Exhibit 10.05
CONSULTING AGREEMENT
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This Consulting Agreement (the "Agreement"), effective as of October 13,
2000 is entered into by and between Biopulse International, Inc., a Nevada
corporation (herein referred to as the "Company") and LIVIAKIS FINANCIAL
COMMUNICATIONS, INC., a California corporation (herein referred to as the
"Consultant").
RECITALS
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WHEREAS, Company is a publicly-held corporation with its common stock
traded on the OTCBB Market; and
WHEREAS, Company desires to engage the services of Consultant to represent
the company in investors' communications and public relations with existing
shareholders, brokers, dealers and other investment professionals as to the
Company's current and proposed activities, and to consult with management
concerning such Company activities;
NOW THEREFORE, in consideration of the promises and the mutual covenants
and agreements hereinafter set forth, the parties hereto covenant and agree
as follows:
1. Term of Consultancy. Company hereby agrees to retain the Consultant
to act in a consulting capacity to the Company, and the Consultant hereby
agrees to provide services to the Company commencing once appropriate
"Lock-ups" (see addendum) have been executed between all direct insiders of
the company covering a term commensurate with the term of this contract and
ending on October 12, 2001.
2. Duties of Consultant. The Consultant agrees that it will generally
provide the following specified consulting services through its officers
and employees during the term specified in Section 1.:
(a) Consult and assist the Company in developing and implementing
appropriate plans and means for presenting the Company and its business
plans, strategy and personnel to the financial community, establishing an
image for the Company in the financial community, and creating the
foundation for subsequent financial public relations efforts;
(b) Introduce the Company to the financial community;
(c) With the cooperation of the Company, maintain an awareness
during the term of this Agreement of the Company's plans, strategy and
personnel, as they may evolve during such period, and consult and assist
the Company in communicating appropriate information regarding such plans,
strategy and personnel to the financial community;
(d) Assist and consult the Company with respect to its (i)
relations with stockholders, (ii) relations with brokers, dealers, analysts
and other investment professionals, and (iii) financial public relations
generally;
(e) Perform the functions generally assigned to stockholder
relations and public relations departments in major corporations, including
responding to telephone and written inquiries (which may be referred to the
Consultant by the Company); preparing press releases for the Company with
the Company's involvement and approval of press releases, reports and other
communications with or to shareholders, the investment community and the
general public; consulting with respect to the timing, form, distribution
and other matters related to such releases, reports and communications;
1.
and, at the Company's request and subject to the Company's securing its own
rights to the use of its names, marks, and logos, consulting with respect
to corporate symbols, logos, names, the presentation of such symbols, logos
and names, and other matters relating to corporate image;
(f) Upon the Company's direction and approval, disseminate
information regarding the Company to shareholders, brokers, dealers, other
investment community professionals and the general investing public;
(g) Upon the Company's approval, conduct meetings, in person or
by telephone, with brokers, dealers, analysts and other investment
professionals to communicate with them regarding the Company's plans, goals
and activities, and assist the Company in preparing for press conferences
and other forums involving the media, investment professionals and the
general investment public;
(h) At the Company's request, review business plans, strategies,
mission statements budgets, proposed transactions and other plans for the
purpose of advising the Company of the public relations implications
thereof; and,
(i) Otherwise perform as the Company's consultant for public
relations and relations with financial professionals.
3. Allocation of Time and Energies. The Consultant hereby promises to
perform and discharge faithfully the responsibilities which may be assigned
to the Consultant from time to time by the officers and duly authorized
representatives of the Company in connection with the conduct of its
financial and public relations and communications activities, so long as
such activities are in compliance with applicable securities laws and
regulations. Consultant and staff shall diligently and thoroughly provide
the consulting services required hereunder. Although no specific hours-
per-day requirement will be required, Consultant and the Company agree that
Consultant will perform the duties set forth herein above in a diligent and
professional manner. The parties acknowledge and agree that a
disproportionately large amount of the effort to be expended and the costs
to be incurred by the Consultant and the benefits to be received by the
Company are expected to occur within or shortly after the first two months
of the effectiveness of this Agreement. It is explicitly understood that
Consultant's performance of its duties hereunder will in no way be measured
by the price of the Company's common stock, nor the trading volume of the
Company's common stock. It is also understood that the Company is entering
into this Agreement with Liviakis Financial Communications, Inc. ("LFC"), a
corporation and not any individual member of LFC, and, as such, Consultant
will not be deemed to have breached this Agreement if any member, officer
or director of LFC leaves the firm or dies or becomes physically unable to
perform any meaningful activities during the term of the Agreement,
provided the Consultant otherwise performs its obligations under this
Agreement.
4. Remuneration. As full and complete compensation for services
described in this Agreement, the Company shall compensate LFC as follows:
4.1 For undertaking this engagement and for other good and valuable
consideration, the Company agrees to issue and deliver to the Consultant a
"Commencement Bonus" payable in the form of 1,490,000 shares of the
Company's Common Stock ("Common Stock"). This Commencement Bonus shall be
issued to the Consultant immediately following execution of this Agreement
and shall, when issued and delivered to Consultant, be fully paid and non-
assessable. The Company understands and agrees that Consultant has
foregone significant opportunities to accept this engagement and that the
Company derives substantial benefit from the execution of this Agreement
and the ability to announce its relationship with Consultant. The
2.
1,490,000 shares of Common Stock issued as a Commencement Bonus, therefore,
constitute payment for Consultant's agreement to consult to the Company and
are a nonrefundable, non-apportionable, and non-ratable retainer; such
shares of common stock are not a prepayment for future services. If the
Company decides to terminate this Agreement prior to October 12, 2001 for
any reason whatsoever, it is agreed and understood that Consultant will not
be requested or demanded by the Company to return any of the shares of
Common Stock paid to it as Commencement Bonus hereunder. Further, if and in
the event the Company is acquired in whole or in part, during the term of
this agreement, it is agreed and understood Consultant will not be
requested or demanded by the Company to return any of the 1,490,000 shares
of Common stock paid to it hereunder. It is further agreed that if at any
time during the term of this agreement, the Company or substantially all of
the Company's assets are merged with or acquired by another entity, or some
other change occurs in the legal entity that constitutes the Company, the
Consultant shall retain and will not be requested by the Company to return
any of the 1,490,000 shares.
4.2 For performance under this agreement on a month-to-month basis, a
Consultancy Fee, payable in the form of 5,000 shares per month of the
Company's Common Stock. This Consultancy Fee shall be issued to the
Consultant on a monthly basis, the first month pro-rated according to the
number of days remaining in that month, and paid immediately following
execution of this Agreement; each following monthly payment payable in full
on the first day of the respective month. The monthly Consultancy Fee
shall continue to be paid monthly for the duration of this Consulting
Agreement.
4.3 The shares issued pursuant to this agreement shall be issued in
the names of Liviakis Financial Communications, Inc. (1,193,500 shares),
Xxxxxxx X. Xxxxxxxxx (148,250 shares) and Xxxx Xxxxxxxxx (148,250 shares).
4.4 With each transfer of shares of Common Stock to be issued pursuant
to this Agreement (collectively, the "Shares"), Company shall cause to be
issued a certificate representing the Common Stock and a written opinion of
counsel for the Company stating that said shares are validly issued, fully
paid and non-assessable and that the issuance and eventual transfer of them
to Consultant has been duly authorized by the Company. Company warrants
that all Shares issued to Consultant pursuant to this Agreement shall have
been validly issued, fully paid and non-assessable and that the issuance
and any transfer of them to Consultant shall have been duly authorized by
the Company's board of directors.
4.5 Consultant acknowledges that the shares of Common Stock to be
issued pursuant to this Agreement (collectively, the "Shares") have not
been registered under the Securities Act of 1933, and accordingly are
"restricted securities" within the meaning of Rule 144 of the Act. As
such, the Shares may not be resold or transferred unless the Company has
received an opinion of counsel reasonably satisfactory to the Company that
such resale or transfer is exempt from the registration requirements of
that Act.
4.6 In connection with the acquisition of Shares hereunder, the
Consultant represents and warrants to the Company, to the best of its/his
knowledge, as follows:
(a) Consultant acknowledges that the Consultant has been
afforded the opportunity to ask questions of and receive answers from duly
authorized officers or other representatives of the Company concerning an
investment in the Shares, and any additional information which the
Consultant has requested.
3.
(b) Consultant's investment in restricted securities is
reasonable in relation to the Consultant's net worth, which is in excess of
ten (10) times the Consultant's cost basis in the Shares. Consultant has
had experience in investments in restricted and publicly traded securities,
and Consultant has had experience in investments in speculative securities
and other investments which involve the risk of loss of investment.
Consultant acknowledges that an investment in the Shares is speculative and
involves the risk of loss. Consultant has the requisite knowledge to
assess the relative merits and risks of this investment without the
necessity of relying upon other advisors, and Consultant can afford the
risk of loss of his entire investment in the Shares. Consultant is (i) an
accredited investor, as that term is defined in Regulation D promulgated
under the Securities Act of 1933, and (ii) a purchaser described in Section
25102 (f) (2) of the California Corporate Securities Law of 1968, as
amended.
(c) Consultant is acquiring the Shares for the Consultant's own
account for long-term investment and not with a view toward resale or
distribution thereof except in accordance with applicable securities laws.
5. Financing "Finder's Fee". It is understood that in the event
Consultant introduces Company, or its nominees, to a lender or equity
purchaser, not already having a preexisting relationship with the Company,
with whom Company, or its nominees, ultimately finances or causes the
completion of such financing, Company agrees to compensate Consultant for
such services with a "finder's fee" in the amount of 2.5% of total gross
funding provided by such lender or equity purchaser, such fee to be payable
in cash. This 2.5% will be in addition to any fees payable by Company to
any other intermediary, if any, which shall be the subject of separate
agreements negotiated between Company and such other intermediary. It is
also understood that in the event Consultant introduces Company, or its
nominees, to an acquisition candidate, either directly or indirectly
through another intermediary, not already having a preexisting relationship
with the Company, which Company, or its nominees, ultimately acquires or
causes the completion of such acquisition, Company agrees to compensate
Consultant for such services with a "finder's fee" in the amount of 2% of
total gross consideration provided by such acquisition, such fee to be
payable in cash. This 2% will be in addition to any fees payable by
Company to any other intermediary. It is specifically understood that
Consultant is not and does not hold itself out be a Broker/Dealer, but is
rather merely a "Finder" in reference to the Company procuring financing
sources and acquisition candidates. Any obligation to pay a "Finder's Fee"
hereunder shall survive the merging, acquisition, or other change in the
form of entity of the Company and to the extent it remains unfulfilled
shall be assigned and transferred to any successor to the Company.
5.1 It is further understood that Company, and not Consultant, is
responsible to perform any and all due diligence on such lender, equity
purchaser or acquisition candidate introduced to it by Consultant under
this Agreement, prior to Company receiving funds or closing on any
acquisition. However, Consultant will not introduce any parties to Company
about which Consultant has any prior knowledge of questionable, unethical
or illicit activities.
5.2 Company agrees that said compensation to Consultant shall be paid
in full at the time said financing or acquisition is closed, such
compensation to be transferred by Company to Consultant within seven (7)
business days of the execution of the financing of acquisition closing
document. Payment of said compensation, shall be a condition precedent to
the closing of such financing or acquisition, and Company shall execute any
and all documents necessary to effect said compensation.
4.
5.3 As further consideration to Consultant, Company, or its nominees,
agrees to pay with respect to any financing or acquisition candidate
provided directly or indirectly to the Company by any lender or equity
purchaser covered by this Section 5 during the period of one year from the
close of the term of this Agreement, a fee to Consultant equal to that
outlined in Section 5 herein.
5.4 Consultant will notify Company of introductions it makes for
potential sources of financing or acquisitions in a timely manner (within
approximately 3 days of introduction) via facsimile memo. If Company has a
preexisting relationship with such nominee and believes such party should
be excluded from this Agreement, then Company will notify Consultant
immediately within twenty-four (24) hours of Consultant's facsimile to
Company of such circumstance via facsimile memo.
6. Non-Assignability of Services. Consultant's services under this
contract are offered to Company only and may not be assigned by Company to
ant entity with which Company merges or which acquires the Company or
substantially all of its assets. In the event of such merger or
acquisition, all compensation to Consultant herein under the schedules set
forth herein shall remain due and payable, and any compensation received by
the Consultant may be retained in the entirety by Consultant, all without
any reduction or pro-rating and shall be considered and remain fully paid
and non-assessable. Notwithstanding the non-assignability of Consultant's
services, Company shall assure that in the event of any merger,
acquisition, or similar change of form of entity, that its successor entity
shall agree to complete all obligations to Consultant, including the
provision and transfer of all compensation herein, and the preservation of
the value thereof consistent with the rights granted to Consultant by the
Company herein, and to Shareholders.
7. Expenses. Consultant agrees to pay for all its expenses (phone,
mailing, labor, etc.), other than extraordinary items (travel required
by/or specifically requested by the Company, luncheons or dinners to large
groups of investment professionals, mass faxing to a sizable percentage of
the Company's constituents, investor conference calls, print advertisements
in publications, etc.) approved by the Company prior to its incurring an
obligation for reimbursement.
8. Indemnification. The Company warrants and represents that all oral
communications, written documents or materials furnished to Consultant by
the Company with respect to financial affairs, operations, profitability
and strategic planning of the Company are accurate and Consultant may rely
upon the accuracy thereof without independent investigation. The Company
will protect, indemnify and hold harmless Consultant against any claims or
litigation including any damages, liability, cost and reasonable attorney's
fees as incurred with respect thereto resulting from Consultant's
communication or dissemination of any said information, documents or
materials excluding any such claims or litigation resulting from
Consultant's communication or dissemination of information not provided or
authorized by the Company.
9. Representations. Consultant represents that it is not required to
maintain any licenses and registrations under federal or any state
regulations necessary to perform the services set forth herein. Consultant
acknowledges that, to the best of its knowledge, the performance of the
services set forth under this Agreement will not violate any rule or
provision of any regulatory agency having jurisdiction over Consultant.
5.
Consultant acknowledges that, to the best of its knowledge, Consultant and
its officers and directors are not the subject of any investigation, claim,
decree or judgment involving any violation of the SEC or securities laws.
Consultant further acknowledges that it is not a securities Broker Dealer
or a registered investment advisor. Company acknowledges that, to the best
of its knowledge, that it has not violated any rule or provision of any
regulatory agency having jurisdiction over the Company. Company
acknowledges that, to the best of its knowledge, Company is not the subject
of any investigation, claim, decree or judgment involving any violation of
the SEC or securities laws.
10. Legal Representation. The Company acknowledges that it has been
represented by independent legal counsel in the preparation of this
Agreement. Consultant represents that it has consulted with independent
legal counsel and/or tax, financial and business advisors, to the extent
the Consultant deemed necessary.
11. Status as Independent Contractor. Consultant's engagement pursuant to
this Agreement shall be as independent contractor, and not as an employee,
officer or other agent of the Company. Neither party to this Agreement
shall represent or hold itself out to be the employer or employee of the
other. Consultant further acknowledges the consideration provided
hereinabove is a gross amount of consideration and that the Company will
not withhold from such consideration any amounts as to income taxes, social
security payments or any other payroll taxes. All such income taxes and
other such payment shall be made or provided for by Consultant and the
Company shall have no responsibility or duties regarding such matters.
Neither the Company or the Consultant possess the authority to bind each
other in any agreements without the express written consent of the entity
to be bound.
12. Attorney's Fee. If any legal action or any arbitration or other
proceeding is brought for the enforcement or interpretation of this
Agreement, or because of an alleged dispute, breach, default or
misrepresentation in connection with or related to this Agreement, the
successful or prevailing party shall be entitled to recover reasonable
attorneys' fees and other costs in connection with that action or
proceeding, in addition to any other relief to which it or they may be
entitled.
13. Waiver. The waiver by either party of a breach of any provision of
this Agreement by the other party shall not operate or be construed as a
waiver of any subsequent breach by such other party.
14. Notices. All notices, requests, and other communications hereunder
shall be deemed to be duly given if sent by U.S. mail, postage prepaid,
addressed to the other party at the address as set forth herein below:
To the Company:
Biopulse International, Inc.
Xxxxxxx X. Xxx
Chairman
00000 Xxxxx Xxxxxx Xxxxxxx, Xxx 000
Xxxxx Xxxxxx, Xxxx 00000
6.
To the Consultant:
Liviakis Financial Communications, Inc.
Xxxx X. Xxxxxxxx, President
000 Xxxxxx Xxxxxx
Xxxx Xxxxxx, XX 00000
With a mandatory copy to:
Xxxxx Xxxxxxx Law Offices
Xxxxxxx Xxxxx
000 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
It is understood that either party may change the address to which
notices for it shall be addressed by providing notice of such change to the
other party in the manner set forth in this paragraph.
15. Choice of Law, Jurisdiction and Venue. This Agreement shall be
governed by, construed and enforced in accordance with the laws of the
State of California. The parties agree that San Francisco County, CA. will
be the venue of any dispute and will have jurisdiction over all parties.
16. Arbitration. Any controversy or claim arising out of or relating to
this Agreement, or the alleged breach thereof, or relating to Consultant's
activities or remuneration under this Agreement, shall be settled by
binding arbitration in California, in accordance with the applicable rules
of the American Arbitration Association, and judgment on the award rendered
by the arbitrator(s) shall be binding on the parties and may be entered in
any court having jurisdiction as provided by Paragraph 14 herein. The
provisions of Title 9 of Part 3 of the California Code of Civil Procedure,
including section 1283.05, and successor statutes, permitting expanded
discovery proceedings shall be applicable to all disputes that are
arbitrated under this paragraph.
17. Complete Agreement. This Agreement contains the entire agreement of
the parties relating to the subject matter hereof. This Agreement and its
terms may not be changed orally but only by an agreement in writing signed
by the party against whom enforcement of any waiver, change, modification,
extension or discharge is sought.
AGREED TO:
"Company"
7.
Date: By: /S/ Xxxxxxx X. Xxx
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Xxxxxxx X. Xxx, Chairman
"Consultant" LIVIAKIS FINANCIAL COMMUNICATIONS, INC.
Date: By:/S/ Xxxx X. Xxxxxxxx
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Xxxx X. Xxxxxxxx, President
8.
