DRNXMYTH

COLLABORATION AGREEMENT

This Consulting Agreement (the “Agreement”) is entered into as of September 6, 2016 by and between In Spirit Group, Inc., a Delaware corporation dba DRNXMYTH (the “Company”), and _______________________ (“Collaborator ”).

  1. Collaboration Relationship.  During the term of this Agreement, Collaborator will provide services (the “Services”) to the Company as described on Exhibit A attached to this Agreement. Collaborator represents that Collaborator is duly licensed (as applicable) and has the qualifications, the experience and the ability to properly perform the Services. Collaborator shall use Collaborator ’s best efforts to perform the Services such that the results are satisfactory to the Company.  

  2. Compensation.  As consideration for the Services to be provided by Collaborator and other obligations, the Company shall pay to Collaborator the amounts or other compensation specified in Exhibit B attached to this Agreement at the times specified therein.

  3. Expenses.  Collaborator shall not be authorized to incur on behalf of the Company any expenses without the prior consent of the Company, which consent shall be evidenced in writing.  As a condition to receipt of reimbursement, Collaborator shall be required to submit to the Company reasonable evidence that the amount involved was expended and related to Services provided under this Agreement.

  4. Term and Termination.  Either party may terminate this Agreement at any time. In the event of such termination, Collaborator shall be paid for any portion of the Services that have been performed prior to the termination.

  5. Independent Contractor.  Collaborator’s relationship with the Company will be that of an independent contractor.

  6. Method of Provision of Services.  Collaborator shall be solely responsible for determining the method, details and means of performing the Services, subject to compliance with Section 1 above.

  7. No Authority to Bind Company.  Neither Collaborator, nor any partner, agent or employee of Collaborator has authority to enter into contracts that bind the Company or create obligations on the part of the Company without the prior written authorization of the Company.

  8. No Benefits.  Collaborator acknowledges and agrees that Collaborator and its employees will not be eligible for any Company employee benefits and, to the extent Collaborator or its employees otherwise would be eligible for any Company employee benefits but for the express terms of this Agreement, Collaborator (on behalf of itself and its employees) hereby expressly declines to participate in such Company employee benefits.  

  9. Withholding; Indemnification.  Collaborator shall have full responsibility for applicable withholding taxes for all compensation paid to Collaborator, its partners, agents or its employees under this Agreement, and for compliance with all applicable labor and employment requirements with respect to Collaborator ’s business organization and Collaborator ’s partners, agents and employees, including state worker’s compensation insurance coverage requirements and any US immigration visa requirements. Collaborator agrees to indemnify, defend and hold the Company harmless from any liability for, or assessment of, any claims or penalties with respect to such withholding taxes, labor or employment requirements, including any liability for, or assessment of, withholding taxes imposed on the Company by the relevant taxing authorities with respect to any compensation paid to Collaborator or Collaborator’s partners, agents or its employees.

  10. Supervision of Collaborator’s Services.  All of the Services to be performed by Collaborator will be as agreed between Collaborator and the Company.

  11. Company Role in Collaborator Services.  Company agrees to provide services and product in relation to the Collaborator’s Services.  Such services are listed on Exhibit C attached to this Agreement.

  12. Confidential Information.

  13. Collaborator agrees at all times during the term of, or after termination of, this Agreement, to hold in strictest confidence, and not to use, except for the benefit of the Company to the extent necessary to perform Collaborator 's obligations to the Company under this Agreement, or to disclose to any person, firm, corporation or other entity without written authorization of the Company, any Confidential Information of the Company that Collaborator obtains or creates.  

  14. The term “Confidential Information” means any and all oral or written (including electronically recorded) confidential technical and/or business information including, but not limited to, information related to, or contained in, patents, patent applications, presentations, emails, research, product plans, products, developments, inventions, trade secrets, know-how, processes, designs, drawings, engineering, formulae, markets, software (including source and object code), computer programs, algorithms, business plans, agreements with third parties, licenses, services, customers, customer lists, suppliers, prices and costs, finances, budgets, marketing or other business and technical information disclosed to Collaborator  by the Company or created by Collaborator  during the term of the Agreement, whether or not during working hours. Confidential Information does not include any information that was in the public domain at the time it was disclosed by the Company or entered the public domain through no wrongful act of Collaborator or of others who were under confidentiality obligations as to the item or items involved.  

  15. Ethics and Non-Disparagement.  Collaborator agrees to abide by the ethical policies and practices of the Company at all times during the term of this Agreement and, within the scope of applicable laws and regulations, to act in the best interests of the Company and abide by the highest ethical standards in performing the duties set forth in this Agreement. During and following the term of this Agreement:  (i) Collaborator  agrees not to, and, if applicable, shall cause its officers, managers, employees not to, make or encourage any disparaging or untruthful remarks or statements about the Company or its products, services, officers, directors, or employees; provided that nothing in this Agreement shall prevent Collaborator  from making truthful statements when required by law, court order, subpoena, or the like, to a governmental agency or body or in connection with any legal proceeding.  Notwithstanding anything in this Agreement to the contrary, the Company may terminate this Agreement at any time without notice or penalty following Collaborator ’s breach of this Section 9.

  16. Return of Documents and Property.  At the time of termination of this Agreement, Collaborator  will deliver to the Company or destroy (and will not keep in Collaborator 's possession, recreate or deliver to anyone else) all Company property and documents (either electronic copies or hard copies), including, but not limited to, documents containing confidential information, presentations, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings, sketches, laboratory notebooks, or flow charts developed by Collaborator  pursuant to this Agreement or otherwise belonging to the Company. At the request of Company, Collaborator shall certify in writing that all documents have been so returned or destroyed.

  17. Intellectual Property.

  18. For purposes of this Agreement, “Prior Intellectual Property” shall include all inventions, discoveries, original works of authorship, developments, improvements, and trade secrets which were made by Collaborator  prior to the commencement of this Agreement, which belong solely to Collaborator  or belong to Collaborator  jointly with another, which relate in any way to any of the Company’s proposed businesses, products or research and development, and which are not assigned to the Company hereunder. If, in the course of Collaborator 's Relationship with the Company, Collaborator  incorporates into a Company product, process, software or other item of property Prior Intellectual Property owned by Collaborator  or in which Collaborator  has an interest, the Company is hereby granted and shall have a non-exclusive, royalty-free, irrevocable, perpetual, worldwide license (with the right to sublicense) to make, have made, use, sell, offer for sale, import, copy, modify, make derivative works of, and otherwise distribute such Prior Intellectual Property as part of or in connection with such product, process, software or other item of property.  

  19. Collaborator  agrees to promptly make full written disclosure to Company, and to hold in trust for the sole right and benefit of Company, and hereby assigns to Company, or its designee, all right, title and interest throughout the world in and to any and all inventions, discoveries, original works of authorship, developments, concepts, know-how, improvements or trade secrets, whether or not patentable or registrable under copyright or similar laws, which Collaborator  may solely or jointly conceive or develop or reduce to practice, or cause to be conceived or developed or reduced to practice, in performing the Services prior to and during the term of this Agreement (collectively referred to as “Intellectual Property"). Any assignment of Intellectual Property hereunder includes an assignment of all paternity, integrity, disclosure, withdrawal, special and any other similar rights recognized by the laws of any jurisdiction or country (“Moral Rights”). To the extent such Moral Rights cannot be assigned to the Company and to the extent the following is allowed by the laws in any country where Moral Rights exist, Collaborator hereby unconditionally and irrevocably waives the enforcement of such Moral Rights, and all claims and causes of action of any kind against the Company or related to the Company’s customers, with respect to such rights. Collaborator further acknowledges and agrees that neither its successors-in-interest do not retain any Moral Rights in any Intellectual Property.

  20. Collaborator  agrees to assist Company, or its designee, at Company expense, in every proper way to secure Company's, or its designee’s, rights in the Intellectual Property and Moral Rights, including any patents, copyrights, trademarks, mask work rights, or other intellectual property rights relating thereto, in any and all countries, including the disclosure to Company or its designee of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, declarations, assignments, recordations, and all other instruments which Company or its designee deem necessary in order to apply for, obtain, maintain, enforce and transfer such rights, or if not transferable, waive such rights, and in order to assign and convey to Company or its designee, and any successors, assigns and nominees the sole and exclusive rights, title and interest in and to such Intellectual Property and Moral Rights, including any copyrights, patents, mask work rights or other intellectual property rights relating thereto. Collaborator further agrees that the obligation to execute or cause to be executed any such instrument or papers shall continue after the termination of this Agreement until the expiration of the last such intellectual property right to expire in any country of the world.

  21. Conflicts with this Agreement.  Collaborator represents and warrants that neither Collaborator nor any of Collaborator ’s partners, employees or agents is under any pre-existing obligation in conflict or in any way inconsistent with the provisions of this Agreement. Collaborator represents and warrants that Collaborator ’s performance of all the terms of this Agreement will not breach any agreement to keep in confidence proprietary information acquired by Collaborator in confidence or in trust prior to commencement of this Agreement. Collaborator warrants that Collaborator has the right to disclose and/or or use all ideas, processes, techniques and other information, if any, which Collaborator has gained from third parties and which Collaborator discloses to the Company or uses in the course of performance of this Agreement, without liability to such third parties. Notwithstanding the foregoing, Collaborator agrees that Collaborator shall not bundle with or incorporate into any deliveries provided to the Company herewith any third party products, ideas, processes, or other techniques or any Prior Intellectual Property, without the express, written prior approval of the Company. Collaborator represents and warrants that Collaborator has not granted and will not grant any rights or licenses to any intellectual property or technology that would conflict with Collaborator ’s obligations under this agreement. Collaborator will not knowingly infringe upon any copyright, patent, trade secret or other property right of any former client, employer or third party in the performance of the Services required by this Agreement.

  22. Miscellaneous.

  23. Amendments and Waivers.  Any term of this Agreement may be amended or waived only with the written consent of the parties.

  24. Sole Agreement.  This Agreement, including the Exhibits hereto, constitutes the sole agreement of the parties and supersedes all oral negotiations and prior writings with respect to the subject matter hereof.

  25. Notices.  Any notice required or permitted y this Agreement shall be in writing and shall be deemed sufficient upon receipt, when delivered personally or by courier, overnight delivery service or confirmed facsimile, 48 hours after being deposited in the regular mail as certified or registered mail (airmail if sent internationally) with postage prepaid, if such notice is addressed to the party to be notified at such party’s address or facsimile number as set forth below, or as subsequently modified by written notice.

  26. Choice of Law.  The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of California, without giving effect to the principles of conflict of laws.

  27. Severability.  If one or more provisions of this Agreement are held to be unenforceable under applicable law, the parties agree to renegotiate such provision in good faith.  In the event that the parties cannot reach a mutually agreeable and enforceable replacement for such provision, then (i) such provision shall be excluded from this Agreement, (ii) the balance of the Agreement shall be interpreted as if such provision were so excluded and (iii) the balance of the Agreement shall be enforceable in accordance with its terms.

  28. Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together will constitute one and the same instrument.

  29. Arbitration.   Any dispute or claim arising out of or in connection with any provision of this Agreement will be finally settled by binding arbitration in Los Angeles, California, in accordance with the rules of the American Arbitration Association by one arbitrator appointed in accordance with said rules. The arbitrator shall apply California law, without reference to rules of conflicts of law or rules of statutory arbitration, to the resolution of any dispute. Judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Notwithstanding the foregoing, the parties may apply to any court of competent jurisdiction for preliminary or interim equitable relief, or to compel arbitration in accordance with this paragraph, without breach of this arbitration provision.

  30. Advice of Counsel.  EACH PARTY ACKNOWLEDGES THAT, IN EXECUTING THIS AGREEMENT, SUCH PARTY HAS HAD THE OPPORTUNITY TO SEEK THE ADVICE OF INDEPENDENT LEGAL COUNSEL, AND HAS READ AND UNDERSTOOD ALL OF THE TERMS AND PROVISIONS OF THIS AGREEMENT.  THIS AGREEMENT SHALL NOT BE CONSTRUED AGAINST ANY PARTY BY REASON OF THE DRAFTING OR PREPARATION HEREOF.

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EXHIBIT A

DESCRIPTION OF COLLABORATION SERVICES

Cocktail Development

  • Develop cocktail formula(s),

  • Must fit DRNXMYTH “sour” template,

  • must pass validation study, shelf life study, and possibly visual result study

  • must meet DRNXMYTH quality control standards: requisite brix ratios, pH balances, not including specific ingredients, etc. (included in cocktail template brief)

  • must include ingredients that:

    • Can be reasonably procured

    • Can be reasonably manufactured at our facility

    • Fit within Cost of Goods target

      • Cocktail template brief will be provided in a separate document

Content and Promotion

  • Label Artwork

    • DRNXMYTH can handle and/or collaborate with partner influencer

    • Partner influencer can provide designs within DRNXYMTH label template

  • Regular promotion of bartender-created content on Instagram Grid and Stories, and other available media channels in coordination with DRNXMYTH

    • Specific schedule will be pre-planned in order to finalize agreement and profit share percentage

Sales

  • Partnership Development

    • Coordination of brand partnerships will satisfy qualitative goals

  • Product and Brand support which will be determined on a case by case basis in partnership with DRNXMYTH

    • As a profit sharing member of the project, brand management will become an aspect of the position and role. Each brand deal will be pre-planned and agreed on in advance, but somewhat unique and responsibilities may vary between deals.

All cocktails must be sold in uniquely-designed packaging, which must be financed by customers or brands or some third party.  DRNXMYTH requires 10,000 unit minimum order to meet efficient economies of scale and margin protection. 10,000 units can be spread across multiple SKUs.

 

EXHIBIT B

COMPENSATION

Earn-Out

Company shall compensate Collaborator with proceeds from the Company in the form of an earn-out of up to fifty percent (50%) of “Net Revenue” of Cocktails developed, promoted, and sold by Collaborator for the Company (the “Collaborator Earn Out”).  “Net Revenue” shall be defined as total revenue of such cocktail minus cost of such goods, taxes, distribution costs, and any other direct costs used to acquire or fulfill purchase orders.  Company retains all rights to not sell all or any cocktails developed by Collaborator.

 

Credit

Company shall give credit to Collaborator by way of identifying Collaborator on the Company packaging in a manner that comports with TTB (United States Alcohol, Tax, Tobacco and Trade Bureau) regulations, and legible to an average consumer in typeface and font size not dissimilar to information of similar type on the Company packaging.  The Company reserves the right to identify Collaborator in any manner it chooses, but with the advice and input of Collaborator. .

EXHIBIT C

LIST OF SERVICES COMPANY TO PROVIDE

Customer management and product execution

  • Plan and formalize Go To Market Plan and Action Programs across Social, .com and email

  • Lead legal and regulatory compliance with TTB and other regulated entities

    • Formula approvals

    • Formula testing

  • Customer and community relations

    • Brand relations

      1. Servicing customer alongside influencer partner

      2. Pitch, presentation, logistics, and negotiation planning and execution

    1. Community management: consumers, customers, regulators, vendors, etc.

  1. Financial management and oversight, including regulatory and tax compliance

    • Vendor acquisition

    • Costing and margin analysis

    • Purchase ordering and ingredient management

    • Federal and state tax payment and management

    • State and federal resale and local ordinance management

  2. Full supply chain and manufacturing management

    • Forecasting

    • End-to-end supply chain management of components and ingredients

    • High pressure processing

    • Cold pressed juice

    • Shipping

    • Bottling

    • Co-Create and co-manage Indiegogo campaign page, backer relations, Page creation and Content

    • Perk development

    • Campaign costing

Intellectual Property and Technology

  • Custom Hardware Design

    • Custom cap

    • Unique texture (i.e. ‘diamond cuts’ ‘twisting cues’)

    • Unique color tinting of cap, middle, and bottom sections

  • Recipe and Formula Quality Assurance

    • Drink must fit within Brix ratio and our proprietary ‘template’ for balanced cocktail inside of 200ml bottle

  • Unique cocktail name

  • Unique label design within DRNXMYTH style guide parameters

  • Logo on front and back of label