CONSULTING AGREEMENTConsulting Services Agreement |
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CONSULTING AGREEMENT
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This Consulting Agreement (the "Agreement") is entered into as of January
5, 2005, by and between National Parking Systems, Inc., a Nevada corporation
(the "Company"), and London Finance Group, Ltd., a California corporation, or
its designees ("Consultant").
WHEREAS, the Company desires to acquire or merge with other businesses,
dispose of businesses or assets, enter into strategic relationships, and/or
enter into investment banking relationships, and to secure valuable management
consulting to assist the Company in its operations, strategy and in its
negotiations with vendors, customers and strategic partners (the "Company
Objectives");
WHEREAS, the Company recognizes that the Consultant can contribute to
finding, analyzing, structuring and negotiating business sales and/or
acquisitions, joint ventures, alliances and other desirable projects, including
the Company Objectives, which contribution is of great value to the Company and
its shareholders;
WHEREAS, the Company believes it to be important both to the future
prosperity of the Company Objectives and to the Company's general interest to
retain Consultant, on a non-exclusive basis, and have Consultant available to
the Company for consulting services in the manner and subject to the terms,
covenants, and conditions set forth herein;
WHEREAS, in order to accomplish the foregoing, the Company and Consultant
desire to enter into this Agreement, effective as of January 5, 2005, to provide
certain assurances as set forth herein.
NOW THEREFORE, in view of the foregoing and in consideration of the
premises and mutual representations, warranties, covenants and promises
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound hereby, agree as follows:
1. Retention. The Company hereby retains the Consultant during the
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Consulting Period (as defined in Section 2 below), and Consultant hereby agrees
to be so retained by the Company, all subject to the terms and provisions of
this Agreement.
2. Consulting Period. The Consulting Period shall commence on January 5,
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2005 and terminate no earlier than January 31, 2007. After January 31, 2007,
either party may terminate this agreement upon at least 90 days prior written
notice.
<PAGE>
3. Duties of Consultant. During the Consulting Period, the Consultant shall
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use its reasonable and best efforts to perform those actions and
responsibilities necessary to assist the Company with achieving the Company
Objectives, as instructed by the Company from time to time, including (i)
identifying, analyzing, structuring and/or negotiating business sales and/or
acquisitions, including without limitation, merger agreements, stock purchase
agreements, and any other agreements relating to such sales or acquisitions
(provided that Consultant shall not engage in any capital raising activities),
(ii) assist the Company in its corporate strategies, (iii) assist the Company in
the implementation of its business plan, (iv) assist the Company in the
negotiation, documentation and closing of strategic alliances, partnerships,
joint ventures, consulting agreements and agreements for the sale of the
Company's products, in each case as requested by the Company (the "Services").
If the Company, in its sole and absolute discretion, determines to undertake one
or more transactions described above, the Company shall use its best efforts to
provide all necessary financing required in order to purchase businesses
approved by the Company, including cash or securities. Consultant shall render
such Services diligently and to the best of its ability. Notwithstanding
anything herein to the contrary, Consultant shall not engage in any capital
raising activity, and shall not be responsible for selling, or soliciting the
sale of, any securities, or maintaining a market for the Company's securities.
The Company may engage such other consultants, investment bankers or other
advisers with respect to the activities set forth in the immediately preceding
sentence as the Company shall deem appropriate in its sole and absolute
discretion, and Consultant shall not be entitled to any fees or commissions
arising out of the activities of such other consultants, investment bankers or
other advisors, unless Consultant provides Services with respect to such
activities, subject to the limitations set forth in the second sentence of
Section 5(c) hereof.
4. Other Activities of Consultant. The Company recognizes that Consultant
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shall perform and be compensated for only those services that are reasonably
required to accomplish the goals and objectives set forth herein, and that
Consultant shall provide services to other businesses and entities other than
the Company. Consultant shall be free to directly or indirectly own, manage,
operate, join, purchase, organize or take preparatory steps for the organization
of, build, control, finance, acquire, lease or invest or participate in the
ownership, management, operation, control or financing of, or be connected as an
officer, director, employee, partner, principal, manager, agent, representative,
associate, consultant, investor, advisor or otherwise with (collectively, be
"Affiliated" with), any business or enterprise, or permit its name or any part
thereof to be used in connection with any business or enterprise, engaged in any
business. Consultant may be Affiliated with any entity or entities which may
provide services to the Company; provided, however, that the Company shall not
be required to engage any such entity Affiliated with Consultant for any purpose
whatsoever.
5. Compensation. In consideration for Consultant entering into this
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Agreement and the Services provided hereunder, the Company shall compensate
Consultant as follows:
<PAGE>
a. Monthly Fees and Benefits:
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i. Retainer. The Company shall pay to Consultant a non-refundable
retainer in the amount of Five Thousand Dollars ($5,000) per month. In
addition, the Company shall issue to Consultant 3,000,000 shares of
the Company's common stock, which shall be registered as promptly as
practicable as described in Section 3(b) below.
ii. Expenses. The Company shall pay all reasonable expenses incurred
during the Consulting Period by the Consultant for business purposes
related to or in furtherance of the goals and objectives of the
Company and/or the provision of the Services (collectively, "Company
Purposes"), including, without limitation, expenses incurred with
respect to the Consultant's travel (including first class travel),
meals, entertainment, lodging and other customary and reasonable
expenses for Company Purposes. The Company shall pay such expenses
directly, or, upon submission of bills, receipts and/or vouchers by
the Consultant, by direct reimbursement to the Consultant.
b. Warrants. The Company shall issue to Consultant or its designees a
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warrant to purchase up to an aggregate of 1,000,000 shares of Common Stock at an
exercise price of $0.10 per share, which shall vest immediately, and which may
be exercised at any time after the date hereof, substantially in the form
attached hereto (the "Warrants"). The common stock issuable upon exercise of
the Warrants shall be registered by the Company at its expense as soon as
practicable after the date hereof (but in no event later than the date the
Company files its first registration statement after the date hereof) on Form
S-8, if available, or on any other form of registration statement if Form S-8 is
not available in the reasonable opinion of the Company's board of directors or
its counsel.
c. Fees for Acquisition Transactions. The Company shall pay to the
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Consultant a fee equal to ten percent (10%) of the aggregate consideration paid
for any acquisition or sale by the Company of any business, corporation or
division (a "Target"), including, but not limited to, acquisitions by stock
purchase agreement, merger agreement, plan of reorganization, asset purchase
agreement or license agreement, which fee shall be paid to Consultant when the
consideration paid or received by the Company is actually paid or received by
the Company. For purposes hereof, the aggregate consideration paid shall
include all cash and stock paid to the seller or sellers of a Target upon
closing of the transaction in addition to any contingent payments to the seller
or sellers, including without limitation, earn-outs, as if all performance
targets are met, as well as any debts or liabilities assumed by the Company,
including without limitation any debts for which the Company issues a guarantee.
<PAGE>
d. Third Party Commissions. Consultant and/or its Affiliates shall be
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entitled to share in any fees or commissions payable by third parties on any
transaction described in Section 5(c), including, but not limited to, any fees
payable to Consultant by a third party lender, financing partner, or other
party, or a seller of a corporation or business, including, without limitation,
investment banking fees or commissions, business brokerage fees or commissions,
finders fees, or any other fee payable by a third party to Consultant for any
reason including the identification of the Company as a potential purchaser or
seller of such corporation or business (a "Transaction Commission"). The
Company hereby waives any conflict of interest that may arise due to any
transaction wherein Consultant receives such a Transaction Commission,
including, but not limited to, any conflict of interest which may arise as a
result of the dual representation by Consultant of the seller or purchaser of a
corporation or business on the one hand, and the Company on the other.
e. Fees Paid in Common Stock. The Company, at its option and with the
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consent of Consultant, may pay fees due under paragraph (c) of this Section 5 by
issuance of Restricted Common Stock or freely tradeable, registered Common
Stock. Restricted Common Stock shall be issued at a rate equal to the lesser of
(i) fifty percent (50%) of the Market Price of the Company's common stock on the
day prior to the closing date of a transaction which entitles the Consultant to
receive such fees, or (ii) $0.10 per share. Registered Common Stock, without
restrictive legend, issued pursuant to an effective and current registration
statement, shall be issued at the rate equal to seventy percent (70%) of the
Market Price of the Company's common stock on the day prior to the closing date
of a transaction which entitles the Consultant to receive such fees. For
purposes of this Section 5(e), the term "Market Price" as of a particular date
shall mean the average of the three lowest closing prices of the common stock of
the Company reported for the twenty trading days ending on the date in question.
All fees payable hereunder shall be paid within seven business days following
the closing date of a transaction which entitles the Consultant to receive such
fees. In the event the Common Stock of the Company is not then listed on a
national securities exchange or market, then, at the Consultant's option, the
Company shall pay all fees due under paragraph (c) of this Section 5 either (i)
in the form of, and based on the same value established by, the consideration
paid or received in the transaction triggering such fees, or (ii) in cash.
f. Common Stock Issuance. All references to numbers of shares of common
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stock herein shall refer to shares of common stock the Company, or, in the event
the Company is acquired by any public company, of such acquiring company after
giving effect to all stock splits effective on or prior to the date which is 30
days following the acquisition of the Company by any such publicly traded
company.
g. It is understood that with respect to any financing or acquisition
transaction, Consultant will act or is acting as a finder only, is not a
licensed securities or real estate broker or dealer, and shall have no authority
to enter into any commitments on the Company's behalf, or to negotiate the terms
of any financing or acquisition, or to hold any funds or securities in
connection with any financing or acquisition, or to perform any act which would
require the Consultant to become licensed as a securities or real estate broker
or dealer.
<PAGE>
6. Registration Rights. In the event the Company shall at any time and from
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time to time file a registration statement with the Securities and Exchange
Commission, if permitted by applicable securities laws, rules and regulations
applicable to the type of registration statement the Company is filing, the
Company shall register any shares of common stock of the Company then
beneficially owned by Consultant or its Affiliates, or any Affiliates of the
principals of Consultant, to the extent not otherwise restricted by applicable
law. The Company shall provide to Consultant not less than ten business day's
notice prior to any filing of any such registration statement, and shall include
on such registration statement such shares as may be reasonably requested by
Consultant, subject to any cutbacks reasonably required by the managing
underwriter of any fully underwritten offering where the Company is not acting
as the underwriter.
7. Termination. Subject to the cure provisions contained herein, the
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Company may terminate the Consulting Period upon written notice for Cause at any
time. Cause shall mean that during the Consulting Period, the Consultant
engaged in gross and willful misconduct that is materially and significantly
injurious to the Company, and, after written notice of such conduct, Consultant
has failed to cure such gross and willful misconduct within 30 days. Any
termination pursuant to this section shall be communicated by written Notice of
Intended Termination. For purposes of this Agreement, a "Notice of Intended
Termination" shall mean a notice which shall clearly state the specific
termination provision in this Agreement relied upon and shall set forth in
reasonable and specific detail the facts and circumstances claimed to provide a
basis for termination of the Consulting Period. No Notice of Intended
Termination shall be valid unless it is signed by at least a majority of the
board of directors of the Company (the "Board").
a. Not less than 15 days after receipt of the Notice of Intended
Termination, Consultant shall have the opportunity to a full, complete
and fair hearing in the presence of the entire Board. Not less than 10
days prior to the hearing, the Board shall present to Consultant its
reasons for the termination, including the specific actions,
inactions, omissions or other facts relied upon by the Board in making
its determination that Consultant has engaged in gross and willful
misconduct and that the Company has the right to terminate this
Agreement for Cause. Consultant shall have the right to attempt to
rebut any evidence or allegations of wrongdoing at the hearing and
shall have the right to be represented, at Consultant's expense, by
counsel of Consultant's choice at such hearing. After such hearing,
should the Board determine that this Agreement may properly be
terminated for Cause, it shall issue a written Final Notice of
Termination to Consultant, signed by at least a majority of the Board,
setting forth in detail the specific facts, conclusions and findings
of the Board in determining that Cause exists for the termination of
this Agreement. The Final Notice of Termination shall contain an
effective termination date, which effective termination date shall be
no less than thirty (30) days from the date of the Final N






