Document:

exh10-2_svcagmt.htm

     

    
      

      

    

     

     

     

     

     

     

     

     

     

    EXHIBIT 10.2

     

    SERVICES AGREEMENT BETWEEN

    V2K INTERNATIONAL, INC. AND AMERIVON HOLDINGS
LLC

    DATED JUNE 6, 2008

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    SERVICES
AGREEMENT

     

    This Services Agreement (this
“Agreement”) is made and entered into as of the day first written on the
signature page hereof by and between V2K International, Inc., a Colorado
corporation (the “Company”) and Amerivon Holdings LLC, a Nevada limited
liability company (“Amerivon”).

    

    RECITALS

     

    A.  The
Company is engaged in the sale and distribution of window fashion treatments
through independent franchisees and also to mass market, wholesale clubs and
other retailers (the “Products”).  The Company markets the Products
under its own brands or co-branded with the manufacturer.  The Company
is also in the process of raising capital to fund its growth through the
placement of its equity and debt securities.

    

    B.  Amerivon
will refer to the Company the distribution entities set forth on Exhibit A
attached hereto  (the “Distribution Prospects”) as amended from time
to time for consideration as customers subject to the terms and conditions of
this Agreement.

    

    C.           The
Company and Amerivon each desire to enter into this relationship for referrals
to the Prospects subject to the terms and conditions as set forth
herein.

    

    NOW,
THEREFORE, in consideration of the foregoing, the mutual promises and covenants
contained herein, and for other good and valuable consideration, their receipt
and adequacy of which are hereby acknowledged, the parties hereby agree as
follows.

    

    AGREEMENT

    

    1.           DEFINITIONS.  Unless
the context requires otherwise, the following underlined terms shall have the
following respective meanings:

    

    1.1           Agreement.  This
Services Agreement.

    

    1.2           Asserted
Liability.  Any claim, demand, or circumstance that may result
in an indemnified Loss, or the commencement or threatened commencement of any
action, proceeding, or investigation that may result in an indemnified
Loss.

    

    1.3           Audit.  The
audit of the Distributor Reports (as defined in Section 4.2 hereof) for purposes
of determining the amount of fees to be paid to Amerivon pursuant to Section 4
hereof, as conducted by the Auditors in accordance with Generally Accepted
Auditing Standards and special procedures to be mutually agreed upon by the
parties.

    

    1.4           Audit
Report.  The written report of the Audit delivered by the
Auditors.

    

    1.5           Auditors.  A
nationally- or regionally-based firm of independent certified public accountants
reasonably acceptable to Amerivon (for this purpose, the Company’s current
auditors, Seligson and Giannattasio, shall be acceptable to Amerivon) that shall
conduct the Audit.

    

    1.6           Commencement
Date.  The date first written on the signature page
hereof.

    

    1.7           Distributors.  A
Distribution Prospect through which Company sells the Products.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    1.8        Amerivon.  Amerivon
Holdings LLC, a Nevada limited liability company.

    

    1.9        Distribution
Prospects.  Those entities set forth on Exhibit A attached
hereto, as amended or appended by the mutual written consent of the parties from
time to time.

    

    1.10      Indemnified
Party.  Amerivon with respect to the indemnification provided
by Section 7.1 hereof, and the Company with respect to the indemnification
provided by Section 7.2 hereof.

    

    1.11      Indemnifying Party.  The
Company with respect to the indemnification provided by Section 7.1 hereof, and
the Amerivon with respect to the indemnification provided by Section 7.2
hereof.

    

    1.12  Company.  V2K
International, Inc., a Colorado corporation.

    

    1.13  Losses.  Any
and all losses, liabilities, damages, deficiencies, demands, claims, actions,
judgments, causes of action, assessments, costs, and expenses, including but not
limited to interest, penalties, court costs, and reasonable attorneys'
fees.

    

    1.14  Net
Sales.  Gross Sales for which payment has actually been
received by the Company, less returns, chargebacks, and
allowances.  Gross Sales shall mean the retail sales amount charged by
the Distributor or the Company’s independent dealers, agents or
franchisees.

    

    1.15  New Distribution
Prospect.  A Distribution Prospect not listed on Exhibit A as
of the Commencement Date.

    

    1.16  Products.  A
diversified portfolio of window fashion treatments including both “hard goods”
such as shutters and blinds and “soft goods” such as window fabrics, draperies,
window coverings.

    

    2.           SOLICITING
PROSPECTS.  During the term of this Agreement, Amerivon shall
solicit the Distribution Prospects to sell the Products.

    

    3.           AMERIVON'S
RESPONSIBILITIES.  During the term of this Agreement, Amerivon
shall:

    

    3.1           Ethical
Responsibilities.  Adhere, and use commercially reasonable
efforts to promote the highest standards of honesty, integrity, fair dealing,
and ethical conduct in all dealings with the Distribution Prospects;
and

    

    3.2           Marketing
Methods.  Use only those materials that have received the
Company’s prior written approval.  Amerivon has no authority to make
any promise or representation on behalf of the Company and Amerivon shall be
responsible to the Company for any promise, representation, or warranty given to
a Distribution Prospect by Amerivon that is not contained in either advertising
or marketing materials approved in writing by the Company.

    

    
      
        
        

      

      
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    4.           FEES.

    

    4.1           Conditions for Receiving
Fees.  The Company will pay fees to Amerivon, pursuant to
Section 4.2 hereof, for each Distribution Prospect that becomes a Distributor
and for which the following conditions are met: (i) Amerivon notifies the
Company in writing prior to introducing a new Distribution Prospect (the “New
Prospect”) to the Company; (ii) the Company does not notify Amerivon within
three business days following Amerivon’s notice that either the Company has a
pre-existing relationship with the New Prospect or the Company desires for
Amerivon to defer the introduction to the New Prospect, and (iii) the Company
enters into a definitive agreement to sell Products to the Distribution
Prospect, which may be the acceptance by Company of a purchase order for
Products.

    

    4.2           Fees for
Distributors.  Subject to the conditions set forth in Section
4.1 hereof, for the referral of Distribution Prospects pursuant to this
Agreement resulting in a Distributor, the Company will pay to Amerivon a fee
equal to five percent (5%) of the Net Sales directly attributable to the sale of
the Products through the Distributor.  The Company shall pay fees
subject to this Section 4.2 monthly pursuant to a “Distributor Report” which
shall be delivered by the 20th day
following the end of the calendar month in which the Net Sales are achieved by
the Company.

    

    4.3           Expense
Reimbursement.  Amerivon shall be reimbursed for all reasonable
out-of-pocket expenses incurred in the fulfillment of its obligations herein.
Said expenses shall be presented to the Company on a monthly basis and paid
within 30 days.  All expenses in excess of $1,000 must be approved by
the Company in advance.

    

    4.4           Option
Grant.  Amerivon shall also receive a five year option to
purchase 3,256,810 shares of common stock of the Company, equal to five percent
(5%) of the number of shares of the Company’s common stock outstanding, on a
fully diluted basis (assuming the exercise of all options and warrants
outstanding as of June 6, 2008) with an exercise price equal to $.30 per share
(the “Option”).  The option shall vest and become exercisable in
accordance with the vesting schedule and benchmarks set forth in the Stock
Option Agreement attached hereto as Exhibit B.  The parties will
execute and deliver the Option concurrently with the execution and delivery of
this Agreement.

    

    4.5           Audit
Rights.  Amerivon shall have the right to Audit a Distributor
Report for one (1) year after its delivery.  Prior to its engagement,
(i) the Auditors shall execute and deliver a confidentiality and non-disclosure
agreement containing usual and customary provisions protecting the Company and
(ii) the Auditors and each of the parties shall consent in writing to the agreed
upon procedures which shall govern the Audit.  The Auditors shall
commence the Audit as soon as practicable and shall complete the Audit and
deliver a preliminary Audit Report to the parties as soon as
practicable.  The parties shall use their best efforts to fully
cooperate with the Auditors in its conduct of the Audit.  The parties
shall have fifteen (15) days from delivery thereof to review the preliminary
Audit Report and provide comments to the Auditors and each
other.  Upon receipt of the parties’ comments, the Auditors shall
issue a final Audit Report.  The Audit Report shall be conclusive and
binding upon the parties.  Amerivon shall pay the Auditors’ fees and
expenses of the Audit unless there is a discrepancy in favor of Amerivon greater
than five percent (5%) of amounts payable pursuant to the Distributor Report(s)
subject to the Audit, in which case the Company shall pay for the Auditors’
reasonable fees and expenses.

    

    
      
        
        

      

      
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    5.           TERM AND
TERMINATION.

    

    5.1           Term.  The
term of this Agreement shall commence on the Commencement Date and, unless
sooner terminated as hereinafter provided, shall continue for a period of one
year, with automatic one-year renewals every year unless terminated by one of
the parties as herein provided.   In the event that Amerivon
makes an investment in the Company or introduces someone who makes an investment
in the Company, then the term of this Agreement shall commence on the
Commencement Date and, unless sooner terminated as hereinafter provided, shall
continue for a period of three years, with automatic one-year renewals every
year unless terminated by one of the parties as herein provided.

    

    5.2           Termination Without
Cause.  Either party may terminate this Agreement after one
year with­out cause upon giving thirty (30) days prior written notice to the
other party.  In the event that Amerivon makes an investment in the
Company or introduces someone who makes an investment in the Company, then
either party may terminate this Agreement after three years with­out cause
upon giving thirty (30) days prior written notice to the other
party.

    

    5.3           Termination For
Cause.  Either party may terminate this Agreement upon thirty
(30) days prior written notice to the other party in the following
events:

    

    (a)      Breach.  A
party breaches any material provision of this Agreement and such breach remains
uncured for thirty (30) days after written notice thereof from the nonbreaching
party to the breaching party, unless such breach is of such a nature that it
cannot be cured within thirty (30) days and the breaching party commences a cure
within thirty (30) days after receipt of written notice of the breach and
diligently proceeds to complete the cure as soon as possible but in no event
greater than one hundred twenty (120) days after receipt of such
notice;

    

    (b)      Voluntary
Bankruptcy.  A party files or consents to any voluntary or
involuntary petition for bankruptcy, insolvency, reorganization, liquidation, or
other similar form of debtor relief, or petitions for or consents to the
appointment of a receiver, trustee, or liquidator on its behalf for all or a
substantial portion of its assets, or makes a general assignment for the benefit
of creditors; or

    

    (c)  Involuntary
Bankruptcy.  A party is the subject of any involuntary petition
for bankruptcy, insolvency, reorganization, liquidation, or other similar form
of debtor relief, or has a receiver, trustee, or liquidator appointed on its
behalf for all or a substantial portion of its assets, unless such petition or
appointment is set aside, withdrawn, or ceases to be in effect within ninety
(90) days from the date of any such petition or appointment.

    

    5.4           Effect of
Termination.  With respect to a termination of this Agreement
pursuant to Sections 5.1, 5.2, or 5.3 hereof, the Company shall have the
obligation to pay fees for only those Distribution Prospects or Distributors who
enter into a binding, written agreement with the Company within one year from
the termination date. In the event that Amerivon makes an investment in the
Company or introduces someone who makes an investment in the Company, the
Company will be obligated to pay fees for three years from the termination
date.

    

    

    
      
        
        

      

      
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    6.           RELATIONSHIP.

    

    6.1           Relationship.  The
parties hereby acknowledge and agree that the relationship arising from this
Agreement does not constitute or create a general agency, joint venture,
partnership, employment relationship, or franchise between them.  The
parties agree and acknowledge that they are independent businesses and are
independent contractors and not employees of the other party for any
purpose.  Each party has the right to operate such party’s business as
the party sees fit, and shall hire employees and have the right to engage other
personnel as such party may deem necessary or desirable, and such party shall
exercise the sole and exclusive control and supervision of such persons. In
addition, each party is free to engage in such other business activities as such
party may desire to pursue, so long as such other business activities do not
interfere with such party’s per­formance hereunder, violate the provisions
hereof, or breach any other contractual obligation of the party; provided,
however, that Amerivon shall not represent, directly or indirectly, any other
person or entity who sells a product which competes with any Product in any
geographic area in which the Company shall be selling or distributing its
Products and shall not, directly or indirectly represent any person or entity in
the sale or distribution of olives in the United States.  Each party
will be responsible for the costs, deductions, withholdings, and contributions
with respect to such party on account of social security, insurance,
unemployment compensation, income tax, or otherwise, under any federal, state,
or local law applicable to the relationship of employer and
employee.

    

    7.           INDEMNIFICATION.

    

    7.1           Indemnification by the
Company.  The Company shall indemnify, save, defend, and hold
Amerivon harmless from and against any and all Losses based upon, arising out
of, or otherwise in respect of any negligent, grossly negligent, or
intentionally wrongful act or omission of the Company or its employees or agents
under this Agreement, any material breach by the Company of any warranty,
representation, covenant or agreement contained herein, any violation or
infringement of any copyright, trademark or any other intellectual property
right, or violation of any third party’s right of publicity; provided that any
claim for indem­nification must exceed Five Thousand Dollars ($5,000) for
each single or related acts or omissions for which indemnification is
claimed.

    

    7.2           Indemnification by
Amerivon.  Amerivon shall indemnify, save, defend, and hold the
Company harmless from and against any and all Losses based upon, arising out of,
or other­wise in respect of any negligent, grossly negligent, or
intentionally wrongful act or omission of Amerivon or its employees, or agents
under this Agreement, any breach by Amerivon of any material warranty,
representation, covenant or agreement contained herein, any violation or
infringement of any copyright, trademark or any other intellectual property
right, or violation of any third party’s right of publicity; provided that any
claim for indemnification must exceed Five Thousand Dollars ($5,000) for each
single or related acts or omissions for which indemnification is
claimed.

    

    7.3           Notice of Asserted
Liability.  Promptly after receipt by an Indemnified Party of
notice of any Asserted Liability, the Indemnified Party shall give written
notice thereof to the Indemnifying Party.  The notice shall describe
the Asserted Liability in reasonable detail, and shall indicate the amount
(estimated, if necessary and to the extent feasible) of the Losses that have
been or may be suffered by the Indemnified Party.  The failure to give
such notice shall not affect the Indemnified Party’s right to seek
indemnification from the Indemnifying Party unless the Indemnified Party is
materially prejudiced by such lack of notice.

    

    7.4           Asserted Liability Not
Involving a Third Party.  Upon receipt of a notice of an
Asserted Liability not involving a third party, unless the Indemnifying Party
provides written 

     

    
      
        
        

      

      
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      objections
as set forth in Section 7.6 of this Agreement, the Indemnifying Party shall
promptly reimburse the Indemnified Party for the Losses suffered by the
Indemnified Party.

    

    

    7.5           Asserted Liability Involving
a Third Party. Upon receipt of a notice of an Asserted Liability
involving a third party, unless the Indemnifying Party provides written
objections as set forth in Section 7.6 of this Agreement, the Indemnifying Party
shall provide a defense of the Asserted Liability for the Indemnified Party,
using qualified legal counsel, and shall pay all reasonable costs of defense and
the amount of any judgment, order, award, settlement, compromise, or
otherwise.  The Indemnified Party shall cooperate with the
Indemnifying Party in any such defense, and the Indemnified Party may
parti­cipate in such defense using legal counsel of its own choice at its
own expense.  The Indemnifying Party may not settle or compromise any
claim without the consent of the Indemnified Party, which consent may not be
unreasonably withheld or delayed; provided that the Indemnifying Party may
settle or compromise any claim without the consent of the Indemnified Party if
(i) the Indemnifying Party pays the full amount of such settlement or compromise
and all expenses, and (ii) the settlement or compromise does not require the
Indemnified Party to perform any act or to refrain from per­forming any
act.  If the Indemnifying Party fails to give the Indemnified Party
written notice within thirty (30) days after receipt of the notice of the
Asserted Liability that the Indemnifying Party is assuming the defense of the
Asserted Liability, or if the Indemnifying Party fails to assume and continually
maintain the defense of the Asserted Liability within thirty (30) days after
receipt of the notice of the Asserted Liability, then the Indemnified Party may
assume control of the defense of the Asserted Liability using legal counsel of
its own choice at the expense of the Indemnifying Party, and the Indemnified
Party may settle or compromise any claim with the consent of the Indemnifying
Party, which consent may not be unreasonably withheld or delayed, at the expense
of the Indemni­fying Party.

    

    7.6           Objections.  If
the Indemnifying Party disputes any notice of an Asserted Liability, then the
Indemnifying Party shall have thirty (30) days from receipt of such notice to
give written objections to the Indemnified Party or such objections shall be
deemed waived.  On delivery of the written objections, the Indemnified
Party and the Indemnifying Party shall have until the earlier of thirty (30)
days from the date of receipt of the written objections or five (5) days before
the Indemnified Party must file a response with a court, arbitrator, or similar
entity with respect to the Asserted Liability to negotiate and attempt to
resolve their differences.  If the parties are unable to resolve their
differences during such thirty (30)-day period, then the Indemnified Party may,
subject to the provisions of this Agreement, immediately thereafter pursue any
legal remedies available.

     

    7.7.          Jurisdiction.  The
parties hereby consent to the exclusive jurisdiction of all courts of the State
of Nevada and the United States District Court for the State of Nevada as well
as to the jurisdiction of all courts from which an appeal may be taken from such
courts, for the purpose of any suit, action or other proceeding arising out of
or with respect to this Agreement.  THE PARTIES HEREBY EXPRESSLY WAIVE
ANY AND ALL OBJECTIONS WHICH THEY MAY HAVE AS TO VENUE IN ANY SUCH COURTS AND
ALSO WAIVE  ALL RIGHTS TO TRIAL BY JURY IN ANY SUCH SUIT, ACTION OR
PROCEEDING.  Each party may file a copy of this Agreement as evidence
of the foregoing waiver of right to jury trial.

    

    8.           LIMITATIONS OF WARRANTIES
AND LIABILITIES.

    

    8.1            Warranty
Restrictions.  The Company makes no warranty, express or
implied, regarding the Products, including any warranty of merchantability or
fitness for a particular purpose.

    

    
      
        
        

      

      
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    8.2           No Liability for
Consequential Damages. Neither party shall be liable for special,
indirect, incidental, exemplary, punitive, or consequential damages, including
but not limited to loss of profits, related to or arising out of the performance
of this Agreement, even if advised of the possibility of such
damages.

    

    8.3           The
Company’s
Representations and Warranties. The Company represents and warrants that:
(i) it is a corporation company duly organized, validly existing and in good
standing under the laws of the State of Colorado (ii) it has the lawful right,
power, authority and capacity to enter into this Agreement; (iii) the person
signing this Agreement is authorized to do so; (iv) neither the execution nor
the performance of this Agreement shall constitute a violation of or interfere
with the Company’s obligations to any third party; (v) to the Company’s actual
knowledge, the Products or their use do not infringe any patents, copyrights,
trademarks, trade secrets, or any other intellectual property rights relating to
their uses; and (vi) that there are no suits or proceedings pending or, to the
Company’s actual knowledge, threatened which allege any infringement of such
proprietary rights.

     

    8.4           Amerivon’s Representations
and Warranties.  Amerivon represents and warrants that: (i) if
it is not an individual, it is a entity validly existing and in good standing
under the laws of its jurisdiction; (ii) it has the lawful right, power,
authority and capacity to enter into this Agreement; (iii) the person signing
this Agreement is authorized to do so; and (iv) neither the execution nor the
performance of this Agreement shall constitute a violation of or interfere with
Amerivon’s obligations to any third party.

    

    9.           GENERAL
PROVISIONS.

    

    9.1           Amendment.  All
amendments or modifications of this Agreement shall be in writing and shall be
signed by each of the parties hereto.

    

    9.2           Waiver.  Any
waiver of any right, power, or privilege hereunder must be in writing and signed
by the party being charged with the waiver.  No delay on the part of
any party hereto in exercising any right, power, or privilege hereunder shall
operate as a waiver of any other right, power, or privilege hereunder, nor shall
any single or partial exercise of any right, power, or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, power, or privilege.

    

    9.3           Notices.  Except
for Distributor Reports, all notices or other communications required or
permitted to be given pursuant to this Agreement shall be in writing and shall
be delivered personally or sent by overnight courier, by telecopy with
confirmation by first-class mail, or by certified mail, return receipt
requested, or by e-mail with receipt confirmation.  Notices delivered
personally or sent by overnight courier or by telecopy with confirmation by
first-class mail shall be effective on the date first received, while notices
sent by certified mail, return receipt requested, shall be deemed to have been
received and to be effective four (4) business days after deposit into the
mails.  Notices shall be given to the parties at the following
respective addresses, or to such other addresses as any party shall designate in
writing:

    

    
      
        
        

      

      
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    If to the
Company:                                           V2K
International, Inc.

                                                                              
13949 West Colfax Avenue

    Suite 250

    Lakewood,
Colorado  80401

    Attn:  Vic
Yosha

    Chief Executive Officer

    Telephone:  (303)
202-1120

    Telecopier:  (303)
202-5201

    E-mail:  vyosha@v2k.com

    

    with a
copy
to:                                                  Fay
M. Matsukage, Esq.

    Dill Dill Carr Stonbraker &
Hutchings, P.C.

    455 Sherman Street

    Suite
300

    Denver,
Colorado 80203

    Telephone:  (303)
777-3737

    Telecopier:  (303)
777-3823

    E-mail:  fmm@dillanddill.com

    

    If to
Amerivon:                                                 Mr.
Tod M. Turley

    Chief Executive Officer

    Amerivon Holdings LLC

    800 Southwood Boulevard

    Suite 212

    Incline
Village, Nevada  89451-7475

    Telephone/Telecopier:
(877) 325-6921

    E-mail:  info@amerivon.com

    

    with a
copy
to:                                                  Charles
E. McKee, Esq.

    Nevers, Palazzo, Maddux & Packard,
plc

    31248 Oak Crest Drive.

    Suite 100

    Westlake Village,
California  91361-5671

    Telephone: (818) 879-9700

    Telecopier:

    E-mail: cemckee@npmp.com

    

    9.4           Successors and
Assigns.  This Agreement and each of its provisions shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, executors, administrators, successors, and
assigns.

     

    9.5           Law
Governing.  This Agreement has been negotiated, executed, and
delivered and shall be performed in the State of Nevada and shall be governed by
and construed and enforced in accordance with the laws of the State of
Nevada  without regard for its conflict of laws rules.  The
parties hereby irrevocably submit to the exclusive jurisdiction of the courts of
the State of Nevada  and any United States District Court situated in
the State of Nevada for the purposes of construing and enforcing this
Agreement.

    

    
      
        
        

      

      
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    9.6           Attorneys’
Fees.  Should a lawsuit be commenced to interpret or enforce
the terms of this Agreement, the prevailing party shall be entitled to recover
costs and reasonable attorneys’ fees in addition to any other recovery to which
such party may be entitled.

    

    9.7           Counterparts.  This
Agreement may be executed in two or more counterparts, including by facsimile
transmission, all of which together shall constitute a single
instrument.

    

    9.8           Severability of
Provisions.  In the event any one or more of the provisions of
this Agreement shall for any reason be held to be invalid, illegal, or
unenforceable in any respect, such invalidity, illegality, or unenforceability
shall not affect any other provision hereof, and this Agreement shall be
construed as if such invalid, illegal, or unenforceable provision had never been
contained herein.

    

    9.9           Construction.  The
headings in the sections and paragraphs of this Agreement are for convenience
only and shall not constitute a part hereof.  Whenever the context so
requires, the masculine shall include the feminine and the neuter, the singular
shall include the plural, and conversely.  The terms and all parts of
this Agreement shall in all cases be interpreted simply and according to their
plain meaning and neither for nor against any party hereto.

    

    IN
WITNESS WHEREOF, the parties have duly executed and delivered this Agreement as
of June 6, 2008.

    

    

    V2K
International, Inc.

    

    

    By:     /s/ Victor J.
Yosha                                 

    

    Title:    Chief Executive
Officer                   

    

    

    Amerivon
Holdings LLC

    

    

    By:     /s/ Tod M.
Turley                               

     

    Title:    Chief Executive
Officer               

     

     

     

     

     

    9exh10-3_consulting.htm

     

    
      

      

    

     

     

     

     

     

     

     

     

     

    EXHIBIT 10.3

     

    CONSULTING AGREEMENT DATED JUNE 6, 2008

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    June 6,
2008

     

     

    

    Gordon
Beckstead

    Chairman

    V2K
International, Inc

    13949
West Colfax Avenue

    Suite
250

    Lakewood,
Colorado  80401

    

    

    Re:           V2K
Business Assessment and Marketing Strategy

    

    

    

    Dear
Gordon,

    

    This
letter will serve as the definitive agreement for the Business Assessment and
Marketing Strategy to be developed by Growth Management Partners LLC d/b/a
Amerivon Retail Consulting (“ARC”) in conjunction with the Reliable Retail
Results Proposal dated March 17, 2008 and executed by V2K and
Amerivon.

    

    We at ARC
are very impressed with the V2K concept and look forward to working with your
team to develop and execute a go-to-market strategy to grow V2K’s business and
shareholder value. This letter provides a detailed description of our work plan
and the deliverables for the engagement.  We look forward to
discussing it with you and beginning our work together.

    

    

    Overview

    

    ARC will
focus its efforts on two fronts:  an initial Business Assessment
followed by a thorough development of a Marketing Plan.  The Marketing
Plan will cover all aspects of the company’s sales and marketing strategy with a
particular focus on two major go-to-market issues:

    

    
      	
              1.  

            	
              Using
      kiosks inside of major retailers to generate sales leads.  It is
      our understanding that V2K has a successful sales model with a very high
      closing rate for new sales prospects.  Our goal will be to
      evaluate how an in-store kiosk could successfully be deployed to generate
      more leads.  We will be working with the company to evaluate and
      adjust the pilot kiosk program being launched in two Sam’s Club locations
      in April 2008.

            

    

    

    
      	
              2.  

            	
              Using
      a dealer network to complement the existing franchise
      model.  V2K currently uses a franchise model as it primary sales
      force.  We understand that this choice was partially driven by
      limited access to capital during the company’s start-up
      phase.  ARC will explore whether or not a dealer model with
      company owned stores and direct employees may provide better control and
      margins.

            

    

    

    The above
will represent Phase l of our work with V2K.  ARC would also like to
evaluate the company’s sourcing and supply chain strategies, especially the
products that are sourced from China and Mexico.  We would also like
to evaluate several technology issues (on-line selling, call centers, and
technology licensing) as well as product line extensions and alliances (paints,
floor coverings, accessories, etc).  We will collect data on these
issues in the course of our work in Phase 1, but a full evaluation of these
issues will be undertaken in a Phase II engagement at the direction of
V2K.

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

      o 
Page 2                                                                                                                                                         
June 6, 2008

       

    

    Approach

    

    As
outlined in our March 17th Reliable Retail Results letter, ARC will provide an
assessment of V2K’s current business and will develop a complete marketing
strategy in Phase l.  The key deliverables for this Phase I plan will
include:

    

    
      	
              1.  

            	
              Current
      business and market assessment,
including:

            

    

    

    
      	
              a.  

            	
              Review
      the size of the window treatment market and industry trends. We will focus
      on the US market, but will include international data where
      available.

            

    

    

    
      	
              b.  

            	
              Develop
      a SWOT analysis for V2K’s current
business.

            

    

    
      	
              i.  

            	
              Strengths:

            

    

    
      	
              1.  

            	
              Technology

            

    

    
      	
              2.  

            	
              Sales
      process

            

    

    
      	
              3.  

            	
              Backend
      process management

            

    

    
      	
              4.  

            	
              Sam’s
      club kiosk test

            

    

    
      	
              ii.  

            	
              Weaknesses:

            

    

    
      	
              1.  

            	
              Lead
      generation

            

    

    
      	
              2.  

            	
              Brand
      awareness

            

    

    
      	
              3.  

            	
              Branding
      strategies

            

    

    
      	
              iii.  

            	
              Opportunities:

            

    

    
      	
              1.  

            	
              Increase
      market penetration and geographic
coverage

            

    

    
      	
              2.  

            	
              Improve
      control and margins

            

    

    
      	
              3.  

            	
              Partner
      with selected retailers

            

    

    
      	
              4.  

            	
              Improve
      efficiency of sourcing and
manufacturing

            

    

    
      	
              5.  

            	
              Add
      related product lines such as paint and floor coverings through alliances,
      expand license technology, develop an on-line
  platform

            

    

    
      	
              iv.  

            	
              Threats:

            

    

    
      	
              1.  

            	
              Low
      brand awareness

            

    

    
      	
              2.  

            	
              Capital
      requirements to increase market penetration and geographic
      coverage

            

    

    
      	
              3.  

            	
              Margin
      pressure from changes in foreign currency exchange rates which in turn
      increases sourcing costs

            

    

    
      	
              4.  

            	
              Competition

            

    

    

    
      	
              c.  

            	
              Analysis
      of the competitive landscape.

            

    

    
      	
              i.  

            	
              Evaluate
      competitors such as Hunter Douglas, who have catalogue and on-line
      businesses, as well as alliances with selected retailers such as
      Costco.

            

    

    
      	
              ii.  

            	
              Evaluate
      regional competitors such as Eddie Z’s who have their own stores or sales
      models.

            

    

    
      	
              iii.  

            	
              Evaluate
      existing retailer initiatives such as the Hunter Douglas in-store kiosk
      program with Costco.

            

    

    
      	
              iv.  

            	
              Evaluate
      the V2K/Sam’s club pilot.

            

    

    

    
      	
              2.  

            	
              Marketing
      Strategy

            

    

    

    
      	
              a.  

            	
              Evaluate
      the current franchise model.

            

    

    
      	
              i.  

            	
              Review
      strengths (franchising income, low capital requirements, high quality
      sales personnel) and weaknesses (less control, lower
    margins).

            

    

    
      	
              ii.  

            	
              Identify
      opportunities to improve control, efficiencies,
    profitability

            

    

    

    
      	
              b.  

            	
              Evaluate
      a potential dealer model with company owned stores and direct
      employees.

            

    

    
      	
              i.  

            	
              Identify
      requirements to establish dealer network: store logistics, technology,
      staff and compensation.

            

    

    
      	
              ii.  

            	
              Develop
      store geography and location strategy, including number of stores and
      expansion planning.

            

    

    
      	
              iii.  

            	
              Evaluate
      costs, benefits, and ROI of a direct dealer
  model.

            

    

    
      	
              iv.  

            	
              Evaluate
      a mixed model of franchise and direct
dealers.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

      
        o 
Page 3                                                                                                                                                         
June 6, 2008

         

      

    

    
      	
              c.  

            	
              Evaluate
      the current in-store kiosk strategy

            

    

    
      	
              i.  

            	
              Review
      the objectives of kiosk: awareness, lead generation, product information
      and demonstration, and sales leads.

            

    

    
      	
              ii.  

            	
              Evaluate
      kiosk execution issues: design, user experience and time, cost,
      maintenance.

            

    

    
      	
              iii.  

            	
              Look
      at current and future channel partners.  Which retailers are the
      best strategic fit (Costco, Loews, JC Penny,
  etc)

            

    

    
      	
              iv.  

            	
              Review
      the retailer value proposition and benefits: providing new services and
      revenues such as the ability to sell custom window
    treatments.

            

    

    
      	
              v.  

            	
              Review
      the kiosk fulfillment plan: lead capture and distribution, payment
      processing, accounting, customer service, and issue
    resolution

            

    

    

    

    Work
Plan

    

    In order
to provide the foregoing deliverables, we propose the following work
plan:

    

    
      	
              1.  

            	
              Current
      business and market assessment.

            

    

    

    
      	
              a.  

            	
              Project
      start-up meeting with V2K
management.

            

    

    
      	
              i.  

            	
              Review
      and finalize project objectives

            

    

    
      	
              ii.  

            	
              Appoint
      V2K project team members: team leader/sponsor; finance; franchisee
      contact; customer contact; Sam’s Club
contact.

            

    

    

    
      	
              b.  

            	
              Determine
      the market size and review trends.

            

    

    
      	
              i.  

            	
              Review
      data from V2K and ARC sources to determine size of window treatment
      market, trends, competitors, and issues. Focus on the US, but collect
      international data where available.

            

    

    
      	
              ii.  

            	
              Interview
      V2K executives and franchises to capture their views on these
      issues

            

    

    

    
      	
              c.  

            	
              Identify
      competitors and evaluate their
models

            

    

    
      	
              i.  

            	
              Identify
      key competitors such as Hunter Douglas and regional companies such as
      Eddie Z’s, etc.

            

    

    
      	
              ii.  

            	
              Evaluate
      the competitor models: product and service offerings, pricing, sales
      channels (company stores, franchisees, catalogue, on-line, in-store
      kiosk), retail partners, sourcing, profitability, strengths and
      weaknesses. In particular, evaluate the Hunter Douglas kiosks in Costco
      (objectives, functions, customer experience, benefits, operations issues,
      cost, and ROI).

            

    

    

    
      	
              d.  

            	
              Evaluate
      the current franchise model

            

    

    
      	
              i.  

            	
              Interview
      V2K franchisees and V2K management.

            

    

    
      	
              ii.  

            	
              Identify
      strengths and weaknesses of V2K franchise model: franchise cost and fees,
      technology, products, training and sales support, leads, in-home selling
      experience, average sale size, backend operations and
      fulfillment.

            

    

    
      	
              iii.  

            	
              Identify
      opportunities for improvement ( i.e. leads, control, new products such as
      paints)

            

    

    
      	
              iv.  

            	
              Evaluate
      financials: franchise fees and income; revenue growth;
      margins.

            

    

    

    
      	
              e.  

            	
              Evaluate
      consumer experience

            

    

    
      	
              i.  

            	
              Interview
      V2K consumers

            

    

    
      	
              ii.  

            	
              Determine
      how consumers became aware of V2K and contacted
  company.

            

    

    
      	
              iii.  

            	
              Determine
      awareness and perception of V2K versus
  competitors.

            

    

    
      	
              iv.  

            	
              Evaluate
      consumer response to brand name.

            

    

    
      	
              v.  

            	
              Evaluate
      in-home shopping, buying and fulfillment
  experience.

            

    

    
      	
              vi.  

            	
              Identify
      trends (in-store shopping, on-line shopping), opportunities for
      improvement, and growth (new products,
etc)

            

    

    

    
      	
              f.  

            	
              Evaluate
      Sam’s Club pilot.

            

    

    
      	
              i.  

            	
              Interview
      V2K and Sam’s Club management.

            

    

    
      	
              ii.  

            	
              Review
      the objectives of the kiosk, operations issues, benefits, cost,
      ROI

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      o 
Page 4                                                                                                                                                         
June 6, 2008

    

     

    
      	
              iii.  

            	
              Interview
      consumers (buyers and aware non-buyers).  Focus on awareness,
      kiosk usage experience, leads generated, if purchased why, if not
      purchased why not, strengths and opportunities for
      improvement.

            

    

     

    ARC will
summarize the findings of Market and Business Assessment and will conduct
management workshops to and present the findings.  The workshops will
cover:

    
      	
              ·  

            	
              SWOT
      analysis of current business

            

    

    
      	
              ·  

            	
              Competitive
      landscape

            

    

    
      	
              ·  

            	
              Evaluation
      of existing retailer initiatives: Hunter Douglas Costco kiosk program; V2K
      Sam’s Program

            

    

    
      	
              ·  

            	
              Key
      issues to be resolved in developing the Marketing
  Strategy

            

    

    

    We
estimate that the Market and Current Business Assessment phase will take 4 to 6
weeks to complete, depending on the availability of data and people to be
interviewed.

    

    

    
      	
              2.  

            	
              Marketing
      Strategy

            

    

    

    
      	
              a.  

            	
              Evaluate
      dealer model

            

    

    
      	
              i.  

            	
              Evaluate
      competitors models: Hunter Douglas, Eddie Z’s and
  others

            

    

    
      	
              ii.  

            	
              Develop
      elements of dealer model

            

    

    
      	
              iii.  

            	
              Store
      costs: rent, technology (kiosks, other),fixtures and display,
      product/sample inventory

            

    

    
      	
              iv.  

            	
              Staffing:
      skills sets (sales people, designer, other); compensation(hourly base,
      commissions)

            

    

    
      	
              v.  

            	
              Headquarters
      team: management, operations, technology, sourcing,
  finance

            

    

    
      	
              vi.  

            	
              Number
      and location of stores with a roll out
plan

            

    

    
      	
              vii.  

            	
              Costs
      and ROI

            

    

    

    
      	
              b.  

            	
              Compare
      franchise and dealer models

            

    

    
      	
              i.  

            	
              Strengths,
      weaknesses and benefits of each
model

            

    

    
      	
              ii.  

            	
              Cost
      and ROI of each model

            

    

    
      	
              iii.  

            	
              Evaluate
      a mix of franchise and dealer
stores

            

    

    

    
      	
              c.  

            	
              Evaluate
      and further refine the in-store kiosk
strategy

            

    

    
      	
              i.  

            	
              Summarize
      findings of Hunter Douglas Costco kiosk program and V2K Sam’s
      test.

            

    

    
      	
              ii.  

            	
              Determine
      the objectives of the kiosk: to increase awareness, generate leads,
      provide information and demonstrate the
product.

            

    

    
      	
              iii.  

            	
              Further
      develop design and user interface/experience. Determine operating and
      maintenance issues.

            

    

    
      	
              iv.  

            	
              Determine
      fulfillment issues: lead and order management; payment and accounting;
      customer service

            

    

    
      	
              v.  

            	
              Develop
      retailer proposition: benefits ( new revenue due to ability to offer
      custom window treatments, etc); terms; cost and ROI to
      retailer

            

    

    
      	
              vi.  

            	
              Determine
      which retailers would be best strategic partners and priority (
      Sam’s/Wal-Mart; Costco; JC Penny, Loews, Bed Bath and Beyond,
      etc)

            

    

    
      	
              vii.  

            	
              Determine
      cost and ROI to V2K

            

    

    

    We will
summarize the findings of the Marketing Strategy plan and will hold meetings
with V2K management to present the results.  We will make
recommendations regarding:

    
      	
              ·  

            	
              Franchise
      model versus dealer strategy, or mix of
both

            

    

    
      	
              ·  

            	
              In-store
      kiosk strategy, including retail partners, proposition, and execution
      issues

            

    

    
      	
              ·  

            	
              Opportunities
      to improve current business model

            

    

    
      	
              ·  

            	
              Priorities,
      timing, capital requirements, and
ROI

            

    

    

    We will
identify several issues for a Phase ll engagement such as: sourcing and supply
chain issues; technology issues (on-line platform, licensing), and international
expansion.

    

    We
estimate that the Marketing Strategy plan will require 4 to 6 weeks to develop.
We believe we can begin some elements of the Marketing Strategy plan toward the
end of the Market and Business Assessment phase. 

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      o 
Page 5                                                                                                                                                         
June 6, 2008

       

       

    

    Consequently,
the total time for the completion of Phase l is estimated at 8 to 10
weeks.  This estimate is dependent upon the availability of data and
people to be interviewed.   As requested by V2K, ARC will use its
best efforts to complete Phase I as quickly as possible, while delivering a
quality report.

    

    

    ARC
Team

    

    The ARC
team will be led by Elizabeth Harrington, President of Amerivon Retail
Consulting. Elizabeth is a former Partner of PricewaterhouseCoopers retail
practice. Her clients have included Wal-Mart/Sam’s, JC Penny, Home Depot, Sears,
and other companies relevant to V2K. She is also experienced in kiosk selling
systems and dealer versus franchise network development from her work with
Kodak, their digital film kiosks, and Kodak Express Stores. Elizabeth will be
supported by Scott DeRuyter, a manager in our consulting practice with extensive
experience in retail kiosk technology and business strategy.

    

    

    Compensation

    

    Our
professional fees for the development of the Business Assessment and
Go-to-Market Strategy will be $200,000 USD. Our out-of-pocket expenses for
travel have been budgeted at $25,000 USD.  All expenses will be
supported with receipts. The fees and expenses have been withheld out of the
$1.6 Million USD Bridge Loan to be provided by Amerivon Investments LLC. 50% of
our fee will be earned upon commencement of our work and the balance will be
deemed earned on a progress basis as we work through the
engagement.  Additional expenses may be required for consumer
research. If so, we will discuss these with you and recommend a third party
supplier, and provide an estimate for your approval in advance.

    

    

    Business
Continuation Services

    

    
      	
              1.  

            	
              Our
      business continuation services will include the
  following:

            

    

    
      	
               
      

            	
              a.

            	
              Review,
      advise, and revise your business plan to maximize your funding
      opportunities for high net worth and institutional investors such as
      venture capital firms, PIPE funds, and private equity
    funds.

            

    

    
      	
               
      

            	
              b.

            	
              Advise
      and represent you in approaching prospective asset based and cash flow
      lenders.

            

    

    

    
      	
              2.  

            	
              Our
      fees for these services will be:

            

    

    
      	
               
      

            	
              a.

            	
              An
      upfront payment of $80,000, which is included in the $305,000 Consulting
      Agreement fee provided in Section 2.3(a) of the Bridge Loan Agreement,
      dated as of June 6, 2008, by and between you and Amerivon Investments
      LLC;

            

    

    
      	
               
      

            	
              b.

            	
              7%
      of the committed equity or convertible debt securities funding amount from
      capital sources introduced to you by us or any of our affiliates during
      the term of our business continuation services
  arrangement;

            

    

    
      	
               
      

            	
              c.

            	
              3%
      of the committed credit extended to you by any lender introduced to you by
      us or any of our affiliates during the term of our business continuation
      services arrangement;

            

    

    
      	
               
      

            	
              d.

            	
              10%
      warrant coverage of equity or convertible debt securities for which we
      receive the cash fee in paragraph 2(b) above, with an exercise price at
      the valuation of V2K determined by such securities with an exercise period
      of five years.  These warrants may be exercised using the
      cashless exercise method;

            

    

    
      	
               
      

            	
              e.

            	
              3%
      warrant coverage of warrants or equity issued to a lender for which we
      receive the cash fee in paragraph 2(c) above, with an exercise price at
      the valuation of V2K determined by such securities with an exercise period
      of five years.  These warrants may be exercised using the
      cashless exercise method;

            

    

    
      	
               
      

            	
              f.

            	
              You
      will reimburse us for all of our reasonable out-of-pocket expenses
      associated with these services; and

            

    

    
      	
               
      

            	
              g.

            	
              We
      will not receive any fees for funds provided by Vision Capital or any of
      its controlled affiliates.  However, we will be entitled to the
      cash fees and warrant coverage with respect to the issuance and sale of
      the Series B preferred stock, except for shares purchased by Vision
      Capital or any of its controlled
affiliates.

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

      
        o  Page
6                                                                                                                                                         
June 6, 2008

         

      

       

    

    
      	
              3.  

            	
              The
      term of our business continuation services will be for 180 days, with
      automatic three-month renewals unless either of us give written notice to
      the other of the election not to renew at least thirty days prior to the
      expiration of the initial or any renewal term.  You will pay our
      fees for any funding received by V2K during the six months following the
      termination of our business continuation
  services.

            

    

    

    

    We look
forward to finalizing this agreement and beginning our work with
V2K.

    

    Best
Regards,

    

    AMERIVON
HOLDINGS LLC

    

    

    

    By:    /s/ Tod M.
Turley                          

    Tod M. Turley, Chairman
and

    Chief Executive Officer

    

    

    

    

    

    Agreed
and acknowledged this 6th day of June, 2008.

    

    

    V2K
International, Inc.

    

    

    By:           /s/ Victor J.
Yosha                    

    

    Name:     Victor J.
Yosha                        

    

    Title:     Chief Executive
Officer

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