As filed with the Securities and Exchange Commission on June 16, 2016.

Registration No. 333-210669

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



 

Amendment No. 3 to
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933



 

LONG ISLAND ICED TEA CORP.

(Exact Name of Registrant as Specified in Its Charter)

   
Delaware   2080   47-2624098
(State or Other Jurisdiction of
Incorporation or Organization) 		  (Primary Standard Industrial
Classification Code Number) 		  (I.R.S. Employer
Identification Number)


 

116 Charlotte Avenue
Hicksville, NY 11801
(855) 542-2832

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)



 

Philip Thomas
Chief Executive Officer
Long Island Iced Tea Corp.
116 Charlotte Avenue
Hicksville, NY 11801
(855) 542-2832

(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service)



 

Copies of communications, including communications sent to agent for service, should be sent to :

 
David Alan Miller, Esq.
Jeffrey M. Gallant, Esq.
Graubard Miller
The Chrysler Building
405 Lexington Avenue
New York, New York 10174
Telephone: (212) 818-8800
Fax: (212) 818-8881 		  Ross Carmel, Esq.
Peter DiChiara, Esq.
Carmel, Milazzo & DiChiara LLP
261 Madison Avenue, 9 th Floor
New York, New York 10016
Telephone: (212) 658-0458
Fax: (646) 838-1314


 

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.

If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. o

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 
Large accelerated filer o   Accelerated filer o
Non-accelerated filer o
(Do not check if a smaller reporting company) 		  Smaller reporting company x

The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the commission, acting pursuant to said section 8(a), may determine.

 

 

 
 

This Amendment No. 3 (“Amendment No. 3”) to the Registration Statement on Form S-1 (File No. 333-210669) of Long Island Iced Tea Corp. (“Registration Statement”) is being filed solely for the purpose of filing certain exhibits as indicated in Part II of this Amendment No. 3. This Amendment No. 3 does not modify any provision of the prospectus that forms a part of the Registration Statement. Accordingly, a preliminary prospectus has been omitted.

PART II
 
INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution

The following table sets forth the fees and expenses, other than underwriting discounts and commissions, payable by us in connection with the offering described in this Registration Statement. All amounts shown are estimates other than the SEC registration fee, the FINRA filing fee and the NASDAQ listing fee.

 
  Amount
SEC registration fee   $ 1,160  
FINRA filing fee     2,225  
NASDAQ listing fee     50,000  
Printing and mailing expenses     50,000  
Accounting fees and expenses     50,000  
Legal fees and expenses     150,000  
Transfer agent fees and expenses     10,000  
Miscellaneous     86,615  
Total expenses   $ 400,000  

Item 14. Indemnification of Directors and Officers.

Our amended and restated certificate of incorporation provides that no director of ours will be personally liable to us or any of its stockholders for monetary damages arising from the director’s breach of fiduciary duty as a director. However, this does not apply with respect to any action in which the director would be liable under Section 174 of the DGCL nor does it apply with respect to any liability in which the director (i) breached his duty of loyalty to Holdco or its stockholders; (ii) did not act in good faith or, in failing to act, did not act in good faith; (iii) acted in a manner involving intentional misconduct or a knowing violation of law or, in failing to act, shall have acted in a manner involving intentional misconduct or a knowing violation of law; or (iv) derived an improper personal benefit. This provision could have the effect of reducing the likelihood of derivative litigation against our directors and may discourage or deter our stockholders or management from bringing a lawsuit against our directors for breach of their duty of care, even though such an action, if successful, might otherwise have benefited us and our stockholders.

Our amended and restated certificate of incorporation also provides that we will indemnify any director or officer of ours to the fullest extent permitted by law. Our bylaws further provide that we will indemnify to the fullest extent permitted by law any person who becomes party to a proceeding by reason of the fact that he is or was an director, officer, employee or agent of ours, or by reason of the fact that he is or was serving at our request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise. We have entered, and intend to continue to enter, into separate indemnification agreements with our directors, executive officers and other key employees, in addition to the indemnification provided for in our amended and restated certificate of incorporation and bylaws. We also maintain directors’ and officers’ liability insurance.

Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended (the “Securities Act”), may be permitted to directors, officers or person controlling us pursuant to the foregoing provisions, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Act and is therefore unenforceable.

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Item 15. Recent Sales of Unregistered Securities.

Business Combination

Effective May 27, 2015, we consummated the transactions contemplated by the Merger Agreement and Plan of Reorganization (the “Merger Agreement”), dated as of December 31, 2015 and amended April 23, 2015, by and among us, Cullen Agricultural Holding Corp. (“Cullen”), Cullen Merger Sub, Inc., a wholly owned subsidiary of ours (“Parent Merger Sub”), LIIT Acquisition Sub, LLC, a wholly owned subsidiary of ours (“LIBB Merger Sub”), Long Island Brand Beverages, LLC (“LIBB”), Phil Thomas and Thomas Panza, and the other members of LIBB who signed joinder agreements to become parties to the Merger Agreement.

Upon the closing of the transactions contemplated by the Merger Agreement, (i) Parent Merger Sub merged with and into Cullen, with Cullen surviving as a wholly owned subsidiary of ours (the “Parent Merger”), and (ii) LIBB Merger Sub merged with and into LIBB, with LIBB surviving as a wholly owned subsidiary of ours (the “Company Merger”). Upon the closing of the Parent Merger, every fifteen shares of common stock of Cullen were automatically converted into one share of our common stock. Upon consummation of Company Merger, we issued an aggregate of 2,633,334 shares of our common stock to the former members of LIBB (“Members”), in exchange for all of the membership interests of LIBB. As a result of the Parent Merger and the Company Merger, we became a public company, the stockholders of Cullen and the Members became our stockholders and Cullen and LIBB became wholly owned subsidiaries of ours.

The issuances to the Members were made in reliance upon the exemption provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and Rule 506 thereunder, for the offer and sale of securities not involving a public offering.

June/July Private Placements

On June 30, 2015, we sold an aggregate of 256,615 shares of our common stock to certain accredited investors at a purchase price of $4.00 per share, for an aggregate purchase price of approximately $1,027,000, including through the cancellation of an aggregate of approximately $556,000 in outstanding debt, including accrued interest, owed by the Company to certain of the investors. The shares were sold in a private placement pursuant to the terms of subscription agreements executed by each of the investors. Family members of Philip Thomas, the Company’s Chief Executive Officer and a member of its board of directors, and family members of Paul N. Vassilakos, a member of the Company’s board of directors, each purchased $50,000 worth of shares in the private placement.

On July 8, 2015, we sold an aggregate of 25,000 shares of our common stock to certain accredited investors at a purchase price of $4.00 per share, for an aggregate purchase price of approximately $100,000. The shares were sold in a private placement pursuant to the terms of subscription agreements executed by each of the investors.

The private placements were conducted pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act. The offerings were made solely to accredited investors without the use of any general solicitation or general advertising.

August Private Placement

Commencing on August 10, 2015 and ending on October 30, 2015, we conducted a “best efforts” private placement of up to $3,000,000 of units (the “August Private Placement”), at a price of $4.00 per unit, through Network 1 Financial Securities, Inc., as placement agent (the “Placement Agent”). During the August Private Placement, we sold an aggregate of 155,750 units for total gross proceeds of $623,000. The units consisted of one share of our common stock (or an aggregate of 155,750 shares) and one warrant (or an aggregate of 155,750 warrants). The units were separable immediately upon issuance and were issued separately as shares of common stock and warrants.

Each warrant entitles the holder to purchase one share of our common stock at an exercise price of $6.00 per share, commencing immediately and expiring on September 17, 2018. The exercise price and number of shares of common stock issuable on exercise of the warrants are subject to standard anti-dilution provisions. We may call the warrants for redemption, at our option, in whole and not in part, at a price of $0.01 per warrant, if (i) the closing price per share of the common stock is at least $10.00 for 30 consecutive trading

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days ending on the third business day prior to the notice of redemption or (ii) the common stock is listed for trading on a national securities exchange and the closing price per share of common stock on the first day of trading on such exchange is at least $7.50. The right to exercise will be forfeited unless the warrants are exercised prior to the date specified in the notice of redemption. On and after the redemption date, a record holder of a warrant will have no further rights except to receive the redemption price for such holder’s warrant upon surrender of such warrant.

Pursuant to the subscription agreement entered into with each of the investors in the August Private Placement, the investors have certain “piggyback” registration rights covering the resale of the shares of common stock included in the units and the shares of common stock underlying the warrants.

We incurred fees paid or to be paid in cash to the Placement Agent in connection with the August Private Placement of $15,000 as a commitment fee, $51,800 in commissions and $16,890 as a non-accountable expense allowance. As additional compensation, we issued the Placement Agent a warrant to purchase 15,575 shares of our common stock at an exercise price of $4.50 per share.

The August Private Placement was conducted pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D thereunder. The offering was made solely to accredited investors without the use of any general solicitation or general advertising.

Credit Facility

On November 23, 2015, we entered into a Credit and Security Agreement (the “Credit Agreement”), as amended as of January 10, 2016 and April 7, 2016, with Brentwood LIIT Inc. (“Brentwood”), as the lender. Brentwood is owned by Eric Watson, who immediately prior to the entering into the Credit Agreement beneficially owned more than 16% of our outstanding common stock, and KA#2 Ltd. The Credit Agreement provides for a revolving credit facility (the “Credit Facility”). The amount available to be advanced under the Credit Facility (the “Available Amount”) may be increased from time to time, in increments of $500,000, up to a maximum of $5,000,000 (the “Facility Amount”), and we may obtain further advances, subject to the approval of Brentwood. The proceeds of the Credit Facility are to be used for the purposes disclosed in writing to Brentwood in connection with each advance. Brentwood has approved an Available Amount of $1,500,000 and has made advances to us in the same amount. Upon the completion of all approved advances, the principal amount of loans outstanding, including capitalized interest and fees (both of which are excluded when determining whether the Available Amount has been reached), was $1,627,930.

The loans under the Credit Agreement are evidenced by a promissory note (the “Brentwood Note”). Brentwood may elect to convert the outstanding principal and interest under the Brentwood Note into shares of our common stock at a conversion price of $4.00 per share. The conversion price and the shares of common stock or other property issuable upon conversion of the principal and interest are subject to adjustment in the event of any stock split, stock combination, stock dividend or reclassification of our common stock, or in the event of a fundamental transaction.

In addition, in connection with the establishment of the Credit Facility, we issued a warrant to Brentwood (the “Brentwood Warrant”). The Brentwood Warrant entitles the holder to purchase 1,111,111 shares of common stock at an exercise price of $4.50 and includes a cashless exercise provision. The exercise price and number of shares of our common stock or property issuable on exercise of the Brentwood Warrant are subject to adjustment in the event of any stock split, stock combination, stock dividend or reclassification of the common stock, or in the event of a fundamental transaction.

Brentwood has agreed to convert all of the outstanding principal and interest under the Brentwood Note into 421,972 shares of our common stock at the closing of the offering. In addition, Brentwood will exchange the Brentwood Warrant for 486,111 shares of our common stock at such time. The Credit Facility will remain outstanding, except that the Facility Amount will be reduced to $3,500,000.

The securities issuable under the Credit Agreement, including the shares of the Company’s common stock issuable upon conversion of the Note and exercise of the Warrant, are being offered pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act, for the offer and sale of securities not involving a public offering.

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November Private Placement

Commencing on November 24, 2015 and ending on March 14, 2016, we conducted another “best efforts” private placement of up to $3,000,000 of units (the “November Private Placement”), at a price of $4.00 per unit, through the Placement Agent. During the November Private Placement, we sold an aggregate of 189,975 units for total gross proceeds of $759,900. The units consisted of one share of our common stock (or an aggregate of 189,975 shares) and one warrant (or an aggregate of 189,975 warrants). The units were separable immediately upon issuance and were issued separately as shares of common stock and warrants.

Each warrant entitles the holder to purchase one share of common stock at an exercise price of $6.00 per share, commencing immediately and expiring on November 30, 2018. The exercise price and number of shares of common stock issuable on exercise of the warrants are subject to standard anti-dilution provisions. We may call the warrants for redemption, at our option, in whole and not in part, at a price of $0.01 per warrant, if (i) the closing price per share of the common stock is at least $10.00 for 30 consecutive trading days ending on the third business day prior to the notice of redemption or (ii) the common stock is listed for trading on a national securities exchange and the closing price per share of common stock on the first day of trading on such exchange is at least $7.50. The right to exercise will be forfeited unless the warrants are exercised prior to the date specified in the notice of redemption. On and after the redemption date, a record holder of warrants will have no further rights except to receive the redemption price for such holder’s warrant upon surrender of such warrant.

Pursuant to the subscription agreement entered into with each of the investors in the November Private Placement, the investors have certain “piggyback” registration rights covering the resale of the shares of common stock included in the units and the shares of common stock underlying the warrants.

We incurred fees paid or to be paid in cash to the placement agent in connection with the November Private Placement of $42,990 in commissions and $22,797 as a non-accountable expense allowance. As additional compensation, we issued a warrant to the placement agent to purchase 18,998 shares of common stock at an exercise price of $4.50 per share.

The November Private Placement was conducted pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D thereunder. The offering was made solely to accredited investors without the use of any general solicitation or general advertising.

March Private Placement

On March 29 and 31, 2016, we sold an additional 58,750 units on a private placement basis, or the “March Private Placement,” directly to various accredited investors, at a price of $4.00 per unit, for aggregate gross proceeds of $235,000. The units consisted of one share of common stock (for an aggregate of 58,750 shares) and one warrant (for an aggregate of 58,750 warrants). Each warrant entitles the holder to purchase one share of common stock at an exercise price of $6.00 per share, expiring on March 29, 2019.

The March Private Placement was conducted pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D thereunder. The offering was made solely to accredited investors without the use of any general solicitation or general advertising.

Equity Grants

On January 26, 2016, the Company granted 8,956 shares of its common stock to each of its nonemployee directors, Kerry Kennedy, Paul Vassilakos, Edward Hanson and Richard Roberts, for an aggregate of 35,824 shares, as compensation for their services as directors. On the same day, the Company also granted 7,500 shares of its common stock to each of the members of its advisory board, John Carson, Tom Cardella, Dan Holland and David Williams, for an aggregate of 30,000 shares of its common stock, as compensation for their advisory services.

On March 31, 2016, we granted 7,500 shares of our common stock to our Vice President of National Sales & Marketing, Joseph Caramele, and we granted an aggregate of 34,133 shares of common stock to several consultants, vendors and advisors, which includes 15,833 shares issued to Bert Moore, a member of our Advisory Board, related to a consumer marketing project.

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The January stock grants were conducted pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act and the March stock grants were conducted pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D thereunder, for the offer and sale of securities not involving a public offering.

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Item 16. Exhibits and Financial Statement Schedules.

(a) The following exhibits are filed as part of this Registration Statement:

 
Exhibit
No. 		  Description
 1.1*   Form of Underwriting Agreement.
3.1   Amended and Restated Certificate of Incorporation (incorporated by reference from Annex C of the proxy statement/prospectus that forms a part of the Company’s Registration Statement on Form S-4 (File No. 333-201527), originally filed on January 15, 2015).
3.2   Bylaws (incorporated from Annex D of the proxy statement/prospectus that forms a part of the Company’s Registration Statement on Form S-4 (File No. 333-201527), originally filed on January 15, 2015).
4.1   Specimen common stock Certificate of Long Island Iced Tea Corp (incorporated by reference from Exhibit 4.1 to the Company’s Registration Statement on Form S-4 (File No. 333-201527), originally filed on January 15, 2015).
 4.2*   Form of Underwriters’ Warrant.
 5.1    Opinion of Graubard Miller.
10.1    Form of Registration Rights Agreement among Triplecrown Acquisition Corp. and the Triplecrown Founders (incorporated by reference from Triplecrown Acquisition Corp.’s Registration Statement on Form S-1 (File Nos. 333-144523 and 333-146850) originally filed on July 12, 2007).
10.2    Sale and Purchase Agreement, dated as of December 31, 2014, by and between Cullen Agricultural Holding Corp. and Hart Acquisitions, LLC (incorporated by reference from Exhibit 10.5 to Cullen’s Annual Report on Form 10-K filed on March 4, 2015).
10.3    Form of Lock-Up Agreement (incorporated from Exhibit 10.1 to Cullen’s Current Report on Form 8-K filed on January 6, 2015).
10.4    Form of Escrow Agreement (incorporated by reference from Exhibit 10.4 to the Company’s Registration Statement on Form S-4 (File No. 333-201527), originally filed on January 15, 2015).
10.5    Form of Registration Rights Agreement (incorporated from Exhibit 10.3 to Cullen’s Current Report on Form 8-K filed on January 6, 2015).
10.6    Form of Employment Agreement between Long Island Iced Tea Corp. and Philip Thomas (incorporated by reference from Exhibit 10.9 to the Company’s Registration Statement on Form S-4 (File No. 333-201527), originally filed on January 15, 2015).
10.7    Form of Employment Agreement between Long Island Iced Tea Corp. and Peter Dydensborg (incorporated by reference from Exhibit 10.10 to the Company’s Registration Statement on Form S-4 (File No. 333-201527), originally filed on January 15, 2015).
10.8    Form of Employment Agreement between Long Island Iced Tea Corp. and James Meehan (incorporated by reference from Exhibit 10.11 to the Company’s Registration Statement on Form S-4 (File No. 333-201527), originally filed on January 15, 2015).
10.9    Form of Employment Agreement between Long Island Brand Beverages LLC. and Thomas Panza (incorporated by reference from Exhibit 10.12 to the Company’s Registration Statement on Form S-4 (File No. 333-201527), originally filed on January 15, 2015).
10.10   2015 Long-Term Incentive Equity Plan (incorporated by reference from Annex G of the proxy statement/prospectus that forms a part of the Company’s Registration Statement on Form S-4 (File No. 333-201527), originally filed on January 15, 2015).
10.11   Form of Executive Stock Option Agreement (incorporated by from Exhibit 10.11 to the Company’s Annual Report on Form 10-K filed on March 23, 2016).
10.12   Form of Subscription Agreement (incorporated by reference from Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on November 13, 2015).
10.13   Form of Warrant (incorporated by reference from Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q filed on November 13, 2015).

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Exhibit
No. 		  Description
10.14     Expense Reimbursement Agreement, dated as of November 23, 2015, by and between Long Island Iced Tea Corp. and Magnum Vending Corp. (incorporated from Exhibit 10.5 to the Company’s Current Report on Form 8-K filed on November 24, 2015).
10.15     Credit and Security Agreement, dated as of November 23, 2015, by and among Long Island Brand Beverages, LLC, Long Island Iced Tea Corp. and Brentwood LIIT Inc. (incorporated from Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on November 24, 2015).
10.16     Form of Secured Convertible Promissory Note (incorporated from Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on November 24, 2015).
10.17     Form of Brentwood Warrant (incorporated from Exhibit C to the Credit and Security Agreement). (incorporated from Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on November 24, 2015).
10.18     Form of Parent Guaranty (incorporated from Exhibit D to the Credit and Security Agreement). (incorporated from Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on November 24, 2015).
10.19     Registration Rights Agreement, dated as of December 3, 2015, by and among Long Island Brand Beverages, LLC, Long Island Iced Tea Corp. and Brentwood LIIT Inc. (incorporated from Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 16, 2015).
10.20     Pledge and Escrow Agreement, dated as of December 3, 2015, by and among Long Island Iced Tea Corp., Brentwood LIIT Inc. and Graubard Miller (incorporated from Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on December 16, 2015).
10.21     First Amendment to Credit and Security Agreement, effective as of January 10, 2016, by and among Long Island Brand Beverages LLC, Long Island Iced Tea Corp., and Brentwood LIIT Inc. (incorporated from Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 20, 2016).
10.22     Second Amendment to Credit and Security Agreement, effective as of April 7, 2016, by and among Long Island Brand Beverages LLC, Long Island Iced Tea Corp., and Brentwood LIIT Inc. (incorporated from Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on April 8, 2016).
10.23     Amendment No. 1 to Registration Rights Agreement, dated as of April 7, 2016, by and among Long Island Brand Beverages LLC, Long Island Iced Tea Corp. and Brentwood LIIT Inc. (incorporated from Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on April 8, 2016).
10.24     Consulting Agreement, dated as of June 17, 2015 and Amendment No. 1 thereto, dated as of June 6, 2016, by and between Long Island Iced Tea Corp. and Julian Davidson.
10.25     Form of Employment Agreement by and between Long Island Iced Tea Corp. and Julian Davidson.
10.26     Employment Agreement, dated as of June 1, 2016, by and between Long Island Iced Tea Corp. and Richard B. Allen.
21.1      List of subsidiaries (incorporated by from Exhibit 21.1 to the Company’s Annual Report on Form 10-K filed on March 23, 2016).
23.1*     Consent of Marcum LLP.
23.2      Consent of Graubard Miller (incorporated from Exhibit 5.1).
24.1      Power of Attorney (set forth on the signature page of the initial filing and Amendment No. 2 of the Registration Statement).
101.INS     XBRL Instance Document.
101.SCH     XBRL Taxonomy Scheme.
 101.CAL     XBRL Taxonomy Calculation Linkbase.
101.DEF     XBRL Taxonomy Definition Linkbase.

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Exhibit
No. 		  Description
 101.LAB   XBRL Taxonomy Label Linkbase.
101.PRE   XBRL Taxonomy Presentation Linkbase.

* Previously filed.
(b) No financial statement schedules are provided because the information called for is not required or is shown either in the financial statements or the notes thereto.

Item 17. Undertakings

The undersigned Registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting certificates in such denominations and registered in such names as required by underwriters to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions referenced in Item 14 of this Registration Statement, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered hereunder, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

The undersigned registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3) For purposes of determining any liability under the Securities Act, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A (§230.430A of this chapter), shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized on this 16th day of June, 2016.

LONG ISLAND ICED TEA CORP.

By: /s/ Philip Thomas

Name: Philip Thomas
Title:  Chief Executive Officer

In accordance with the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

   
Name   Title   Date
/s/ Philip Thomas

Philip Thomas 		  Chief Executive Officer (Principal Executive Officer)   June 16, 2016
*

Richard Allen 		  Chief Financial Officer (Principal Financial Officer)   June 16, 2016
*

James Meehan 		  Chief Accounting Officer (Principal Accounting Officer)   June 16, 2016
*

Julian Davidson 		  Executive Chairman   June 16, 2016
*

Edward Hanson 		  Director   June 16, 2016
*

Kerry Kennedy 		  Director   June 16, 2016
*

Richard Roberts 		  Director   June 16, 2016
*

Paul Vassilakos 		  Director   June 16, 2016
*

Tom Cardella 		  Director   June 16, 2016
*By: /s/ Philip Thomas            
Philip Thomas, attorney-in-fact

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Exhibit 5.1

 

 

Graubard Miller

The Chrysler Building

405 Lexington Avenue

New York, N.Y. 10174-1101

(212) 818-8800

 
facsimile   direct dial number
(212) 818-8881    

  

June 16, 2016

 

Long Island Iced Tea Corp.

116 Charlotte Avenue

Hicksville, NY 11801

 

Re: Long Island Iced Tea Corp.

 

Ladies and Gentlemen:

 

You have requested our opinion with respect to certain matters in connection with the sale by Long Island Iced Tea Corp., a Delaware corporation (the “Company”), of up to 1,769,231 shares (the “Shares”) of the Company’s common stock, par value $0.0001 per share (including up to 230,769 that may be sold pursuant to the exercise of an over-allotment option granted by the Company to the underwriters), pursuant to the Registration Statement on Form S-1 (File No. 333-210669) (the “Registration Statement”) initially filed with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Act”), on April 8, 2016, as amended. We understand that the Shares are to be sold to the underwriters for resale to the public as described in the Registration Statement and pursuant to an underwriting agreement, substantially in the form filed as an exhibit to the Registration Statement, to be entered into by and among the Company and the underwriters (the “Underwriting Agreement”).

 

In connection with this opinion, we have examined and relied upon the Registration Statement and the originals or copies certified to our satisfaction of such other documents, records, certificates, memoranda and other instruments as in our judgment are necessary or appropriate to enable us to render the opinion expressed below. With your consent, we have relied upon certificates and other assurances of officers of the Company as to factual matters without having independently verified such factual matters. We have assumed the genuineness and authenticity of all documents submitted to us as originals, and the conformity to originals of all documents submitted to us as copies thereof and the due execution and delivery of all documents where due execution and delivery are a prerequisite to the effectiveness thereof.

 

 

 

  

Long Island Iced Tea Corp.

June 16, 2016

Page 2

 

Our opinion is limited to the matters stated herein and no opinion is implied or may be inferred beyond the matters expressly stated. Our opinion herein is expressed solely with respect to the federal laws of the United States and the Delaware General Corporation Law, as amended. Our opinion is based on these laws as in effect on the date hereof, and we disclaim any obligation to advise you of facts, circumstances, events or developments which hereafter may be brought to our attention and which may alter, affect or modify the opinion expressed herein.

 

Subject to the foregoing and the other matters set forth herein, it is our opinion that, when the Shares to be issued and sold by the Company are issued and paid for in accordance with the Registration Statement and the terms of the Underwriting Agreement, such Shares will be validly issued, fully paid and nonassessable.

 

We consent to the reference to our firm under the caption “Legal Matters” in the prospectus included in the Registration Statement and to the filing of this opinion as an exhibit to the Registration Statement. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission thereunder.

 

  Very truly yours,
   
  /s/ Graubard Miller

 

 

 

Exhibit 10.24

 

Long Island Iced Tea Corp.

116 Charlotte Avenue

Hicksville, New York 11801

 

June 17, 2015

 

Mr. Julian Davidson

27 Ronald Road,

Mission Bay

Auckland

New Zealand

 

Mr. Davidson:

 

This will confirm the terms and conditions of the consulting agreement (this “ Agreement ”) between Long Island Iced Tea Corp. (the “ Company ”) and Julian Davidson (the “ Consultant ”):

 

1. Services . Commencing on the date of this Agreement, the Company hereby retains Consultant to provide the services set forth in Exhibit A hereto (the “ Services ”). During the Term (as defined below), the Company shall not retain any other person to provide the Services. The Company shall not control the manner or means by which you perform the Services.

 

2. Term . The term of this Agreement shall commence on the date hereof and shall continue until the earlier of (i) the completion of the Services and (ii) June 17, 2016, unless earlier terminated in accordance with this Section (the “ Term ”).

 

a) Either party may terminate this Agreement at any time on thirty (30) days’ prior written notice.

 

b) If the conditions set forth in Exhibit B hereto are satisfied, the Company and Consultant shall enter into an employment agreement substantially in the form of Exhibit C hereto and this Agreement shall be deemed to have been terminated as of the date of the employment agreement.

 

3. Expense Reimbursement; Office Space . The Company agrees to reimburse Consultant for all reasonable and documented travel and other costs or expenses that are incurred or paid by Consultant during the Term in connection with the performance of the Services and have been approved in writing in advance by the Company including, but not limited to, expenses incurred from brand design specialists, Claessens, and sales and market data from Nielsen. The Company shall pay undisputed expenses within thirty (30) days after the Company’s receipt of documentation from Consultant. The Company also agrees that it or an affiliate will make available to Consultant offices and facilities in New York and Auckland, New Zealand in order for Consultant to perform the Services hereunder.

 

     

 

 

4. Restrictive Covenants .

 

a) Consultant acknowledges that:

 

i) As a result of its consultancy with the Company, Consultant has obtained and will obtain secret and confidential information concerning the Company and its subsidiaries (“ Confidential Information ”). Confidential Information includes all information whether of a technical, business or other nature (including, without limitation, trade secrets, recipes, know-how and information relating to the technology, customers, business plan, patents, promotional and marketing activities, finances and other business affairs) that is or may be disclosed or imparted to Consultant or that may be developed by Consultant in performance of the Services. Confidential Information also includes all information concerning any other plans for, or existence and progress of, potential business combinations, acquisitions, financings, business expansions, mergers, sales of assets, take-overs or tender offers involving the Company or its affiliates. Confidential Information may be in any format, whether written, printed, electronic, oral or in any other form or medium.

 

ii) The Company will suffer substantial damage that will be difficult to compute if, during the period of the consultancy with the Company or thereafter, Consultant should divulge Confidential Information or compete with the Company.

 

iii) The provisions of this Agreement are reasonable and necessary to protect the business of the Company, to protect the Company’s trade secrets and Confidential Information and to prevent loss to a competitor of a Consultant whose services are special, unique and extraordinary.

 

b) Consultant shall not at any time, during the term of this Agreement or thereafter, divulge to any person or entity any Confidential Information obtained or learned by it as a result of its consultancy with the Company, except (i) in the course of performing its duties hereunder, (ii) with the Company’s prior written consent, (iii) to the extent that any such information is in the public domain other than as a result of Consultant’s breach of any of its obligations hereunder or (iv) where required to be disclosed by court order, subpoena or other government process. If Consultant shall be required to make disclosure pursuant to the provisions of clause (iv) of the preceding sentence, Consultant shall promptly, but in no event more than 48 hours after learning of such subpoena, court order, or other government process, notify the Company and, at the Company’s expense, Consultant shall: (a) take all reasonably necessary and lawful steps required by the Company to defend against the enforcement of such subpoena, court order or other government process, and (b) permit the Company to intervene and participate with counsel of its choice in any proceeding relating to the enforcement thereof.

 

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c) During the Term (the “ Restricted Period ”), Consultant, without the prior written permission of the Company, shall not (i) be employed by, or render any services to, any person, firm or corporation engaged principally in the beverage industry or any other business which is directly in competition with any “material” business conducted by the Company or any of its subsidiaries at the time of termination or expiration of this Agreement (as used herein “material” means a business which generated at least 10% of the Company’s consolidated revenues for the last full fiscal year for which audited financial statements are available) in the Priority Territory (as defined in Exhibit A hereto) (“ Competitive Business ”); (ii) engage in any Competitive Business for his own account; (iii) be associated with or interested in any Competitive Business as an individual, partner, shareholder, creditor, director, officer, principal, agent, employee, trustee, consultant, advisor or in any other relationship or capacity; (iv) employ or retain, or have or cause any other person or entity to employ or retain, any person who was employed or retained by the Company while Executive was employed by the Company; or (v) solicit, interfere with, or endeavor to entice away from the Company, for the benefit of a Competitive Business, any of its customers, suppliers or any persons with whom the Company has a contractual relationship. Notwithstanding the foregoing, nothing in this Agreement shall preclude Consultant from investing his personal assets in any manner he chooses, provided, however, that Consultant may not, during the Restricted Period, own more than 4.9% of the equity securities of any Competitive Business. Except as set forth above, Consultant is not restricted from providing services to other entities or persons.

 

d) Consultant shall promptly return, following the termination of this Agreement or upon earlier request by the Company, all written materials in its possession and (i) supplied by the Company in conjunction with the Services under this Agreement, or (ii) generated by Consultant in the performance of the Services under this Agreement.

 

e) Consultant shall not engage in any transaction involving the Company’s securities while in the possession of any Confidential Information prior to the time such information shall be made known to the general public.

 

f) If Consultant commits a breach, or threatens to commit a breach, of any of the provisions of Section 4, the Company shall have the right and remedy to seek to have the provisions of this Consulting Agreement specifically enforced by any court having equity jurisdiction, it being acknowledged and agreed by Consultant that the services being rendered hereunder to the Company are of a special, unique and extraordinary character and that any such breach or threatened breach will cause irreparable injury to the Company and that money damages will not provide an adequate remedy to the Company. The rights and remedies enumerated in this Section 4(f) shall be in addition to, and not in lieu of, any other rights and remedies available to the Company under law or equity.

 

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5. Intellectual Property .

 

a) Consultant will disclose promptly and fully to the Company all works of authorship, ideas, inventions, discoveries, improvements, designs, processes, software, or any improvements, enhancements, or documentation of or to the same that Consultant makes, works on, conceives, or reduces to practice, individually or jointly with others, in the course of Consultant’s consultancy with respect to the business of the Company, in any way related or pertaining to or connected with the Services (collectively the “ Work Product ”).

 

b) All intellectual property rights, including patent, trademark, trade secret and copyright rights, in and to the Work Product are and shall be the sole property of the Company. All Work Product of Consultant shall be deemed, as applicable, to be a “work made for hire” within the meaning of 17 U.S.C. §101. To the extent that the Work Product is deemed not to be “work made for hire,” this Agreement shall constitute an irrevocable assignment by the Consultant to the Company of all right, title and interest in and to all intellectual property rights in and to the Work Product.

 

c) Consultant hereby agrees to assist the Company in any manner as shall be reasonably requested by the Company to protect the Company’s intellectual property rights in the Work Product and to execute and deliver such legal instruments or other documents as the Company shall request in order for the Company to obtain protection of the Work Product throughout the world. If the Company is unable after reasonable effort to secure Consultant’s signature for any such documents, then Consultant hereby irrevocably designates and appoints the Company and its duly authorized officers and agents as Consultant’s agent and attorney in fact, to act for and in Consultant’s behalf and stead to execute and file any such documents and to do all other lawfully permitted acts to further the prosecution and issuance of patents, copyrights or other intellectual property protections. Consultant agrees that this power of attorney is coupled with an interest.

 

d) Consultant shall make and maintain adequate and current written records and evidence of all Work Product including, without limitation, drawings, work papers, graphs, computer code, source code, documentation, records, and any other document, all of which shall be and remain the property of the Company, and all of which shall be surrendered to the Company either upon request or upon cessation of Consultant’s consultancy with the Company, regardless of the reason for such cessation.

 

e) Consultant hereby waives, and further agrees not to assert, any moral rights in or to the Work Product, including, but not limited to, rights to attribution and identification of authorship, rights to approval of modifications or limitations on subsequent modifications, and rights to restrict, cause or suppress publication or distribution of the Work Product.

 

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6. Representations and Warranties .

 

a) The Company hereby represents and warrants to Consultant that: (a) it has all requisite power and authority to enter into this Agreement and to perform its obligations hereunder, and (b) this Agreement has been fully and duly authorized by all necessary action on and has been duly executed and delivered by it, and (c) this Agreement constitutes a valid and binding agreement enforceable against it in accordance with its terms.

 

b) Consultant hereby represents and warrants to the Company that: (a) this Agreement constitutes a valid and binding agreement enforceable against Consultant in accordance with its terms, and (b) Consultant is free to enter into this Agreement and to perform the Services and duties required hereunder, and that there are no employment or consultancy contracts, restrictive covenants or other restrictions that would be breached by or prevent or limit performance of the Services hereunder.

 

7. Indemnification . Consultant agrees to indemnify and hold harmless the Company and its directors, officers and controlling stockholders (each, an “ Indemnified Person ”) from and against any claims or suits by a third party against the Company or any liabilities or judgments based thereon, either arising from the Consultant’s grossly negligent performance of Services under this Agreement or the Consultant’s willful misconduct in connection with the Services, except to the extent that such claims, suits, liabilities or judgments are caused by the gross negligence or willful misconduct of the Company, its directors, officers, employees, agents and controlling stockholders. The provisions of this Section 7 shall survive the termination or expiration of this Agreement for any reason.

 

8. Notices . All notices provided for in this Agreement shall be in writing and shall be deemed to have been duly given upon actual receipt or when delivered if delivered personally or by nationally recognized overnight courier (for example and not by way of limitation, by Federal Express, United Parcel Service, Airborne Express), with acknowledgement of receipt required, addressed to the party to receive the same at its address set forth above, or such other address as the party to receive the same shall have specified by written notice given in the manner provided for in this Section 8.

 

9. Independent Contractor . Consultant hereby acknowledges that it will be performing services hereunder as an independent contractor and not as an employee or agent of the Company or any affiliate thereof. Further, Consultant shall have no authority to act for, represent or bind the Company or any affiliate thereof in any manner, except as may be expressly agreed to by the Company in writing from time to time. Without limiting the foregoing, Consultant will not be eligible to participate in any vacation, group medical or life insurance, disability, profit sharing or retirement benefits or any other fringe benefits or benefit plans offered by the Company to its employees, and the Company will not be responsible for withholding or paying any income, payroll, Social Security or other federal, state or local taxes, making any insurance contributions, including unemployment or disability, or obtaining worker's compensation insurance on Consultant’s behalf. Consultant shall be responsible for, and shall indemnify the Company against, all such taxes or contributions, including penalties and interest. Any persons engaged by Consultant in connection with the performance of the Services shall be Consultant’s contractors and Consultant shall be fully responsible for them and indemnify the Company against any claims made by or on behalf of any such contractors.

 

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10. Survival . If this Agreement expires or is terminated pursuant to Section 2(a), the provisions of Sections 3 (with respect to expenses incurred prior to such expiration or termination), 4, 5, 6, 7, 8, 9, 10 and 11 shall survive such expiration or termination. If this Agreement is terminated pursuant to Section 2(b), the provisions of Sections 3 (with respect to expenses incurred prior to such termination), 5, 6, 7, 8, 9, 10 and 11 shall survive such termination.

 

11. Miscellaneous . This Agreement constitutes the entire agreement between the parties relating to the matters discussed herein and may be amended or modified only with the mutual written consent of the parties. Consultant shall not assign this Agreement, in whole or in part, or subcontract any of the Services, to any other party without the prior written consent of the Company. This Agreement shall be governed by internal laws of the State of New York. Each party agrees to submit to personal jurisdiction and to waive any objection as to venue in the courts located in the State of New York. The prevailing party in any such action shall be entitled to recover its reasonable attorney’s fees and costs incurred in any such action or on appeal. If a provision of this Agreement is held invalid under any applicable law, such invalidity shall not affect any other provision of this Agreement that can be given effect without the invalid provision. Further, all terms and conditions of this Agreement shall be deemed enforceable to the fullest extent permissible under applicable law, and when necessary, the court is requested to reform any and all terms or conditions to give them such effect.

 

[ Signature Page Follows ]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed on the day and year first above written.

 

  Very truly yours,
   
  LONG ISLAND ICED TEA CORP.
     
  By: /s/ Philip Thomas
    Name: Philip Thomas
    Title: Chief Executive Officer

 

AGREED AND ACCEPTED:

 

/s/ Julian Davidson  
Julian Davidson  

 

     

 

   

Long Island Iced Tea Corp.

116 Charlotte Avenue

Hicksville, New York 11801

 

June 6, 2016

 

Mr. Julian Davidson

27 Ronaki Road

Mission Bay

Auckland

New Zealand

 

Mr. Davidson:

 

This will confirm the terms and conditions of the first amendment (this “ Amendment No. 1 ”) to the consulting agreement, dated June 17, 2015 (the “ Agreement ”), between Long Island Iced Tea Corp. (the “ Company ”) and Julian Davidson (the “ Consultant ”) who has been guiding the Company through various strategic activities over the last 18 months (all capitalized terms used but not defined herein have the meanings set forth in the Agreement as amended hereby):

 

1. Amendments . The Agreement is hereby amended as follows:

 

a) Section 1 of the Agreement is hereby amended and restated in its entirety as follows:

 

“1. Services . The Company hereby retains Consultant (a) effective as of the original date of the Agreement, to provide the services set forth in Exhibit A hereto and (b) effective as of the date of the first amendment to this Agreement, to serve as the Company’s Executive Chairman and to perform such duties as are customarily provided by executive chairman of similar companies (the “ Services ”). During any period during which the Consultant is providing the Services hereunder, the Company shall not retain any other person to provide the Services.”

 

b) Section 2 of the Agreement is hereby amended and restated in its entirety as follows:

 

“2. Term . The term of this Agreement commenced on the original date of the Agreement and shall continue until terminated in accordance with this Section (the “ Term ”).

 

“a) Either party may terminate this Agreement at any time on thirty (30) days’ prior written notice.

 

     

 

 

“b) If the conditions set forth in Exhibit B hereto are satisfied, and the Consultant has received a visa from the United States government allowing him to be employed in the United States, the Company and Consultant shall enter into an employment agreement substantially in the form of Exhibit C hereto and this Agreement shall be deemed to have been terminated as of the date of the employment agreement. At such time, the Consultant can elect to enter into the employment agreement or amend this Agreement under similar terms. Consultant also may elect amend this Agreement under similar terms at any time commencing two months after the conditions set forth in Exhibit B hereto are satisfied.”

 

c) Section 3 of the Agreement is hereby amended by retitling such section “Compensation; Expense Reimbursement; Office Space”, by enumerating the existing text after the title as paragraph (a) and by adding a new paragraph (b) that shall read in its entirety as follows:

 

“b) As compensation for the Services, commencing on the date of the first amendment to this Agreement and ending on the last day of the Term (the “ Compensation Period ”):

 

“i) The Company shall pay Consultant a fee of $10,000 per month in cash (“Monthly Consulting Fee”), payable within fifteen (15) days after the end of each calendar month, prorated based on the number of days for any partial calendar month in the Compensation Period.

 

“ii) The Company shall grant Consultant 1,667 shares of the Company’s common stock per month (“Monthly Stock Grant”), issuable within fifteen (15) days after the end of each calendar month, prorated based on the number of days for any partial calendar month in the Compensation Period. The number of shares issuable hereunder shall be subject to equitable adjustment for any stock split or combination, stock dividend or similar event affecting the Company’s common stock generally prior to the date of issuance of such shares, such adjustment to be determined in good faith by the Company’s board of directors in its sole discretion.

 

“iii) If the conditions set forth in Exhibit B hereto are satisfied, the Company and Consultant shall amend this Agreement to (A) increase the Monthly Consulting Fee to $20,000 per month, (B) replace the Monthly Stock Grant with a one-time grant of 50,000 shares of the Company’s common stock, with the Consultant agreeing that such shares shall not be transferable by him until the first anniversary of issuance, and (C) pay Consultant a one-time cash fee of $95,000. For the avoidance of doubt, regardless of whether Consultant enters into an employment agreement pursuant to Section 2(b) on the date the conditions set forth in Exhibit B are satisfied, the compensation set forth in clause (B) and (C) above shall be deemed to have accrued prior to any termination of this Agreement under Section 2(b) and shall nonetheless be payable.”

 

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d) Section 10 of the Agreement is hereby amended by replacing in their entirety each of the two parentheticals that read “(with respect to expenses incurred prior to such expiration or termination)” with “(with respect to compensation earned under Section 3(b) or expenses incurred under Section 3(a) prior to such expiration or termination)”.

 

e) Exhibit B to the Agreement is hereby amended by replacing it with Exhibit B hereto.

 

f) Exhibit C to the Agreement is hereby amended by replacing it with Exhibit C hereto.

 

2. Representations and Warranties .

 

a) The Company hereby represents and warrants to Consultant that: (i) it has all requisite power and authority to enter into this Amendment and to perform its obligations hereunder, (ii) this Amendment has been fully and duly authorized by all necessary action on and has been duly executed and delivered by it, and (iii) this Amendment constitutes a valid and binding agreement enforceable against it in accordance with its terms.

 

b) Consultant hereby represents and warrants to the Company that: (i) this Amendment constitutes a valid and binding agreement enforceable against Consultant in accordance with its terms, (ii) Consultant is free to enter into this Amendment and to perform the Services and duties required hereunder, and that there are no employment or consultancy contracts, restrictive covenants or other restrictions that would be breached by or prevent or limit performance of the Services hereunder, (iii) Consultant is an “accredited investor” as that term is defined in Regulation D under the Securities Act of 1933, as amended (the “Securities Act”), (iv) Consultant is acquiring the shares of the Company’s common stock and the warrant for investment and not with a view towards the public distribution of such securities, except in accordance with the Securities Act, (v) Consultant understands and acknowledges that the shares of the Company’s common stock and the warrant to be issued hereunder are “restricted securities” under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that, under such laws and applicable regulations, such securities may be resold without registration under the Securities Act only in certain limited circumstances, (vi) Consultant represents that it is familiar with Rule 144 under the Securities Act, as presently in effect, and understands the resale limitations imposed thereby and by the Securities Act, (vii) Consultant acknowledges that it can bear the economic and financial risk of its investment for an indefinite period, and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in the shares of the Company’s common stock and the warrant, and (viii) Consultant has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of the shares and the business, properties, prospects and financial condition of the Company.

 

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3. Miscellaneous . Except as specifically provided in this Amendment, no provision of the Agreement is modified, changed, waived, discharged or otherwise terminated and the Agreement shall continue to be in full force and effect. All references in the Agreement to the “Agreement” shall be deemed to be references to the Agreement as amended by this Amendment. This Amendment, together with the Agreement and the exhibits and schedules hereto and thereto, constitutes the entire agreement between the parties relating to the matters discussed herein and may be amended or modified only with the mutual written consent of the parties. This Amendment may be executed in counterparts (including, without limitation, by facsimile, pdf or other electronic document transmission), each of which shall constitute an original, and each of which taken together shall constitute one and the same agreement.

 

[ Signature Page Follows ]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed on the day and year first above written.

 

  Very truly yours,
   
  LONG ISLAND ICED TEA CORP.
     
  By: /s/ Philip Thomas
    Name: Philip Thomas
    Title: Chief Executive Officer

 

AGREED AND ACCEPTED:

 

/s/ Julian Davidson  
Julian Davidson  

 

     

 

 

Exhibit 10.25

 

EMPLOYMENT AGREEMENT

 

AGREEMENT dated as of [●] (“Commencement Date”) between JULIAN DAVIDSON, residing at _________________ (“Executive”), and Long Island Iced Tea Corp., a Delaware corporation having its principal office at 116 Charlotte Avenue, Hicksville, NY 11801 (“Company”);

 

WHEREAS, the Company has appointed Executive as Executive Chairman of the Company and desires to enter into an employment agreement with Executive; and

 

WHEREAS, Executive is willing to enter into such employment agreement on the terms, conditions and provisions hereinafter set forth.

 

NOW, THEREFORE, in consideration of the mutual promises, terms, covenants and conditions set forth herein and the performance of each, the parties hereby agree as follows:

 

IT IS AGREED:

 

1.             Employment, Duties and Acceptance .

 

1.1          General . During the Term (as defined in Section 2), the Company shall employ Executive in the position of Executive Chairman of the Company and such other positions as shall be given to Executive by the Board of Directors of the Company (the “Board”) and are typical for a Executive Chairman, including without limitation secretary, treasurer and similar positions with subsidiaries of the Company. All of Executive’s powers and authority in any capacity shall at all times be subject to the direction and control of the Board. The Board may assign to Executive such management and supervisory responsibilities and executive duties for the Company or any subsidiary of the Company, including serving as an executive officer and/or director of any subsidiary, as are consistent with Executive’s status as Executive Chairman. The Company and Executive acknowledge that Executive’s functions and duties as Executive Chairman shall be similar to those customarily performed by comparable officers of similar companies. Without limiting the foregoing, Executive’s primary functions and duties as Executive Chairman shall include among others: determination of brand and portfolio positioning; evaluation of long-term financial and other strategic alternatives; and establishment of a culture promoting performance, innovation, business growth and talent development.

 

     

 

 

1.2          Full-Time Position . Executive accepts such employment and agrees to devote substantially all of his business time, energies and attention to the performance of his duties hereunder. Nothing herein shall be construed as preventing Executive from (i) making and supervising personal investments, (ii) participating in charitable, civic or trade activities (including board service for such types of organizations) and (ii) serving as a consultant to, or on boards of directors of, or in any other capacity to other companies, for profit and not for profit, provided they will not, individually or in the aggregate, interfere with the performance of Executive’s duties hereunder or violate the provisions of Section 5.4 hereof.

 

1.3          Location . Executive will perform his duties primarily in New Zealand. However, Executive shall undertake such occasional travel, within or outside the United States, as is reasonably necessary in the interests of the Company. Should the company and the Executive agree to permanently relocate the Executive to the United States (subject to the Executive meeting the necessary United States visa requirements) the Company will meet all reasonable relocation costs pertaining to the Executive and his spouse, on the same basis as other similarly situated executive chairmen within the beverage industry, subject to and in accordance with that certain letter agreement between Executive and the Company dated as of [●], 2016.

 

2.             Term . The term of Executive’s employment hereunder shall be for three years commencing on the Commencement Date, unless terminated earlier as hereinafter provided (“Term”); provided, however, that on the third anniversary of the Commencement Date and on each subsequent anniversary of such date (each a “Renewal Date”), the term of this Agreement shall automatically be extended by one additional year (the “Extension Period”) unless either party shall have provided notice to the other 120 days prior to a Renewal Date that such party does not desire to extend the term of this Agreement, in which case no further extension of the term of this Agreement shall occur pursuant hereto but all previous extensions of the term shall continue to be given full force and effect. The “Term” of this Agreement shall include any Extension Periods. In connection with any non-renewal by the Company, the Company shall pay to Executive the amount set forth in Section 4.6(d).

 

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3.             Compensation and Benefits .

 

3.1          Salary . The Company shall pay to Executive a salary (“Base Salary”) at the annual rate of $250,000. Executive’s compensation shall be paid in equal, periodic installments in accordance with the Company’s normal payroll procedures.

 

3.2          Commencement Incentive . The Company shall pay to Executive an Incentive (“Commencement Bonus”) of $75,000 on the Commencement Date and $165,000 on the first anniversary of the Commencement Date. The Company shall also issue to Executive 35,000 shares of the Company’s Common Stock (“Commencement Shares”). The Executive will agree that the Commencement Shares shall not be transferable by him until the first anniversary of the Commencement Date.

 

3.3          Performance Incentives . Executive shall be eligible to be paid an annual bonus (“Bonus”) of up to 50% of the Base Salary then in effect based on Executive’s performance over each calendar year (prorated for the partial year at the beginning of the Term). The Bonus criteria will be determined by the Board or, if applicable, the compensation committee of the Board (the “Committee”), and will be based upon reasonably and objective financial and operational benchmarks as to the Company’s and/or Executive’s performance, as determined by the Board or Committee in its reasonable discretion. The Bonus will be paid in cash and/or stock as per the recommendation of the Board or the Committee, as applicable, not later than the later of (i) January 31 of the year following the calendar year to which the Bonus is applicable and (ii) the date the Company files its Annual Report on Form 10-K for the calendar year to which the Bonus is applicable.

 

3.4          Automobile . The Company shall provide Executive with a suitable leased automobile for business use and shall pay for all other costs associated with the use of the vehicle, including insurance costs, repairs and maintenance. The Company shall not be required to expend more than $750 per month for the costs of leasing such automobile. The costs associated with Executive’s automobile shall be considered taxable income to Executive, except to the extent that it is documented to have been used by him for business purposes. In lieu of a leased automobile provided by the Company, Executive may request by way of substitution the sum of $750 per month for the reimbursement of Executive’s out-of-pocket costs for his own automobile expenses.

 

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3.5          Benefits . Executive shall be entitled to such medical, life, disability and other benefits as are generally afforded to other executives of the Company, subject to applicable waiting periods and other conditions, as well as participation in all other company-wide employee benefits, including a defined contribution pension plan and 401(k) plan, as may be made available generally to executive employees from time to time. If the benefits in this Section 3.3 are not implemented by the date being six (6) months from the Commencement Date the Executive will accept by way of substitution the sum of $1,000.00 per month for the period until the benefits are made available to the Executive.

 

3.6          Vacation and Sick Days . Executive shall be entitled to twenty (20) days of paid vacation and five (5) days of paid sick days in each year during the Term and to a reasonable number of other days off for religious and personal reasons in accordance with customary Company policy.

 

3.7          Expenses . The Company shall pay or reimburse Executive for all transportation, hotel and other expenses reasonably incurred by Executive on business trips and for all other ordinary and reasonable out-of-pocket expenses actually incurred by him in the conduct of the business of the Company against itemized vouchers submitted with respect to any such expenses and approved in accordance with customary procedures.

 

3.8          Stock Options . Subject to approval by the Committee and all terms and conditions set forth in the Company’s standard form of stock option agreement, on the day after the date the Company has completed an offering that raises gross proceeds of at least US$10,000,000 from the sale of its equity securities (the “Trigger Date”) and on each anniversary thereof, the Company shall grant Executive options (the “Options”) to purchase up to maximum amount of shares of the Company’s Common Stock per year as permitted by the Company’s equity compensation plans, until Executive has been granted pursuant to this Section 3.8 Options to purchase a number of shares of the Company’s Common Stock equal to 5% of the fully diluted outstanding Common Stock of the Company on the Trigger Date (“Total Option Amount”). The Options shall be vested as to one-third of the Total Option Amount (or the number of shares underlying the outstanding Options, if less) on the Trigger Date, two-thirds of the Total Option Amount (or the number of shares underlying the outstanding Options, if less) on and after the first anniversary of the Trigger Date and all of the shares underlying the outstanding Options on and after the second anniversary of the Trigger Date. All Options shall have an exercise price equal to $__ per share [ the price utilized by the Company in its most recent capital raise closest to the Commencement Date ]. All Options will expire on the fifth anniversary of the Trigger Date.

 

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3.9          Future Equity Compensation . The Committee will grant Executive additional options, restricted stock and/or other long term incentives under the Company’s equity compensation plans on the same basis as other similarly situated executive chairmen within the beverage industry.

 

4.             Termination .

 

4.1          Death . If Executive dies during the Term, Executive’s employment hereunder shall terminate and the Company shall pay to Executive’s estate the amount set forth in Section 4.6(a).

 

4.2          Disability . The Company, by written notice to Executive, may terminate Executive’s employment hereunder if Executive shall fail because of illness or incapacity to render services of the character contemplated by this Agreement for six (6) consecutive months. Upon such termination, the Company shall pay to Executive the amount set forth in Section 4.6(a).

 

4.3          By Company for “Cause” . The Company, by written notice to Executive, may terminate Executive’s employment hereunder for “Cause”. As used herein, “Cause” shall mean: (a) the refusal or failure by Executive to carry out specific directions of the Board which are of a material nature and consistent with his status as Chief Executive Officer (or whichever positions Executive holds at such time), or the refusal or failure by Executive to perform a material part of Executive’s duties hereunder; (b) the commission by Executive of a material breach of any of the provisions of this Agreement; (c) fraud or dishonest action by Executive in his relations with the Company or any of its subsidiaries or affiliates (“dishonest” for these purposes shall mean Executive’s knowingly or recklessly making of a material misstatement or omission for his personal benefit); or (d) the conviction of Executive of a felony under federal or state law. Notwithstanding the foregoing, no “Cause” for termination shall be deemed to exist with respect to Executive’s acts described in clauses (a) or (b) above, unless the Company shall have given written notice to Executive within a period not to exceed ten (10) calendar days of the initial existence of the occurrence, specifying the “Cause” with reasonable particularity and, within thirty (30) calendar days after such notice, Executive shall not have cured or eliminated the problem or thing giving rise to such “Cause;” provided, however, no more than two cure periods need be provided during any twelve-month period. Upon such termination, the Company shall pay to Executive the amount set forth in Section 4.6(b).

 

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4.4          By Executive for “Good Reason” . The Executive, by written notice to the Company, may terminate Executive’s employment hereunder if a “Good Reason” exists. For purposes of this Agreement, “Good Reason” shall mean the occurrence of any of the following circumstances without the Executive’s prior written consent: (a) a substantial and material adverse change in the nature of Executive’s title, duties and/or responsibilities with the Company that represents a demotion from his title, duties or responsibilities as in effect immediately prior to such change (such change, a “Demotion”); (b) material breach of this Agreement by the Company; (c) a failure by the Company to make any payment to Executive when due, unless the payment is not material and is being contested by the Company, in good faith; (d) a liquidation, bankruptcy or receivership of the Company; or (e) if Executive’s primary residence is in the United States, the moving of Executive’s office to a location that requires Executive to commute in excess of 10 miles more than Executive’s then-current commute to Hicksville, New York (or 50 miles if greater), either on a permanent or, if more than 30 days, temporary basis. Notwithstanding the foregoing, no “Good Reason” shall be deemed to exist with respect to the Company’s acts described in clauses (a), (b) or (c) above, unless Executive shall have given written notice to the Company within a period not to exceed ten (10) calendar days of the Executive’s knowledge of the initial existence of the occurrence, specifying the “Good Reason” with reasonable particularity and, within thirty (30) calendar days after such notice, the Company shall not have cured or eliminated the problem or thing giving rise to such “Good Reason”; provided, however, that no more than two cure periods shall be provided during any twelve-month period of a breach of clauses (a), (b) or (c) above. Upon such termination, the Company shall pay to Executive the amount set forth in Section 4.6(c).

 

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4.5          By Company Without “Cause” . The Company may terminate Executive’s employment hereunder without “Cause” by giving at least thirty (30) days written notice to Executive. Upon such termination, the Company shall pay to Executive the amount set forth in Section 4.6(c), unless such termination occurs after the expiration of the Term, in which case nothing shall be paid.

 

4.6          Compensation Upon Termination . In the event that Executive’s employment hereunder is terminated, the Company shall pay to Executive the following compensation:

 

(a)           Payment Upon Death or Disability . In the event that Executive’s employment is terminated pursuant to Sections 4.1 or 4.2, the Company shall no longer be under any obligation to Executive or his legal representatives pursuant to this Agreement except for: (i) the Base Salary due Executive pursuant to Section 3.1 hereof through the date of termination; (ii) full payment of any previously granted but unpaid Bonus and a pro rata share of Executive’s Bonus for the current year determined in the ordinary course and assuming completion of any individual performance benchmarks by Executive; (iii) vesting to the next applicable vesting date of any grant or benefit subject to vesting, with Executive being provided with that period of time to exercise any options as is provided in the applicable plan (or, if no timeframe is provided therein, a reasonable period of time); (iv) all valid expense reimbursements; an d(v) all accrued but unused vacation pay.

 

(b)           Payment Upon Termination by the Company For “Cause” . In the event that the Company terminates Executive’s employment hereunder pursuant to Section 4.3, the Company shall have no further obligations to the Executive hereunder, except for: (i) the Base Salary due Executive pursuant to Section 3.1 hereof through the date of termination; (ii) all valid expense reimbursements; and (iii) all unused vacation pay through the date of termination required by law to be paid.

 

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(c)           Payment Upon Termination by Company Without Cause or by Executive for Good Reason . In the event that Executive’s employment is terminated pursuant to Sections 4.4 or 4.5, the Company shall have no further obligations to Executive hereunder except for: (i) the Base Salary due Executive pursuant to Section 3.1 hereof through the date of termination; (ii) Base Salary at the applicable annual rate as of the date of termination for nine (9) months commencing on the date of termination, payable in accordance with Section 3.1, subject to the Executive executing a general release in favor of the Company in customary form; (iii) full payment of any previously granted but unpaid Bonus and a pro rata share of Executive’s Bonus for the current year determined in the ordinary course and assuming completion of any individual performance benchmarks by Executive; (iv) full vesting of any grant or benefit subject to vesting, with Executive being provided with that period of time to exercise any options as is provided in the applicable plan (or, if no timeframe is provided therein, a reasonable period of time); (v) all valid expense reimbursements; and (vi) all accrued but unused vacation pay (pro rata for the period to the date of termination).

 

(d)           Payment Upon Non-Renewal . In the event that Executive’s employment is terminated as a result of the Company sending notice that it is not renewing the Term as set forth in Section 2, the Company shall have no further obligations to Executive hereunder after the end of the Term, except for: (i) Base Salary at the applicable annual rate as of the date of such notice for five (5) months commencing after the expiration of the Term, payable in accordance with Section 3.1, subject to the Executive executing a general release in favor of the Company in customary form; (ii) full payment of any previously granted but unpaid Bonus and a pro rata share of Executive’s Bonus for the current year determined in the ordinary course and assuming completion of any individual performance benchmarks by Executive; (iii) full vesting of any grant or benefit subject to vesting, with Executive being provided with that period of time to exercise any options as is provided in the applicable plan (or, if no timeframe is provided therein, a reasonable period of time); (iv) all valid expense reimbursements; and (v) all accrued but unused vacation pay (pro rata for the period through the expiration of the Term).

 

(e)           Executive shall have no duty to mitigate awards paid or payable to him pursuant to this Agreement, and any compensation paid or payable to Executive from sources other than the Company will not offset or terminate the Company’s obligation to pay to Executive the full amounts pursuant to this Agreement.

 

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5.             Protection of Confidential Information; Non-Competition .

 

5.1          Acknowledgment . Executive acknowledges that:

 

(a)           As a result of his employment with the Company, Executive has obtained and will obtain secret and confidential information concerning the business of the Company and its subsidiaries (referred to collectively in this Section 5 as the “Company”), including, without limitation, financial information, proprietary rights, trade secrets and “know-how,” customers and sources (“Confidential Information”).

 

(b)           The Company will suffer substantial damage which will be difficult to compute if, during the period of his employment with the Company or thereafter, Executive should enter a business competitive with the Company or divulge Confidential Information.

 

(c)           The provisions of this Agreement are reasonable and necessary to protect the business of the Company, to protect the Company’s trade secrets and Confidential Information and to prevent loss to a competitor of an employee whose services are special, unique and extraordinary.

 

5.2          Confidentiality . Executive agrees that he will not at any time, during the Term or thereafter, divulge to any person or entity any Confidential Information obtained or learned by him as a result of his employment with the Company, except (i) in the course of performing his duties hereunder, (ii) with the Company’s prior written consent; (iii) to the extent that any such information is in the public domain other than as a result of Executive’s breach of any of his obligations hereunder; or (iv) where required to be disclosed by court order, subpoena or other government process. If Executive shall be required to make disclosure pursuant to the provisions of clause (iv) of the preceding sentence, Executive promptly, but in no event more than two (2) business days after learning of such subpoena, court order, or other government process, shall notify the Company (to the extent such notice is legally permissible) and, at the Company’s expense, Executive shall: (a) take reasonable and lawful steps required by the Company to defend against the enforcement of such subpoena, court order or other government process, and (b) permit the Company to intervene and participate with counsel of its choice in any proceeding relating to the enforcement thereof.

 

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5.3          Documents . Upon termination of his employment with the Company, Executive will promptly deliver to the Company all memoranda, notes, records, reports, manuals, drawings, blueprints and other documents (and all copies thereof) relating to the business of the Company and all property associated therewith, which he may then possess or have under his control; provided, however, that Executive shall be entitled to retain copies of such documents reasonably necessary to document his financial relationship with the Company or as otherwise may be reasonably required to comply with applicable law or legal process.

 

5.4          Non-Competition . For and in consideration of Executive’s employment by the Company and the consideration the Executive will receive thereby, Executive hereby agrees as follows:

 

(a)           Executive shall not during the period of his employment by or with the Company and for the Applicable Period (defined below), for himself or on behalf of, or in conjunction with, any other person, persons, company, partnership, limited liability company, corporation or business of whatever nature:

 

(i)           engage, as an officer, director, manager, member, shareholder, owner, partner, joint venturer, trustee, or in a managerial capacity, whether as an employee, independent contractor, agent, consultant or advisor, or as a sales representative, in an entity that designs, researches, develops, markets, sells or licenses products or services that are substantially similar to or competitive with the business of the Company that is located within seventy-five (75) miles of any market in which Company currently operates or has plans to do business in at the time of termination;

 

(ii)          call upon any person who is at that time, or within the preceding nine (9) months has been, an employee of the Company, for the purpose, or with the intent, of enticing such employee away from, or out of, the employ of the Company or for the purpose of hiring such person for Executive or any other person or entity, unless any such person was terminated by the Company more than nine (9) months prior thereto;

 

 

(iii)         call upon any person who, or entity that is then or that has been within nine (9) months prior to that time, a customer of the Company, for the purpose of soliciting or selling products or services in competition with the Company; or

 

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(iv)         call upon any prospective acquisition or investment candidate, on the Executive’s own behalf or on behalf of any other person or entity, which candidate was known by Executive to have, within the previous nine (9) months, been called upon by the Company or for which the Company made an acquisition or investment analysis or contemplated a joint marketing or joint venture arrangement with, for the purpose of acquiring or investing or enticing such entity into a joint marketing or joint venture arrangement.

 

For purposes of this Section 5:

 

· the term “Company” shall be deemed to include the Company and any of its respective subsidiaries; and

 

· the term “Applicable Period” shall mean nine (9) months from the termination of Executive’s employment.

 

5.5          Injunctive Relief . If Executive commits a breach, or threatens to commit a breach, of any of the provisions of Section 5.2 or 5.4, the Company shall have the right and remedy to seek to have the provisions of this Agreement specifically enforced by any court having equity jurisdiction, it being acknowledged and agreed by Executive that the services being rendered hereunder to the Company are of a special, unique and extraordinary character and that any such breach or threatened breach will cause irreparable injury to the Company and that money damages will not provide an adequate remedy to the Company. The rights and remedies enumerated in this Section 5.5 shall be in addition to, and not in lieu of, any other rights and remedies available to the Company under law or equity. In connection with any legal action or proceeding arising out of or relating to this Agreement, the prevailing party in such action or proceeding shall be entitled to be reimbursed by the other party for the reasonable attorneys’ fees and costs incurred by the prevailing party.

 

5.6          Modification . If any provision of Section 5.2 or 5.4 is held to be unenforceable because of the scope, duration or area of its applicability, the tribunal making such determination shall have the power to modify such scope, duration, or area, or all of them, and such provision or provisions shall then be applicable in such modified form.

 

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5.7          Survival . The provisions of this Section 5 shall survive the termination of this Agreement for any reason, except in the event Executive is terminated by the Company without “Cause,” or if Executive terminates this Agreement with “Good Reason,” in either of which events, clause (i) of Section 5.4 shall be null and void and of no further force or effect. The non-renewal of this Agreement at the end of the Term shall not be deemed a termination by the Company without “Cause”; provided, that in such event all of the nine (9) month periods set forth in Section 5.4 shall be deemed to be five (5) months.

 

6.             Miscellaneous Provisions .

 

6.1          Notices . All notices provided for in this Agreement shall be in writing, and shall be deemed to have been duly given when (i) delivered personally to the party to receive the same, or (ii) when mailed first class postage prepaid, by certified mail, return receipt requested, addressed to the party to receive the same at his or its address set forth below, or such other address as the party to receive the same shall have specified by written notice given in the manner provided for in this Section 6.1. All notices shall be deemed to have been given as of the date of personal delivery or mailing thereof.

 

If to Executive:

 

Julian Davidson

___________________

___________________

___________________

 

If to the Company:

 

Long Island Ice Tea Corp.

116 Charlotte Avenue

Hicksville, New York 11801

 

With a copy in either case to:

 

Graubard Miller

405 Lexington Avenue, 11 th Floor

New York, New York 10174

Attn: David Alan Miller / Jeffrey M. Gallant

 

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6.2          Entire Agreement; Waiver . This Agreement sets forth the entire agreement of the parties relating to the employment of Executive and is intended to supersede all prior negotiations, understandings and agreements. No provisions of this Agreement may be waived or changed except by a writing by the party against whom such waiver or change is sought to be enforced. The failure of any party to require performance of any provision hereof or thereof shall in no manner affect the right at a later time to enforce such provision.

 

6.3          Governing Law . All questions with respect to the construction of this Agreement, and the rights and obligations of the parties hereunder, shall be determined in accordance with the law of the State of New York applicable to agreements made and to be performed entirely in New York.

 

6.4          Binding Effect; Nonassignability . This Agreement shall inure to the benefit of and be binding upon the successors and assigns of the Company. This Agreement shall not be assignable by Executive, but shall inure to the benefit of and be binding upon Executive’s heirs and legal representatives.

 

6.5          Severability . Should any provision of this Agreement become legally unenforceable, no other provision of this Agreement shall be affected, and this Agreement shall continue as if the Agreement had been executed absent the unenforceable provision.

 

6.6          Section 409A . This Agreement is intended to comply with the provisions of Section 409A of the Internal Revenue Code (“Section 409A”). To the extent that any payments and/or benefits provided hereunder are not considered compliant with Section 409A, the parties agree that the Company shall take all actions necessary to make such payments and/or benefits become compliant.

 

6.7          Counterparts; Electronic Signatures . This Agreement may be executed in counterparts, each of which will constitute an original of this Agreement and both of which together shall constitute one and the same Agreement. Signature pages delivered by facsimile, .pdf or similar electronic means shall have the same force and effect as original signatures.

 

[ Signature Page Follows ]

 

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IN WITNESS WHEREOF, the parties have executed this Agreement on the date first above written.

 

  LONG ISLAND ICED TEA CORP.
   
  By:  
  Name:
  Title:

 

   
  JULIAN DAVIDSON

 

     

 

Exhibit 10.26

 

EMPLOYMENT AGREEMENT

 

AGREEMENT (this “Agreement”) dated as of June 1, 2016 (the “Commencement Date”), between RICHARD B. ALLEN, residing at the address on file with the Company (“Executive”), and Long Island Iced Tea Corp., a Delaware corporation having its principal office at 116 Charlotte Avenue, Hicksville, NY 11801 (“Company”);

 

WHEREAS, the Company desires to enter into an employment agreement with Executive, and Executive is willing to enter into such employment agreement, on the terms, conditions and provisions hereinafter set forth.

 

NOW, THEREFORE, in consideration of the mutual promises, terms, covenants and conditions set forth herein and the performance of each, the parties hereby agree as follows:

 

1.             Employment, Duties and Acceptance .

 

1.1          General . During the Term (as defined in Section 2), the Company shall employ Executive in the position of Chief Financial Officer of the Company and such other positions as shall be given to Executive by the Board of Directors of the Company (the “Board”) and are typical for a Chief Financial Officer, including without limitation secretary, treasurer and similar positions with subsidiaries of the Company. All of Executive’s powers and authority in any capacity shall at all times be subject to the direction and control of the Board and the Company’s Chief Executive Officer. The Board may assign to Executive such management and supervisory responsibilities and executive duties for the Company or any subsidiary of the Company, including serving as an executive officer and/or director of any subsidiary, as are consistent with Executive’s status as Chief Financial Officer. The Executive’s duties shall be similar to those customarily performed by comparable officers of similar companies. Without limiting the foregoing, the Company and Executive acknowledge that Executive’s primary functions and duties as Chief Financial Officer shall be to manage and supervise the Company’s financial operations. The Company also appoints Executive as Chief Financial Officer of all of its subsidiaries.

 

 

 

 

1.2          Full-Time Position . Executive accepts such employment and agrees to devote substantially all of his business time, energies and attention to the performance of his duties hereunder. Nothing herein shall be construed as preventing Executive from making and supervising personal investments or participating in charitable, civic or trade activities (including board service for such types of organizations), provided they will not, individually or in the aggregate, interfere with the performance of Executive’s duties hereunder or violate the provisions of Section 5.4 hereof. Executive shall not serve as a consultant to, or on boards of directors of, or in any other capacity to other for profit companies without the prior consent of the Board.

 

1.3          Location . Executive will perform his duties in or around Hicksville, New York. Executive shall undertake such occasional travel, within or outside the United States, as is reasonably necessary in the interests of the Company.

 

2.             Term . The term of Executive’s employment hereunder shall be for three years commencing on and including the Commencement Date, unless terminated earlier as hereinafter provided (the “Term”); provided, however, that on the third anniversary of the Commencement Date and on each subsequent anniversary of such date (each a “Renewal Date”), the term of this Agreement shall automatically be extended by one additional year (the “Extension Period”) unless either party shall have provided notice to the other 120 days prior to a Renewal Date that such party does not desire to extend the term of this Agreement, in which case no further extension of the term of this Agreement shall occur pursuant hereto but all previous extensions of the term shall continue to be given full force and effect. The “Term” of this Agreement shall include any Extension Periods. In connection with any non-renewal by the Company, the Company shall pay to Executive the amount set forth in Section 4.6(d).

 

3.             Compensation and Benefits .

 

3.1          Salary . The Company shall pay to Executive a salary (“Base Salary”) at the annual rate of $170,000; provided , however , that if prior to December 31, 2016, either (i) the Company completes an offering of its equity securities with gross proceeds to the Company of at least $5,000,000, or (ii) the Company has net sales as determined in accordance with U.S. generally accepted accounting principles of at least $1,000,000 during any calendar month, then the Company shall pay to Executive a Base Salary at an annual rate of (x) $185,000 commencing on the first anniversary of the Commencement Date and (y) $200,000 commencing on the second anniversary of the Commencement Date. Executive’s Base Salary shall be paid in equal, periodic installments in accordance with the Company’s normal payroll procedures.

 

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3.2          Performance Incentives . Executive shall be eligible to be paid an annual bonus (“Bonus”) of up to 50% of the Base Salary then in effect based on Executive’s performance over each calendar year (prorated for the partial year at the beginning of the Term). The Bonus criteria will be determined by the Board or, if applicable, the compensation committee of the Board (the “Committee”), and will be based upon objective financial and operational benchmarks as to the Company’s and/or Executive’s performance, as determined by the Board or Committee in its reasonable discretion. The Bonus will be paid in cash and/or stock as per the recommendation of the Board or the Committee, as applicable, not later than the later of (i) January 31 of the year following the calendar year to which the Bonus is applicable and (ii) the date the Company files its Annual Report on Form 10-K for the calendar year to which the Bonus is applicable.

 

3.3          Benefits . Executive shall be entitled to such medical, life, disability and other benefits as are generally afforded to other executives of the Company, subject to applicable waiting periods and other conditions, as well as participation in all other company-wide employee benefits, including a defined contribution pension plan and 401(k) plan, as may be made available generally to executive employees from time to time. In lieu of medical insurance provided by the Company, Executive may request by way of substitution the sum of up to $1,500.00 per month for the reimbursement of Executive’s out-of-pocket costs for medical insurance for Executive and his family.

 

3.4          Vacation and Sick Days . Executive shall be entitled to twenty (20) days of paid vacation and five (5) days of paid sick days in each year during the Term and to a reasonable number of other days off for religious and personal reasons in accordance with customary Company policy.

 

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3.5          Expenses . The Company shall pay or reimburse Executive for all transportation, hotel and other expenses reasonably incurred by Executive on business trips and for all other ordinary and reasonable out-of-pocket expenses actually incurred by him in the conduct of the business of the Company against itemized vouchers submitted with respect to any such expenses and approved in accordance with customary procedures.

 

3.6          Long-Term Incentives .

 

(a)           The Company shall grant to Executive (i) 8,333 shares of the Company’s common stock on May 31, 2017 and (ii) a number of shares of the Company’s common stock having a Fair Market Value (as defined below) equal to $50,000 on each of May 31, 2018 and 2019. “Fair Market Value” of a share of the Company’s common stock shall mean the higher of (A) the closing sale price of the Company’s common stock on the principal trading market for the Company’s common stock, as reported by such trading market and (B) the average of the closing sale price or closing bid price, as applicable, on the principal trading market for the Company’s common stock, as reported by such trading market, for the twenty (20) consecutive trading days ending on May 31 of each year; provided , however , if the fair market value cannot be determined pursuant to the foregoing clause, the Fair Market Value of a share shall be such price as the Board or the Committee, as applicable, shall determine, in good faith, based on the reasonable application of a reasonable valuation method. The Company represents that the initial 8,333 shares of the Company’s common stock granted pursuant to clause (i) above represents 0.1279% of the Company’s common stock on a fully-converted, fully-diluted basis, based on 6,515,513 shares outstanding on such basis.

 

(b)           The Executive shall be entitled to otherwise participate in the long-term incentive plans of the Company, including, but not limited to, the Company’s 2015 Long-Term Incentive Equity Plan, on a basis consistent with the Executive’s position as the Chief Financial Officer of the Company.

 

3.7          Automobile . The Company shall provide Executive with a suitable leased automobile for business use and shall pay for all other costs associated with the use of the vehicle, including insurance costs, repairs and maintenance. The Company shall not be required to expend more than $500 per month for the costs of leasing such automobile. The costs associated with Executive’s automobile shall be considered taxable income to Executive, except to the extent that it is documented to have been used by him for business purposes. In lieu of a leased automobile provided by the Company, Executive may request by way of substitution the sum of $500.00 per month for the reimbursement of Executive’s out-of-pocket costs for his own automobile expenses.

 

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4.             Termination .

 

4.1          Death . If Executive dies during the Term, Executive’s employment hereunder shall terminate and the Company shall pay to Executive’s estate the amount set forth in Section 4.6(a).

 

4.2          Disability . The Company, by written notice to Executive, may terminate Executive’s employment hereunder if Executive shall fail because of illness or incapacity to render services of the character contemplated by this Agreement for six (6) consecutive months. Upon such termination, the Company shall pay to Executive the amount set forth in Section 4.6(a).

 

4.3          By Company for “Cause” . The Company, by written notice to Executive, may terminate Executive’s employment hereunder for “Cause”. As used herein, “Cause” shall mean: (a) the refusal or failure by Executive to carry out specific directions of the Board or Chief Executive Officer which are of a material nature and consistent with his status as Chief Financial Officer (or whichever positions Executive holds at such time), or the refusal or failure by Executive to perform a material part of Executive’s duties hereunder; (b) the commission by Executive of a material breach of any of the provisions of this Agreement; (c) fraud or dishonest action by Executive in his relations with the Company or any of its subsidiaries or affiliates (“dishonest” for these purposes shall mean Executive’s knowingly or recklessly making of a material misstatement or omission for his personal benefit); or (d) the conviction of Executive of a felony under federal or state law. Notwithstanding the foregoing, no “Cause” for termination shall be deemed to exist with respect to Executive’s acts described in clauses (a) or (b) above, unless the Company shall have given written notice to Executive within a period not to exceed ten (10) calendar days of the initial existence of the occurrence, specifying the “Cause” with reasonable particularity and, within thirty (30) calendar days after such notice, Executive shall not have cured or eliminated the problem or thing giving rise to such “Cause;” provided, however, no more than two cure periods need be provided during any twelve-month period. Upon such termination, the Company shall pay to Executive the amount set forth in Section 4.6(b).

 

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4.4          By Executive for “Good Reason” . The Executive, by written notice to the Company, may terminate Executive’s employment hereunder if a “Good Reason” exists. For purposes of this Agreement, “Good Reason” shall mean the occurrence of any of the following circumstances without the Executive’s prior written consent: (a) a substantial and material adverse change in the nature of Executive’s title, duties and/or responsibilities with the Company that represents a demotion from his title, duties or responsibilities as in effect immediately prior to such change (such change, a “Demotion”); (b) material breach of this Agreement by the Company; (c) a failure by the Company to make any payment to Executive when due, unless the payment is not material and is being contested by the Company, in good faith; (d) a liquidation, bankruptcy or receivership of the Company; or (e) the moving of Executive’s office to a location that requires Executive to commute in excess of 10 miles more than Executive’s then-current commute to Hicksville, New York as of the Effective Date (or 50 miles if greater), either on a permanent or, if more than 30 days, temporary basis Notwithstanding the foregoing, no “Good Reason” shall be deemed to exist with respect to the Company’s acts described in clauses (a), (b) or (c) above, unless Executive shall have given written notice to the Company within a period not to exceed ten (10) calendar days of the Executive’s knowledge of the initial existence of the occurrence, specifying the “Good Reason” with reasonable particularity and, within thirty (30) calendar days after such notice, the Company shall not have cured or eliminated the problem or thing giving rise to such “Good Reason”; provided, however, that no more than two cure periods shall be provided during any twelve-month period of a breach of clauses (a), (b) or (c) above. Upon such termination, the Company shall pay to Executive the amount set forth in Section 4.6(c).

 

4.5          By Company Without “Cause” . The Company may terminate Executive’s employment hereunder without “Cause” by giving at least thirty (30) days written notice to Executive. Upon such termination, the Company shall pay to Executive the amount set forth in Section 4.6(c).

 

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4.6          Compensation Upon Termination . In the event that Executive’s employment hereunder is terminated, the Company shall pay to Executive the following compensation:

 

(a)           Payment Upon Death or Disability . In the event that Executive’s employment is terminated pursuant to Sections 4.1 or 4.2, the Company shall no longer be under any obligation to Executive or his legal representatives pursuant to this Agreement except for: (i) the Base Salary due Executive pursuant to Section 3.1 hereof through the date of termination; (ii) full payment of any previously granted but unpaid Bonus and a pro rata share of Executive’s Bonus for the current year determined in the ordinary course and assuming completion of any individual performance benchmarks by Executive; (iii) vesting to the next applicable vesting date of any grant or benefit subject to vesting, with Executive being provided with that period of time to exercise any options as is provided in the applicable plan (or, if no timeframe is provided therein, a reasonable period of time); (iv) all valid expense reimbursements; and (v) all accrued but unused vacation pay.

 

(b)           Payment Upon Termination by the Company For “Cause” . In the event that the Company terminates Executive’s employment hereunder pursuant to Section 4.3, the Company shall have no further obligations to the Executive hereunder, except for: (i) the Base Salary due Executive pursuant to Section 3.1 hereof through the date of termination; (ii) all valid expense reimbursements; and (iii) all unused vacation pay through the date of termination required by law to be paid.

 

(c)           Payment Upon Termination by Company Without Cause or by Executive for Good Reason . In the event that Executive’s employment is terminated pursuant to Sections 4.4 or 4.5, the Company shall have no further obligations to Executive hereunder except for: (i) the Base Salary due Executive pursuant to Section 3.1 hereof through the date of termination; (ii) Base Salary at the applicable annual rate as of the date of termination for nine (9) months commencing on the date of termination, payable in accordance with Section 3.1, subject to the Executive executing a general release in favor of the Company in customary form; (iii) full payment of any previously granted but unpaid Bonus and a pro rata share of Executive’s Bonus for the current year determined in the ordinary course and assuming completion of any individual performance benchmarks by Executive; (iv) full vesting of any grant or benefit subject to vesting, with Executive being provided with that period of time to exercise any options as is provided in the applicable plan (or, if no timeframe is provided therein, a reasonable period of time); (v) all valid expense reimbursements; and (vi) all accrued but unused vacation pay (pro rata for the period to the date of termination).

 

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(d)           Payment Upon Non-Renewal . In the event that Executive’s employment is terminated as a result of the Company sending notice that it is not renewing the Term as set forth in Section 2, the Company shall have no further obligations to Executive hereunder after the end of the Term, except for: (i) Base Salary at the applicable annual rate as of the date of such notice for five (5) months commencing after the expiration of the Term, payable in accordance with Section 3.1, subject to the Executive executing a general release in favor of the Company in customary form; (ii) full payment of any previously granted but unpaid Bonus and a pro rata share of Executive’s Bonus for the current year determined in the ordinary course and assuming completion of any individual performance benchmarks by Executive; (iii) full vesting of any grant or benefit subject to vesting, with Executive being provided with that period of time to exercise any options as is provided in the applicable plan (or, if no timeframe is provided therein, a reasonable period of time); (iv) all valid expense reimbursements; and (v) all accrued but unused vacation pay (pro rata for the period through the expiration of the Term).

 

(e)           Executive shall have no duty to mitigate awards paid or payable to him pursuant to this Agreement, and any compensation paid or payable to Executive from sources other than the Company will not offset or terminate the Company’s obligation to pay to Executive the full amounts pursuant to this Agreement.

 

5.             Protection of Confidential Information; Non-Competition .

 

5.1          Acknowledgment . Executive acknowledges that:

 

(a)           As a result of his employment with the Company, Executive has obtained and will obtain secret and confidential information concerning the business of the Company and its subsidiaries (referred to collectively in this Section 5 as the “Company”), including, without limitation, financial information, proprietary rights, trade secrets and “know-how,” customers and sources (“Confidential Information”).

 

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(b)           The Company will suffer substantial damage which will be difficult to compute if, during the period of his employment with the Company or thereafter, Executive should enter a business competitive with the Company or divulge Confidential Information.

 

(c)           The provisions of this Agreement are reasonable and necessary to protect of the business of the Company, to protect the Company’s trade secrets and Confidential Information and to prevent loss to a competitor of an employee whose services are special, unique and extraordinary.

 

5.2          Confidentiality . Executive agrees that he will not at any time, during the Term or thereafter, divulge to any person or entity or use any Confidential Information obtained or learned by him as a result of his employment with the Company, except (i) in the course of performing his duties hereunder, (ii) with the Company’s prior written consent; (iii) to the extent that any such information is in the public domain other than as a result of Executive’s breach of any of his obligations hereunder; or (iv) where required to be disclosed by court order, subpoena or other government process. If Executive shall be required to make disclosure pursuant to the provisions of clause (iv) of the preceding sentence, Executive promptly, but in no event more than two (2) business days after learning of such subpoena, court order, or other government process, shall notify the Company (to the extent such notice is legally permissible) and, at the Company’s expense, Executive shall: (a) take reasonable and lawful steps required by the Company to defend against the enforcement of such subpoena, court order or other government process, and (b) permit the Company to intervene and participate with counsel of its choice in any proceeding relating to the enforcement thereof.

 

5.3          Documents . Upon termination of his employment with the Company, Executive will promptly deliver to the Company all memoranda, notes, records, reports, manuals, drawings, blueprints and other documents (and all copies thereof) relating to the business of the Company and all property associated therewith, which he may then possess or have under his control; provided, however, that Executive shall be entitled to retain copies of such documents reasonably necessary to document his financial relationship with the Company or as otherwise may be reasonably required to comply with applicable law or legal process.

 

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5.4          Non-Competition . During the Term and for a period of nine (9) months thereafter, Executive shall not, for himself or on behalf of, or in conjunction with, any other person, persons, company, partnership, limited liability company, corporation or business of whatever nature:

 

(i)           engage, as an officer, director, manager, member, shareholder, owner, partner, joint venturer, trustee, or in a managerial capacity, whether as an employee, independent contractor, agent, consultant or advisor, or as a sales representative, in an entity that designs, researches, develops, markets, sells or licenses products or services that are substantially similar to or competitive with the business of the Company that is located within seventy-five (75) miles of any market in which Company currently operates or has current, actively pursued plans to do business in at the time of termination;

 

(ii)          call upon any person who is at that time, or within the preceding nine (9) months has been, an employee of the Company, for the purpose, or with the intent, of enticing such employee away from, or out of, the employ of the Company or for the purpose of hiring such person for Executive or any other person or entity, unless any such person was terminated by the Company more than nine (9) months prior thereto; or

 

(iii)         call upon any person who, or entity that is then or that has been within nine (9) months prior to that time, a customer of the Company, for the purpose of soliciting or selling products or services in competition with the Company; or

 

(iv)         call upon any prospective acquisition or investment candidate, on the Executive’s own behalf or on behalf of any other person or entity, which candidate was known by Executive to have, within the previous nine (9) months, been called upon by the Company or for which the Company made an acquisition or investment analysis or contemplated a joint marketing or joint venture arrangement with, for the purpose of acquiring or investing or enticing such entity into a joint marketing or joint venture arrangement.

 

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5.5          Injunctive Relief . If Executive commits a breach, or threatens to commit a breach, of any of the provisions of Section 5.2 or 5.4, the Company shall have the right and remedy to seek to have the provisions of this Agreement specifically enforced by any court having equity jurisdiction, it being acknowledged and agreed by Executive that the services being rendered hereunder to the Company are of a special, unique and extraordinary character and that any such breach or threatened breach will cause irreparable injury to the Company and that money damages will not provide an adequate remedy to the Company. The rights and remedies enumerated in this Section 5.5 shall be in addition to, and not in lieu of, any other rights and remedies available to the Company under law or equity. In connection with any legal action or proceeding arising out of or relating to this Agreement, the prevailing party in such action or proceeding shall be entitled to be reimbursed by the other party for the reasonable attorneys’ fees and costs incurred by the prevailing party.

 

5.6          Modification . If any provision of Section 5.2 or 5.4 is held to be unenforceable because of the scope, duration or area of its applicability, the tribunal making such determination shall have the power to modify such scope, duration, or area, or all of them, and such provision or provisions shall then be applicable in such modified form.

 

5.7          Survival . The provisions of this Section 5 shall survive the termination of this Agreement for any reason, except in the event Executive is terminated by the Company without “Cause,” or if Executive terminates this Agreement with “Good Reason,” in either of which events, clause (i) of Section 5.4 shall be null and void and of no further force or effect. The non-renewal of this Agreement at the end of the Term shall not be deemed a termination by the Company without “Cause”; provided, that in such event all of the nine (9) month periods set forth in Section 5.4 shall be deemed to be five (5) months.

 

6.             Miscellaneous Provisions .

 

6.1          Notices . All notices provided for in this Agreement shall be in writing, and shall be deemed to have been duly given when (i) delivered personally to the party to receive the same, or (ii) when mailed first class postage prepaid, by certified mail, return receipt requested, addressed to the party to receive the same at his or its address set forth below, or such other address as the party to receive the same shall have specified by written notice given in the manner provided for in this Section 6.1. All notices shall be deemed to have been given as of the date of personal delivery or mailing thereof.

 

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If to Executive, at the address on file with the Company.

 

If to the Company:

 

Long Island Iced Tea Corp.

116 Charlotte Avenue

Hicksville, New York 11801

 

With a copy in either case to:

 

Graubard Miller

405 Lexington Avenue

New York, New York 10174

Attn: Jeffrey M. Gallant, Esq.

 

6.2          Entire Agreement; Waiver . This Agreement sets forth the entire agreement of the parties relating to the employment of Executive and is intended to supersede all prior negotiations, understandings and agreements. No provisions of this Agreement may be waived or changed except by a writing by the party against whom such waiver or change is sought to be enforced. The failure of any party to require performance of any provision hereof or thereof shall in no manner affect the right at a later time to enforce such provision.

 

6.3          Governing Law . All questions with respect to the construction of this Agreement, and the rights and obligations of the parties hereunder, shall be determined in accordance with the law of the State of New York applicable to agreements made and to be performed entirely in New York.

 

6.4          Binding Effect; Nonassignability . This Agreement shall inure to the benefit of and be binding upon the successors and assigns of the Company. This Agreement shall not be assignable by Executive, but shall inure to the benefit of and be binding upon Executive’s heirs and legal representatives.

 

6.5          Severability . Should any provision of this Agreement become legally unenforceable, no other provision of this Agreement shall be affected, and this Agreement shall continue as if the Agreement had been executed absent the unenforceable provision.

 

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6.6          Section 409A . This Agreement is intended to comply with the provisions of Section 409A of the Internal Revenue Code (“Section 409A”). To the extent that any payments and/or benefits provided hereunder are not considered compliant with Section 409A, the parties agree that the Company shall take all actions necessary to make such payments and/or benefits become compliant.

 

6.7          Counterparts; Electronic Signatures . This Agreement may be executed in counterparts, each of which will constitute an original of this Agreement and both of which together shall constitute one and the same Agreement. Signature pages delivered by facsimile, .pdf or similar electronic means shall have the same force and effect as original signatures.

 

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IN WITNESS WHEREOF, the parties have executed this Agreement on the date first above written.

 

  LONG ISLAND ICED TEA CORP.
   
  By: /s/ Philip Thomas
  Name: Philip Thomas
  Title: CEO

 

  /s/ Richard B. Allen
  RICHARD B. ALLEN