Exhibit 10.1
 
CONSULTING AGREEMENT
 
This Consulting Agreement (this "Agreement") is made and entered into effective
as of June 1, 2011 (“Effective Date”), by and between Respect Your Universe,
Inc., a Nevada corporation ("Company") and Exit 21 Global Solutions LLC, dba
Exit 21 Apparel Solutions, an Oregon limited liability company (“Consultant”),
and its partners Eric Siffert (“Siffert”) and Chris Martens (“Martens”).
 
 
RECITALS
 
WHEREAS, Consultant has certain experience in the design, development,
merchandising, sourcing and production of clothing lines;
 
WHEREAS, the Company has appointed Martens as the Company’s Chief Executive
Officer (“CEO”) on a consulting basis via Consultant;
 
WHEREAS, the Company has appointed Siffert as the Company’s Chief Operations
Officer (“COO”) on a consulting basis via Consultant; and
 
WHEREAS, the Company desires to engage the services of the Consultant to assist
the Company in the development and production of a clothing line for the
Company.
 
NOW, THEREFORE, in consideration of the mutual promises herein contained, the
parties hereto hereby agree as follows:
 
1.                      CONSULTING SERVICES.  The “Consulting Services” refers
to collectively the Product Consulting Services, CEO Consulting Services and the
COO Consulting Services.
 
(A)           Product Consulting Services.  Attached hereto as Exhibit A and
incorporated herein by this reference is a description of the services to be
provided by the Consultant for the development and production of the Company’s
clothing line during the Term of this Agreement (the "Product Consulting
Services"). Consultant will provide the Consulting Services in a professional
and workmanlike manner to the best of its abilities. Consultant makes no other
warranty to the Company, and specifically disclaims any warranty of
merchantability or fitness for a particular purpose with respect to any products
designed by Consultant hereunder.
 
(B)           CEO Consulting Services.  During the Term of this Agreement,
Martens shall act as the Company’s CEO, managing all aspects of the day-to-day
business of the Company, and report to the Company’s Board of Directors.
 
 
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(C)           COO Consulting Services.  During the Term of this Agreement,
Siffert shall act as the Company’s COO, managing the Company’s operations, and
report to the Company’s CEO.
 
(D)           Excluded Duties.  The Consultant Services hereunder shall not
include either Siffert or Martens being appointed principal executive or
accounting officer of the Company for purposes of any Securities and Exchange
Commission filings, including certification of same pursuant to sections 302,
404 or 906 of the Sarbanes-Oxley Act of 2002 .
 
2.                      TERM OF AGREEMENT
 
This Agreement shall be in full force and effect commencing upon the Effective
Date and expiring on December 31, 2011 (“Term”). Consultant or Company shall
have the right to terminate this Agreement with 30 days notice in the event of
(i) the bankruptcy, insolvency, or assignment for the benefit of creditors of
the other, or (ii) a material breach of the Agreement of the other, and such
failure continues un-remedied for a period of 15 days after written notice.
 
3.                      TIME DEVOTED BY CONSULTANT, SIFFERT AND MARTENS
 
It is anticipated that the Consultant, Siffert and Martens shall spend as much
time as deemed necessary in order to perform their respective obligations
hereunder. The Company understands that this amount of time may vary and that
the Consultant may perform Consulting Services for other companies.
 
4.                      PLACE WHERE SERVICES WILL BE PERFORMED
 
The Consultant, Siffert and Martens will perform most services in accordance
with this Agreement at Consultant's offices, or at such other place(s) as
necessary to perform these services in accordance with this Agreement.
 
5.                      COMPENSATION
 
The compensation to for the Consulting Services shall be as set forth in Exhibit
B attached hereto and incorporated herein by this reference.
 
6.                      INDEPENDENT CONTRACTOR; OWNERSHIP
 
(A)           Both Company and the Consultant agree that the Consultant, Martens
and Siffert will act as an independent contractors in the performance of their
respective duties under this Agreement.
 
 
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(B)           All of the designs conceived by Consultant in connection with the
Consulting Services shall be the sole and exclusive property of the Company.
 
7.                      CONFIDENTIAL INFORMATION
 
The Consultant and the Company acknowledge that each will have access to
proprietary information regarding the business operations of the other and agree
to keep, all, such information, secret and confidential and not to use or
disclose any such information to any individual or organization without the
non-disclosing party's prior written consent. It is hereby agreed that from time
to time Consultant and the Company may designate certain disclosed information
as confidential for purposes of this Agreement.
 
8                       INDEMNIFICATION
 
The Consultant shall indemnify and hold the Company harmless from any and al
liabilities and obligations arising from Consultant's gross negligence and
willful misconduct with the Consulting Services. The Company shall indemnify and
hold Consultant Siffert, and Martens harmless from any and all liabilities and
obligations arising from conduct and activities of the Company, including (i)
any allegation of infringement or violation of any third-party intellectual
property rights; (ii) any product liability claim in connection with any
products designed hereunder; (iii) any claims under state, federal or local laws
or regulations in connection with the offer or sale of the Company’s securities;
(iv) any reporting or other requirement in connection with the Securities and
Exchange Act of 1934 and other state or local securities laws; and (v) any
claims in connection with the Excluded Duties set forth in Section 1(D).
 
The indemnity obligations of the parties under this paragraph 8 shall be binding
upon and inure to the benefit of any successors, assigns, heirs, and personal
representatives of the Company, the. Consultant and any other such persons or
entities mentioned hereinabove.
 
9.                      COVENANTS OF CONSULTANT
 
Consultant covenants and agrees with the Company that, in performing Consulting
Services under this Agreement, Consultant will: 
 
 
(a)
Comply with all federal and state laws;. and

 
 
(b)
Not make any representations on behalf of the Company other than those
authorized by the Company.

 
10.                    SUBCONTRACTORS AND MANUFACTURERS
 
 
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(A)          Subcontractors. Consultant may, from time to time, engage
subcontractors or independent contractors to perform portions of the Product
Consulting Services under the authority, and control of Consultant.
 
(B)           Manufacturers. Consultant will identify certain manufacturers,
factories, suppliers and facilities for the production of the Company's
products, and will manage such relationships on behalf of the Company as part of
the Product Consulting Services hereunder. The Company will be solely
responsible for the payment of any invoices, posting of any requires
letters-of-credit, and any other financial aspects of the business relationship
with such manufacturers, factories, suppliers and facilities. Consultant is
responsible for delivery of prototypes, as set forth on Exhibit A. The Company
is responsible for the cost of salesman samples, as well as the cost of
production lines for the products designed hereunder.
  
11.                      MISCELLANEOUS
 
(A)           Any controversy arising out of or relating to this Agreement or
any modification or extension thereof, including any claim for damages and/or
rescission shall be settled by arbitration in Los Angeles County, California in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association before a single arbitrator. The arbitrator sitting in any such
controversy shall have no power to alter or modify any express provisions of
this Agreement or to render any award which by its terms effects any such
alteration, or modification subject to 11(G). This Section 11 shall survive the
termination of this Agreement.
 
(B)           If either party to this Agreement brings an action on this
Agreement, the prevailing, party shall be entitled to reasonable expenses
therefore, including, but not limited to, attorneys’ fees and expenses and court
costs.
 
(C)           This Agreement shall inure to the benefit of the parties hereto,
their administrators and successors in interest. This Agreement shall not be
assignable by either party hereto without the prior written consent of the
other.
 
(D)           This Agreement contains the entire understanding of the parties
and supersedes all prior agreements between them.
 
(E)           This Agreement shall be constructed and interpreted in accordance
with and the governed by the laws of the State of California.
 
(F)           No supplement, modification or amendment of this Agreement shall
be binding unless, executed in writing by the parties. No waiver of any of the
provisions of this Agreement shall be deemed, or shall constitute, a waiver of
any other provision, whether or not similar, nor shall any waiver constitute a
continuing waiver. No waiver shall be binding unless executed in. writing by the
party making the waiver.
 
 
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(G)           If any provision hereof is held to be illegal, invalid or
unenforceable under present or future laws effective during the term hereof,
such provision shall be fully severable. This Agreement shall be construed and
enforced as if such illegal, invalid or unenforceable provision had never
comprised apart hereof, and the remaining provisions hereof shall remain in full
force and effect and shall not be affected by the illegal, invalid or
unenforceable provision or by its severance herefrom.
 
 
 
 
 
 
 
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IN WITNESS WHEREOF, the parties hereto have placed their signatures hereon on
the day below.
 
RESPECT YOUR UNIVERSE, INC.,
a Nevada corporation

 
 
/s/ Kristian Andresen
   
Name:
Kristian Andresen
   
Title:
Corporate Secretary
   
Date:
June 30, 2011

 
EXIT 21 GLOBAL SOLUTIONS LLC, DBA EXIT 21 APPAREL SOLUTIONS,
an Oregon limited liability company
 
 
 
/s/ Christopher Martens
   
Name:
Christopher Martens
   
Title:
Partner
   
Date:
June 30, 2011

 
 
 
CHRISTOPHER MARTENS
 
 

/s/ Christopher Martens    
Date:
June 30, 2011

 
 
 
ERICK SIFFERT
 
 

/s/ Erick Siffert    
Date:
June 30, 2011

 
 
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EXHIBIT A
 
DESCRIPTION OF PRODUCT CONSULTING SERVICES
 
Consultant shall perform the following Product Consulting Services pursuant to
the terms of this Agreement:
 
(1)           General consulting services for the design, development,
merchandising, sourcing and production of a 20-style clothing line, including
but not limited to:
 
(a)           competitive market analysis, merchandising, and line planning;
 
(b)           product and component design, including color and fabric
selection;
 
(c)           raw material selection and purchasing for prototypes, including
the delivery of garment prototypes;
 
(d)           fit and approval of garment and accessory prototypes; and
 
(e)           production: responsible for delivery management and quality
control of all apparel and accessories.
 
The above services will be further defined and delineated by the parties from
time to time as, necessary. Consultant will not be responsible for any inventory
(raw material or finished product) warehousing, sales, sales forecasting and
planning.
 
 
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EXHIBIT B
TERMS OF COMPENSATION
 
The compensation under the Agreement shall be as follows:
 
1.               CONSULTING SERVICES FEES.
 
 
a.
PRODUCT CONSULTING SERVICES. The fee for the Product Consulting Services $24,000
monthly. Any additional fees shall be mutually agreed upon in writing by Company
and Consultant.

 
b.      CEO CONSULTING SERVICES FEES.  The fee for the CEO Consulting Services
is $13,000 monthly.
 
c.      COO CONSULTING SERVICES FEES.  The fee for the COO Consulting Services
in $13,000 monthly.
 
2.               EQUITY COMPENSATION. In addition to the Fees, the Board of
Director of the Company shall approve on July 1, 2011 and the Company shall
issue and deliver the following options to purchase Company common stock issued
from the Company’s 2011 Incentive Award Plan:
 
OPTIONEE
OPTION
SHARES
ISSUE
DATE
VESTING
EXERCISE
PRICE
TYPE
           
Christopher
Martens
300,000
July 1, 2011
Fully vested on issuance
Market close on July 1, 2011
Non-Qual
           
Eric Siffert
300,000
July 1, 2011
Fully vested on issuance
Market close on July 1, 2011
Non-Qual
           

 
3.               EXPENSES. Consultant shall be reimbursed for all out-of-pocket
expenses upon submission of receipts or accounting to the Company, including,
but not limited to, all travel expenses, research material and charges, computer
charges, long-distance telephone charges, facsimile costs, copy charges,
messenger services, mail expenses and such other Company related charges as may
occur exclusively in relation to the Company's business as substantiated by
documentation. Any expenditure above $100 will require oral or written
pre-approval of the Company.
 
 
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