Document:

exhibit101.htm

EXHIBIT 10.1

 

 

Binding Heads of Terms Agreement

 

This Heads of Terms Agreement ("HTA") is effective as of the date first signed below and is made by and between:

 

●       Aruls Environment and Green Ozone Pvt. Ltd. c/o of Sundaram Arulrhaj Hospitals, 145/5-B, Jeyaraj Road, Tuticorin 628 002, Tel: 0461-2320061, 2322661, 4200061, 6538061; Fax: 0461 – 2338661, e.mail:  drarulrhaj@gmail.com,   www.arulsenvironment.com,   www.drarulrhaj.com  (together "AEGOPL’) based in the Republic of India, and

 

●      A  group  of  international  investors  to  be  independently  sourced  and  arranged  by  AEGOPL  (the ‘Investors’) and represented herein by Jayesh Tanna, Jose Capote, and Jivabhai Rambhai Khunti, and

 

●       E-Waste Systems, Inc. and its subsidiaries (www.ewastesystems.com),  a USA publicly traded and fully compliant reporting company regulated by the United States Securities and Exchange Commission (the ‘SEC’) and Taking Advice Ltd (‘TAL’) which is a UK Registered Auditor and Chartered Certified Accountant, governed by the UK’s Financial Services Authority, which provides EWSI with a range of services including cloud-based statutory accounting and auditing, tax preparation and advice for selected subsidiaries and affiliates, (together ‘ESWI’) (OTC: EWSI)  and

●      AEGOPL and EWSI are each herein a (‘Party’) and jointly (the ‘Parties’)

 

Introduction

 

●       EWSI, through its subsidiaries, licensees, partners and affiliates, offers customized end-to-end branded (eWasteTM) solutions including recycling plant engineering and related technologies (ePlant1000TM and others), carbon credit analysis and trading (eWasteCCTM), IT Asset Recovery Services (eAssetTM), E- Management Services (eVolveTM), Electronics Reverse Logistics Services (eRLOGTM) and Incubation Services (eIncubatorTM)  (collectively the ‘Services’), and

 

●       AEGOPL is a group of professionals some of which have extensive international executive experience in building companies and which together wish to establish a presence in the USA for the establishment of a  Waste  to  Energy  and  Resources  business  which  may  also  include  recycling  and  reverse  logistics market in the USA as a first step before doing the same in the Republic of India (‘India’) and South-East Asia, and Canada

 

●       As part  of this collaboration, AEGOPL plan to cement their presence in the USA through the acquisition of an existing Public Company through a Reverse Take-Over (RTO).

●       A  professional  and  ownership  collaboration  between  AEGOPL  and  their  related  companies,  the Investors and EWSI, is desired by the Parties in order to implement the project objectives.

 

IT IS HEREBY AGREED as follows:

 

1.   Purpose

 

The Parties agree to enter into this HTA in order to plan for and then execute a joint venture between themselves with the following goals and objectives:

 

a.    For AEGOPL:

 

i.       Acquire a target Public Company (PubCo) vehicle for undertaking the RTO

 

 

  

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ii.     To establish a functional presence in the USA from which it can generate credibility in advance of application for government support to open recycling and environmental operations in India,  Canada & other parts of the World

 

iii.    To provide a base of operation in the New York region whereby their existing relations with  Bhima Ranmal,  and others which may be used to expand sales and profits

 

iv.    To obtain executive positions for certain of the professionals in AEGOPL

 

v.        To create an accelerated revenue and profit stream initially in the USA and ultimately in India, Canada & other parts of the World

 

b.   For EWSI:

 

i.     To expand its business and grow profits initially in the USA and later into India, South- East Asia and other parts of the world

 

ii.     Expand its capital raising to support its growth 

 

iii.    To create superior value for its stakeholders

 

c.      For the Investors:

 

i.      Obtain a superior return on investment through investment into public securities,

 

ii.     Utilize the investment  into EWSI to fund the acquisition  of the target PubCo for the RTO and thus to invest into  at least two public companies

 

d.   Generally extend the customer base, expand geographies and grow sales of and with EWSI

 

e.      Create increased capital value for all Parties

 

2.   Contribution of the Parties

 

a.      AEGOPL shall contribute and do the following:

 

i.      Investment into EWSI of initially US$750,000, to be used as stated in the Use of Proceeds, detailed below; with such funds coming from qualified investors under SEC regulations: 

 

Proposed Use of Proceeds:

 

•      USD $500,000 for the acquisition of the target PubCo for the RTO

 

•      USD $250,000 as working capital for the development of e-waste projects in New York area

 

ii.     EWSI will, in turn receive shares in the new PubCo, equal to 2.5% of the post-acquired PubCo common stock plus warrants  in the PubCo to be negotiated under the formal Share Exchange Agreement associated with the RTO. .

 

iii.    Enter into an exclusive contract with EWSI for the expansion of their New York e-waste recycling center. The Capital Investment required for this expansion will be made via the RTO  Company  and  shall  be  a  further  $1.75M   This  investment  will  be  subject  to  due diligence to be undertaken by the AEGOPL and it's investment partners and the new management of the PubCo

 

iv.   Based on the successful collaboration on the New York project, the Parties would negotiate a  Joint  Venture  agreement  to  establish  regional  and/or  national  eWaste  recycling  and environmental business(es) in India

 

 

 

 

  

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b.   EWSI shall contribute and do the following:

 

i.    Shall  offer  AEGOPL  investors  securities  in EWSI  in one  of the following  forms,  to be decided by the investor:

 

 i.     Restricted  common  stock at a 30%  discount  to the current  20 day volume  weighted average price (‘VWAP’) per share with voting rights, or

 

ii.     Series A Convertible  Redeemable  Preferred Shares priced at $1000/share  with a 10% coupon to maturity, a 30% redemption  premium, and option to convert, at a price of $1100, into common stock at a 25% discount to the 20 day VWAP with voting available upon conversion

 

iii.    Series  B  Preferred  Stock  at  $1000  per  share  with  super  voting  rights  and  25% redemption premium but no conversion rights 

 

iv.    Convertible Debenture with 10% interest and the right to convert to free trading shares after 180 days at a price of 30% discount to the 20 day VWA

 

ii.    Shall allow its fully licensed and permitted eWaste recycling operation in the State of New York, USA to become the platform for the Project, including its customer base, its facility, its inventory, its know-how, and its employees and management in the NY facility

 

iii.   Provide  such  managerial  and  professional  support  for  the  Project  required  to  at  least maintain  its  current  credentials,  including  ISO  9001,  ISO  14001,  R2,  New  York  State licenses, etc.

 

iv.   Provide assistance in obtaining Sponsorship visa’s for members of AEGOPL who intend to come to the USA as part of the Project’s management team

 

v.    Through  Taking-Account,  provide  AEGOPL  with  accounting  and  audit  services  for  the Project

 

vi.   Support  and  promote  AEGOPL’s  intent  to  expand  internationally   through  the  EWSI network, with specific focus on India

 

vii.  Provide   support   to   AEGOPL,   as   requested   and   if   requested   by   AEGOPL   in   the implementation of the RTO

 

c.      The Parties will jointly:

 

i.    Enter into definitive agreements containing (but not limited to) the scope and precise legal structure of the project; the use of funds from the Investors; the management team to be deployed to run the project; the financial plan; the governance of the project, etc.

 

ii.   Agree to execute the Use of Funds as in the schedule.

 

d.   The Parties will each:

 

i.      Be individually responsible for their own costs,

 

ii.     Agree  to  abide  by  the  highest  legal  and  ethical  standards,  including  at  minimum  the execution of a Code of Business Conduct and Ethics policy and Insider Trading Policy

 

iii.    Agree to abide by Fair Trade Employment principles

 

iv.    Agree to adopt the highest principles of respect for the environment in selecting companies and individuals as targets, clients, customers, etc.

 

 

 

 

 

  

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3.   Timing

 

Within  15 business days of the effective date of this HTA, EWSI shall deliver definitive  investment documents to enable the closing of the investments within  75 days.

 

4.   Intellectual Property

All work or materials developed or provided by either Party shall be owned exclusively by that Party and shall not be represented in any form as belonging to anyone other than the originating Party. Such work or materials shall include, but are not limited to, standard corporate documents, branding and intellectual property,  operational  data,  notes,  plans,  customer  lists,  deal  based  documentation,   specifications, designs, files, engineering technology, software (in source and object code form), and any proprietary solutions.

 

5.   No Agency

 

The Parties agree that this HTA does not create any formal or informal agency, partnership or similar permanent relationship other than as described in this HTA and executed in the subsequent documents in support of this agreement, and neither Party shall have any right or authority to bind the other Party in any manner including, without limitation, any legal or financial obligation.

 

6.   No Warranty

 

The Parties shall use reasonable efforts to ensure the suitability of all proposed solutions and plans but neither Party shall be providing any warranty or guarantees.

 

7.   Legal Effect

 

This HTA is binding upon the Parties, however each Party agrees that it will not make any frivolous claim for damages or seek any other legal or equitable remedy against or from the other Party or against the other Party's affiliates arising from or in connection with this HTA other than by a serious breach of this HTA.

 

8.   Confidentiality

 

This HTA and all information disclosed by one Party to the other in connection with the proposed collaboration  shall be deemed  Confidential  Information  and treated  accordingly  by the Parties.   The Parties hereby affirm a separate Non-Disclosure Agreement signed between them.

 

9.   Term and Termination

 

This HTA is effective from the date first signed below and shall continue in force until terminated by either  Party  giving  the  other  Party  at  least  60  business  days  prior  written  notice.  If  the  Parties subsequently execute definitive agreements, any such agreements will supersede this HTA as of its/their effective date.

 

10. Exclusivity and Non-Circumvention

 

The rights and relationships arising under this HTA are exclusive to the Parties until Termination or until such time as the Parties may execute definitive  agreements  which may require extended  exclusivity. Until the later of the Termination Date or the execution of any definitive agreement neither Party shall engage others to perform services the same as or similar to those contemplated by the Parties under this HTA, and shall not do or take any action which directly or indirectly circumvents  the other Party in execution of the Project which is contemplated by this Agreement.

 

11. Public Company Obligations & Public Announcements

 

The Parties understand  that EWSI is a publicly  traded company  under the jurisdiction  of the United States Securities and Exchange Commission (the ‘SEC’) and that if in the opinion of EWSI’s counsel any agreements between the Parties, including this one, may be subject to requirements for filing with the SEC, in which case EWSI shall promptly do so and shall so notify AEGOPL with a copy of any such filing.  Any other public statements, such as press releases, will specifically require joint approval by the Parties in advance of any release.

 

In addition, AEGOPL specifically  agrees that they shall not execute any trading of EWSI’s common stock in any manner that would be in contravention of any trading laws of the SEC, or in violation of EWSI’s Insider Trading Policy or Code of Business  Conduct  and Ethics Policies, both of which are posted on EWSI’s website.

 

 

 

  

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12. Governing Law

 

This HTA shall be construed and controlled by the Laws of Nevada, USA. IN WITNESS WHEREOF, the Parties hereto have executed this Agreement.

 

	On behalf of EWSI 	On behalf of AEGOPL
	 	 
	 	 
	 	 
	By: /s/   Martin Nielson                                                      	By: /s/  Dr. Arulrhaj                                                         
	               Martin Nielson	             Dr. Arulrhaj
	               Chief Executive Officer	 
	 	 
	Effective Date:  November 28, 2014	Effective Date:  November 28, 2014
	 	 
	 	 
	Jayesh Tanna	Jose Capote
	 	 
	 	 
	 	 
	By: /s/  Joyesh Tanna                                                          	By: /s/  Jose Capote                                                         
	             Joyesh Tanna	             Jose Capote
	 	 
	Effective Date:  November 28, 2014	Effective Date:  November 28, 2014
	 	 
	
Jivabhai Rambhai Khunti

	 
	 	 
	 	 
	 	 
	By: /s/   Jivabhai Rambhai Khunti                                   	 
	              Jivabhai Rambhai Khunti	 
	 	 
	Effective Date:  November 28, 2014	 

 

Attachments:

 

1.   Uses of Funds Schedule

 

2.   CV’s of the Key Individuals of AEGOPL and EWSI

 

 

 

 

 

  

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Uses of Funds Schedule

	
Investment Category

	
Use

	
Amount

	 	 	 
	
$500,000 RTO

	
Management FeeS

Legal Fees

Due Diligence Fees

Audit and Accounting Fees Stock Transfer Agent Fees FINRA Filing 

Blue Sky Filing Fees State Filing Fees Market Maker Fees

Payment to Shell Owners

Post Closing Working Capital

	  
	
$250,000 New York Working Capital

	  	  
	 	 	 
	
$1,750,000 New York Expansion

	
Upgraded capital equipment

•      Next generation shredding and separating line

•      Precious Metals processing line

•      Leaded glass separation line

Hire additional sales, biz dev personnel

New management personnel from India

•      Base Comp

•      Expenses

	  

 

 

 

 

 

 

  

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EXHIBIT 10.2

 

TEAMING AGREEMENT

 

THIS TEAMING AGREEMENT (the “Agreement”) is made and entered into this November _, 2014, by and between E-WASTE SYSTEMS, INC.(EWSI) 1350 E. Flamingo, #3101 - Las Vegas, NV 89119 (“EWSI”), and Ingram Micro (UK) Limited whose address is 7 Clarendon Drive , Wymbush,  Milton  Keynes,  MK8  8ED  (“PARTNER”),  which  together  hereinafter  are  jointly referred to as the "Parties".

 

RECITALS

 

WHEREAS, EWSI is executing a branded strategy of growth by brand licensing, by partnership, by acquisition; by organic business development; and by joint venture and as a result has a constantly growing network of high quality companies around the globe that it is working with, and

 

WHEREAS, both EWSI and PARTNER have or may develop customer relations which may need servicing in locations where they do not presently operate and,

WHEREAS, both Parties desire to provide the operational support for these customer initiatives to the other Party, and

 

WHEREAS the Parties wish to engage each other to promote and to perform the services described under this Teaming Agreement.

 

NOW, THEREFORE, the Parties hereby agree as follows:

 

 

1)            Joint Cooperation

 

EWSI and PARTNER have resolved to enter into this Agreement to agree on the collaboration between the Parties to address customers with services to process certain end of life electronics assets from their respective customers with the objective of providing the highest standards of recycling, refurbishing, and /or reselling of these assets, and only in keeping with the customer's requirements, for either reuse or scrap. Neither party shall landfill or export hazardous materials in performing its respective services pursuant this Agreement. All data will also be destroyed to satisfy customer requirements and to satisfy EWSI's and PARTNER’s own high-end standards.  This Agreement  does  not  obligate  either  Party  to  perform  any  specific  services  unless  and  until separately mutually agreed in writing.

 

2)            Sole Brand

 

EWSI  shall  be  the  sole  commercial  brand  deployed  in  the  operation  of  services  under  this Agreement for its customers and PARTNER shall be the sole commercial brand deployed for its customers unless otherwise agreed by the Parties in writing. All communication, correspondence and documentation shall be as directed by the Party which owns the customer relationship.  Both Parties may choose to display the brand, geography and services of the other Party on its own website and promotional material so long as the form of their use is agreed with the other Party in writing prior to such use.    Each Party shall indemnify, defend and hold the other Party and its affiliates harmless from and against any and all third party claims asserting that the first Party’s trademarks, brands or other intellectual property infringe on such third party’s right.

 

 

 

  

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3)             Principles

 

The Parties warrant to each other that they shall deploy the highest industry and ethical standards in execution of the contracted customer services, including but not limited to the following: zero landfilling of any electronics or other waste; complete destruction of customer data; provision of certificates of destruction; resale of still usable electronics only with the consent of the customer; and prohibition of any improper or illegal exportation. In addition, the Parties agree to be guided by, but may exceed and therefore not be limited to, the highest legal e-waste recycling standards in the world, generally accepted to be Europe's WEEE Directive, as well as the principles of the R2 standards as recommended by the United States EPA, and all local laws pertaining to the jurisdictions relevant to the Parties.

 

4)             Customer Relationship; non-circumvention

 

The relationships with the customers that will be served by the Parties belong solely to the original owner of the customer relationship and neither Party shall do or take any action to circumvent the other  or  otherwise  attempt  to  take  away  the  business  of  the  customer  from  the  other  Party. Similarly, the Parties shall not do or take any action to hire away any employees of the other Party or otherwise circumvent the other Party; provided, however, that responses to general solicitations shall not be a breach hereof.

 

5)        Geography

 

The Parties are not limiting themselves by entering into this Agreement to any sector or geography. It is contemplated that the Parties may choose to pursue opportunities wherever they choose to in the world.

 

6)        Management

 

Under this Agreement, each Party originating the customer relationship will be responsible for establishing, publishing and overseeing the operational standards in advance of signing any contract or order with such customer.   The Parties agree that any contract and/or order shall carefully identify the specific customer requirements (or statements of work), including, but not limited to:

 

i.          Removal

ii.         Labor

iii.       Trucking

iv.       Grading

v.        Parting

vi.       Refurbishment

vii.      Testing

viii.     Data destruction

ix.        Demanufacturing

x.         Method of recycling

xi.        Packaging

xii.       Financing

xiii.      Selling

xiv.      Reporting to the customer

xv.       Reporting to the other Party

xvi.      Environmental compliance, and

 xvii.    Providing for customer on-site inspections, tours of the facility, or video capture of the processing, etc.

 

 

 

 

  

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7)             Locations

 

Unless otherwise agreed upon by the Parties the work will be performed at PARTNER’s facilities or EWSI's locations as evidenced by its website, but may include any other agreed location which is under direct or sub-contractual control of either Party, or which is part of the EWSI affiliate network. So long as this Agreement remains valid, the facilities of either Party and any other subsequently deployed locations, may be identified as part of the combined network of both Parties via their websites and other public documents as either Party chooses.

 

8)             Cost of Assets

 

For purposes of clarity, and unless otherwise agreed on a case by case basis, the Parties enter into this Agreement with the understanding that it will be generally receiving end of life assets for disposition at little or no cost to be paid to the customer(s), but that if the equipment contains enough high value at the end of the processing, a portion of the net recovered value may be offered to the customer. Final details regarding a particular customer transaction will address the applicable pricing and materials at issue, and further will specify the compensation and other financial arrangements between the Parties for that specific transaction and a separate agreement will be entered into between the parties with respect thereto.

 

9)             Term & Termination

 

The term of this Agreement will initially be for one year, with a routine reviews to ensure that the terms of this Agreement provide a fair reflection of the performance and rewards of each Party, and may be renewed annually thereafter, by mutual agreement. Within 60 days of the end of the initial term, the Parties will evaluate this Agreement and endeavor to extend the same on terms that are mutually acceptable.  In the event the Parties do not agree on a new contract, this Agreement shall continue month to month thereafter until terminated.  At the end of the initial one year term, either Party may elect to terminate the Agreement by giving not less than 30 days written notice to the other Party, without penalty.  Either Party may terminate this Agreement at any time for "cause", to be defined as material breach of this Agreement, gross misconduct, malfeasance, moral or unethical dealings, or violation of any laws of any applicable jurisdiction. In the event of termination, the Parties shall complete all contracted services and settle the financial matters between them in accordance with the terms of this Agreement.

10)           EWSI’s  Repres entation  a nd  W arranti es

 

Each Party represents and warrants that it will conduct itself with the highest ethical standards and in compliance with any and all applicable laws and will not make any false or misleading representation or warranty regarding the services of the other Party and shall indemnify, defend and hold Partner harmless from and against any and all third party claims resulting from a breach of such representation and warranty contained in this clause.

 

11)           Change of Control Provision

 

This Agreement is binding upon the Parties, their successors and assigns.   The foregoing notwithstanding, in the event that either Party to this Agreement sells a controlling interest of its company to a third party, the other Party shall have the right to cease work on behalf of any

 

 

 

 

 

  

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customer until the third party confirm this Agreement in writing as requested and further shall be entitled to terminate this Agreement immediately upon notice thereof.

 

12)           Authority

 

The Parties warrant to each other that they have full authority to enter into this Agreement and agree to be bound by its terms.

 

13)           No Strict Construction

 

The Parties confirm that there is no relevance to the order of listing of the terms of this Agreement and that if any single element of this Agreement is deemed invalid the other elements shall remain valid and in full force.

 

14)           Governing Law

 

The laws governing this Agreement will be those of England and Wales. In case of any dispute regarding this Agreement, the parties shall refer any disputes to and to agree to be bound by exclusive jurisdiction of the course of competent jurisdiction in London, England.

 

The Parties hereby approve and accept these terms on the date shown below.

 

 

	On Behalf of E-Waste Systems, Inc.	 On Behalf of Ingram Micro UK Ltd
	 	 
	 	 
	 	 
	 /s/            Martin Nielson                                                               	 /s/         Brent McCarty                                                         
	Name:       Martin Nielson	Name:    Brent McCarty
	Title:         Chief Executive Officer	Title:      Director
	Date:         11/25/2014	Date:     11/25/2014

 

 

 

 

 

 

  

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