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Exhibit 10.31
[LETTERHEAD OF
ALCHEMY ALTERNATIVES]
BROKERAGE
SERVICES AGREEMENT
This Brokerage Services Agreement ("Agreement") is effective as of
this 22nd day
of February, 2006 ("Effective Date") by and between American Soil
Technologies,
Inc., ("AST") with offices located at 12224 Montague Street, Pacoima,
California
91331 and Alchemy Alternatives, Inc. ("Alchemy") or their assignees,
with its
principal office located at 751 Laurel St., Suite 119, San Carlos, California
94070,
WHEREAS, Alchemy will provide Brokerage and Advisory Services to AST in
connection with suitable strategic business relationships, funding sources, and
other business opportunities ("Brokerage Services");
WHEREAS, AST desires to retain Alchemy to provide such Brokerage and Advisory
Services, and Alchemy desires to provide such Brokerage and Advisory Services
to
AST;
WHEREAS, AST is endeavoring to obtain funding in an amount up to $10,000,000.00
US, in order to further develop, expand and enhance its business. AST
contemplates that the funding for its business may be in the form of common
stock, convertible preferred stock, convertible debt, other equity-linked
securities, mezzanine debt, senior debt, term loans, lines of credit, stock
options, etc. The business of the AST shall be hereinafter referred to as the
"Venture" and;
NOW THEREFORE, in consideration of the foregoing and of the mutual covenants
and
conditions contained herein, AST and Alchemy (when used together the companies
are sometimes collectively referred to herein as the "Parties")
hereto agree as
follows:
I. COMPANY FUNDING
1.1 Funding Duties. Alchemy shall use their best efforts to assist AST in
positioning itself to various types of prospective funding sources in order to
obtain funding for the Venture and to introduce AST to various prospective
funding sources. All potential funding sources and any of their affiliate funds
or funding sources, introduced to AST by Alchemy shall be hereinafter referred
to as ("Funder)"or Funders). A Funder shall be considered to have
been
introduced to AST by Alchemy if such Introduction is submitted to AST by
Alchemy
and if such Introduction shall be accepted by AST in writing. Any introduction
accepted by AST shall be added to, or listed on, "Exhibit A",
attached hereto
under the column "Name of Introduction". All Funders submitted by
Alchemy to AST
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and accepted by AST, shall become part of "Exhibit A" and are covered
under the
stipulations of sections 1.6 and 1.7. Alchemy shall also perform the following,
if requested by AST:
a)
Advise AST as to the types of funding sources generally available.
b)
Introduce AST to various potential funding sources for the Venture.
Funders may include
institutional investors, private investors,
venture capital funds, hedge
funds, lending institutions, investment
bankers, merchant bankers, financial
planners, and broker dealers. The
Funder introductions will be on
a "best efforts" basis as there can be
no guarantee that Alchemy will
actually succeed in raising capital for
AST.
c)
Assist AST in reviewing any offer received from a Funder and help
resolve conflicts to the terms
of such offer. Advise AST as to the
manner in which AST can
position and structure itself, if appropriate;
in order to maximize its
attractive.
d)
Access to various types of funding sources. Alchemy shall not
negotiate with such Funders nor
is either party authorized to
represent AST in any
discussions with such Funders. Alchemy's sole
function with respect to the
Funders is to provide introductions.
Alchemy shall be the registered
broker-dealer in all transactions
dealing with securities.
1.2 Duties of AST. AST shall be solely responsible for the decision as to
whether to accept any Funder introduced by Alchemy or any funding source. AST
shall be under no obligation to accept any offer or to close any offer of any
Funder. AST understands and acknowledges that this Agreement is by no means a
guarantee of funding of any kind through the introduction by Alchemy of any
Funders, and all work performed by Alchemy is on a "best efforts"
basis.
1.3 Introduction. Alchemy shall be deemed to have introduced a Funder to AST if
the Funders name was submitted to AST by Alchemy, via fax or email, as a
potential funding source, in accordance with Section 1.1, and Alchemy initially
advised Funder of AST's need for funding. Assuming compliance with Section 1.1,
the introduction shall be deemed to have been made by Alchemy within
twenty-four
hours of Alchemy providing the Funders name to AST as a potential funding
source.
1.4 Funders Lists. Alchemy shall provide AST with a detailed list, attached
hereto as Exhibit A. AST may solicit any potential funding source, which it
deems appropriate, without the consent of Alchemy, except those Funders, which
have been previously contacted by Alchemy or those that have been subsequently
listed on Exhibit A and approved by AST.
1.5 Use of Materials. In contacting potential Funders, Alchemy shall have the
right to utilize the information concerning the Venture, which has been
imparted
to it by AST, or its agents. The information contained in the materials which
AST has prepared for Alchemy's use in connection with locating a potential
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<PAGE>
Funder. Alchemy acknowledges that any AST trade secret information imparted to
Alchemy by the AST regarding the Venture ("Proprietary Information")
is for the
exclusive use of Alchemy in connection with the location of a potential funding
source for the AST and may be disclosed in accordance with the terms of this
Agreement and Alchemy shall not disclose any such Proprietary Information to
any
third party other than a prospective Funder, or to an agent, representative,
employee or officer of a prospective Funder, without the consent of the AST.
AST
also represents that all Proprietary Information provided by AST to Alchemy is
true and accurate.
1.6 Term & Non-Circumvention. The term of the AST Funding portion of this
Agreement shall be for a period of three (3) years from the date of funding
made
by a Funder as a result of an introduction made by Alchemy, listed, and sent
via
email to AST on Exhibit A under the Date of Introduction column. Alchemy shall
be compensated for any and all funding provided by a Funder which is introduced
to AST, in accordance with Section 1.1 of this Agreement, as long as the
"term
sheet" or "letter of intent" to provide such funding is mutually
signed by both
AST and the Funder within three (3) years from the "Date of
Introduction" on
Exhibit A hereto. AST also agrees to acknowledge receipt of, names via email
and
adhere to the guidelines set forth in "Exhibit B" of this Agreement
entitled
"Non-Circumvention Agreement" between AST and Alchemy.
1.7 Compensation. AST agrees to pay Alchemy for Brokerage and Advisory Services
upon the successful closing of any type of equity-linked funding (which
includes
common stock, equity lines of credit, convertible preferred stock, convertible
debentures, promissory notes with warrants, sub-debt with warrants, etc.),
Alchemy shall receive a cash fee of ten percent (10.0%) of the amount of all
funding actually received from all Funders, over the life of the Funding, which
were introduced to AST in accordance with Section 1.1 of this Agreement,
without
regard to the form or amount thereof, as a fee for Brokerage and Advisory
Services as provided under this Article I. Alchemy shall receive such fee if
one
or more Funders provide funding to finance all, or a portion, of the Venture on
terms, which have been accepted by AST and shall be paid by AST to Alchemy
directly out of the escrow account ("Escrow"), if any, or any account
which is
established between the Funder and AST for any and all funding received by AST.
Such fee shall be paid in connection with any and all funding provided during
the term of this Agreement as extended under, and in accordance with Section
1.6.
In addition, upon the successful closing of any equity-linked funding provided
to AST by a Funder introduced by Alchemy, AST hereby agrees to grant and
deliver
to Alchemy executed common stock certificates equal to ten percent (10%) of the
total number of common stock shares, preferred stock shares, convertible
preferred stock shares, convertible debentures, convertible debentures with
stock and/or warrants, sub-debt with stock and/or warrants, promissory notes
with stock and/or warrants or any other equity-linked security. The number of
common stock shares granted will be calculated at the time of investment from






