Document:

mine_ex101.htm

Exhibit 10.1

 

BRAND LICENSING AGREEMENT

 

LEVEL 5 BEVERAGE COMPANY, INC. and VITAMINFIZZ, L.P.

 

This Brand Licensing Agreement (the “Agreement”) is made as of November 21, 2013, between Level 5 Beverage Company, Inc. (the “Licensee”), a corporation organized and existing under the laws of the State of Delaware having offices at 20 Trafalgar Square, Suite #455, Nashua, New Hampshire 03063 (the “Licensee”) and VITAMINFIZZ, L.P. (the “Licensor”), a limited partnership organized and existing under the laws of the State of California having offices at 11815 Laurelwood Drive, Suite 4, Studio City, California 91604 (the “Licensor”).

 

WITNESSETH:

 

 

WHEREAS, Minerco Resources, Inc., the parent company of Level 5 Beverage Company, Inc. (the “Licensee”), is a publicly traded company on the United States OTC Markets (“OTC”) under the symbol OTCQB: MINE; and

 

WHEREAS, Licensor is in the business of developing beverages and is seeking to obtain retail sales of its Products (as each is defined in Exhibit A hereto) marketed under the Brand (as defined below in paragraph 2(b) below); and

 

WHEREAS, Licensee is in the business of developing and selling beverages and is seeking to expand its brand base; and

 

WHEREAS, Licensee desires to acquire the exclusive rights in North America (the “Territory”) to use the Brand on and in connection with the marketing, distribution and sale of the Products, and Licensor desires to grant to Licensee, an exclusive license to use the Brands on and in connection with the marketing, distribution and sale of the Products in the Territory, subject to and in accordance with this Agreement.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:

 

1.             License.

 

(a)           Licensor hereby grants to Licensee, subject to the terms and conditions hereof, the exclusive license in the Territory to use Licensor's Brand, Know-how and commercial and technical information to market, distribute  and sell the Products and any other products it manufactures using the Brand to {commercial} customers, which shall include all rights to use in advertising, publicity, or otherwise, any other trademark, trade name or names, or any contraction, abbreviation, or simulation thereof, on and in connection with the marketing, distribution and sale of the Products.   

(b)           Licensor shall provide information on all Know-how, technical information, techniques, and other technical information, as requested, within a commercially reasonable period of time.

(c)           Licensee shall have the right to grant sublicenses provided that such sublicensees agree to abide by the terms of this Agreement to the same extent as if they were a licensee.

(d)           Licensor acknowledges that Licensee may hereafter enter into licenses with third parties regarding the sale of other similar products and such sale shall not be deemed to be a breach of this Agreement.

 

(e)           Licensor agrees that except for the license herein granted to Licensee it shall not license or sell any products similar to the Products or any other products in connection with the Brand.

 

  

 

  

 

2.              Definitions.

 

(a)             Know-how. All patent applications, inventions, discoveries, data, improvements, techniques, technology, formulae, processes, plans or programs, useful, related to, or necessary to formulate, handle, or utilize the Brand, now or hereafter owned or controlled by Licensor prior to the termination of this Agreement to the extent to which Licensor has the right to grant licenses of the scope herein granted.

 

(b)             The Brand: Vitamin FIZZ®.

 

(c)             Licensing Fee: Fee to be paid by Licensee to Licensor for the marketing rights of the Products.

 

(d)             Licensor Component: That part of the technical information developed by Licensor that consists of patents, copyrights, trade secrets, trademarks or service marks as well as all parts and components based upon or derived from Licensor Know-how pertaining to the Licensor Component.

(e)           Product: any product employing or derived from Licensor Know-how, as well as improvements, modifications, additions, adaptations, or new models designed or developed by, for or in association with the Brand.

 

(f)            Term of the Agreement: Five years from the date of this Agreement. The Agreement will be automatically renewed for an additional five years if agreed to by both parties of this Agreement within thirty days prior to the termination of the initial term and provided that Licensee is in compliance with all of the terms and conditions of this agreement.

 

3.            Initial License Fee.

 

(a)              Fee. In consideration for the costs incurred by Licensor for manufacturing and maintaining its existing inventory of Products, inclusive of any raw material costs, Licensee shall pay Licensor an initial license fee of Thirty Thousand Dollars ($30,000) upon the execution of this Agreement, as an advance against license fees due under paragraph 4 below.

 

(b)               Proof of Sufficient Financial Resources. During the six (6) months following the execution of this Agreement, Licensee shall provide, to Licensor on a strictly confidential basis, as and when requested by Licensor, sufficient proof that Licensee’s financial resources to be dedicated to the Brand and the marketing, distribution and sale of the Products are in excess of One Hundred Thousand Dollars ($100,000.00), inclusive of the Thirty Thousand Dollar ($30,000) initial advance license fee paid as set forth above.  During the next succeeding six (6) month period, Licensor shall continue to have the right to request, and Licensee shall continue to provide on a strictly confidential basis, information related to the sufficiency of its resources to market and sell the Products.

(c)           Maintenance of Trademarks.  During the Term, Licensor shall be responsible for filing, prosecuting and maintaining any patents or trademarks licensed by Licensor related to the Brand.

(d)           Services to be Provided by Licensor or its Affiliated Entities. The parties acknowledge that Power Brands Consulting, LLC is the general partner of the Licensor and that Power Brands Consulting, LLC is in the business of providing product development and brand management services for companies engaged in the beverage industry. Licensor acknowledges that one of the incentives for Licensee to enter into this Agreement was its agreement to provide the following services or to cause Power Brands Consulting, LLC to perform the following services at no cost to Licensee other than the brand management services which shall be provided to Licensee at the cost price incurred by Licensor:

 

	
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Re-formulation and re-design of VitaminFIZZ®;

 

	
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Set up and maintain a website for the display of the Products under the Brand;

 

  

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Provide all brand management services at cost;

 

	
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develop necessary P&L, Cash Flow, and Balance Sheet documents

 

	
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setup and keep Licensee’s accounting books

 

	
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Advise on production (all scales)

 

	
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Advise on ordering raw materials, invoicing, delivery, and finished goods logistics (freight and warehousing)

 

	
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Create a brand specific sales and marketing plan based on the brand’s demographic and geographic targets and budget.

 

	
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Manage sales person(s)

 

	
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Design Product and Brand sell sheet and Point of Sale material including posters, suction racks, static clings, coolers, etc.

 

	
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Establish appropriate sales and marketing budgets based on scope of overall project.

 

	
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Develop an impactful and cost effective rollout marketing campaign.

 

	
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Create retailer and distributor presentations based on brand’s demographic and geographic targets.

 

	
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Identify correct retail and distributor partners

 

	
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Actively participate in key account buyer meetings.

 

	
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Work directly with sales personnel to secure sales meetings and ultimately shelf space.

 

 

4.            Percentage Fee and Milestone Payments.

(a) Percentage Fee.  The Licensee and Licensor agree that the profit to be recognized by each party shall be earned and distributed as follows:  (i) fifty-one percent (51%) of the net revenue derived from the sale of Products under the Brand shall be earned by and distributed to Licensee and (ii) forty-nine percent (49%) of the net revenue derived from the sale of Products under the Brand shall be earned by and distributed to Licensor as license fees.  For the purposes hereof, “net sales” shall mean the gross amount invoiced to third parties by Licensee less the sum of: (a) trade, cash and quantity discounts or rebates actually allowed or taken; (b) credit or allowances given or made for rejection of or return of previously sold Products or for retroactive price reduction; (c) charges for insurance, freight and other transportation costs directly related to delivery of the Products; and (d) sales, transfer and other excise taxes levied on the sale of the Products . The payment by the Licensee to the Licensor shall be within thirty (30) days following the calendar month in which payment for the net revenue was received. No percentage fee payment shall be made to Licensor until such time as the aggregate percentage fee payments earned by Licensor exceed Thirty Thousand Dollars ($30,000).  The percentage fee shall be computed and paid in accordance with Licensee’s accounting records.  All withholding and other taxes that may be imposed on Licensee shall be deducted from the payment of such fees upon provision to Licensor of an official receipt evidencing payment of such taxes.  All out-of-pocket expenses related to the manufacture of the Products after the date hereof shall managed by, and the responsibility of, Licensee. Licensor shall have the right to assign and/or sell its revenue interest to a third party upon thirty (30) days prior written notice.

(b) Milestone Payment.  If at any time the Licensee’s net sales of Products under the Brands exceeds Twenty Million Dollars ($20,000,000), then Licensee shall pay to Licensor a one-time cash milestone payment equal to One Million Dollars ($1,000,000), payable within thirty days of the end of the first fiscal year in which such net sales are achieved.

5.           Term. The initial term of this Agreement shall be for five (5) years from the date hereof unless earlier terminated pursuant to the terms hereof. Thereafter, so long as Licensee is not in default, this Agreement may be extended by Licensee for five (5) additional years under such terms and conditions as may be mutually agreed to by the parties Licensor. If the parties are unable to agree to renewal terms then, at the election of the Licensee, in its sole discretion, this Agreement shall continue for an additional five year term upon the same terms and condition contained in this agreement. If this Agreement is terminated before the end of the initial term then the Licensee, its agents or sublicensees shall not engage, directly or indirectly, in any part of the business of manufacturing, marketing or servicing of Products based upon or derived from Licensor Know-how for a period of five (5) years.

 

6.            Confidentiality.

 

(a)              Licensee recognizes that trade secrets and other proprietary information of Licensor will be conveyed to Licensee pursuant to this Agreement, and Licensee agrees to keep such information in confidence and not to disclose it during or within five (5) years after the term of this Agreement to third parties other than Licensee Affiliates that are bound by confidentiality restrictions as set forth herein and as required by Licensor’s Intellectual Property Protection Program. This confidentiality provision shall survive the early termination or cancellation of this Agreement, and remain in full force.

 

(b)             The restrictions set forth in subparagraph (a) of this paragraph shall not apply to any information: (i) well-known and in the public domain at the time of disclosure; (ii) known to Licensee at the time it was disclosed to it by Licensor as shown by documentation establishing such prior knowledge; (iii) disclosed with the prior written approval of Licensor; and (iv) rightfully disclosed to Licensee by a third party other than a Licensee Affiliate.

 

7.            Technical Data. Within ten (10) days after the execution of this Agreement, Licensor shall provide Licensee with a complete description of all Licensor patent applications, plans, specifications, and instructions and drawings, for the manufacture and use of Products, provided, however, that all such materials shall remain the property of Licensor.

8.            Board of Directors. Licensor shall appoint a representative to Licensee’s to its board of directors, which shall consist of no more than three (3) members.  The by-laws of the Licensee shall further provide that no action may be taken by the Board without notice being given to Licensor’s representative and that any sale of the Licensee or its business operations will require a unanimous vote. 

  

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9.               Relationship. Licensee and Licensor shall act as principals in all respects hereunder, and nothing herein shall be construed to constitute either as the agent, partner, or joint venturer of the other.

 

10.             Litigation; Indemnification. Licensee may at its own expense prosecute any suits or other proceedings against third parties for infringement of Licensor patents or for theft or misuse of the industrial property of Licensor licensed hereunder, and shall be entitled to retain all judgments or other recoveries. In the event that a third party alleges that Licensee infringes any United States patents owned or controlled by such third party by virtue of the manufacture, sale or use of products, except for any improvements thereto by Licensee, Licensor shall indemnify Licensee for all such claims, demands, damages and cost, including reasonable attorneys' fees; provided, however, that this indemnity is conditioned upon Licensee notifying Licensor in writing promptly of the receipt of any claim or the filing of any action, suit or litigation for which Licensor would be liable under the above indemnity and Licensee tendering to Licensor the full defense and direction thereof so long as any compromise or  settlement by Licensor gives Licensee a complete and unconditional release; and provided, further, that this indemnity shall be deemed waived by Licensee in the event of a compromise or settlement of any such alleged infringement by Licensee without first obtaining the consent in writing of Licensor, which consent shall not be unreasonably conditioned, delayed or withheld. In addition, Licensee shall not incur any expenses covered by this indemnity over two thousand five hundred dollars ($2,500) without approval of Licensor, which shall not be unreasonably conditioned, delayed or withheld, Licensee shall be solely responsible for ensuring the compliance of Products with all safety or other standards under any applicable law, rule or order, of any competent governmental authority. Licensee shall indemnify Licensor and its officers, directors and employees  agents and representatives, harmless from any loss, cost or expense, including reasonable attorney’s fees, damages, or penalties of any kind on account of or resulting from any claim incurred in connection with the manufacture or sale of the Products other than (i) due to a breach of the representations or warranties contained in this Agreement; (ii) the gross negligence or willful misconduct of Licensor; or (iii) a claim for which Licensor is obligated to indemnify Licensee under the preceding paragraph.

11.              Termination.

 

                  (a)  In the event of the failure of Licensee to:

(i) pay any royalties due hereunder in full and in a prompt manner,

(ii) sell at least 100,000 cases (24 x 16oz cans per case) of Product during the twenty-four (24) months following the date hereof; or

(iii) or in the event of Licensee's failure to observe or comply with any of the other material terms and conditions of this Agreement

and any such failure is not corrected within thirty (30) days after written notice thereof is given to Licensee, the licenses granted hereunder to Licensee may be terminated forthwith by Licensor upon furnishing a written notice to that effect to Licensee; provided, however, in the event of a default under clause (ii) above, Licensee shall be entitled to cure such default by paying Licensor the fee it would have received has its sold the one hundred thousand (100,000) cases.

 

(b)             In the event that Licensee shall become insolvent, or admit in writing its inability to pay its debts as they mature, or make a general assignment for the benefit of creditors, or file a petition for bankruptcy or permit a petition for bankruptcy against it to remain undismissed for a period of sixty (60) days, or go into liquidation or receivership, or become a party to dissolution proceeding or be admitted as a party to any statutory procedure for the settlement of its debts, Licensor shall have the right and option upon written notice to Licensee to terminate forthwith the licenses granted herein to Licensee.

 

(c)              In the event of termination, however occasioned, the entire unpaid balance as of the date of termination under paragraph 3 shall become immediately due and payable.

 

(d)              In the event of termination, however occasioned, Licensee, its agents or sublicensees shall return to Licensor all printed or written materials containing, based upon, or derived from Licensor Know-how, and shall make no further use of such Know-how, or of Licensor patents, if any. Licensee shall have the option to purchase from Licensor or its Affiliates any or all of Licensor's inventory at cost. Licensee will undertake to examine favorably such inventory and acquire on the aforesaid basis from Licensor such items as it may determine to be commercially reasonable for it to acquire.

 

  

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(e)                In the event of termination, however occasioned, Licensor shall not have any liability or responsibility for compensation, reimbursement, indemnification or damages on account of the loss of prospective business by Licensee or on account of expenditures, investments, leases or commitments made by Licensee.

 

(f)                 In the event of termination, under subparagraph (a) and (b) above, Licensor at its option shall have the exclusive worldwide right to, use and sell, lease, loan, rent or otherwise dispose of, with full right to assign or sublicense, any improvements, to Licensor Know-how developed or owned by Licensee subject for ninety (90) days. Inventory containing the Products shall be disposed of thereafter, unless approved in writing by the Licensor.

(g)           In the event that Licensor shall become insolvent, or admit in writing its inability to pay its debts as they mature, or make a general assignment for the benefit of creditors, or file a petition for bankruptcy or permit a petition for bankruptcy against it to remain undismissed for a period of sixty (60) days, or go into liquidation or receivership, or become a party to dissolution proceeding or be admitted as a party to any statutory procedure for the settlement of its debts, Licensee shall have the right and option upon written notice to Licensor to terminate forthwith the licenses granted herein to Licensee.

 

12.            Representations and Warranties of Licensor. Licensor represents and warrants to Licensee that,

 

(a)            The License granted hereunder does not infringe any patent, trade secret or other property or proprietary rights of any third party.  Licensor is the exclusive owner of all Know-how licensed hereunder and shall use its best efforts to prosecute its pending patent application to completion, and to protect all trade secrets and other intellectual property.  Licensor has not granted a license to the Brands or Products to any other party in the Territory.

 

(b)            All proceeds received from Licensee under this license will be applied by Licensor first to satisfy all legal obligations to employees and government instrumentalities, and next to trade creditors, prior to any payments to shareholders for interest on debt, repayment of debt principal, or dividends or other distribution in respect of Licensor stock.

 

(c)              Licensor has good title to the Products to be sold to Licensee and its customers hereunder, and such inventory and equipment is, and at the time of conveyance to Licensee or its customers, as the case may be, shall be, free and clear of all liens or encumbrances.

(d)           Licensor has full authority to execute and to perform this Agreement in accordance with its terms; the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby does not and will not conflict with, result in a breach, violation or default or give rise to an event which, with the giving of notice or after the passage of time, or both, would conflict with or result in a breach, violation or default of any of the terms or provisions or of any indenture, agreement, judgment, decree or other instrument or restriction to which Licensor is a party or by which Licensor may be bound or affected; and no further authorization or approval, whether of governmental bodies or otherwise, is necessary in order to enable Licensor to enter into and perform the same.

(e)           This Agreement constitutes a valid and binding obligation enforceable against Licensor in accordance with its terms.

13.           Representations and Warranties of Licensee. Licensee represents and warrants to Licensor that,

 

(a)           Licensee has full authority to execute and to perform this Agreement in accordance with its terms; the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby does not and will not conflict with, result in a breach, violation or default or give rise to an event which, with the giving of notice or after the passage of time, or both, would conflict with or result in a breach, violation or default of any of the terms or provisions or of any indenture, agreement, judgment, decree or other instrument or restriction to which Licensee is a party or by which Licensee may be bound or affected; and no further authorization or approval, whether of governmental bodies or otherwise, is necessary in order to enable Licensee to enter into and perform the same.

(b)           This Agreement constitutes a valid and binding obligation enforceable against Licensee in accordance with its terms.

14.           Notices.  All notices, requests, demands and other communications hereunder shall be in writing and shall be delivered: (a) personally; (b) by facsimile or email transmission; (c) by a commercial overnight delivery service (e.g., Federal Express, UPS, Airborne, etc.) and paid for by the sender; or (d) by certified, registered or express mail, postage prepaid. Any such notice shall be deemed given when so delivered: (i) personally, upon such service or delivery; (ii) if sent by facsimile or email transmission, on the day so transmitted, if the sender receives written confirmation (which may be electronic form) from the receiver that the communication was received; (iii) if sent by commercial overnight delivery service, on the date reflected by such service as delivered to the addressee; or (iv) if mailed by certified or registered mail, five business days after the date of deposit in the United States mail. In each instance, such notice, request, demand or other communications shall be addressed to the parties at the addresses set forth hereinabove or to such other address or to such other person as Licensor or Licensee shall have last designated by written notice given as herein provided.

 

  

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15.              Miscellaneous.

 

(a)               Nothing contained in this Agreement shall be construed as (i) a warranty or representation as to the validity or scope of any patent; (ii) an agreement to bring or prosecute actions or suits against third parties for infringement, or conferring any rights to bring or prosecute actions against third parties for infringement except as provided in paragraph 10; or (iii) conferring by implication, estoppel, or otherwise, upon Licensee any license or other right in or to any patent, trademark, copyright or Know-how.

(b)               No delay or failure of either party in exercising any right hereunder shall affect such right, nor shall any single or partial exercise of any right preclude any further exercise thereof. No modification, amendment, addition, or waiver, of any provision of this Agreement shall be effective unless set forth in a writing signed by Licensor and Licensee which specifically states that such writing is to be a modification, amendment, addition, or waiver, and then only in that specific instance and for the specific purpose for which given.

 

(c)               This Agreement contains the entire and complete understanding of the parties with respect to the subject matter and merges all prior and contemporaneous understandings.

 

(d)             This Agreement may not be assigned or sublicensed by Licensee without the prior written consent of Licensor, which shall not be unreasonably withheld. Where Licensee is permitted to assign or sublicense, this Agreement it shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns and sublicensees.  Licensor retains the right to sell and/or assign at any time its right to receive any of the license fees and other payments due to it hereunder to third parties upon no less than thirty (30) days prior written notice to the Licensee.

 

(e)            No remedy conferred herein is intended to be exclusive of any other remedy and each and every such remedy shall be cumulative and in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise.

 

(f)             Each of the parties hereto shall make, do or cause to be done, such further acts and things, and execute, acknowledge, and deliver, such instruments and documents as may be necessary to effectuate the purposes and intent of this Agreement.

 

(g)              The invalidity, partial failure of consideration, or unenforceability, of any particular provision of this Agreement shall not affect the validity or enforceability hereof.

 

(h)               This Agreement may be executed in counterparts, all of which taken together shall be deemed one original agreement.

 

(i)                This Agreement shall be governed by the laws of the State of California.

 

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their representatives, thereunto duly authorized, as of the date first above written.

 

LEVEL 5 BEVERAGE COMPANY, INC

 

By: _/s/ John F. Powers                              

Name: John F. Powers

Title: President and CEO

 

VITAMINFIZZ, L.P.

 

By:  /s/ Darin Ezra                                        

General Partner: Power Brands Consulting, LLC

Name: Darin Ezra

Title: CEO

 

  

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Exhibit A

 

The Products

VitaminFIZZ®

 

7anyi_ex1020.htm

Exhibit 10.20

RESIGNATION AND TRANSITION SERVICES AGREEMENT

This Resignation and Transition Services Agreement (the "Agreement") is made and entered into as of the 2nd day of December, 2013 by and between AnythingIT, Inc., a Delaware corporation with its principal place of business at 17-09 Zink Place, Unit 1, Fair Lawn, New Jersey 07410 (the "Company"), and Gail L. Babitt, an individual (the “Executive”) with her principal place of business at _________.

RECITALS

A. The Executive is a member of the Company’s Board of Directors has been employed by the Company as its Chief Financial Officer.

B. The Executive and the Company are parties to that certain Executive Employment Agreement dated March 7, 2012 (the “March 2012 Employment Agreement”), as amended on July 24, 2013 (collectively, the “Employment Agreement”).

C. After discussions between the parties, the parties desire to terminate their relationship on an amicable basis pursuant to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual promises, undertakings and releases, receipt of which is hereby acknowledged as sufficient consideration by both parties, the parties agree as follows:

1. Recitals.  The above recitals are true, correct, and are herein incorporated by reference.

2. Resignation of Employment; Transition Services.

(a) The Executive hereby resigns as an employee and member of the Board of Directors of the Company and from any and all other offices or positions she may have had with the Company or any of its subsidiaries, to be effective on the Termination Date, as defined herein.  The Company shall file a Current Report on Form 8-K with the Securities and Exchange Commission within the timeframe provided by the Securities Exchange Act of 1934, as amended, and the applicable rules disclosing such resignation, and it shall provide the Executive with a draft of such report for her review and approval prior to the filing thereof.

(b) Until December 31, 2013, the Executive shall provide transition assistance to the Company in the transition of the Executive’s duties, including timely responding to any reasonable requests for information or assistance by the Company (the “Transition Services”). Unless otherwise agreed to by the Executive, all Transition Services shall be performed by the Executive, in her sole discretion, and from a location chosen by her.

3. Termination.  The Employment Agreement is terminated effective on the Termination Date.

4. Satisfaction of Certain Obligations of the Company.

(a) The Company owes the Executive $1038.65 in accrued but unpaid expenses through November 1, 2013 (the “Accrued Expenses”).  The Company shall reimburse the Executive for the Accrued Expenses by December 13, 2013.

(b) The Executive has not cashed a previously issued paycheck in the net amount of $3,881.04 (the “Unpaid Salary”).  The Company acknowledges that the Executive will cash the paycheck for the Unpaid Salary on or after January 9, 2014.

(c) The Executive has previously provided a personal guaranty (the “Personal Guaranty”) of the Company’s obligations evidenced by Honda Civic Lease account # Account # 153818558  (the “Leased Vehicle”).  The Company shall take all actions required, prior to the Termination Date, to release the Executive in full from the Personal Guaranty, either by providing a replacement personal guarantor or terminating the vehicle lease and returning the Leased Vehicle to the lessor or designated agent, it being the intent of the parties that the Executive shall have no personal liability for any amounts of any nature related to the Leased Vehicle.  If such Personal Guaranty is not released prior to the Termination Date, or the Leased Vehicle is not returned to the lessor or designated agent, each of David Bernstein and Vlad Stelmak shall issue joint and several personal guarantees to the Executive, the form of which is attached hereto as Exhibit A and incorporated herein by such reference, agreeing stand in her stead with respect to any and all obligations currently existing, or which may exist in the future, associated with the Leased Vehicle.

  

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5. Compensation.  As compensation for the transition services, the Executive shall be entitled to the following:

(a) Cash compensation in the form of salary of an aggregate of $40,000 for the period ended December 31, 2013 (“Transition Payment”). payable at the rate of $1,250.00 per week, for 32 weeks, beginning on the Termination Date.  All such payments will be less applicable withholding and other applicable taxes through the Company’s standard payroll processor with all other employee payroll.  If the Company defaults on any payment under the terms, all remaining obligations will become immediately due and payable.  Additionally, the Company will ensure that the Executive receives a copy of each pay stub for her records.

(b) The insurance and other benefits currently provided to the Executive by the Company shall continue at the same rate and cost to the Executive through December 31, 2013.

(c) Attached as Schedule A are all options heretofore granted to the Executive under the Company’s 2010 Equity Compensation Plan (the “Executive Options”).  All unvested Executive Options heretofore granted to the Executive shall immediately vest, and all such options, together with previously vested Executive Options, shall remain exercisable through their original expiration date as if the Executive were still employed by the Company. In the event the Company should file a registration statement on Form S-8 with the Securities and Exchange Commission, the Company shall include the shares underlying the Executive Options in such registration statement.

(d) The Company agrees that if the Executive is made a party, is threatened to be made a party, to any action, suit or proceeding, whether civil, criminal, administrative, or investigative (a “Proceeding”), by reason of the fact that the Executive is or was a director, officer, or employee of the Company, or is or was serving at the request of the Company as a director, officer, member, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise, including service with respect to employee benefit plans, whether or not the basis of such Proceeding is the Executive’s alleged action in an official capacity while serving as a director, officer, member, employee, or agent, the Executive shall be indemnified and held harmless by the Company to the fullest extent legally permitted or authorized by the Company’s Certificate of Incorporation, as amended, Bylaws, or resolutions of the Board of  the Company, or, if greater, by the laws of the State of Delaware, against all cost, expense, liability, and loss (including, without limitation, attorney’s fees, judgments, fines or other liabilities or penalties and amounts paid or to be paid in settlement) reasonably incurred or suffered by the Executive in connection therewith, and such indemnification shall continue as to the Executive even if she has ceased to be a director, member, employee, or agent of the Company or other entity and shall inure to the benefit of the Executive’s heirs, executors, and administrators.  The Company shall also advance to the Executive all reasonable costs and expenses incurred by the Executive in connection with a Proceeding within 40 days after receipt by the Company of a written request for such advance.  Such request shall include a written undertaking by the Executive to repay the amount of such advance if it shall ultimately be determined that the Executive is not entitled to be indemnified against such costs and expenses; provided that the amount of such obligation to repay shall be limited to the after-tax amount of any such advance except to the extent the Executive is able to offset such taxes incurred on the advance by the tax benefit, if any, attributable to a deduction for repayment.

(e) The Executive acknowledges that the foregoing compensation are in full and complete satisfaction of all of the Company's obligations to the Executive, including, without limitation, all salary, commissions, stock options and stock not heretofore issued or granted, car allowances, vacation pay or other compensation of any kind.  The Executive agrees that these payments constitute consideration for the covenants and releases of the Executive as set forth herein.

6. Non-Compete.  The Executive acknowledges and recognizes the highly competitive nature of the Company’s Business. Accordingly, in consideration of the execution of this Agreement, and as except as may specifically otherwise approved by the Company’s Board of Directors, the Executive agrees to the following:

(1) That during the one (1) year period from the date of this agreement (the “Restricted Period”) and within a 50 mile radius of the Company’s principal offices located at 17-09 Zink Place, Unit 1, Fair Lawn, New Jersey 07410 (the “Restricted Area”), the Executive will not, individually or in conjunction with others, directly or indirectly, engage in any Business Activities (as hereinafter defined), whether as an officer, director, proprietor, employer, partner, independent contractor, investor (other than as a holder solely as an investment of less than five percent (5%) of the outstanding capital stock of a publicly traded corporation), consultant, advisor, agent or otherwise.

(2) That during the Restricted Period in the Restricted Area, the Executive will not, directly or indirectly, compete with the Company by engaging in equipment recycling.

(3) That during the Restricted Period in the Restricted Area, the Executive will not (A) directly or indirectly recruit, solicit or otherwise influence any employee or agent of the Company to discontinue such employment or agency relationship with the Company, or (B) employ or seek to employ, or cause or permit any business which competes directly or indirectly with the Business Activities of the Company (the "Competitive Business") to employ or seek to employ for any Competitive Business any person who is then employed by the Company.

(4) For the purposes of this Section:

(i) “Business” shall mean equipment recycler that manages the equipment needs of its government and commercial clients by buying, reselling, or recycling, in an environmentally and regulatory compliant manner, computers and other technology hardware,

(ii) “Business Activities" shall be deemed to any business activities concerning data scrubbing and recycling of used computers and other technology hardware.

  

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7. Termination Date and Condition to Agreement.  The effective date of the resignation of the Executive and termination of the Employment Agreement shall be December 2, 2013 (the “Termination Date”).

8. Return of Property.  As a condition to the terms of this Agreement, the Executive shall return to the Company, in good condition, or destroy all documentation and materials to the Company in the Executive's possession.  The Executive shall be entitled to retain, at no cost, all Company equipment currently in her possession.

9. Non-Disparagement.  The Company and the Executive further agree that they shall not make any disparaging, denigrating or untrue statements about the parties or about any other employee of the Company.  It is agreed and understood that any breach of this paragraph by the Executive or the Company would be material to the other.

10. General Releases and Voluntary Waiver of Rights.

(a) Except for the obligations created by or arising out of this Agreement, effective on the Termination Date, the Executive and the Executive's descendants, heirs, successors and assigns, and each of them, do hereby release, acquit, satisfy and forever discharge and covenant not to sue the Company, its agents, servants, employees and all persons for whose conduct it is legally responsible, including, but not limited to, its officers, directors, attorneys, insurers, stockholders, parent, subsidiary, affiliated or related entities and their respective successors and assigns, and each of them, past or present, from any and all manner of action, causes of action, rights, liens, agreements, contracts, covenants, obligations, suits, claims, debts, dues, sums of monies, costs, expenses, attorneys' fees, judgments, orders and liabilities, accounts, covenants, controversies, promises, damages, of whatever kind and nature in law or equity or otherwise whether now known or unknown, including specifically but not limited to, any and all claims arising out of such employment relationship which the Executive ever had (including claims not yet accrued) against the Company, its agents, servants, employees and persons for whom it is legally responsible, for and upon any reason arising out of the employment relationship the Executive had with the Company and the transactions and relationships described herein unless there is a breach of any of the obligations under this Agreement.  The Executive specifically acknowledges that she has been advised that she should consult with an attorney concerning her rights and the signing of this Agreement.

(b) Except for the obligations created by or arising out of this Agreement, effective on the Termination Date, the Company, and the Company’s successors and assigns, and each of them, does hereby release, acquit, satisfy and forever discharge and covenant not to sue the Executive, the Executive’s descendants, heirs, successors and assigns, and each of them, past or present, from any and all manner of action, causes of action, rights, liens, agreements, contracts, covenants, obligations, suits, claims, debts, dues, sums of monies, costs, expenses, attorneys' fees, judgments, orders and liabilities, accounts, covenants, controversies, promises, damages, of whatever kind and nature in law or equity or otherwise whether now known or unknown, including specifically but not limited to, any and all claims arising out of such employment relationship which the Company  against the Executive, for and upon any reason arising out of the employment relationship with the Executive and the transactions and relationships described herein.

11. Non-Admissions.  The Company and the Executive agree that neither this Agreement nor the consideration given shall be construed as an admission of any wrongdoing or liability by the Company or the Executive, and that all such liability or wrongdoing is expressly denied.

12. Anti-Coercion.  Each of the Parties hereto has entered into this Agreement without undue influence, fraud, coercion, duress, misrepresentation, or restraint having been imposed upon them by any other party, and further acknowledges that each party had the opportunity to be represented by counsel of their own selection.

13. Interpretation of Release.  That this Agreement shall be construed in any case which doubt may arise in such a manner as will make it lawful and fully enforceable, and in the event that any part hereof shall be deemed unenforceable or illegal, then it is the intention of the parties hereto that such part be severed and only the remainder be in force.  That for the purposes of interpretation and construction of this Agreement, this Agreement shall be deemed to have been drafted by the Company.

14. Notices.  Any notice required or permitted to be given under the terms of this Agreement shall be sufficient if in writing and if sent postage prepaid by registered or certified mail, return receipt requested; by overnight delivery; by courier; or by confirmed telecopy, to the addresses set forth earlier in this agreement, or at such other place as a party may hereinafter designate.

15. Entire Agreement.  This Agreement constitutes the entire agreement between the parties and shall not be modified, altered, or discharged, except by a writing signed by each of the parties hereto.

16. Governing Law, Jurisdiction and Venue.  This Agreement shall be governed by the laws of the State of Delaware.  The Company and the Executive acknowledge and agree that the U.S. District for the District of New Jersey or if such court lacks jurisdiction, the Circuit Court (or its successor) in and for Bergen County, New Jersey, shall be the venue and exclusive proper forum in which to adjudicate any case or controversy arising either, directly or indirectly, under or in connection with this Agreement and the parties further agree that, in the event of litigation arising out of or in connection with this Agreement in these courts, they will not contest or challenge the jurisdiction or venue of these courts.

  

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17. Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same Agreement.

18. Waiver of Breach - Effect.  No waiver or any breach of any term or provision of this Agreement shall be construed to be, nor shall be, a waiver of any other breach of this Agreement.  No waiver shall be binding unless in writing and signed by the party waiving the breach.

19. Full Understanding and Voluntary Acceptance.  In entering into this Agreement, the parties represent that they have relied upon the advice of their attorneys or have chosen to enter into this Agreement without the assistance of counsel based upon their understanding of the terms hereof.  The terms of this Agreement have been completely read and explained to them by there attorneys and/or they have reviewed the terms hereof in complete detail and that the terms are fully understood and voluntarily accepted by them.  The parties understand and agree that Pearlman Schneider LLP is counsel to the Company and is not counsel, and has not rendered advice, to the Executive.

20. Attorneys' Fees.  In the event of proceeding arising out of the construction, enforcement, and/or interpretation of this Agreement, the prevailing party shall be entitled to reasonable attorneys' fees and costs, both on the trial and appellate level.

21. Headings.  The headings in this Agreement are for convenience only and shall not be used to interpret or construe its provisions.

THE EXECUTIVE ACKNOWLEDGES THAT SHE HAS READ THIS AGREEMENT, THAT THE EXECUTIVE HAS BEEN GIVEN AMPLE OPPORTUNITY TO REVIEW IT AND TO CONSULT WITH A REPRESENTATIVE OR ATTORNEY OF HER CHOOSING CONCERNING ITS TERMS.  THE EXECUTIVE FURTHER ACKNOWLEDGES THAT SHE UNDERSTANDS THE TERMS AND CONDITIONS OF THIS AGREEMENT AND IS VOLUNTARILY ENTERING INTO IT WITH THE COMPANY.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.

 

	 	 
ANYTHING IT, INC.

	 
	 	 	 	 
	
 

	
By: 

	/s/ David Bernstein	 
	 	 	 
David Bernstein, Chief Executive Officer

	 
	 	 	 	 
	 	 	 	 
	 	 
By: 

	 
/s/ Gail L. Babitt

	 
	 	 	 
GAIL L. BABITT

	 
	 	 	 	 

  

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Schedule A

 

	Date of Grant	 	Type of Grant 	 	Shares	 	Exercise Price 	 	Termination
	 	 	 	 	 	 	 	 	 
	12/22/11	 	ISO	 	183,334	 	$0.36	 	12/22/16
	12/22/11	 	ISO	 	183,333	 	$0.36	 	12/22/17
	12/22/11	 	ISO	 	183,333	 	$0.36	 	12/22/18
	 	 	 	 	 	 	 	 	 
	3/7/12	 	ISO	 	166,667	 	$0.15	 	3/7/17
	3/7/12	 	ISO	 	166,667	 	$0.15	 	3/7/18
	3/7/12	 	ISO	 	166,667	 	$0.15	 	3/7/19
	3/7/12	 	ISO	 	166,666	 	$0.15	 	3/7/20

 

 

  

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Exhibit A

PERSONAL GUARANTY

WHEREAS, AnythingIT, Inc., a Delaware corporation (the “Company”) is a party to that certain Honda Civic Lease, Account # 153818558 (the “Vehicle Lease”).

WHEREAS, Gail L. Babitt, an individual (the “Executive”), has previously provided a personal guarantee for the Company’s obligations under the Vehicle Lease (the “Personal Guarantee”).

WHEREAS, the lessor of the Vehicle Lease will not consent to the release of the Executive from the Personal Guarantee.

WHEREAS, the Company desires to continue the Vehicle Lease and has requested that the Executive permit the Personal Guarantee to continue.

WHEREAS, the undersigned is an executive officer and a member of the Board of Directors of the Company.

WHEREAS, the Company and the Executive have entered into a Resignation and Transition Services Agreement (the “Resignation Agreement”) of even date herewith, the terms of which require the undersigned to provide a personal guarantee to the Executive with respect to any and all obligations related to the Vehicle Lease and the undersigned has agreed to provide this guaranty.

NOW, THEREFORE, in consideration of the premises and of other good and valuable consideration and in order to induce the Executive to not terminate the Personal Guarantee, the undersigned agrees that, upon notice or demand, the undersigned shall reimburse the Executive, to the extent that such reimbursement is not made by the Company, for any and all fees, costs, expenses (including counsel fees) whatsoever incurred by the Executive in connection with any and all liabilities of any nature whatsoever associated with the Vehicle Lease, the operation of the vehicle which is the subject of the Vehicle Lease, or the collection thereof (collectively, the “Liabilities”).

This guaranty is a continuing guaranty and shall remain in full force and effect through the termination of the Vehicle Lease and the payment by the Company of the Liabilities.  This guaranty is a joint and several guarantee by the undersigned parties.

The undersigned hereby waives (a) presentment and demand for payment of any of the Liabilities of the Company (b) protest and notice of dishonor or default to the undersigned or to any other party with respect to any of the Liabilities; (c) all other notices to which the undersigned might otherwise be entitled; and (d) any demand for payment under this guaranty and shall pay any obligations within 10 days of presentment by the Executive.

The undersigned further waives any right to require that any action be brought against the Executive or the Company in connection with the Liabilities.  No delay on the part of the Executive in exercising any rights hereunder or failure to exercise the same shall operate as a waiver of such rights; no notice to or demand on the undersigned shall be deemed to be a waiver of the obligations of the undersigned or of the right of the Executive to take further action without notice or demand as provided herein; nor in any event shall any modifications or waiver of the provisions of this guaranty be effective unless in writing nor shall any such waiver be applicable except in the specific instance for which given.

This guaranty is, and shall be deemed to be, a contract entered into under and pursuant to the laws of the State of New Jersey and shall be in all respects governed, construed, applied and enforced in accordance with the laws of said State, and no defense given or allowed by the laws of any other state of the United States of America shall be interposed in any action hereon unless defense is also given or allowed by the laws of the State of New Jersey.

	 	 	 
	 	 	 	 
	
Dated:  December 2, 2013

	 	/s/ David Bernstein	 
	 	 	 
David Bernstein

	 
	 	 	 	 
	Dated:  December 2, 2013 	 	/s/ Vlad Stelmak	 
	 	 	 
Vlad Stelmak

	 

 

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