Extracted Text
Highlighting: “"Protempo"”
1 RUTAN & TUCKER, LLP
Richard K. Howell (State Bar No.
2 rhowell@rutan.com ELECTRONICALLY
ate Bar No.
3 FILED
Superior Court of California.
Bar No. County of San Francisco
4
1 Anton • ou evar , Suite 1400 12/22/ 2O17
Clerk of the Court
5 Costa Mcsa, C is -1931 BY DAVID YU! N
Telephone: Deputy Clerk
6 Facsimile:
7 Attorneys for Plaintiff
PROTEMPO LIMITED
8
9 SUPERIOR COURT OF THE STATE OF CALIFORNIA
I0 FOR THE COUNTY OF SAN FRANCISCO
11
12 PROTEMPO LIMITED, Case No. CGC-17-559617
13 Plaintiff, SECOND AMENDED COMPLAINT FOR:
(1) Promissory Fraud;
14 vs. (2) Fraud and Intentional Deceit;
(3) Negligent Misrepresentation;
15 ALIPHCOM, INC. d/b/a JAWBONE, a (4) Breach of Contract (Direct Claims);
California corporation, HOSAIN RAHMAN, an (5) Unjust Enrichment;
16 individual, JASON CHILD, an individual, and (6) Breach of Warranty;
DOES 1 through 10, inclusive (7) Conversion;
17 (8) Account Stated;
Defendants. (9) Open Book Account;
18 (10) Breach of Contract (Assigned Claims);
(11) Account Stated (Assigned Claims);
19 (12) Open Book Account (Assigned Claims);
(13) Violation of Penal Code section 496(a).
20
21
22
23
24
25
26
27
28
RlItail 11 Tucker, LLP
attorneys et taw
2152/033019-0002
11786640.1 912/2107 SECOND AMENDED COMPLAINT
EFTA00807802
1 Plaintiff Protempo Limited ("Protempo") alleges the following on information and belief:
2 INTRODUCTION
3 I. This action concerns the fraudulent and otherwise wrongful conduct of defendants
4 AliphCom, Inc. cl/b/a Jawbone ("Jawbone"), its Chief Executive Officer Hosain Rahman
5 ("Rahman"), and its Chief Financial Officer, Jason Child ("Child"), in making or directing the
6 making of materially false statements and promises to Protempo before Protempo contracted with
7 Jawbone, to induce Protempo to pay Jawbone at least $1.9 million, making or directing the
8 making of false statements and promises of performance in the parties' contract itself, and
9 thereafter breaching that contract. Rahman and Child knew the statements were false when they
10 were made, and knew Jawbone would not and could not perform when the false promises were
11 made, but nevertheless participated in, directed, and authorized the making of the false statements
12 and promises. Then, when Protempo and Jawbone entered into their agreement, Jawbone
13 breached the agreement in numerous respects. As a result of Jawbone, Rahman and Child's
14 fraudulent and wrongful conduct, Protempo has incurred millions of dollars in damages for which
15 Protempo now seeks to hold the Defendants accountable.
16 PARTIES
17 2. Protempo is, and at all material times mentioned herein was, a New Zealand
18 corporation authorized to do business and doing business in California.
19 3. Jawbone is, and at all relevant times herein mentioned was, a California
20 corporation organized and existing under and by virtue of the laws of the State of California, and
21 which has its principal place of business in the State of California, County of San Francisco.
22 4. Rahman is, and at all relevant times mentioned herein was, an individual residing in
23 the State of California, County of San Francisco. Rahman, at all relevant times mentioned herein,
24 was serving as the Chief Executive Officer of Jawbone.
25 5. Child is, and at all relevant times mentioned herein was, an individual residing in
26 the State of California, County of San Francisco. Child, at all relevant times mentioned herein,
27 was serving as the Chief Financial Officer of Jawbone.
28 6. Protempo is presently unaware of the true names and capacities of defendants Does
&Wart & Tucker. LLP
attorneys et taw
2152(01)019-0002
11786640 1 412/21/17 SECOND AMENDED COMPLAINT
EFTA00807803
1 1 through 10, inclusive, and therefore sues these defendants by such fictitious names. Protempo
2 will amend this Complaint to show the true names and capacities of such fictitiously-named
3 defendants when the same have been ascertained or upon proof at trial. Protempo is informed and
4 believes and based thereon alleges that each of the fictitiously-named defendants is in some
5 capacity legally responsible for the events and damages alleged herein.
6 7. At all relevant times mentioned herein, certain of the defendants, including the Doe
7 defendants, were acting as the partners, agents, servants, employees, alter egos, successors or
8 predecessors in interest, or conspirators, of others of the defendants, and were acting within the
9 course and scope of such relationship, with the knowledge, express or implied, of each such other
10 named defendant. Protempo sometimes refers to Jawbone, Rahman, Child and Does 1 through 10
11 herein collectively as "Defendants."
12 OPERATIVE FACTS
13 8. Protempo contracts with electronics manufacturers to remarket excess or trailing-
14 edge but still functional and salable products.
15 9. Jawbone was at one time considered a richly-valued maker of wearable gadgets and
16 wireless speakers. By mid-2016, however, unbeknownst to Protempo, Jawbone was on
17 increasingly shaky financial footing, as it struggled to pay key vendors and keep inventory in
18 stock.
19 10. On or about April 29, 2016, Protempo entered into an agreement (the "Original
20 Agreement") with Jawbone whereby Jawbone promised to provide brand-new products free and
21 clear of all encumbrances in exchange for payment by Protempo. Child signed the Original
22 Agreement on behalf of Jawbone. A true and correct copy of the Original Agreement is attached
23 hereto and incorporated herein as Exhibit A.
24 11. On June 2, 2016 and June 9, 2016, the parties amended the Original Agreement to
25 add additional products which Jawbone would sell to Protempo. True and correct copies of these
26 amendments arc attached hereto and incorporated herein as Exhibits B and C.
27 12. In August and September 2016, both Rahman and Child engaged in and directed
28 negotiations with Protempo for entry into a third amendment to the Original Agreement to sell
RuLin L Tucker, LLP
attorneys at law -3-
2152/0330194002
11786640.1 al2/21/17 SECOND AMENDED COMPLAINT
EFTA00807804
1 Protempo what Jawbone represented was an additional $2.1 million of purportedly brand-new,
2 unencumbered products, ready for distribution. However, during the course of those negotiations,
3 Rahman and Child made and directed, approved, ratified and encouraged the making of several
4 misrepresentations and false promises, with the knowledge — shared by Rahman and Child and
5 others at Jawbone — that the statements were false and that Jawbone would not and could not
6 perform as promised.
7 13. On or about September II, 2016, Rahman and Child directed Steve Jordan of
8 Jawbone in writing and otherwise to encourage Protempo to immediately purchase a remaining
9 Jawbone inventory of products — which Jawbone had set aside to meet customer warranty claims —
10 in Tijuana, Mexico, so that Jawbone could quickly receive from Protempo a cash infusion to
I1 continue Jawbone's flagging operations and meet overdue payment obligations to Jawbone's
12 vendors.
13 14. In a September 12, 2016 e-mail, Mr. Jordan wrote to Adam Brown of Protempo
14 that Rahman and Child "are looking to sell all remaining customer care units" to Protempo,
15 attaching an inventory of new, customer care units supposedly available for sale to Protempo.
16 15. On September 14, 2016, following the parties' negotiations and Defendants'
17 making of the false statements and promises alleged herein, Jawbone and Protempo entered into
18 their third amended agreement ("Amended Agreement") whereby Jawbone promised to sell an
19 additional $2,121,161 worth of products to Protempo. A true and correct copy of the Amended
20 Agreement is attached hereto and incorporated herein as Exhibit D.
21 16. More specifically, between August 27, 2016 and September 14, 2016 (among other
22 times), at both Rahman's and Child's direction, and with their approval, ratification and
23 encouragement, Jawbone made numerous false statements and promises to Protempo, including,
24 but not limited to, the following:
25 • During a face-to-face meeting in San Francisco on or about August 27, 2016. Mr.
26 Jordan of Jawbone informed Adam Brown. Adam Burke and Mark Priscott of
27 Protempo that Jawbone had an inventory of brand-new products available for sale
28 to Protempo. On or about September 10. 2016. and again on or about September
Rutan a Tucker. LIP
attorneys at taw -4-
2152/011019.0002
11786640.1 012421/17 SECOND AMENDED COMPLAINT
EFTA00807805
11, 2016, via e-mail and video conference calls, Mr. Jordan of Jawbone represented
to Adam Brown and Mark Priscott of Protemno that the products discussed on
August 27,2016 were new, functioning. re-sellable, and available for immediate
purchase by and delivery to Protemno, and were suitable for resale to Protempo's
network of distributors.
o These representations were further set forth at Exhibit A of the Amended
Agreement, identifying $2,121,161 worth of specified products to be sold
S and made available to Protempo. The Amended Agreement also
9 incorporated and reaffirmed the representations set forth at Section 5.3.1,
I0 subsection (c) of the Original Agreement, stating that "the Products arc
11 brand new and are not refurbished or used stock." The Amended
12_ Agreement additionally incorporated and reaffirmed the Original
13 Agreement's statement that "Jawbone holds all right, title, and interest in
14 and to the Products, and the Products are free and clear of all liens, security
15 interest, and other third party claims to ownership of the Products" (Ex. A,
16 § 5.2.1(b)).
17 o The true facts — of which Rahman and Child were aware when they directed
18 the false representations be made, and when Child signed the Amended
19 Agreement, and Rahman directed that the Amended Agreement be signed
20 were that:
21 • The products were subject to a lien in favor of North American
22 Production Sharing, Inc. ("NAPS"), as a result of Jawbone's failure
23 to pay hundreds of thousands of dollars in storage and handling fees;
24 • As a result of Jawbone's intention not to pay and failure to pay its
25 outstanding invoices to NAPS, NAPS would not release the
26 products to Protempo;
27 • Jawbone did not have $2,121,161 worth of products available for
28 Protempo, and several months after entry into the Amended
Pular & LLP
attorneys a: ISW -5-
2152/033019-0002
11736640.1 312/21117 SECOND AMENDED COMPLAINT
EFTA00807806
Agreement, had only delivered a fraction of the products Protempo
was promised;
• Jawbone was short thousands of units to be provided to Protempo,
1 many of which were units that were not fit for retail sales and did
not pass quality tests; and,
• Many of the same products promised to Protempo were already
committed to use by Jawbone to fulfill customer warranty claims.
• During a September 11.2016 video conference. Mr. Jordan reiterated to Adam
9 Brown of Protempo that the products were brand-new, in working order. and could
10 be and would be subject to warranties Jawbone would honor as to Protempo's
11 distributor customers.
I2 o These representations were further set forth in the Amended Agreement,
which provided (as incorporated from the Original Agreement and
14 reaffirmed in the Amended Agreement) that "the Products are brand new
I5 and are not refurbished or used stock" (Ex. A, § 5.2.1(c)); and that
16 "Jawbone offers a limited warranty to end-user purchasers of its Products . .
17 . . Distributor shall direct end-user purchasers to Jawbone for resolution of
18 any Product warranty claims" (Ex. A, § 5.2.2).
19 o The true facts — of which Rahman and Child were aware when they directed
20 the false representations be made, and when Child signed the Amended
21 Agreement, and Rahman directed that the Amended Agreement be signed —
22 were that:
23 • The products were significantly aged, and were highly defective or
24 otherwise inoperative, and could not be re-sold;
25 • The products had an exorbitantly high rate of consumer complaints,
26 thus reinforcing that the products were significantly faulty and/or
27 not in working condition; and,
28 • Jawbone was not honoring warranties on its products, and had no
Rutan 6 Tuck•,. LIP
allOmayS at law -6-
2152,0330194002
11786(40.1 912/21/11 SECOND AMENDED COMPLAINT
EFTA00807807
intention of honoring warranties on the products Defendants
intended that Protempo purchase.
• During the e-mails, videoconferences and meetings taking place on September 10,
11 and 12, 2016 (among other times), Mr. Jordan and Matt DeBenedetti, among
others at Jawbone, represented to the identified Protempo emaoyees that the
products Jawbone intended that Protempo purchase would be delivered or made
available by Jawbone in a timely fashion, and in time for Protempo to have the
S products for the crucial holiday sales season.
o Exhibit A to the Amended Agreement likewise identified $2,121,161 worth
of specified products to be sold and made immediately available to
Protempo.
I2 o The true facts — of which Rahman and Child were aware when they directed
the false representations be made, and when Child signed the Amended
Agreement, and Rahman directed that the Amended Agreement be signed —
I5 were that:
16 ■ Shipment of the products was dependent on funding from Jawbone;
17 and,
IS ■ Jawbone would not be able to timely pay its vendors, which would
19 delay shipment of the products.
20 17. Rahman and Child knew these statements were false and that Jawbone would not
21 and could not keep these promises to Protempo; nevertheless, Child signed the parties'
22 agreements, and Rahman directed that the agreements be signed with knowledge of their falsity
23 and Jawbone's intention not to perform and inability to perform.
24 18. Immediately following the parties' entry into the Amended Agreement, Protempo
25 paid Jawbone the full required $1,910,794, and expected to timely receive the brand-new,
26 unencumbered products it had been promised and had purchased.
27 19. Only after Jawbone had taken Protempo's $1,910,794 payment did Protempo
28 discover that Defendants' representations and promises were false.
Rutin it Tucker. LLP
attorneys at law -7-
2152/033019-0002
117866401a12/21)11 SECOND AMENDED COMPLAINT
EFTA00807808
1 20. NAPS refused to release the products Protempo had purchased absent payment in
2 full of Jawbone's $450,000 debt for overdue storage and handling fees. Despite repeated requests
3 by Protempo to Jawbone to pay Jawbone's debt to NAPS so Protempo could obtain the products it
4 had purchased, Jawbone refused, leaving Protempo with no viable alternative but to pay NAPS the
5 $450,000 on Jawbone's behalf to obtain release of Protempo's products and allow Protempo to
6 fulfill its own obligations to downstream distributors. NAPS and Protempo executed a contract
7 ("Assignment of Debt") by which NAPS assigned its entire right, title, and interest in Jawbone's
8 debt to Protempo.
9 21. As a result of Jawbone's false representations and promises, and its failure to pay
10 NAPS to allow release of the products, the products were delivered to Protempo late, causing
11 Protempo to miss out on sales during the crucial holiday season and to lose Protempo's largest
12 deal with a distributor.
13 22. When Protempo finally received and could inspect the products it purchased under
14 the Amended Agreement, it discovered that $129,624 worth of products were missing.
I5 Additionally, after taking delivery of the products and providing them for distribution, Protempo
16 discovered for the first time that numerous batches of Jawbone's UP2 wearable fitness product
17 were dead on arrival (including, for example, dead irreplaceable batteries and other malfunctions)
18 and the products experienced massive failure rates.
19 23. Rahman, Child and others at Jawbone nevertheless led Protempo to believe
20 otherwise and withheld information from Protempo in negotiating the parties' agreement,
21 committing a blatant "bait and switch" involving millions of dollars of faulty and encumbered
22 products in a desperate attempt to obtain the immediate cash infusion Jawbone required to pay its
23 mounting debts.
24 24. Jawbone's actions have caused significant injury to Protempo. To date, $1,234,621
25 worth of Jawbone's UP2 product purchased by Protempo under the parties' agreements are
26 defective and unsellable. In addition to its resulting financial damages, Protempo has suffered
27 significant disruptions to its business and to several of its important relationships with distributors
28 and others. Jawbone has also refused to reimburse Protempo the $450,000 debt that Protempo was
Rutan a newer. Li,
atfOrneyS at law -8-
2152/033019-0002
1146640.1 e12121111 SECOND AMENDED COMPLAINT
EFTA00807809
1 forced to pay NAPS in order to secure the release of the purchased products; failed to deliver the
2 missing products totaling $129,624; and failed to take any action to remedy the product shortfall,
3 such as refunding Protempo's overpayment or delivering the promised products. Jawbone has
4 also failed to fix or otherwise address or remedy the numerous defective products it sold to
5 Protempo.
6 25. Protempo's damages are on-going and far exceed the jurisdictional minimum of
7 this Court. Despite oral and written demands by Protempo, Defendants have failed and refuse to
8 compensate Protempo for its damages.
9 FIRST CAUSE OF ACTION
10 (For Promissory Fraud Against All Defendants)
11 26. Protcmpo reallcges and incorporates by reference Paragraphs 1 through 25, above,
12 as if set forth in their entirety.
13 27. Between August and September 2016, at both Rahman's and Child's direction, and
14 with their involvement, approval, ratification and encouragement, Defendants made the false
15 promises of performance, orally (in face-to-face meetings and phone calls), and in writing
16 (including by e-mail), to Protempo's identified employees, including but not limited to Adam
17 Brown, Mark Priscott, and others, as set forth at Paragraph 16 of this Complaint.
18 28. At the time Defendants made the promises to Protempo, Defendants had no
19 intention of performing them.
20 29. Defendants made their promises with the intent to induce Protempo to pay its $1.9
21 million to Jawbone and enter into the Amended Agreement.
22 30. Protempo, at the time the promises were made and at the time Protempo took the
23 actions herein alleged, was ignorant of Defendants' secret intention not to perform, and Protempo
24 could not, in the exercise of reasonable diligence, have discovered Defendants' secret intention.
25 In reliance on Defendants' promises, Protempo paid its $1.9 million to Jawbone and entered into
26 the Amended Agreement. If Protempo had known of Defendants' actual intentions, Protempo
27 would not have taken such actions.
28 31. Defendants failed to abide by their promises as herein alleged, including but not
Ru1an a Tucht,1.1.1.
attcrneys et low -9-
2152/033019.0002
11786640107121/17 SECOND AMENDED COMPLAINT
EFTA00807810
1 limited to as alleged at Paragraph 16 of this Complaint.
2 32. As a proximate result of Defendants' fraudulent conduct, Protempo has and \\ill
3 continue to suffer general, consequential, and compensatory damages, as alleged above.
4 33. The acts of Defendants were done with a conscious disregard ofProtempo's rights,
5 and with the specific intent to defraud Protempo into providing an up-front payment of $1,910,794
6 and to pay other sums, such as to constitute fraud, oppression and malice under California Civil
7 Code section 3294. By virtue of Defendant's willful and wrongful conduct, Protempo is entitled
8 to punitive and exemplary damages.
9 SECOND CAUSE OF ACTION
10 (For Fraud And Intentional Deceit Against All Defendants)
11 34. Protempo realleges and incorporates by reference Paragraphs 1 through 33, above,
12 as if set forth in their entirety.
13 35. Between August and September 2016, at both Rahman's and Child's direction, and
14 with their involvement, approval, ratification and encouragement, Defendants made the false
I5 statements and misrepresentations, orally (in face-to-face meetings and phone calls), and in
16 writing (including by e-mail), to Protempo's identified employees, including but not limited to
17 Adam Brown, Mark Priscott, and others, as set forth at Paragraph 16 of this Complaint.
18 36. The representations made by Defendants were in fact false, and the true facts were
19 as set forth at Paragraph 16.
20 37. When Defendants made their representations, they knew them to be false and made
21 these representations with the intention to deceive and defraud Protempo and to induce Protempo
22 to pay its $1.9 million to Jawbone and enter into the Amended Agreement, or with the expectation
23 that Protempo would so act.
24 38. Protempo, at the time Defendants made their representations and at the time
25 Protempo took the actions herein alleged, was ignorant of the falsity of Defendants'
26 representations and believed them to be true. In reliance on these representations, Protempo was
27 induced to and did pay its $1.9 million to Jawbone and entered into the Amended Agreement.
28 Had Protempo known the actual facts, it would not have taken such actions. Protempo's reliance
Roan A Tucker. LIP
AffOrlityS at law -10-
21321033019-0002
11786601 012/21/17 SECOND AMENDED COMPLAINT
EFTA00807811
1 on Defendants' representations was justified because, inter alia, Protempo could not, in the
2 exercise of reasonable diligence, have discovered the true facts (for example, the products at issue
3 were stored on other continents, and their condition was known only to Defendants, and Protempo
4 was without the necessary internal information for Jawbone).
5 39. As a proximate result ofDefendants' fraudulent conduct, Protempo has and will
6 continue to suffer general, consequential, and compensatory damages, as alleged above.
7 40. The acts of Defendants were done with a conscious disregard of Protempo's rights,
8 and with the specific intent to defraud Protempo into providing an up-front payment of $1,910,794
9 and to pay other sums, such as to constitute fraud, oppression and malice under California Civil
10 Code section 3294. By virtue of Defendant's willful and wrongful conduct, Protempo is entitled
11 to punitive and exemplary damages.
12 THIRD CAUSE OF ACTION
13 (For Negligent Misrepresentation Against All Defendants)
14 41. Protempo rcalleges and incorporates by reference Paragraphs 1 through 40 above,
15 as if set forth in their entirety.
16 42. Between August and September 2016, at both Rahman's and Child's direction, and
17 with their involvement, approval, ratification and encouragement, Defendants made the false
18 statements and misrepresentations, orally (in face-to-face meetings and phone calls), and in
19 writing (including by e-mail), to Protempo's identified employees, including but not limited to
20 Adam Brown, Mark Priscott, and others, as set forth at Paragraph 16 of this Complaint.
21 43. As set forth at Paragraph 16 of this Complaint, the information Defendants
22 provided to Protempo was in fact false. The true facts, of which Protempo was ignorant, were that
23 (i) the products were subject to NAPS' claim for substantial unpaid fees; (ii) NAPS would not
24 release the products until its unpaid fees were paid; (iii) Jawbone did not have the inventory to
25 fulfill its agreement with Protempo; and (iv) many of the products were inoperative and highly
26 defective.
27 44. If Defendants did not intentionally lead Protempo to believe false information as
28 alleged above, then Defendants had no reasonable grounds to believe the information they
Rutin 8 Tucker, LLP
8110/1/0y$ at law -Il-
3152/071019.0002
11786610.1 812/21/17 SECOND AMENDED COMPLAINT
EFTA00807812
1 provided was true.
2 45. Defendants intended for Protempo to rely on such negligent misrepresentations,
3 and Protempo did reasonably rely on the misrepresentations as alleged above.
4 46. As a direct, proximate, and foreseeable result of Defendants' conduct, Protempo
5 has and will continue to suffer general, consequential, and compensatory damages, as alleged
6 above.
7 FOURTH CAUSE OF ACTION (DIRECT CLAIMS)
8 (For Breach of Contract Against Jawbone and DOES 1-10)
9 47. Protempo realleges and incorporates by reference Paragraphs 1 through 46, above.
10 as if set forth in their entirety.
11 48. On or about September 14, 2016 Protempo entered into the Amended Agreement
12 with Jawbone, whereby Jawbone promised to provide brand-new products free and clear of all
13 encumbrances in exchange for payment in the amount of $2,121,161 by Protempo.
14 49. Protempo has performed all terms, conditions, and agreements on its part to be
15 performed under the Amended Agreement.
16 50. Jawbone has materially breached its obligations to Protempo under the Agreement
17 by failing to deliver $129,624 worth of products which Protcmpo purchased, and failing to honor
18 the warranties set forth in the Agreement, among other breaches.
19 51. The Amended Agreement contains an implied covenant of good faith and fair
20 dealing, which includes a covenant that neither party will deprive the other party of the intendcd
21 benefits of the agreement. When a condition in a contract involves the performance of an act
22 within the control of a party, the party has a duty to make a good faith effort to satisfy the
23 condition.
24 52. As a result of the conduct alleged above, and in particular, failing to deliver the full
25 product for which Protempo paid, Jawbone breached the implied covenant of good faith and fair
26 dealing.
27 53. As a direct and proximate result of Jawbone's breach of the Amended Agreement,
28 Protempo has been damaged in an amount to conform to proof at trial, but in no event less than
Rutan & Tucker. UP
attorneys at taO' -12-
21521073019-0001
117866401 412/21/17 SECOND AMENDED COMPLAINT
EFTA00807813
1 $129,624, plus any and all accrued interest.
2 FIFTH CAUSE OF ACTION
3 (For Unjust Enrichment Against Jawbone and DOES 1-10)
4 54. Protempo realleges and incorporates by reference Paragraphs 1 through 53, above,
5 as if set forth in their entirety.
6 55. By virtue of its wrongful conduct toward Protempo alleged above, and specifically,
7 as a result of its failure to compensate Protempo for its out-of-pocket expenditures (including
8 payment of Jawbone's $450,000 debt to NAPS), Jawbone has been unjustly enriched.
9 56. It would be manifestly unjust for Jawbone to retain any of the benefits it has gained
10 through its wrongful conduct. Subject to and as alleged above, unless the Court orders restitution
11 to Protempo, Jawbone will unjustly benefit from its actions.
12 SIXTH CAUSE OF ACTION
13 (For Breach of Warranty Against Jawbone and DOES 1-10)
14 57. Protempo realleges and incorporates by reference Paragraphs 1 through 56, above,
15 as if set forth in their entirety.
16 58. Pursuant to the Original Agreement and each of its subsequent amendments,
17 Jawbone represented and warranted that products were unencumbered, were brand-new and not
18 refurbished, and were not previously used.
19 59. Jawbone breached the express warranties contained in the parties' agreements
20 regarding the quality of product sold to Protempo by delivering to Protempo products that were
21 dead on arrival and products which showed massive failure rates. In particular, the UP2 products
22 Jawbone sold to Protempo contained faulty batteries incapable of holding a charge. As a result of
23 such breaches, Protempo did not receive products as warranted by Jawbone.
24 60. After discovering the defects in the products sold and delivered to Protempo in
25 breach of Jawbone's express warranties, Protempo timely informed Jawbone both orally and in
26 writing of such breaches and of the nature of the damages suffered by Protempo as a result of such
27 breaches. Despite such notice, Jawbone has failed and refused and continues to fail and refuse to
28 respond to such notice or to otherwise compensate Protempo for the damages it has suffered.
Puna 14 Tustin, LLP
attorneys at law -13-
21521033019.0002
11786640 1312/21/17 SECOND AMENDED COMPLAINT
EFTA00807814
I 61. As a direct and proximate result of Jawbone's breaches of warranties to Protempo,
2 Protempo has been damaged in an amount in excess of the jurisdictional minimum of this Court.
3 Protempo will establish the full nature and extent of its damages according to proof at the time of
4 trial, but currently believes its damages to exceed $1,234,621.
5 62. In addition to the monetary damages it has suffered, as a direct and proximate result
6 of Jawbone's decision to intentionally place a significant amount of knowingly defective and
7 faulty product into the market, Protempo has also suffered significant business disruptions and
8 related losses.
9 SEVENTH CAUSE OF ACTION
10 (For Conversion Against Jawbone and DOES 1-10)
11 63. Protempo realleges and incorporates by reference Paragraphs 1 through 62, alio% e.
12 as if set forth in their entirety.
13 64. Protempo has, and at all times relevant herein did have, the immediate right to
14 possession of the products for which it paid.
15 65. By the conduct alleged in this Complaint, Jawbone knowingly and intentionally
16 interfered with Protempo's property by refusing, without justification, to turn over possession to
17 Protempo of the products which Protempo purchased, despite the fact that the products lawfully
18 belong to Protempo. Jawbone has no rights to Protempo's property and is wrongfully retaining
19 and refusing to deliver Protempo's property despite multiple proper demands from Protempo that
20 the property be delivered.
21 66. As a direct and proximate result of Jawbone's unlawful conversion, Protempo has
22 suffered and will continue to suffer actual damages, including costs incurred attempting to
23 mitigate damages, and legal costs and expenses. Protempo is entitled to immediate possession of
24 the property (Le., the products it purchased) in an amount to be proven at trial.
25 67. The acts and omissions of Jawbone were knowing, intentional, malicious, and
26 oppressive, and were done with the intent and design to damage Protempo. For these reasons,
27 Protempo is entitled to recover punitive damages in an amount to be determined at the time of
28 trial.
Rutin 8 tutkor.I.LP
attorneys et ?SW -14-
71524013019-0003
117866401612,21/17 SECOND AMENDED COMPLAINT
EFTA00807815
1 EIGHTH CAUSE OF ACTION
2 (For Account Stated Against Jawbone and DOES 1-10)
3 68. Protempo realleges and incorporates by reference Paragraphs 1 through 67, above,
4 as if set forth in their entirety.
5 69. Within the last two years, Jawbone became indebted to Protempo on an account
6 stated in the amount of at least $450,000.
7 70. Protempo is informed and believes and on that basis alleges that although repeated
8 demands for payment have been made and Jawbone admitted that it owed the $450,000 and
9 promised to pay that amount, the principal sum due to Protempo — currently $450,000, plus
10 interest thereon at the maximum legal rate according to proof— remains due, owing, and unpaid
II from Jawbone to Protempo on an account stated.
12 NINTH CAUSE OF ACTION
13 (For Open Book Account Against Jawbone and DOES 1-10)
14 71. Protempo realleges and incorporates by reference Paragraphs 1 through 70 above,
15 as if set forth in their entirety.
16 72. Within the last year, Jawbone has become indebted to Protempo on an open book
17 account in the principal sum of $579,624, which includes Jawbone's unpaid debt of $450,000 to
18 NAPS and the $129,624 worth of products Jawbone failed to deliver to Protempo.
19 73. Protempo has kept an account of the debits and credits involved in the transactions.
20 Although repeated demands for payment have been made, as of the date of this Complaint, there is
21 now due, owing, and unpaid the principal sum of $579,624 together with interest accruing thereon.
22 TENTH CAUSE OF ACTION (ASSIGNED CLAIMS)
23 (For Breach of Contract Against Jawbone and DOES 1-10)
24 74. Protempo realleges and incorporates by reference Paragraphs 1 through 73, above.
25 as if set forth in their entirety.
26 75. Pursuant to the Assignment of Debt, NAPS "grant[ed], assign[ed], transfer[ed] and
27 set[] over unto [Protempo] its entire right, title and interest in and to the Debt, including without
28 limitation, all rights, benefits and advantages of [NAPS] to be derived therefrom[.]" Protempo is
Rutin 4 Tudor, LLP
attorneys at law -15-
2132,013019.0002
11796640.1 al 2,21/17 SECOND AMENDED COMPLAINT
EFTA00807816
1 informed and believes and based thereon alleges that NAPS acquired a warehouseman's lien on
2 the products Jawbone was storing in its facility.
3 76. As a result of the Assignment ofDebt, Protempo is entitled to enforce NAPS's
4 warehouseman's lien to the extent allowed by applicable law.
5 77. Protempo is informed and believes and based thereon alleges that NAPS and
6 Jawbone had an agreement, by which Jawbone was required to pay NAPS for all storage and
7 handling fees NAPS incurred from storing Jawbone's products.
8 78. Protempo is informed and believes and based thereon alleges that NAPS has
9 performed all terms, conditions, and agreements on its part to be performed under the agreement,
I0 except for those that were excused, waived, and/or discharged by Jawbone's conduct, including
II Jawbone's fraud and deceit, or which Jawbone is prevented or estopped to assert.
12 79. Jawbone has breached its obligations to NAPS by failing to pay $450,000 in
13 storage and handling fees.
14 80. Protempo is informed and believes and based thereon alleges that the agreement
15 between NAPS and Jawbone contained an implied covenant of good faith and fair dealing, which
16 includes a covenant that neither party will deprive the other party of the intended benefits of the
17 agreement. When a condition in a contract involves the performance of an act within the control
18 of a party, the party has a duty to make a good faith effort to satisfy the condition.
19 81. As a result of the conduct alleged above, and in particular, failing to pay NAPS the
20 storage and handling fees, Jawbone breached the implied covenant of good faith and fair dealing.
21 82. As a direct and proximate result of Jawbone's breach of its obligations to pay its
22 storage and handling fees, NAPS, and by assignment, Protempo, has been damaged in an amount
23 to conform to proof at trial, but in no event less than $450,000, plus any and all accrued interest.
24 ELEVENTH CAUSE OF ACTION (ASSIGNED CLAIMS)
25 (For Account Stated Against Jawbone and DOES 1-10)
26 83. Protempo realleges and incorporates by reference Paragraphs 1 through 82 above,
27 as if set forth in their entirety.
28 84. Pursuant to the Assignment of Debt, NAPS "grant[ed], assignred), transfer[ed] and
Rusin a Tudor, LLP
attorneys of law -16-
21521033019.0002
11766640.1 a12/21/17 SECOND AMENDED COMPLAINT
EFTA00807817
1 sell] over unto [Protempo] its entire right, title and interest in and to the Debt, including without
2 limitation, all rights, benefits and advantages of [NAPS] to be derived therefrom[.]"
3 85. Within the last two ycars, Jawbone became indebted to NAPS on an account stated
4 in the amount of at least $450,000.
5 86. Protempo is informed and believes and on that basis alleges that although repeated
6 demands for payment have been made and Jawbone admitted that it owed $450,000 and promised
7 to pay that amount, the principal sum due to NAPS, and by assignment, to Protempo — currently
8 $450,000, plus interest thereon at the maximum legal rate according to proof — remains due,
9 owing, and unpaid from Jawbone to NAPS, and by assignment, Protempo on an account stated.
10 TWELFTH CAUSE OF ACTION (ASSIGNED CLAIMS1
11 (For Open Book Account Against Jawbone and DOES 1-10)
12 87, Protempo realleges and incorporates by reference Paragraphs 1 through 86, above,
13 as if set forth in their entirety.
14 88. Pursuant to the Assignment of Debt, NAPS "grant[ed], assign[ed], transfer[cd] and
15 seta over unto [Protempo] its entire right, title and interest in and to the Debt, including without
16 limitation, all rights, benefits and advantages of [NAPS) to be derived therefrom[.]"
17 89. Within the last year, Jawbone has become indebted to NAPS, and by assignment.
18 Protempo on an open book account in the principal sum of $450,000.
19 90. NAPS, and by assignment, Protempo has kept an account of the debits and credits
20 involved in the transactions.
21 91. Although repeated demands for payment have been made, as of the date of this
22 Complaint, there is now due, owing and unpaid the principal sum of $450,000 together with
23 interest accruing thereon.
24 THIRTEENTH CAUSE OF ACTION
25 (Violation of Penal Code section 496(a) Against All Defendants)
26 92. Protempo realleges and incorporates by reference Paragraphs 1 through 91, above,
27 as if set forth in their entirety.
28 93. Defendants induced Protempo to remit payment of $1,910,794 under false
Rutin I Inciter, LLP
attOrneys at law -17-
21521033019-0002
11786640 1212f/1/17 SECOND AMENDED COMPLAINT
EFTA00807818
1 pretenses as alleged herein, including but not limited to as set forth at Paragraphs 12 through 18.
2 Therefore Defendants obtained Protempo's money in a manner constituting theft pursuant to Penal
3 Code section 496(a).
4 94. Penal Code section 496(c) permits a person who has been injured by a violation of
5 Penal Code section 496(a) to bring a civil action pursuant thereto for treble damages.
6 95. As a direct and proximate cause of the foregoing acts and omissions of Defendants,
7 Protempo been damaged in an amount to be proven at trial, but not less than $1,910,794.
8 96. Pursuant to Penal Code section 496(c), such sum shall be trebled. Plaintiffs are
9 informed and believe that Defendants liability therefore exceeds $5,732,382.
10 PRAYER FOR RELIEF
11 WHEREFORE, Protempo prays for judgment against Defendants as follows:
12 1. For damages in an amount to conform to proof at trial, but no less than $1,814,245;
1? 2. For interest in the maximum amount allowed by law;
14 3. For treble damages pursuant to Penal Code section 496(e);
I5 4. For exemplary and punitive damages pursuant to Civil Code section 3294;
16 5. For attorneys' fees and costs of suit incurred herein as may be allowed by law; and
6. For such other and further relief as the court deems just and proper.
Iti
19 I )ated: December 22, 2017
20
21
22
23
24
25
26
27
28
Rutin & rud,x, LLP
attorneys et low -18-
2152/0330194002
I 17166i0.I al2/21/17 SECOND AMENDED COMPLAINT
EFTA00807819
EXHIBIT A
EFTA00807820
DocuSign Enveope ID: CE6E53F8-24C2-4B98-8306-. C89959845
NON-EXCLUSIVE SALES & DISTRIBUTION AGREEMENT
This NON-EXCLUSIVE SALES & DISTRIBUTION AGREEMENT ("Agreement"), is effective as of April 29, 2016
("Effective Date") by and between ALIPUCOM, dba Jawbone, a California corporation, with offices at 99 Rhode Island
St., San Francisco, CA 94103 USA ("Jawbone") and PROTEMPO LIMITED, a New Zealand corporation, with offices at 21
Taylors Road, Momingside, Auckland 1025, New Zealand ("Distributor").
1. Products & Pricing.
Products. Jawbone and Distributor are entering into a non-exclusive commercial relationship for the distribution
and sale in the Territory to Distributor of the Jawbone-branded products ("Products"), as further set forth on
Exhibit A. Jawbone may, in its sole discretion, and without incurring any liability to Distributor, change the
features, or discontinue the sale, of any of the Products, provided Jawbone provide at least 6 months notice
before any information becomes public regarding the discontinuing of support for the Jawbone app. Additional
Jawbone products may be added to this Agreement only upon the mutual written agreement of the parties.
Distributor shall be permitted to sell the Products to and through its own authorized resellers and shall use
commercially reasonable efforts to ensure that its authorized resellers perform in accordance with the terms of
this Agreement, and to monitor for and inform Jawbone of any deviances.
1.2. Prices. Prices are defined on Exhibit A. Jawbone will not offer price protection or other support for the Products
should market prices change.
1.3. No Returns. Subject to Section 5.2.1(c) and except in respect of Rejected Goods (as defined herein), no returns
are authorized for the Products for any reason.
1.4. Exclusivity: Right of First Refusal; Subject to Section 1.5 below and except for direct sales to Jawbone's
corporate wellness customers in connection with Jawbone's corporate wellness program, Jawbone will not sell or
agree to sell Products to any customer other than Distributor for the period between the Effective Date through
July 31, 2016 ("Exclusivity Period"). Following the Exclusivity Period and through December 31, 2016, in the
event that Jawbone wishes to sell any additional quantities of Products beyond the amounts set forth on Exhibit
A, Distributor shall have a right of first refusal ("ROM") for thirty (30) days to purchase such Products. The
ROFR will begin upon Jawbone submitting a written offer via email for Products to Distributor, and all other
terms of this Agreement will apply to such offer. In the event of expiration or Distributor's rejection of the
ROFR, Jawbone is free to sell the Products to any other third parties, provided that the terms offered to third
parties are substantially the same as those offered to Distributor. For clarification, the offering of amended terms
or prices for the purchase of Products on more favourable terms shall constitute a new offer and Distributor shall
receive a new ROFR.
1.5. Sales on Jawbone's Web Store. Notwitbstandin an thin to the contra in this Agreement, Jawbone will
continue selling Products on its own web store ("Jawbone Web Store"). Uoless
otherwise a eed in writing by Distributor, Jawbone will offer the Products at prices at or above the
"Minimum ' prices set forth in the table on Exhibit A.
2. Order Process & Shipping.
2.1. PO Submission. Distributor shall purchase Products by issuing one or more Purchase Orders ("POs") via email
to the address specified in Exhibit B, or as otherwise specified in writing by Jawbone. The PO shall be signed
by Distributor's authorized representative. The PO shall specify ordered Products, Jawbone's product number,
any internal product numbers assigned by Distributor, quantity, unit price, total price of order per Product,
complete shipping address and instructions, PO number, line item number, Distributor point of contact
information, and any other special instructions.
2.2. PO Acceptance: All POs from Distributor are subject to acceptance by written confirmation by Jawbone.
Jawbone is under no obligation to accept any PO. Jawbone shall, in writing within five (5) business days of
Page 1 of 4
EFTA00807821
DoteSign Envelope ID: EE6C53r0-24C2-489R-0374-:. ..:89959845
receipt, accept a PO or offer a proposed modification to the PO terms. Except as otherwise agreed in writing by
the Parties, accepted POs are non-cancellable. This Agreement applies to all quotations made and POs accepted
by Jawbone and is an integral part of the sales contract between Jawbone and Distributor. Whenever this
Agreement conflicts with or is expanded or added to by any terms and conditions of Distributor's purchase order,
this Agreement shall govern and supersede the terms and conditions ofDistributor's PO.
2.3. Shipping; Delivery. Jawbone shall ship Products FOB Origin to one of three shipping points located in the
America or EMEA designated by Jawbone (each, a "Jawbone FOB Point") as set forth in Exhibit A. The
Jawbone FOB Point shall be determined on a case-by-case basis depending on the nearest location for the
inventory of Products requested by Distributor. Jawbone is responsible for shipping costs to the Jawbone FOB
Point, and Distributor is responsible for any and all shipping costs thereafter. For purposes of this Agreement,
"Delivery" shall occur once the Products are delivered to the Distributor's carrier at the Jawbone FOB Point.
Title and risk of loss for damage to the Products passes to Distributor upon Delivery. Notwithstanding the
foregoing, as between Distributor and Jawbone, title to any software incorporated in the products remains with
Jawbone. Jawbone shall use commercially reasonable efforts to Deliver the Products within the delivery date(s)
specified on the applicable accepted Purchase Order. Delivery date(s) to be mutually agreed by the parties.
Within three (3) business days of the Distributor receiving the Products at the Jawbone FOB Point as specified
on the accepted Purchase Order, those goods having been released to the freight forwarder of the Distributor,
("Inspection Period"), Distributor shall notify Jawbone and Jawbone's outside legal counsel referred to in
Section 3 below of any Products that do not conform with the accepted Purchase Order; to the representations set
forth in Section 5.2.1; which have been delivered damaged due to inadequate packing by Jawbone; or which
were delivered more than 10 days after the agreed delivery date ("Rejected Products"). Distributor agrees that,
alter the Inspection Period, and except for any Rejected Products, all other Products shall be deemed irrevocably
accepted ("Product Acceptance").
3. Payment; Taxes. Jawbone shall invoice Distributor for each accepted PO at the address set forth in Exhibit B.
Following acceptance by Jawbone of a PO, payment in U.S. dollars shall be deposited by Distributor into Jawbone's outside
legal counsel's escrow account (the "Escrow") pursuant to the payment instructions set forth on Exhibit B and provided that
Jawbone's outside legal counsel has entered into the undertaking set out in Exhibit C. Payment into the Escrow for the full
amount of Products subject to the accepted PO is required in advance of shipping. Upon Product Acceptance, Distributor will
timely notify via email Jawbone's outside legal counsel to release the corresponding amount of funds in Escrow to Jawbone.
If Products that are the subject of the accepted PO are not Delivered by Jawbone within ten (10) business days of Distributor
paying funds into Escrow, or if the Distributor provides written notification of Rejected Products as set forth in Section 2.3
above, then outside legal counsel will immediately refund the corresponding amount of the funds to the Distributor and, in the
case of Rejected Products, Distributor will immediately return such Rejected. Products to Jawbone at the Jawbone FOB Point
Distributor shall be responsible for payment of all taxes (other than taxes based on Jawbone's income), fees, duties (not
including import and customs duties), and other governmental charges, and any related penalties and interest, arising from the
payment of the Product price to Jawbone or delivery of Product to Distributor.
4. Confidentiality. On August 19, 2015, the parties executed a Mutual Non-Disclosure Agreement ("NDA"), the terms
and conditions of which are incorporated herein. For the avoidance of doubt, the terms of this Agreement are Confidential
Information (as that term is defined in the NDA).
5. Representation and Warranties.
5.1. By Distributor. Distributor represents, warrants, and covenants to Jawbone that: (a) it has the authority to enter
into the Agreement, and that the persons signing the Agreement on behalf ofDistributor arc authorized to sign;
and (b) it shall not make any false or misleading representations about Jawbone or the Product(s).
5.2. By Jawbone.
5.2.1. Jawbone represents, warrants, and covenants to Distributor that: (a) it has the authority to enter into the
Agreement, and the persons signing the Agreement on behalf of Jawbone are authorized to sign; (b) as
of the date of this Agreement, Jawbone holds all right, title, and interest in and to the Products, and the
Page 2 of 4
EFTA00807822
DecoSign Envelope ID: EE6E53F8-24C2-4096-8306, X39959845
Products are free and clear of all liens, security interest, and other third party claims to ownership of the
Products; and (c) the Products are brand new and are not refurbished or used stock.
5.2.2. Jawbone offers a limited warranty to end-user purchasers of its Products as further described in the user
manual and at httas://iawbone.com/warranty. Distributor shall direct end-user purchasers to Jawbone
for resolution of any Product warranty claims. Except as set forth in this Section 5.2.2, no other
warranties apply to the Products.
5.2.3. Exclusive Warranties. TO THE EXTENT PERMITTED BY APPLICABLE LAWS, THE FOREGOING
WARRANTIES ARE DISTRIBUTOR'S SOLE AND EXCLUSIVE WARRANTJES. JAWBONE SPECIFICALLY
DISCLAIMS THE IMPLIED WARRANTIES OF MERCHANTABILITY, TITLE, FITNESS FOR A PARTICULAR
PURPOSE, AND NON-INFRINGEMENT.
6. Termination. This Agreement shall terminate on December 31, 2016. Either party may terminate this Agreement in
the event of a material breach which is not cured within five (5) days notice to the party in breach. All terms that by their
nature should survive the termination or expiration of this Agreement shall survive where necessary to effectuate the intent of
the parties.
7. Limitation of Liability. TO THE EXTENT PERMITTED BY APPLICABLE LAWS, IN NO EVENT SHALL JAWBONE OR ITS
SUPPLIERS BE LIABLE FOR ANY SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL LOSSES OR DAMAGES WHATSOEVER
(INCLUDING WITHOUT LIMITATION, LOSS OF PROFITS, OTHER COMMERCIAL LOSS, OR COST OF PROCUREMENT OF SUBSTITUTE
GOODS), EVEN IF JAWBONE HAS BEEN ADVISED OF 771E POSSIBILITY OP SUCH POTENTIAL LOSSES OR DAMAGES. IN NO EVENT
SHALL JAWBONE'S CUMULATIVE LIABILITY UNDER OR IN CONNECTION WITH THE AGREEMENT EXCEED THE AGGREGATE
CONSIDERATION PAID BY DISTRIBUTOR TO JAWBONE I IEREUNDER. THIS LIMITATION OF LIABILITY IS CUMULATIVE, WITH ALL
PAYMENTS FOR CLANS IN CONNECTION WITH THE AGREEMENT BEING AGGREGATED TO DETERMINE SATISFACTION OF 771E
LIMIT. THE EXISTENCE OF ONE OR MORE CLAIMS SHALL NOT ENLARGE THE LIMIT. DISTRIBUTOR ACKNOWLEDGES THAT THE
PRICE CHARGED TO DISTRIBUTOR HEREUNDER FOR THE PRODUCTS REFLECTS THE ALLOCATION OF RISK SET PORN IN THE
AGREEMENT AND THAT JAWBONE WOULD NOT ENTER INTO THE AGREEMENT WITHOUT THESE LIMITATIONS ON ITS LIABILITY.
IN ADDITION, JAWBONE DISCLAIMS ALL LIABILITY OF ANY KIND ON BEHALF OF JAWBONE'S SUPPLIERS AND LICENSORS.
8. Miscellaneous.
8.1. No Relationship. Nothing set forth in this Agreement creates or shall be deemed to create a partnership, joint
venture, or agency relationship between Distributor and Jawbone. Distributor's relationship to Jawbone is that of
an independent contractor, neither party is an agent or partner of the other, and nothing contained in the
Agreement shall be construed to give either party the power to direct or control the day-to-day activities of the
other. Distributor shall not have, and shall not represent to any third party that it has, any authority to act on
behalf of Jawbone. All financial obligations associated with Distributor's business are the responsibility of
Distributor.
8.2. Licenses and Bacon. Distributor agrees to comply with all applicable laws, including export laws. Distributor
shall obtain any required non-U.S. governmental authorizations, including without limitation any import licenses
and foreign exchange permits, from the appropriate authorities. Distributor shall provide proof of compliance
with required non-U.S. governmental authorization to Jawbone upon request.
8.3. Notices. Notices to Distributor and Jawbone hereunder must be given by personal delivery or overnight courier
to Distributor at 21 Taylors Road, Morningside, Auckland, New Zealand, Attn Mark Priscott and to Jawbone at
99 Rhode Island St., San Francisco, CA 94103 USA, Atm: General Counsel.
8.4. Waiver: Severabilitv. The failure of a party to require performance by the other party of any provision of the
Agreement does not affect the (1111 right to require such performance at any time thereafter; nor does a waiver by
either party of a breach of any provision thereof a waiver of the provision itself. The invalidity or
unenforceability of any provision set forth herein do not in any way affect the validity or enforceability of any
other provision.
Page 3 of 4
EFTA00807823
DocuSignEnvelopeaCESES3F8-24C2489842406-, 289959845
8.5. Force Majeure, In no event shall either party be responsible for any breach of the Agreement (except the
payment of money owed) due to the occurrence of any events beyond its reasonable control, including, but not
limited to war, insurrection, governmental action, acts of God, or any other similar causes beyond the control of
a party, provided that such party uses reasonable efforts, under the circumstances, to notify the other party of the
circumstances causing the delay and to resume performance as soon as possible.
8.6. General. This Agreement, including any Exhibits and documents referred to herein or attached hereto,
constitutes the entire and exclusive statement of agreement between the parties with respect to the subject matter
and it supersedes any prior or contemporaneous oral or written communications between the parties. In the event
of conflict between the terms of this Agreement and the terms of any Exhibit hereto, the terms of the Agreement
shall govern. Neither party may assign this Agreement without the other party's prior written consent (not to be
unreasonably withheld). Any attempted assignment in violation of the foregoing shall be void. This Agreement
may only be modified by a written document executed by the parties. This Agreement shall be construed in
accordance with the laws of the State of California without regard to conflict of law principles. The United
Nations Convention on Contracts for the International Sale of Goods does not apply to the Agreement. Each
party irrevocably submits to the exclusive jurisdiction of the courts of the State of California located in San
Francisco County and the courts of the United States in the Northern District of California for the purpose of any
suit, action or other proceeding arising out of the Agreement or any transaction contemplated hereby; provided,
however, that either party may take action in any court having jurisdiction to protect its Confidential Information
and intellectual property rights. The official text of the Agreement (and any Exhibits thereto or notice submitted
hereunder) shall be in English. In the event of any dispute concerning the construction or meaning of the
Agreement, reference shall be made only to the Agreement as written in English and not to any translation into
another language.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed.
Distributor [.-- Demisliwdfri, Jawbone F riovrnw-
Signature:
AkArt Prisatt Signature:
.36-Set", Oast
Printed Name: Mark Priscott Printed Name: Jason Child
Title: General Manager Title: Chief Financial Officer
4/29/2016 4/29/2016
Date: Date:
Page 4 of 4
EFTA00807824
DowSign Envelope ID: EE6E53r8.24C24B88.8306-. a9991845
EXHIBIT A
Products:
Minimum
Product Price Units Cash Payment Prices
MINI $39.00 49,582 $1,933,698 129.99
UP4 (version as of 4/28/2016) $25.75 11,553 $297,490 119.99
UP3 (version as of 4/28/2016) $29.00 204,716 $5,936,764 99.99
UP2 Rope $18.00 118,126 $2,126,268 79.99
UP2 $17.00 54,685 $929,645 79.99
UP MOVE Black $10.00 10,000 $100,000 S 49.99
UP Move Colors $6.50 154,649 $1,005,219 49.99
Total 603,311 $12,329,083
Territory: Worldwide
Jawbone FOB Americas EMEA -1MM EU EMEA - Luzern ( APAC
Point:
2290 Enrico Fermi Logistic1c9 areal Blancbardstown [TBD)
Dr, Suite 19 Westpoint D2 Business &
San Diego, CA Hale 3, 6.p. 1070 Technology Park
92154 Lozomo 900 55 Snugborough
Slovak Republic Road
Dublin 15
Ver. 20071127
)21729 v2/CD
EFTA00807825
DocuSIgn Envelope ID: EEEIES3F8,2402-489B113Dt ,C59959845
EXHIBIT B
ADDRESSES AND PAYMENT INSTRUCTIONS
Distributor Addresses an bone Addresses
Send invoices to: Send Distributor Purchase Orders to:
Distributor Name: Protempo Limited
and
Distributor Address:
21 Taylors Road, Morningside, Auckland, New or as otherwise directed by Jawbone in writing
Zealand
finance®protempo.com
Escrow ItiformatIon:
General Trust Account
City National Bank
San Francisco Private Client Services
150 California Street, Suite 1200
San Francisco CA 94111
ABA
Swift o c: I 6L
Account Name: Coo/ LLP Attorney Trust Account
Account
Wire Details: FBO AliphCom
Payment Instructions: Payment is due prior to shipping of Products. Payment shall be by wire in U.S.
dollars. Wire instructions for the Escrow will be sent in an encrypted email, and Distributor will need4o
sign into the Cooley LLP email gateway to retrieve the wire instructions.
321729 v2tC0
EFTA00807826
DocuSign Envelope ID: EESE53F8.24C2-4(3984330t .C89959845
EXHIBIT C
ESCROW AGENT UNDERTAKING
Ladies and Gentlemen,
Cooley LLP ("Cooley") is counsel to Aliphcom d/ib/a Jawbone ("Jawbone") from time to time on
a variety ofmatters. It has come to Cooley's attention that Jawbone and Protempo Limited (