printing and publication costs of Company annual reports, quarterly reports,
and/or other shareholder communication collateral material, which is not supplied by
the Company.






	6.  	COMPANY’S DUTIES AND OBLIGATIONS




Company shall have the following duties and obligations under this Agreement:





	 	6.1  	Cooperate fully and timely with ELITE so as to enable ELITE to perform its
obligations under this Agreement.
	 
	 	6.2  	Within ten (10) days of the date of execution of this Agreement to deliver to
ELITE a complete due diligence package on the Company, including all the Company’s
filings with the U.S. Securities and Exchange Commission within the last twelve months;
the last six (6) months of press announcements on the Company; and all other relevant
materials with respect to such filings, including, but not limited to, corporate
reports, brochures, and the like, and a list of analysis and or fund managers, who have
been following the Company.
	 
	 	6.3  	The Company will act diligently and promptly in reviewing materials submitted
to it from time to time by ELITE and inform ELITE of any inaccuracies contained therein
prior to the dissemination of such materials.
	 
	 	6.4  	Promptly give written notice to ELITE of any change in the Company’s financial
condition or in the nature of its business or operations which had or might have an
adverse material effect on is operations, assets, properties or prospects of its
business.
	 
	 	6.5  	Promptly pay all Company pre-approved costs and expenses incurred by ELITE
under the provisions of this Agreement when presented with invoices for the same by
ELITE.
	 
	 	6.6  	Give full disclosure of all material facts concerning the Company to ELITE and
update such information on a timely basis.
	 
	 	6.7  	Promptly pay the compensation due ELITE under the provisions of this Agreement
and as defined in Section 4 herein.





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	7.  	NONDISCLOSURE




Except as may be required by law, the Company, its officers, directors, employees, agents and
affiliates shall not disclose the contents and provisions of this Agreement to any individual or
entity without ELITE’s expressed written consent subject to disclosing same further to Company
counsel, accountants and other persons performing investment banking, financial, or related
functions for the Company.





	8.  	COMPANY’S DEFAULT




In the event of any default in the payment of ELITE’s compensation to be paid to it pursuant to
this Agreement, or any other charges or expenses on the Company’s part to be paid or met, or any
part or installment thereof, at the time and in the manner herein prescribed for the payment
thereof and as when and the same becomes due and payable, and such default shall continue for five
(5) days after ELITE’s written notice thereof is received by Company; in the event of any default
in the performance of any of the other covenants, conditions, restrictions, agreements, or other
provisions herein contained on the part of the Company to be performed, kept complied with or
abided by, and such default shall continue for five (5) days after ELITE has given Company written
notice thereof, or if a petition in bankruptcy is filed by the Company, or if the Company is
adjudicated bankrupt, or if the Company shall compromise all of its debts or assign over all of its
assets for the payment thereof, of if a receiver shall be appointed for the Company’s property,
then upon the happening of any of such events, ELITE shall have the right, at its option forthwith
or thereafter to accelerate all compensation, costs and expenses due or coming due hereunder and to
recover the same from the Company by suit or otherwise and further, to terminate this Agreement.
The Company covenants and agrees to pay all reasonable attorney fees, paralegal fees, costs and
expenses due of ELITE, including court costs, (including such attorney fees, paralegal fees, costs
and expenses incurred on appeal) if ELITE employs an attorney to collect the aforesaid amounts or
to enforce other rights of ELITE provided for in this Agreement in the event of any default as set
forth above and ELITE prevails in such litigation.





	9.  	COMPANY’S REPRESENTATIONS AND WARRANTIES




The Company represents and warrants to ELITE for the purpose of inducing ELITE to enter into and
consummate this Agreement as follows:





	 	9.1  	The Company has the power and authority to execute, deliver and perform under
this Agreement.
	 
	 	9.2  	The execution and delivery by the Company of this Agreement have been duly and
validly authorized by all requisite action by the Company. No license, consent or
approval of any form is required for the Company’s execution and delivery of this
Agreement.
	 
	 	9.3  	No representation or warranty by the Company in this Agreement and no
information in any statement, certificate, exhibit, schedule or other document
furnished, or to be furnished by the Company to ELITE pursuant hereto, or in connection
with the transactions contemplated hereby, contains or will contain any untrue
statement of a material fact, or omits or will omit to state a material





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	 	   	fact necessary to make the statements contained herein or therein not misleading.
There is no fact which the Company has not disclosed to ELITE, in writing, or in SEC
filings or news announcements, which materially adversely affects, nor, so far as
the Company can now reasonably foresee, may adversely affect the business,
operations, prospects, properties, assets, profits or condition (financial or
otherwise) of the Company.






	10.  	LIMITATION OF ELITE LIABILITY




If Elite fails to perform its services hereunder, its entire liability to the Company shall not
exceed the lessor of (a) the amount of cash compensation ELITE has received from the Company under
Section 4 of this Agreement or (b) actual damage to the Company as a result of such
non-performance. IN NO EVENT WILL ELITE BE LIABLE FOR ANY INDIRECT, SPECIAL OR CONSEQUENTIAL
DAMAGES NOR FOR ANY CLAIM AGAINST THE COMPANY BY ANY PERSON OR ENTITY ARISING FROM OR IN ANY WAY
RELATED TO THIS AGREEMENT, UNLESS SUCH DAMAGES RESULT FROM THE USE, BY ELITE, OR INFORMATION NOT
AUTHORIZED BY THE COMPANY.





	11.  	MISCELLANEOUS






	 	11.1  	Notices. Any notice or other communication required or permitted to be given
hereunder shall be in writing and shall be deemed to have been duly given when
delivered personally or sent by registered or certified mail, return receipt requested,
postage prepaid to the parties hereto at their addresses first above written. Either
party may change his or its address for the purpose of this paragraph by written notice
similarly given.
	 
	 	11.2  	Entire Agreement. This Agreement represents the entire agreement between the
Parties in relation to its subject matter and supercedes and voids all prior agreements
between such Parties relating to such subject matter.
	 
	 	11.3  	Amendment of Agreement. This Agreement may be altered or amended, in whole or
in part, only in a writing signed by both Parties.
	 
	 	11.4  	Waiver. No waiver of any breath or condition of this Agreement shall be deemed
to be a waiver of any other subsequent breach or condition, whether of a like or
different nature, unless such shall be signed by the person making such waiver and/or
which so provides by its terms.
	 
	 	11.5  	Captions. The captions appearing in this Agreement are inserted as a matter of
convenience and for reference and in no way affect this Agreement, define, limit or
describe its scope or any of its provisions.
	 
	 	11.6  	Situs. This Agreement shall be governed by and construed in accordance with
the laws of the State of Florida. Venue shall be located in Seminole County, Florida.
	 
	 	11.7  	Benefits. This Agreement shall inure to the benefit of and be binding upon the
Parties hereto, their heirs, personal representatives, successors and assigns.





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	 	11.8  	Severability. If any provision of this Agreement shall be held to be invalid
or unenforceable, such invalidity or unenforceability shall attach only to such
provision and shall not in any way render invalid or unenforceable any other provisions
of this Agreement, and this Agreement shall be carried out as if such invalid or
unenforceable provision were not contained herein.
	 
	 	11.9  	Arbitration. Any controversy, dispute or claim arising out of or relating to
this Agreement or the breach thereof shall be settled by arbitration. Arbitration
proceedings shall be conducted in accordance with the rules then prevailing of the
American Arbitration Association or any successor. The award of the Arbitration shall
be binding on the Parties. Judgment may be entered upon an arbitration award or in a
court of competent jurisdiction and confirmed by such court. Venue for arbitration
proceedings shall be Seminole County, Florida. The costs of arbitration, reasonable
attorney’s fees of the Parties, together with all other expenses, shall be paid as
provided in the Arbitration award.
	 
	 	11.10  	Currency. In all instances, references to monies used in this Agreement shall
be deemed to be United States dollars.
	 
	 	11.11  	Multiple Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, and all of such counterparts
shall constitute one (1) instrument.





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IN WITNESS WHEREOF, the Parties have executed this Agreement on the day and year as follows:



CONFIRMED AND AGREED ON THIS 1st DAY OF JANUARY, 2005.



ELITE FINANCIAL COMMUNICATIONS GROUP, LLC




	 	 	 	 	 
	By:

	 	/s/ Dodi B. Handy
	 	/s/ Andrea L. Strittmatter
	

	 	 
	 	 
	

	 	ELITE Officer
	 	Witness






	 	 	 
	Dodi B. Handy
	 	Andrea L. Strittmatter
	 
	 	 
	Print Name
	 	Print Name





CONFIRMED AND AGREED ON THIS 1st DAY OF JANUARY, 2005.



INTEGRATED BUSINESS SYSTEMS & SERVICES, INC.




	 	 	 	 	 
	By:

	 	/s/ George E. Mendenhall
	 	/s/ Stuart E. Massey
	

	 	 
	 	 
	

	 	Duly Authorized
	 	Witness






	 	 	 
	George E. Mendenhall, Ph.D.
	 	Stuart E. Massey
	 
	 	 
	Print Name
	 	Print Name






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