Exhibit 10.1

 

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Garden State Securities Inc.

328 Newman Springs Rd.

Red Bank, NJ 07707

 

August 1, 2013

 

Numbeer, Inc.

Good Earth Energy Conservation, Inc.

7660 Pebble Drive,

Fort Worth, TX 76118

Attn: James Emmons, President

 

 

Re:Engagement Agreement

 

Dear Mr. Emmons:

 

This letter sets forth the Agreement (the “Letter Agreement”) by and among
Numbeer, Inc. and its subsidiaries, including but not limited to Good Earth
Energy Conservation, Inc., and affiliates (collectively herein referred as the
“Company”) and Garden State Securities Inc. and its subsidiaries and its
affiliates (“GSS”) with respect to the engagement of GSS to act as an exclusive
selling/placement agent for the Company.

 

In connection with its engagement hereunder, this Letter Agreement confirms the
Company’s understanding of GSS’s intention to attempt to utilize its best
efforts to affect the following:

 

1.Review the business and operation of the Company and its historical and
projected financial condition.

2.Advise Company of “best efforts” Private Placement/public offering of debt or
equity securities to fulfill the Company’s business plan.

3.Contact for the Company possible financing sources.

 

Notwithstanding the foregoing, the intent herein described shall not obligate
GSS to effect any public or private financing for the Company. Any such
obligation shall be conditioned in its entirety upon the execution and delivery
by GSS of an Agency or Underwriting Agreement satisfactory to GSS and the
Company and satisfactory due diligence performed by GSS.

 

1. Term:

 

GSS shall act as the Company’s exclusive placement/selling agent from the date
of the execution of this Letter Agreement until the later of; (i) 90 days from
the date of the execution of this Letter Agreement; or (ii) the end of the
offering period of the Securities Financing (the “Exclusive Period”). GSS shall
act as the Company’s non-exclusive placement/selling agent after the Exclusive
Period until terminated. However, it is understood that GSS will not receive
compensation on any investors listed on Exhibit A, who were already contacted or
who will be contacted (as agreed and defined in Section 2 “Compensation” of this
Letter Agreement”) by Young American Capital, Sunrise Securities and Good Earth
representatives.

 

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2. Compensation:

 

The Company agrees to pay to GSS at each full or incremental closing of any
equity financing, convertible debt financing, debt conversion or any instrument
convertible or exercisable into the Company’s common stock (the “Securities
Financing”) during the Exclusive Period; (i) a cash transaction fee in the
amount of 9% of the amount of the Securities Financing; and (ii) warrants (the
“Warrants”) with “piggy back” registration rights, equal to 10% of the stock and
warrants (on an as converted or exercised basis) issued in the Securities
Financing at an exercise price equal to the investor’s warrant exercise price of
the Securities Financing. The Company agrees to pay to GSS at each full or
incremental closing of any equity financing, convertible debt financing, debt
conversion or any instrument convertible or exercisable into the Company’s
common stock (the “Securities Financing”) after the Exclusive Period on any
Source(s) (described in Section 5) contacted by GSS for the purpose of investing
in a Securities Financing; (i) a cash transaction fee in the amount of 9% of the
amount of the Securities Financing; and (ii) warrants (the “Warrants”) with
“piggy back” registration rights, equal to 10% of the stock and warrants (on an
as converted or exercised basis) issued in the Securities Financing at an
exercise price equal to the investor’s warrant exercise price of the Securities
Financing The Warrants shall have a 5-year term and will have a cashless
exercise. All funds shall be deposited in a third party bank escrow account to
be designated by GSS and released to the Company at the same time as payment of
the above stated fees and expenses are made to GSS. The Company will pay the
expense of the Escrow account. The Company will pay a $7,500 non-refundable due
diligence fee to GSS upon request of GSS to begin a Securities Financing that
involves a Private Placement Memorandum (“PPM”). The Company will also pay, at
closing, the expense of GSS’s legal counsel in connection to the Securities
Financing equal to $25,000 for an institutional Securities Financing and $30,000
for a Securities Financing involving a PPM. However, the Company will pay to
GSS’s legal counsel a non-refundable advancement of $7,500 to be credited
against the full legal fee described above, once terms of the Securities
Financing have been agreed to by the Company and GSS and formal offering
documents are then required to be drafted. At the initial closing of the
Securities Financing, the Company shall pay to GSS a non-refundable banking fee
of $20,000 for the structuring of the Securities Financing. The Company shall
also cause, at its cost and expense, all “blue sky” filings related to the
Securities Financing and required by applicable law to be made in due and proper
form and substance and in a timely manner as required under the laws of the
states in which Securities are sold (“Blue Sky Filings”). In addition, the
Company shall cause, at its cost and expense, a Form D related to the Securities
Financing to be filed with the Securities and Exchange Commission (“SEC”) in due
and proper form and substance and in a timely manner. The Company shall deliver
true and correct copies of all Blue Sky Filings and the Form D, as filed with
the SEC, to GSS within 15 days of the final closing date. It is also understood
that GSS will not receive compensation on any investors listed on Exhibit A of
this Letter Agreement (“Excluded Investors”), who were already contacted by
Young American Capital, Sunrise Securities and Good Earth representatives. The
Company will not enter into any financing that is different from the offering as
detailed in Exhibit B with an Excluded Investor during the Exclusive Period
without the written consent of GSS, however, that consent will not be
unreasonably withheld. Any investors that the Company wants to add to Exhibit A,
after the date of execution of this Letter Agreement, must be approved in
writing (email included) by GSS, such approval will not be unreasonably
withheld, to be classified as Excluded Investors.

 

 

3. Access to Premises:

 

In connection with the performance of services hereunder, the Company shall make
its facilities, management and employees available to GSS and its
representatives, during normal working hours, and shall be responsive to any and
all reasonable requests for information made by GSS, with reasonable notice and
with confidentiality. In performing its services hereunder, GSS shall be
entitled to rely upon and assume, without independent verification, the accuracy
and completeness of all information that is available from public sources and of
all information that has been furnished to it by the Company and shall have no
obligation to verify the accuracy or completeness of any such information or to
conduct any appraisal of any assets.

 

4. Mergers and Acquisitions:

 

In the event that the Company enters into a merger, acquisition, sale
transaction or business relationship (the “Transaction”) with a Source(s)
introduced to the Company by GSS, GSS shall be entitled to receive a fee in the
same form of Consideration on the same terms over the same period (i.e. if GSS’s
introduction results in a cash transaction, then GSS will be compensated in
cash; if GSS’s introduction results in a stock transaction, then GSS will be
compensated in stock) equal to 5% of the total value of the Transaction. For the
purposes of this Letter Agreement, “Consideration” means the aggregate value,
whether in cash, securities, assumption (or purchase subject to) of debt or
liabilities (including without limitation, indebtedness for borrowed money,
pension liabilities and guarantees), license fees, royalty fees, joint venture
interests or other property, obligations or services, paid or payable by or to
the Company directly or indirectly (in escrow or otherwise) or otherwise assumed
in connection with a Transaction. The value of such Consideration shall be
determined as follows:

 

1.The value of securities, liabilities, obligations, property and services shall
be the fair market value as reasonably determined by an independent third party
to be mutually agreed upon by GSS and the Company.

2.The value of indebtedness assumed, shall be the face amount.

 

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If Consideration payable in a Transaction includes contingent payments to be
calculated by references to uncertain future occurrences, such as future
financial or business performance, then any fees of GSS’s relating to such
consideration shall be payable at the earlier of (i) the receipt of such
Consideration or (ii) the time that the amount of such Consideration can be
determined.

 

5. Future Financing:

 

If the Company were to receive any additional capital within eighteen (18)
months from either the later of; (i) the closing of the Securities Financing
from any investors that invested in the Securities Financing; and/or (ii) date
of termination of this Letter Agreement from any Source(s) contacted by GSS for
the purpose of investing in the Securities Financing; the Company will pay to
GSS a cash fee of 9% of the amount raised at the closing of any such financing
along with the Warrants detailed above in Section 2 of this Letter Agreement,
with the exception of Excluded Investors. If the Company were to enter into a
Transaction within eighteen (18) months from the time any Source(s) are
contacted by GSS for the purpose of entering into a Transaction, the Company
will pay to GSS a cash fee of 5% of the Consideration of the Transaction. The
Company will not circumvent GSS and will not attempt to deal directly or
indirectly through agents or representatives of the Company, with such Source(s)
or investors without prior written consent of an officer of GSS. As used in this
Letter Agreement, the term “Source(s)” shall be broadly interpreted to include,
without limitation, any corporation, company, institution, partnership,
individual and all of the Source(s)’ affiliates that are directly or indirectly
contacted by GSS for the purpose of investing in the Securities Financing or the
purpose of entering into a Transaction. GSS will periodically provide the
Company with a list of all Source(s) contacted by GSS, upon request from the
Company. This paragraph shall survive any termination of this Letter Agreement.

 

6. Expenses:

 

Except as provided in Section 2 of this Letter Agreement, the Company hereby
agrees to pay all filing fees, charges and expenses incident to the performance
by the Company of its obligations hereunder, including, without limitation,
all fees, charges, and expenses in connection with:  (i) the issuance, sale,
transfer, and delivery of the Securities, including any transfer or other taxes
payable thereon and the fees of any transfer agent or registrar; (ii) the
securing of an exemption therefrom under state or foreign "blue sky" or
securities laws, including without limitation, filing fees payable in the
jurisdictions in which such registration or qualification or exemption therefrom
is sought and disbursements in connection therewith; (iii) filing fees payable
to the SEC, if any; and (iv)  pre-approved (by the Company and GSS) traveling
and lodging expenses in connection with the sale of securities for the
Securities Financing.

 

7. Intentionally Left Blank:

 

8. Indemnification:

 

The Company agrees to indemnify GSS and certain other entities and persons as
set forth in Schedule I.

 

9. Disclosure:

 

(a)The Company recognizes and confirms that GSS, in acting pursuant to this
engagement, will be using information in reports and other information provided
by others, including, without limitation, information provided by or on behalf
of the Company, and that GSS does not assume responsibility for and may rely,
without independent verification, on the accuracy and the completeness of any
such reports and information. The Company hereby warrants that all of its
information relating to the Company will not contain any untrue statement of a
material fact or omit to state any material fact or omit to state any material
fact necessary to make the statements contained herein, in the light of the
circumstances under which they were made, not misleading. The Company agrees to
provide GSS with (i) prompt notice of any material development affecting the
Company; (ii) such other information concerning the business and financial
condition of the Company as GSS may from time to time reasonably request
provided that such information is maintained by GSS pursuant to a
confidentiality agreement. GSS agrees to distribute information regarding the
Company, not in the public domain, only with written approval by the Company.

 

(b)The Company agrees that any information or advise rendered by GSS or its
representatives in connection with this engagement is for the confidential use
of the Company only and, except as otherwise required by law, the Company has
not and will not permit any third party to disclose or otherwise refer to such
advice or information in any manner without GSS’s prior written consent, unless
such information becomes part of the public domain through no fault of the
Company.

 

(c)GSS agrees that any information, plans or data regarding the Company and its
activities are for the confidential use of GSS only and, except as otherwise
required by law or otherwise in the public domain, GSS will not disclose or
otherwise permit any third party to disclose or otherwise refer to, without the
Company’s prior written consent.

 

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10. Termination:

 

The Company and GSS will each have the right to terminate this Letter Agreement
at any time after the later of 90 days from the execution of this Letter
Agreement or end of the offering period of the Securities Financing, provided
prior written notice is given 20 days before termination. Any termination of
this Letter Agreement shall not affect or limit (i) the rights of GSS or any
other indemnified person (as defined in schedule I hereto) to receive
indemnification, (ii) rights to receive fees accrued prior to such termination,
(iii) the rights of GSS to receive fees and be covenanted to all of the terms
and conditions detailed in Section 2, Section 4 and Section 5 of this Letter
Agreement on any Securities Financing and/or Transaction that was negotiated
during the term of this Letter Agreement and/or closes after any termination and
(iv) the rights detailed in Section 5 of this Letter Agreement.

 

11. Miscellaneous:

 

GSS may, at its own expense, place announcements or advertisements in financial
newspapers and journals describing its services hereunder, provided that the
same shall comply with securities laws and shall be approved by the Company
prior to dissemination.

 

12. Governing Law:

 

This Agreement (a) shall be governed by and construed in accordance with the
laws of the State of New York and the parties agree that any dispute, claim or
controversy relating to or arising out of this Agreement or the performance of
its terms shall be resolved and conducted in the County and State of New York,
regardless of the laws that might otherwise govern under applicable principles
of conflicts of law thereof, (b) incorporates the entire understanding of the
parties with respect to the subject matter hereof and supersedes all previous
agreements should they exist hereto, (c) may not be amended or modified except
in writing executed by the Company and GSS and (d) shall be binding upon and
inure to the benefit of the Company, GSS, and other indemnified Parties and
their respective successors and assigns.

 

If you are in agreement with the foregoing, please execute the enclosed
counterpart of this letter in the space below provided for that purpose and
deliver it to the undersigned, whereupon the terms hereof shall become a binding
agreement between us.

 

The investment banking staff of GSS and its affiliates look forward to working
with you.

 

Very truly yours,

 

 

/s/ Ernest Pellegrino

 

Ernest Pellegrino

Garden State Securities Corp.

 

 

AGREED TO AND ACCEPTED

THIS 1st DAY OF August, 2013

 

 

/s/ James R. Emmons

 

By: James R. Emmons, President

Numbeer, Inc.

Good Earth Energy Conservation, Inc.

 

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Schedule I

 

Good Earth Energy Conservation, Inc. (the “Company”) referred to in the attached
Letter Agreement (the “Letter Agreement”) agrees to indemnify and hold harmless
Garden State Securities Inc. (“GSS”) and its affiliates, and the respective
directors, officers, agents and employees of GSS and its affiliates and each
other entity or person, if any, controlling GSS or any of its affiliates within
the meaning of Section 15 of the Securities Act of 1933, as amended, (GSS and
each such entity or person being referred to as an “Indemnified Person”) from
and against any losses, claims, damages or liabilities (or actions in respect
thereof) relating to or arising out of activities performed pursuant to the
Letter Agreement, the transactions contemplated thereby or GSS’s role in
connection therewith, or caused by any untrue statements of material nature
contained in any document provided to GSS by the Company which documents are
relied upon by GSS in connection with its performance of the Letter Agreement,
and will reimburse GSS and any other Indemnified Person for all expenses
(including, without limitation, reasonable fees and disbursements of counsel)
incurred by GSS or any such other Indemnified Person in connection with
investigating, preparing or defending any such action or claim, whether or not
in connection with pending or threatened litigation to which GSS (or any other
Indemnified Person) is a party, in each case, as such expenses are incurred or
paid. The Company will not, however, be responsible for any such losses, claims,
damages, liabilities or expenses of any Indemnified Person that are determined
by final judgment of a court of competent jurisdiction to have primarily
resulted from actions taken or omitted to be taken by such Indemnified Person in
bad faith, intentional misconduct, or from such indemnified Person’s gross
negligence. The Company also agrees that no Indemnified Person shall have any
liability (whether direct or indirect, in contract or tort or otherwise) to the
Company for or in connection with the Letter Agreement, any transactions
contemplated thereby or GSS’s role in connection therewith, expect for any such
liability for losses, claims, damages liabilities or expenses incurred by the
Company that are determined by final judgment of a court of competent
jurisdiction to have resulted primarily from actions taken or omitted to be
taken by such Indemnified Person in bad faith, intentional misconduct, or from
such Indemnified Person’s gross negligence.

 

Upon receipt by an Indemnified Person of actual notice of a claim, action or
proceeding against such Indemnified Person in respect of which indemnity may be
sought hereunder, such Indemnified Person shall promptly notify the Company
after any action is commenced by way of service with a summons or other legal
process (giving information as to the nature and basis of the claim) against
such Indemnified Person. In any event, failure so to notify the Company shall
not relieve the Company from any liability that the Company may have on account
of this indemnity or otherwise, except to the extent the Company shall have been
materially prejudiced by such failure. The Company will, if requested by an
Indemnified Person, assume the defense of any litigation or proceeding in
respect of which indemnity may be sought hereunder, including the employment of
counsel reasonably satisfactory to GSS and the payment of the fees and expenses
of such counsel, in which event, except as provided below, the Company shall not
be liable for the fees and expenses of any other counsel retained by any
Indemnified Person in connection with such litigation or proceeding. In any such
litigation or proceeding the defense of which the Company shall have so assumed,
any Indemnified Person shall have the right to participate in such litigation or
proceeding and to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such Indemnified Person unless (i) the
Company and such Indemnified Person shall have mutually agreed in writing to the
retention of such counsel or (ii) the named parties to any such litigation or
proceeding (including any impeded parties) include the Company and such
Indemnified Person and representation of both parties by the same counsel would
in the opinion of counsel to such Indemnified Person, be inappropriate due to
actual or potential differing interests between the Company and such Indemnified
Person. The Company shall not be liable for any settlement of any litigation or
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the Company agrees to
indemnify the Indemnified Person from and against any loss or liability by
reason of such settlement or judgment. If the Company assumes the defense of any
litigation or proceeding, the Company will not settle such litigation or
proceeding without GSS’s written consent, which shall not be unreasonably
withheld.

 

If for any reason the foregoing indemnification is unavailable to an Indemnified
Person or insufficient to hold it harmless, the Company shall contribute to the
amount paid or payable by the Indemnified Person as a result of such loss,
claim, damage or liability in proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Indemnified
Person on the other hand. Notwithstanding the foregoing, under no circumstances
shall any Indemnified Person’s aggregate contribution to any losses, claims,
damages and expenses with respect to which contribution is available hereunder
exceed the amount of fees actually received hereunder.

 

The provisions contained in this Schedule I shall remain operative and in full
force and effect regardless of the expiration of any termination of the Letter
Agreement.

 

 

 

 

Exhibit A

 

[Intentionally deleted]

 

 

 

 

Exhibit B

 

TERM SHEET

FOR COMMON STOCK OFFERING OF

GOOD EARTH ENERGY CONSERVATION, INC.

JULY 1, 2013

 

This Term Sheet summarizes the principal terms of the Common Stock Offering of
Good Earth Energy Conservation, Inc., a Delaware corporation (the “Company”).

 

OFFERING TERMS   Closing Date: The first Closing (“Closing”) is expected to be
on or before July 12, 2013, with additional Closing(s) within 30 days
thereafter.     Amount Raised: Up to a maximum of $5,000,000.     Price Per
Share: $.60 per share (based on the capitalization of the Company set forth
below) (the “Original Purchase Price”), post-split basis. Share price of $1.51
on a pre-split basis.     Pre-Money Valuation: The Original Purchase Price is
based upon a pre-money valuation of $12,485,533. Assuming conversion of the 2012
Convertible Notes, which are convertible at the Note holders’ option into
5,384,615  million Common Shares, the pre-money valuation is $15,716,302.    
Warrant Coverage: 50% Warrant Coverage, 5 year warrants, at $.80 per share
Strike Price.     Capitalization: The Company’s capital structure before and
after the Closing is set forth on Exhibit A.

 

 

SUBSCRIPTION AGREEMENT   Representations and Warranties: Standard
representations and warranties by the Company.     Registration Rights:      
Registrable Securities: All shares of Common Stock held by the Investors will be
deemed “Registrable Securities”.     Piggyback Registration: The holders of
Registrable Securities will be entitled to “piggyback” registration rights on
all registration statements of the Company.     Lock-up: Investors shall agree
not to sell or transfer any shares of Common Stock for a period of up to 180
days to comply with applicable regulatory requirement.

 

 

 

 

Exhibit B

 

Pre and Post-Financing Capitalization (Post-Split Basis)

 

   Pre-Financing   Post-Financing  Security  # of Shares   %   # of Shares   % 
Common   20,809,222    100    20,809,222    60                        Common -
Convertible Notes             5,384,615    16                        Common -
$5m Stock Offering             8,333,333    24                        Total 
 20,809,222    100    34,527,170    100 

 

 

Pre and Post-Financing Capitalization (Pre-Split Basis)

 

   Pre-Financing   Post-Financing  Security  # of Shares   %   # of Shares   % 
Common   8,268,197    100    8,268,197    60                        Common -
Convertible Notes             2,139,487    16                        Common -
$5m Stock Offering             3,311,111    24                        Total 
 8,268,197    100    13,718,795    100