Exhibit 10.16
STOCK ISSUANCE AGREEMENT
This Stock Issuance Agreement is entered into as of January 21, 2004,
by SulphCo, Inc., a Nevada corporation (the "Corporation"), and Fuad A M A
Alghareeb (the "Consultant").
SECTION 1. Issuance of Shares.
(a) ISSUANCE. The Corporation and the Consultant have entered into a
consulting agreement for the provision of sales consulting services with regard
to Kuwait and certain other areas of the Middle East in consideration of the
issuance of One Hundred Thousand (100,000) shares of the Common Stock of the
Corporation (the "Shares"). The Shares are being issued by the Corporation to
the Consultant pursuant to a resolution of the Board of Directors adopted at a
meeting held on January 21, 2004, for the issuance of the Shares.
(b) DEFINED TERMS. Capitalized terms not defined above are defined in
Section 8 of this Agreement.
SECTION 2. Restrictions.
(a) CONSULTANT REPRESENTATIONS. In connection with the issuance of
Shares under this Agreement, the Consultant hereby represents and warrants to
the Corporation as follows:
(i) The Consultant is acquiring and will hold the Shares for
investment for his or her account only and not with a view to, or for resale in
connection with, any "distribution" thereof within the meaning of the Securities
Act.
(ii) The Consultant understands that the Shares have not been
registered under the Securities Act by reason of a specific exemption therefrom
and that the Shares must be held indefinitely, unless they are subsequently
registered under the Securities Act or the Consultant obtains an opinion of
counsel, in form and substance satisfactory to the Corporation and its counsel,
that such registration is not required. The Consultant further acknowledges and
understands that the Corporation is under no obligation to register the Shares.
(iii) The Consultant is aware of the adoption of Rule 144 by
the Securities and Exchange Commission under the Securities Act, which permits
limited public resales of securities acquired in a non-public offering, subject
to the satisfaction of certain conditions, including (without limitation) the
availability of certain current public information about the issuer, the resale
occurring only after the holding period required by Rule 144 has been satisfied,
the sale occurring through an unsolicited "broker's transaction," and the amount
of securities being sold during any three-month period not exceeding specified
limitations.
(iv) The Consultant will not sell, transfer or otherwise
dispose of the Shares in violation of the Securities Act, the Securities
Exchange Act of 1934, or the rules promulgated thereunder, including Rule 144
under the Securities Act. The Consultant agrees that he or she will not dispose
of the Shares unless and until he or she has complied with all requirements of
this Agreement applicable to the disposition of Shares and he or she has
provided the Corporation with written assurances, in substance and form
satisfactory to the Corporation, that (A) the proposed disposition does not
require registration of the Shares under the Securities Act or all appropriate
action necessary for compliance with the registration requirements of the
Securities Act or with any exemption from registration available under the
Securities Act (including Rule 144) has been taken and (B) the proposed
disposition will not result in the contravention of any transfer restrictions
applicable to the Shares under any "blue sky" laws.
(v) The Consultant has been furnished with, and has had access
to, such information as he or she considers necessary or appropriate for
deciding whether to invest in the Shares, and the Consultant has had an
opportunity to ask questions and receive answers from the Corporation regarding
the terms and conditions of the issuance of the Shares.
(vi) The Consultant is aware that his or her investment in the
Corporation is a speculative investment that has limited liquidity and is
subject to the risk of complete loss. The Consultant is able, without impairing
his or her financial condition, to hold the Shares for an indefinite period and
to suffer a complete loss of his or her investment in the Shares.
(b) SECURITIES LAW RESTRICTIONS. Regardless of whether the offering and
sale of Shares under this Agreement have been registered under the Securities
Act or have been registered or qualified under the securities laws of any state,
the Corporation at its discretion may impose restrictions upon the sale, pledge
or other transfer of the Shares (including the placement of appropriate legends
on stock certificates or the imposition of stop-transfer instructions) if, in
the judgment of the Corporation, such restrictions are necessary or desirable in
order to achieve compliance with the Securities Act, the securities laws of any
state or any other law.
(c) RIGHTS OF THE CORPORATION. The Corporation shall not be required to
(i) transfer on its books any Shares that have been sold or transferred in
contravention of this Agreement or (ii) treat as the owner of Shares, or
otherwise to accord voting, dividend or liquidation rights to, any transferee to
whom Shares have been transferred in contravention of this Agreement.
SECTION 3. Successors and Assigns.
Except as otherwise expressly provided to the contrary, the provisions
of this Agreement shall inure to the benefit of, and be binding upon, the
Corporation and its successors and assigns and be binding upon the Consultant
and the Consultant's legal representatives, heirs, legatees, distributees,
assigns and transferees by operation of law, whether or not any such person has
become a party to this Agreement or has agreed in writing to join herein and to
be bound by the terms, conditions and restrictions hereof.
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SECTION 4. Legend.
All certificates evidencing Shares shall bear substantially the
following legend:
"THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD,
PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE
REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL,
SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH
REGISTRATION IS NOT REQUIRED."
If required by the authorities of any state in connection with the
issuance of the Shares, the legend or legends required by such state authorities
shall also be endorsed on all such certificates.
SECTION 5. Notices.
Any notice required by the terms of this Agreement shall be given in
writing and shall be deemed effective upon personal delivery or upon deposit
with the United States Postal Service, by registered or certified mail, with
postage and fees prepaid. Notice shall be addressed to the Corporation at its
principal executive office and to the Consultant at the address that he or she
most recently provided to the Corporation.
SECTION 6. Entire Agreement.
This Agreement constitutes the entire contract between the parties
hereto with regard to the subject matter hereof. It supersedes any other
agreements, representations or understandings (whether oral or written and
whether express or implied) relating to the subject matter hereof.
SECTION 7. Choice of Law.
This Agreement shall be governed by, and construed in accordance with,
the laws of the State of Nevada, as such laws are applied to contracts entered
into and performed in such State.
SECTION 8. Definitions.
(a) "Agreement" shall mean this Stock Issuance Agreement.
(b) "Board of Directors" shall mean the Board of Directors of the
Corporation, as constituted from time to time.
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(c) "Corporation" shall mean SulphCo, Inc., a Nevada corporation.
(d) "Shares" shall mean the Shares issued to the Consultant pursuant to
this Agreement.
(e) "Securities Act" shall mean the Securities Act of 1933, as amended.
(f) "Share" shall mean one share of Stock.
IN WITNESS WHEREOF, the Corporation and the Consultant have executed
this Agreement to be effective as of January 21, 2004.
CORPORATION: SULPHCO, INC.
By /S/ XXXX X. XXXXXXXXXX
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Xxxx X. Xxxxxxxxxx, President
CONSULTANT: /S/ XXXX XXXXXXXXX
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Fuad A M A Alghareeb
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