CONSULTING AGREEMENT
EXHIBIT
10.1
THIS
CONSULTING AGREEMENT, effective July 28, 2006, is entered into by and between
Hydrogen Power International, Inc. (the “Company”) and Boston Financial Partners
(“Consultant”).
WHEREAS,
Consultant has provided valuable consulting services to the Company relating
to
merger and acquisition activities in connection with the Company’s acquisition
of Hydrogen Power, Inc. (“HPI”) and continues to provide general strategic
corporate advice to the Company; and
WHEREAS,
the Consultant and the Company have negotiated certain terms and conditions
regarding the Consultant’s services and desire to enter into this Agreement
under those terms and conditions, which are set forth herein;
NOW,
THEREFORE, in consideration of the mutual promises contained herein, it is
hereby agreed as follows:
1. Service.
Consultant agrees to provide such strategic corporate advice (including without
limitation relating to potential mergers, acquisitions and disposition), as
may
be reasonably requested by Company from time to time during the term of this
Agreement.
2. Term
of Agreement.
This
Agreement shall terminate one year from the date hereof, provided that Company
may terminate this Agreement at any time for any or no reason upon thirty (30)
days advance written notice.
3. Compensation.
In
consideration for the Consultant’s services under this Agreement, the Company
will issue to the Consultant 300,000 unregistered shares of the Company’s $0.01
par value common stock (the “Securities”) as follows:
150,000
shares upon execution of this Agreement;
75,000
shares on September 30, 2006; and
75,000
shares on December 31, 2006.
4. Consultant
Representations and Warranties.
By
executing and delivering this Agreement, the Consultant acknowledges, warrants
and represents to the Company as follows:
a. The
Consultant has obtained and reviewed (i) the Company’s latest Annual and
Quarterly Reports on Form 10-K and 10-Q, respectively and any other documents
specifically requested by the Consultant (all such documents are collectively
referred to hereinafter as the “Disclosure Documents”).
b. The
Consultant has, either alone or with the assistance of a professional advisor,
sufficient knowledge and experience in financial and business matters that
the
Consultant believes itself capable of evaluating the merits and risks of the
prospective
investment
in the Securities and the suitability of an investment in the Company in light
of the Consultant’s financial condition and investment needs, and legal, tax and
accounting matters.
c. The
Consultant has been given access to full and complete information regarding
the
Company and has utilized such access to the Consultant’s satisfaction for the
purpose of obtaining information in addition to, or verifying information
included in, the Disclosure Documents. Particularly, the Consultant has been
given reasonable opportunity to meet with and/or contact Company representatives
for the purpose of asking questions of, and receiving answers from, such
representatives concerning the accuracy of information provided in the
Disclosure Documents.
d. The
Consultant is an “accredited investor” as defined in Rule 501(a) of Regulation D
promulgated under the Securities Act of 1933, as amended (the
“Act”).
e. The
Consultant has relied upon the advice of the Consultant’s legal counsel and
accountants or other financial advisors with respect to tax and other
considerations relating to the purchase of Securities hereunder. The Consultant
is not relying upon the Company with respect to the economic considerations
involved to make an investment decision in the Securities.
f. The
Consultant represents and warrants that it is the intent to acquire the
Securities for the account of the Consultant, for investment purposes and not
with a view to resale of the Securities in connection with any distribution
thereof. In order to assure the Company that the Consultant has no present
intention to resell or dispose of the Securities acquired in this offering,
the
Consultant further represents and warrants to the Company as
follows:
(1) The
Consultant intends to receive and hold the Securities for the Consultant’s own
account.
(2) The
Consultant has no contract, undertaking, agreement or arrangement with any
person or entity to sell or otherwise transfer the Securities to any such person
or entity or to have any such person or entity sell the Securities on the
Consultant’s behalf.
(3) The
Consultant represents and warrants that (i) it was not organized for the
specific purpose of acquiring the Securities, and (ii) this Agreement has been
duly authorized by all necessary action on the part of the Consultant, has
been
duly executed by an authorized officer or representative of the Consultant,
and
is a legal, valid and binding obligation of the undersigned enforceable in
accordance with its terms.
5. Registration
Status; Restrictions on Transferability.
With
respect to the registration status and transferability of the Securities, the
Consultant understands, acknowledges and agrees that:
a. The
Securities to be issued in connection with this Agreement have not been
registered under the Act or under applicable state securities laws on the
grounds that they are
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being
issued in a transaction (i) involving one knowledgeable investor fully familiar
with the proposed operations of the Company and (ii) not involving a public
offering and that, consequently, such transaction is exempt from the
registration under the Act and applicable state securities laws. The Company
will rely on the Consultant’s representations herein as a basis for the
exemption from the Act’s registration requirements.
b. The
Securities may not be sold, transferred or otherwise disposed of except pursuant
to an effective registration statement (which the Company is under no obligation
to file) or appropriate exemption from registration under applicable state
law
and, as a result, the Consultant may be required to hold the Securities for
an
indefinite period of time.
c. Certificates
representing the Securities will bear a legend substantially in the following
form:
The
securities represented hereby have not been registered under the Securities
Act
of 1933, as amended, or the securities law of any state. Such securities have
been acquired for investment and without a view to their distribution and may
not be sold or otherwise disposed of in the absence of any effective
registration statement for such securities under the Securities Act of 1933,
as
amended, and under applicable state securities laws, unless an exemption from
registration is available under applicable securities laws.
6. Registration
Rights.
a. If
at any
time prior to the expiration of three (3) years from the date hereof, the
Company proposes to register under the 1933 Act (except by a Form S-4 or Form
S-8 Registration Statement or any successor forms thereto and except for any
dividend warrants issued to all stockholders of record) or qualify for a public
distribution under Section 3(b) of the 1933 Act, any of its equity securities
or
debt with equity features, it will give written notice to Consultant of its
intention to do so and, on the written request of Consultant given within five
(5) days after receipt of any such notice (which request shall specify the
Securities intended to be sold or disposed of by Consultant and describe the
nature of any proposed sale or other disposition thereof), the Company will
use
its best efforts to cause all such Securities to be included in such
registration statement proposed to be filed by the Company; provided, however,
that nothing herein shall prevent the Company from, at any time, abandoning
or
delaying any registration. The right of Consultant to include the Securities
in
any such registration statement may be subject to approval by selling
securityholders whose securities are being registered in the registration
statement and the Company does not guarantee such approval may be given. If
any
registration pursuant to this Section 6(a) is underwritten in whole or in part,
the Company may require that the Securities requested for inclusion pursuant
to
this Section 6(a) be included in the underwriting on the same terms and
conditions as the securities otherwise being sold through the underwriters.
If a
greater number of Securities is offered for participation in the proposed
offering than in the reasonable opinion of the managing underwriter of the
proposed offering can be accommodated without adversely affecting the proposed
offering, then the amount of Securities proposed to be offered by Consultants
for registration, as well as the number of
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securities
of any other selling shareholders participating in the registration, shall
be
proportionately reduced to a number deemed satisfactory by the managing
underwriter.
b. With
respect to each inclusion of securities in a registration statement pursuant
to
this Section 6, the Company shall bear the following fees, costs, and expenses:
all registration, filing and NASD fees, printing expenses, fees and
disbursements of counsel and accountants for the Company, fees and disbursements
of counsel for the underwriter or underwriters of such securities (if the
offering is underwritten and the Company is required to bear such fees and
disbursements), all internal expenses, the premiums and other costs of policies
of insurance against liability arising out of the public offering, and legal
fees and disbursements and other expenses of complying with state securities
laws of any jurisdictions in which the securities to be offered are to be
registered or qualified. Fees and disbursements of special counsel and
accountants for the Consultant, underwriting discounts and commissions, and
transfer taxes for Consultant and any other expenses relating to the sale of
securities by the Consultant not expressly included above shall be borne by
the
Consultant.
7. Successors
and Assigns.
This
Agreement is binding on and inures to the benefit of the Company’s successors
and assigns, all of which are included in the term the “Company” as it is used
in this Agreement; provided, however, that the Company may assign this Agreement
only in connection with a merger, consolidation, assignment, sale or other
disposition of substantially all of its assets or business. This Agreement
is
binding upon and inures to the benefit of the Consultant’s successors, assigns
and legal representatives.
8. Modification.
This
Agreement may be modified or amended only by a writing signed by both the
Company and the Consultant.
9. Governing
Law.
The
laws of Colorado will govern the validity, construction and performance of
this
Agreement. Any legal proceeding related to this Agreement will be brought in
an
appropriate Colorado court, and both the Company and the Consultant hereby
consent to the exclusive jurisdiction of that court for this
purpose.
10. Construction.
Wherever possible, each provision of this Agreement will be interpreted so
that
it is valid under the applicable law. If any portion of this Agreement is to
any
extent declared invalid by a court of competent jurisdiction under the
applicable law, that provision will remain effective to the extent not declared
invalid. The remainder of this Agreement also will continue to be valid, and
the
entire Agreement will continue to be valid in other jurisdictions
11. Waivers.
No
failure or delay by either the Company or the Consultant in exercising any
right
or remedy under this Agreement will waive any provision of the Agreement. Nor
will any single or partial exercise by either the Company or the Consultant
of
any right or remedy under this Agreement preclude either of them from otherwise
or further exercising these rights or remedies, or any other rights or remedies
granted by and law or any related document.
12. Entire
Agreement.
This
Agreement encompasses all agreements between the parties and supersedes all
previous and contemporaneous oral negotiations, commitments, writings, and
understandings between the parties concerning the matters in this
Agreement.
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IN
WITNESS WHEREOF, the Company and the Consultant have executed this Agreement
as
of the Effective Date.
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HYDROGEN
POWER INTERNATIONAL, INC.
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By:
Xxxxx
Xxxx
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Its:
President
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BOSTON
FINANCIAL PARTNERS
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By:
Xxxxxx
Brazil
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Its:
President
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