CONSULTING AGREEMENT
--------------------
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
---------
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,
-----------------
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.
3. Duties of Consultant. During the Consulting Period, the Consultant shall
--------------------
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
------------------------------
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
------------
Agreement and the Services provided hereunder, the Company shall compensate
Consultant as follows:
a. Monthly Fees and Benefits:
-------------------------
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
--------
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
---------------------------------
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.
d. Third Party Commissions. Consultant and/or its Affiliates shall be
-----------------------
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
-------------------------
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
---------------------
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.
6. Registration Rights. In the event the Company shall at any time and from
-------------------
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
-----------
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 Notice of
Termination. In the event of any termination of this Agreement for any
reason, including for Cause, any and all fees paid, or required to be
paid, to the Consultant prior to the effective date of such
Termination, including, without limitation, the vested portion of any
warrants issued hereunder, shall be deemed fully earned and shall not
be refundable to the Company.
b. In the event the Company terminates this Agreement without Cause as
defined herein, and/or does not fully comply with the termination and
hearing procedures specified in paragraph 7(a) herein, then the
Company shall pay to Consultant, as liquidated damages, at the
Consultant's option, either (a) $250,000, or (b) the greater of (i)
1,000,000 shares of Common Stock (subject to adjustment for any stock
splits or combinations) which shall be registered with the Securities
and Exchange Commission or (ii) the total value of all fees and other
compensation paid or payable to Consultant over the twelve months
prior to the date of the Notice of Intended Termination.
Notice. Any notice required, permitted or desired to be given pursuant to
------
any of the provisions of this Agreement shall be deemed to have been
sufficiently given or served for all purposes if delivered in person or sent by
certified mail, return receipt requested, postage and fees prepaid, or by
national overnight delivery prepaid service to the parties at their addresses
set forth below. Any party hereto may at any time and from time to time
hereafter change the address to which notice shall be sent hereunder by notice
to the other party given under this paragraph. The address of the Company shall
be such address as is set forth in the Company's most recently filed report with
the Securities and Exchange Commission, and the address of the Consultant shall
be the last address provided to the Company in writing by the Consultant.
8. Waiver. No course of dealing nor any delay on the part of either party
------
in exercising any rights hereunder will operate as a waiver of any rights of
such party. No waiver of any default or breach of this Agreement or application
of any term, covenant or provision hereof shall be deemed a continuing waiver or
a waiver of any other breach or default or the waiver of any other application
of any term, covenant or provision.
9. Definition of "Reasonable and Best Efforts." Reasonable and best efforts
------------------------------------------
shall not include the payment of any non-reimbursable out-of-pocket costs or
other payments by Consultant. Consultant shall not guarantee, make any
representation concerning (which representation would survive the closing of any
escrow or other transaction) or warrant (i) the condition, performance, value,
or profitability of any business purchased, sold by, or otherwise considered for
purchase or sale by the Company; (ii) the validity or authorization of any
capital stock purchased, sold by, or otherwise considered for purchase or sale
by the Company; (iii) the market value of any capital stock, business or assets
purchased or sold by, or otherwise considered for purchase or sale by the
Company; (iv) the ability to finance, refinance or otherwise mortgage or
encumber any business or corporation purchased, sold by, or otherwise considered
for purchase or sale by the Company; (vi) that Consultant will find or present
any business or corporation which the Company will consider, approve or
ultimately purchase or be able to purchase; or (vii) the covenants,
representations or warranties of any party to any stock purchase, asset
purchase, merger or other agreement entered into by the Company with any third
party.
10. Successors; Binding Agreements. Prior to the effectiveness of any
------------------------------
succession (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company, or the sale of all or a controlling interest in the capital stock of
the Company, the Company will require the successor to expressly assume and
agree to perform this Agreement in the same manner and to the same extent that
the Company would be required to perform it if no such succession had occurred.
As used in this Agreement, "Company" shall mean the Company as defined above and
any successor to its business and/or assets.
11. Survival of Terms. Notwithstanding the termination of this Agreement
-----------------
for whatever reason, the provisions hereof shall survive such termination,
unless the context requires otherwise.
12. Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed to be an original, but all of which
---
together shall constitute one and the same instrument. Any signature by
facsimile shall be valid and binding as if an original signature were delivered.
13. Captions. The caption headings in this Agreement are for convenience of
--------
reference only and are not intended and shall not be construed as having any
substantive effect.
14. Governing Law. This Agreement shall be governed, interpreted and
-------------
construed in accordance with the laws of the state of California applicable to
agreements entered into and to be performed entirely therein.
15. Arbitration. Any controversy, claim, or counterclaim arising from this
-----------
agreement shall be either (i) resolved by trial, with jury waived, in the
superior or municipal courts sitting in Santa Monica, California (and each party
hereby submits to the jurisdiction of such court), or, (ii) if such provision
for waiver of jury trial is not enforceable for any reason, any controversy,
claim, or counterclaim arising from this agreement shall be submitted to and
decided by final and binding arbitration by a single arbitrator administered in
Los Angeles, California by the American Arbitration Association under its
commercial rules, as provided below.
a. The prevailing party in such dispute shall be entitled to recover from
the other party all reasonable costs and fees of enforcing any right
of the prevailing party including, without limitation, any American
Arbitration Association administration fee, the arbitrators fee, costs
for the use of facilities during the hearings, expert fees,
accountants fees and expenses, and attorneys fees and expenses. The
prevailing party shall be that party which recovers a judgment or
award in the action.
b. Within 15 days after the commencement of any arbitration, the parties
to the dispute shall each select names from a list of retired judges
of the California Superior Court, or any higher California court,
provided by the American Arbitration Association, and list such
proposed arbitrators in order of preference, and submit such list to
the American Arbitration Association, which shall then appoint one
arbitrator based on such submissions. The arbitrator shall have the
discretion to order a prehearing exchange of information by the
parties, including without limitation, production of requested
documents, exchange of summaries of testimony of proposed witnesses,
and examination by deposition of the parties.
c. The arbitration shall generally be administered in accordance with the
American Arbitration Associations Commercial Arbitration Rules. The
provisions of Sections 1282.6, 1283, and 1283.05 of the California
Code of Civil Procedure apply to the arbitration. The arbitrator shall
have the authority to award any remedy or relief that a court of the
State of California could order or grant, including, without
limitation, specific performance of any obligation created under this
Agreement, the issuance of an injunction, or the imposition of
sanctions for abuse or frustration of the arbitration process. The
arbitrator, however, will have no authority to award punitive damages,
and each party hereby irrevocably waives any right to recover such
damages with respect to any issue resolved by arbitration, and the
arbitrator may not, in any event, either make any ruling, finding or
award that does not conform to the terms and conditions of this
Agreement, or alter, amend, modify or change any of the terms of this
Agreement. The arbitrators decision shall be rendered within 30 days
after the conclusion of the arbitration hearing, and the arbitrator
shall make findings of fact and shall set forth the reasons and legal
bases for the decision. Such arbitrators decision shall be final and
binding on the parties and a judgment upon the decision rendered may
be entered in any court having jurisdiction thereof.
d. THE PARTIES HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE
CONTEMPLATED TRANSACTIONS, WHETHER NOW EXISTING OR HEREAFTER ARISING,
AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. THE PARTIES AGREE
THAT ANY OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH ANY COURT AS
WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED-FOR AGREEMENT
AMONG THE PARTIES IRREVOCABLY TO WAIVE TRIAL BY JURY AND THAT ANY
PROCEEDING WHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT OR ANY
OF THE CONTEMPLATED TRANSACTIONS SHALL INSTEAD BE RESOLVED BY BINDING
ARBITRATION AS PROVIDED HEREIN.
16. Attorneys' Fees, Costs and Expenses. In any action, litigation or
-----------------------------------
proceeding (including mediation and/or arbitration) between the parties arising
out of or in relation to this Agreement, the prevailing party in such action
shall be awarded, in addition to any damages, injunctions or other relief, and
without regarding to whether or not such matter be prosecuted to final judgment,
such party's costs and expenses, including but not limited to all related costs
and actual attorneys', accountants' and experts' fees incurred in bringing such
action, litigation or proceeding and/or enforcing any judgment or order granted
therein, all of which shall be deemed to have accrued upon the commencement of
such action, litigation or proceeding. Any judgment or order entered in such
action, litigation or proceeding shall contain a specific provision providing
for the recovery of actual attorneys' fees and costs incurred in enforcing such
judgment. If the judgment or order should fail to contain such a provision, the
prevailing party shall have the right to initiate further action to recover its
actual attorneys' fees incurred in enforcing such judgment or order, which right
shall survive the entry of judgment or order in the initial action, litigation
or proceeding. For the purpose of this Paragraph 16 herein, actual attorneys'
fees shall also include, without limitation, fees incurred in the following:
(i) post-judgment motions; (ii) contempt proceedings; (iii) discovery, and (iv)
any post-judgment proceedings, including appeals, and collection and enforcement
actions. Wherever in this Agreement the phrase "Attorneys' Fees" or "Actual
Attorneys' Fees" is used, each of such phrases shall mean the full and actual
cost of any legal services actually performed in connection with the matter for
which such fees are sought, calculated on the basis of the usual fees charged by
the attorneys performing such services, and such fees shall not be limited to
"reasonable attorneys' fees" as that term may be defined by statutory or
decisional cause authority.
17. Entire Agreement/Modifications. This Agreement, along with the attached
------------------------------
Indemnification Agreement, which is incorporated herein by this reference,
constitutes the entire agreement between the parties and supersedes all prior
understandings and agreements, whether oral or written, regarding Consultant's
retention by the Company; provided, however, that all fees previously earned
and/or paid to Consultant under prior agreements shall be deemed earned, and
shall be in addition to any fees payable hereunder. This Agreement shall not be
altered or modified except in writing, duly executed by the parties hereto.
18. Warranty. The Company and Consultant each hereby warrant and agree that
--------
each is free to enter into this Agreement, that the parties signing below are
duly authorized and directed to execute this agreement, and that this Agreement
is a valid, binding and enforceable against the parties hereto.
19. Severability. If any term, covenant or provision, or any part thereof,
------------
is found by any court of competent jurisdiction to be invalid, illegal or
unenforceable in any respect, the same shall not affect the remainder of such
term, covenant or provision, any other terms, covenants or provisions or any
subsequent application of such term, covenant or provision which shall be given
the maximum effect possible without regard to the invalid, illegal or
unenforceable term, covenant or provision, or portion thereof. In lieu of any
such invalid, illegal or unenforceable provision, the parties hereto intend that
there shall be added as part of this Agreement a term, covenant or provision as
similar in terms to such invalid, illegal or unenforceable term, covenant of
provision, or part thereof, as may be possible and be valid, legal and
enforceable.
20. No Legal Services. The parties understand and acknowledge that
-----------------
Consultant will not and does not provide legal services, and nothing contained
in this Agreement shall be interpreted to mean that Consultant, or any of its
principals, employees or representatives, has provided or will provide legal
services. While certain employees of Consultant are lawyers, licensed to
practice law in the state of California, the Company expressly agrees that it
does not consider Consultant or any of its employees as the Company's legal
counsel, or as legal counsel to any of the Company's shareholders, officers,
directors or employees, and that is shall not assert that either Consultant or
any of its employees or principals have provided, or will provide, legal
services. Any comments or suggestions provided by Consultant or its employees
relating to documents or contracts are provided as a consultant only, and not as
a lawyer, and the Company agrees that it shall seek advice from its own
independent counsel with respect to any such documents or agreements.
Consultant shares office space with a law firm of which an employee of
Consultant is a partner. Such law firm, and such employee, shall not be deemed
to provide any legal services to the Company, its officers, directors or
employees, unless and only to the extent of a written engagement agreement with
such law firm, and the Company shall not assert that such employee or law firm
has provided any such legal services unless such law firm, on its letterhead,
executes an engagement letter with the Company specifically identifying the
legal services to be provided.
IN WITNESS HEREOF, the parties hereto have duly executed and delivered this
Agreement as of the day and year first above written.
National Parking Systems, Inc.
a Nevada Corporation
By: /s/ Xxxx Xxxxxxxx
------------------------------
Name: Xxxx Xxxxxxxx
Title: Chief Executive Officer
LONDON FINANCE GROUP, LTD.
By:
------------------------------
Name:
Title:
INDEMNIFICATION AGREEMENT
-------------------------
This Indemnification Agreement is a part of and is incorporated into that
Consulting Agreement between the parties hereto (together, the "Agreement") by
and between National Parking Systems, Inc., a Nevada corporation (the
"Company"), and London Finance Group, Ltd., a California corporation, or its
designees ("LFG").
The Company agrees to indemnify and hold harmless LFG, its affiliates,
directors, officers, agents and employees, including, without limitation, any
person or entity that provides consulting or other services to the Company (LFG
and each such entity or person, is referred to herein as an "Indemnified
Person") from and against any losses, claims, damages, judgments, assessments,
costs and other liabilities (collectively, "Liabilities"), and will reimburse
each Indemnified Person for all fees and expenses (including the reasonable fees
and expenses of counsel) (collectively, "Expenses") as they are incurred in
investigating, preparing, pursuing or defending any claim, action, proceeding or
investigation, whether or not in connection with pending or threatened
litigation and whether or not any Indemnified Person is a party (collectively,
"Actions"), (i) caused by, or arising out of or in connection with, any untrue
statement or alleged untrue statement of a material fact contained in the any
written document furnished to LFG or its representatives or affiliates, or any
filing with the Securities and Exchange Commission (including any amendments
thereof and supplements thereto) or any omission or alleged omission to state
therein a material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading or (ii) otherwise
arising out of, related to or in connection with advice or services rendered or
to be rendered by an Indemnified Person pursuant to the Agreement or otherwise,
any transaction entered into by the Company and any Indemnified Person's actions
or inactions in connection with any such advice, services or transactions;
provided that, in the case of clause (ii) only, the Company will not be
responsible for any Liabilities or Expenses of any Indemnified Person that are
determined by a judgment of a court of competent jurisdiction which is no longer
subject to appeal or further review to have resulted solely from an Indemnified
Person's gross negligence or willful misconduct in connection with any of the
advice, actions, inactions or other services referred to in the Agreement. The
Company also agrees to reimburse such Indemnified Person for all Expenses as
they are incurred in connection with enforcing such Indemnified Person's
indemnification rights under this Agreement.
Upon receipt by an Indemnified Person of actual notice of an Action against such
Indemnified Person or otherwise with respect to which indemnity may be sought
under this Agreement, such indemnified Person shall promptly notify the Company
in writing; provided that failure so to notify the Company shall not relieve the
Company from any liability which the Company or any other person may have on
account of this indemnity or otherwise, except and only to the extent the
Company shall have been materially prejudiced by such failure. The Company shall
not be liable for any settlement of any Action effected without its written
consent (which shall not be unreasonably withheld). In addition, the Company
and its shareholders will not, without prior written consent of LFG, settle,
compromise or consent to the entry of any judgment in or otherwise seek to
terminate any pending or threatened Action in respect of which indemnification
or contribution may be sought hereunder (whether or not any Indemnified Person
is a party thereto) unless such settlement, compromise, consent or termination
includes an unconditional release of such Indemnified Person from all
liabilities arising out of such Action.
In the event that the foregoing indemnity is not available to an Indemnified
Person in accordance with this Agreement pursuant to the requirements of
applicable law, the Company shall contribute to the Liabilities and Expenses
paid or payable by such Indemnified Person in such proportion as is appropriate
to reflect (i) the relative benefits to the Company and its shareholders, on the
one hand, and to the Indemnified Persons, on the other hand, of the matters
contemplated by this Agreement, or (ii) if the allocation provided by the
immediately preceding clause is not permitted by the applicable law, not only
such relative benefits but also the relative fault of the Company and/or its
shareholders, on the one hand, and the Indemnified Persons, on the other hand,
in connection with the matters as to which such Liabilities or Expenses relate,
as well as any other relevant equitable considerations, provided that, subject
to the third paragraph of this Indemnification Agreement, in no event shall the
Company contribute less than the amount necessary to ensure that all Indemnified
Persons, in the aggregate, are not liable for any Liabilities and Expenses in
excess of the amount of fees actually paid to or received by or contemplated to
be paid to or received by LFG pursuant to this Agreement. For purposes of this
paragraph, the relative benefits to the Company and its shareholders, on the one
hand, and to LFG, on the other hand, of the matters contemplated by the
Agreement, shall be deemed to be in the same proportion as (a) the total value
paid to or received by or contemplated to be paid to or received by the Company,
in the transaction or transactions that are within the scope of the Agreement,
whether or not any such transaction is consummated, including any increase in
the value of securities held by the shareholders of the Company, bears to (b)
the fees paid to or received by or contemplated to be paid to or received by LFG
in the transaction or transactions that are within the scope of the Agreement,
whether or not any such transaction is consummated.
The Company also agrees that no Indemnified Person shall have any liability
(whether direct or indirect, in contract or tort or otherwise) to the Company or
its shareholders for or in connection with advice or services rendered or to be
rendered by any Indemnified Person pursuant to this Agreement, the transactions
contemplated hereby or any Indemnified Person's actions or inactions in
connection with any such advice, services or transactions except for Liabilities
and Expenses of the Company that are determined by a judgment of a court of
competent jurisdiction which is no longer subject to appeal or further review to
have resulted solely from such Indemnified Person's gross negligence or willful
misconduct in connection with any such advice, actions, inactions or services.
Any party that proposes to assert the right to be indemnified under this
Indemnification Agreement shall promptly, after receipt of notice of any
applicable claim, action, proceeding or litigation, notify the proposed
indemnifying party of the commencement of such claim, action, proceeding or
litigation. Indemnification shall be limited for any party who shall fail to
give notice as provided in the preceding sentence to the extent the indemnifying
party was prejudiced by the failure to give such notice. An indemnifying party
shall be entitled to participate in and to assume the defense of such claim,
action, proceeding or litigation, with counsel reasonably satisfactory to such
indemnified party, and after giving notice thereof, the indemnifying party shall
not be liable to such indemnified party for any fees of other counsel or any
other expenses with respect to the defense of such matter after the date of such
notice, unless the indemnified party shall have reasonably concluded that there
may be a conflict of interest between the indemnifying party and the indemnified
party in the conduct of the defense of such matter (in which case the
indemnifying party shall reimburse the indemnified party for the reasonable fees
and expenses of one counsel).
The reimbursement, indemnity and contribution obligations set forth herein shall
apply to any modification of this Agreement (unless and to the extent that such
obligations are specifically modified thereby) and shall remain in full force
and effect regardless of any termination of, or the completion of any
Indemnified Person's services under or in connection with, this Agreement.
IN WITNESS WHEREOF, this Indemnification Agreement is executed as of January 5,
2005.
LONDON FINANCE GROUP, LTD.
By:
-------------------------------
Name:
Title:
National Parking Systems, Inc.
a Nevada Corporation
By: /s/ Xxxx Xxxxxxxx
-------------------------------
Name: Xxxx Xxxxxxxx
Title: Chief Executive Officer
