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Bonds.com Group, Inc. 8-K [bonds-8k_1025.htm]
Exhibit 10.13
 
TERMINATION AND RELEASE
 
This TERMINATION AND RELEASE (this “Agreement”), dated as of October 19, 2010,
is entered into between Bonds.com Group, Inc., a Delaware corporation (the
“Company”), Mark G. Hollo (“Hollo”), The Fund LLC (the “Fund”) and Black-II
Trust (“Black-II” and, collectively with Hollo and the Fund, the “Hollo
Parties”).
 
Background
 
The Company and the Fund are parties to a letter agreement dated December 28,
2009 entitled Financial Advisory Agreement (the “Financial Advisory Agreement”).
 
A.           The Company and Radnor Research and Trading Company LLC (“Radnor”)
are parties to a Restated Revenue Sharing Agreement, dated November 13, 2009,
pursuant to which, among other things, the Company has agreed to pay certain
amounts to Radnor (the “Revenue Sharing Agreement”).  Hollo and Radnor are
parties to a Independent Contractor Agreement, dated January 28, 2010, pursuant
to which, among other things, Radnor has agreed to pay a portion of the amounts
it receives under the Revenue Sharing Agreement to Hollo subject to certain
conditions (the “Independent Contractor Agreement”).  Additionally, the
Independent Contractor Agreement provides that Radnor shall not terminate, amend
or otherwise modify the Radnor Revenue Sharing Agreement or the GO Agreement (as
defined in the Independent Contractor Agreement) without Hollo’s prior written
consent.
 
B.           Hollo is attorney-in-fact and a beneficiary of Black-II, and he is
the Chairman, CEO and a stockholder of the Fund.
 
Operative Terms
 
For good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
 
1.           Payments to the Fund and Grant of Warrant to Black-II.  In
consideration of the agreements, terminations, releases and waivers provided by
Hollo, the Fund and Black-II hereunder, the Company hereby agrees that (a) it
hereby issues to Black-II a warrant to purchase ten million (10,000,000) shares
of the Company’s common stock for a purchase price of $0.24 per share for the
period beginning on the date hereof and ending on October 18, 2015 pursuant to
the terms and conditions of the Warrant attached hereto as Exhibit A (the
“Warrant Agreement”); and (b) subject to the Company raising at least $5,000,000
of gross proceeds (including the conversion of outstanding indebtedness) from
the sale of equity securities or debt financing in one or more related closings
on and after the date hereof (a “Qualified Financing”), the Company shall pay
Black-II $250,000 in four equal monthly installments of $62,500, such payments
to be made as follows, (x) the first payment shall be made on the closing date
on which the gross proceeds of the Qualified Financing exceed $5,000,000
(including the conversion of outstanding indebtedness) or, if not reasonably
possible to make the payment on such closing date, the first business day
following such closing, and (y) the three remaining payments to be made on the
thirtieth (30th), sixtieth (60th) and ninetieth (90th) days following such
closing date (provided, however, that if any such date is not a business day,
then payment shall be made on the first business day following such date).  The
foregoing payments shall be made by wire transfer of immediately available funds
to an account specified in writing by Black-II.

2.           Termination of the Financial Advisory Agreement.  The Financial
Advisory Agreement is hereby terminated in all respects and shall be null and
void and of no further force or effect, and no provision thereof shall survive
this termination.

 
 

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3.           Consents.  Hollo hereby consents in all respects to (a) the
termination of the Revenue Sharing Agreement by the Company and Radnor; and (b)
the amendment, modification or termination of the GO Agreement (including,
without limitation, to eliminate any amounts payable thereunder to
Radnor).  Additionally, Hollo hereby waives, relinquishes and releases Radnor
from any and all claims, causes of action and other rights with respect to any
revenue sharing payments to be made pursuant to the Revenue Sharing Agreement as
amended by the Agreement.  Radnor is an intended third-party beneficiary of the
provisions of this Section 3.

4.           Resignation and Termination of Advisory Role.  Hollo hereby resigns
from his position as a non-voting advisor to the Company’s Board of Directors
and agrees that any rights he may have to be designated as a non-voting advisor,
to otherwise serve in that role or to receive any remuneration or consideration
in respect thereof (including any right he may have to receive the same
compensation paid to all or any other members of the Company’s Board of
Directors) are hereby terminated, waived, relinquished and released.

5.           Amendment and Restatement of Stock Option.  Simultaneously
herewith, the Company and Hollo are amending and restating the Stock Option
Agreement, dated August 28, 2009, by and among Hollo and the Company (the
“Terminated Option”) by executed and delivering the Amended and Restated Option
Agreement attached hereto as Exhibit B (the “Amended and Restated Option”).

6.           Release by the Hollo Parties.  Hollo, the Fund and Black-II for
himself or itself and each of their respective heirs, successors, affiliates,
managers, members, officers, directors, trustees, beneficiaries and assigns, and
anyone claiming by or through them (collectively, the “Releasing Parties”),
irrevocably and unconditionally releases, waives, and forever discharges the
Company, Bonds.com Holdings, Inc., Bonds.com Inc., each of their respective
parents, subsidiaries and affiliates, and each of their and their respective
parents’, subsidiaries’ and affiliates’ directors, officers, agents, attorneys,
present and former employees, partners, investors, shareholders, insurers,
predecessors, successors, assigns, and representatives, from any and all actual
or potential, direct, indirect or derivative claims, complaints, liabilities,
obligations, promises, actions, causes of action, liabilities, agreements,
damages, costs, debts, and expenses of any kind, whether known or unknown, that
the Releasing Parties have ever had or now have from the beginning of time
through the date the undersigned executes this Agreement (collectively, the
“Released Claims”); provided that this release shall not release any covenants
or obligations contained in (a) this Agreement or the Warrant Agreement, (b)
Black-II’s Ordinary Purchase Rights, Special Purchase Rights or Additional
Purchase Rights, (c) the Amended and Restated Option, or (d) any shares of
Common Stock owned by any of the Hollo Parties.  Without limitation, the
Released Claims include all claims arising out of, related to or connected with
any law, rule or regulation of the State of Florida, the State of New York, the
State of Delaware; any other law, rule or regulation of any other state; any
local ordinance; and any other federal, state or local statute, rule, regulation
or ordinance; any obligations under, arising out of, or related to any actual or
quasi-contracts; common law claims, including but not limited to defamation,
breach of a covenant of good faith and fair dealing, breach of fiduciary duty,
fraud, misrepresentation, breach of express or implied contract, promissory
estoppel; any claims for or to past or future unpaid amounts under the Financial
Advisory Agreement, Revenue Sharing Agreement or GO Agreement or in his capacity
as an advisor to the Company’s Board of Directors, incentive payments, expense
reimbursements, and any other income or benefits the Releasing Parties received
or claim they should receive; and all other claims of any kind, including but
not limited to any claims for attorneys’ fees.

 
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7.           Release by the Company.  The Company, for itself and each its
successors, subsidiaries, affiliates and assigns, and anyone claiming by or
through them (collectively, the “Company Releasing Parties”), irrevocably and
unconditionally releases, waives, and forever discharges the Hollo Parties and
each of their respective heirs, successors, affiliates, managers, members,
officers, directors, trustees, beneficiaries and assigns, from any and all
actual or potential, direct, indirect or derivative claims, complaints,
liabilities, obligations, promises, actions, causes of action, liabilities,
agreements, damages, costs, debts, and expenses of any kind, whether known or
unknown, that the Company Releasing Parties have ever had or now have from the
beginning of time through the date the undersigned executes this Agreement
(collectively, the “Company Released Claims”); provided that this release shall
not release any covenants or obligations contained in (a) this Agreement or the
Warrant Agreement, (b) Black-II’s Ordinary Purchase Rights, Special Purchase
Rights or Additional Purchase Rights, or (c) the Amended and Restated
Option.  Without limitation, the Company Released Claims include all claims
arising out of, related to or connected with any law, rule or regulation of the
State of Florida, the State of New York, the State of Delaware; any other law,
rule or regulation of any other state; any local ordinance; and any other
federal, state or local statute, rule, regulation or ordinance; any obligations
under, arising out of, or related to any actual or quasi-contracts; common law
claims, including but not limited to defamation, breach of a covenant of good
faith and fair dealing, breach of fiduciary duty, fraud, misrepresentation,
breach of express or implied contract, promissory estoppel; any claims for or to
past or future unpaid amounts and all other claims of any kind, including but
not limited to any claims for attorneys’ fees.

8.           Representations and Warranties by the Hollo Parties.  Each of the
Hollo Parties jointly and severally represent and warrant to the Company that
they have not assigned, sold or transferred to any person or entity any Released
Claims or any rights with respect thereto.  The Hollo Parties jointly and
severally represent and warrant to the Company that this Agreement constitutes a
valid, binding and enforceable obligation of each of them.

9.           Representations and Warranties by the Company.  The Company
represents and warrants to the Hollo Parties that this Agreement constitutes a
valid, binding and enforceable obligation of the Company.

10.         Governing Law; Jurisdiction; Jury Trial.  All questions concerning
the construction, validity, enforcement and interpretation of this Agreement
shall be governed by the internal laws of the State of New York, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
State of New York or any other jurisdictions) that would cause the application
of the laws of any jurisdictions other than the State of New York.  Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in the City of New York, Borough of Manhattan for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper.  EACH PARTY HEREBY
IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY
TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR
ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

11.         Headings.  The headings of this Agreement are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Agreement.

 
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12.         Entire Agreement; Amendments.  This Agreement, the Warrant Agreement
and the Amended and Restated Option supersede all other prior oral or written
agreements between the Company, Hollo, the Fund and/or Black-II with respect to
the matters discussed herein, and this Agreement, the Warrant Agreement and the
Amended and Restated Option contain the entire understanding of the parties with
respect to the matters covered herein and therein.  No provision of this
Agreement may be amended other than by an instrument in writing signed by the
Company, Hollo, the Fund and Black-II.  No provision hereof may be waived other
than by an instrument in writing signed by the party against whom enforcement is
sought.

13.         Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and assigns.

14.         No Strict Construction; Definition of Business Day.  The language
used in this Agreement will be deemed to be the language chosen by the parties
to express their mutual intent, and no rules of strict construction will be
applied against any party.  As used herein, the term “business day” shall mean
any day other than (a) a Saturday or Sunday and (b) any day on which banks are
required or permitted to be closed in New York, New York.

15.         Counterparts.  This Agreement may be executed in two or more
counterparts and by facsimile signature or otherwise, and each of such
counterparts shall be deemed an original and all of such counterparts together
shall constitute one and the same agreement.

[Signature pages follow]

 
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IN WITNESS WHEREOF, this Termination and Release is executed as of the date
first set forth above.
 
 

   
BONDS.COM GROUP, INC.
         
By:
 /s/ Michael O. Sanderson    
Name:
Michael O. Sanderson     
Title:
CEO 

 
 
 

   
 /s/ Mark G. Hollo
   
MARK G. HOLLO
   
 
 

 

   
THE FUND LLC
         
By:
 /s/ Mark G. Hollo     
Name:
Mark G. Hollo    
Title:
Chairman and CEO

 
 

   
BLACK-II TRUST
         
By:
 /s/ Mark G. Hollo     
Name:
Mark G. Hollo    
Title:
Attorney-in-Fact 

 
 
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