Exhibit 10.13


CONSULTING SERVICES AGREEMENT 


 


This
Consulting Services Agreement (the “Agreement) is entered into as of this 31st
day of July, 2007 by and between Thomas J. Berthel (“Tom Berthel”), whose
business address is 701 Tama Street, Building B, Marion, Iowa 52302 and
American Defense Systems, Inc., a Delaware corporation whose address is 230
Duffy Avenue, Unit C, Hicksville, New York 11801 (“ADSI”).


 


WHEREAS,
ADSI entered into an investment banking agreement between itself and Stifel
Nicolaus in which Stifel Nicolaus agreed to, in exchange for payment of certain
fees to Stifel Nicolaus by ADSI, to provide investment banking services to ADSI
(the “Investment Banking Fees”); and


 


WHEREAS,
Tom Berthel agreed to negotiate with Stifel Nicolaus, on behalf of ADSI, to
attempt to lower the Investment Banking Fees; and


 


WHEREAS,
Tom Berthel also agreed to provide other consulting services to ADSI; and 


 


WHEREAS,
the parties desire to set forth the terms and conditions of the Agreement.


 


NOW
THEREFORE, in consideration of the mutual benefits to derived by each party
hereto and for other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties agree as follows:


 


1.             ADSI acknowledges Tom Berthel’s
assistance as a consultant in renegotiating the terms of an investment banking
agreement executed between ADSI and Stifel Nicolaus.  As compensation for the services provided by
Tom Berthel, ADSI has agreed to pay Berthel one half of the fee reductions that
are actually realized as a result of the renegotiation. 


 


The
fees due Stifel Nicolaus under the original investment banking agreement were
as follows:


 




	
  2%
  of the first $50 million raised

  	
   

  	
   

  
	
  3%
  of the next $20 million raised

  	
   

  	
   

  
	
  5%
  of anything in excess of the above (the “Original Fees”)

  	
   

  	
   

  






                                                                                                


As
a result of the renegotiation with Stifel Nicholaus, Stifel Nicolaus has now
agreed to payment of fees according to the following formula:


 




	
  2% of the first $50 million raised

  	
   

  	
   

  
	
  3% of the next $50 million
  raised

  	
   

  	
   

  
	
  4% of all funds raised
  over $100 million (the “Revised Fees”)

  	
   

  	
   

  






                                                                                                


As
an illustration and by way of an example only, in the event the Stifel Nicolaus
assisted offering should raise a total of $200,000,000, the fee reduction and
the amount to be paid to Berthel would be calculated as follows:


 




	
  Amount Raised

  	
   

  	
  Original Fees

  	
   

  	
  Revised Fees

  	
   

  	
  Fee Reduction

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  $

  	
  50 MM

  	
   

  	
  $

  	
  1MM

  	
   

  	
  $

  	
  1MM

  	
   

  	
  0

  
	
  $

  	
  20 MM

  	
   

  	
  $

  	
  600,000

  	
   

  	
  $

  	
  600,000

  	
   

  	
  0

  
	
  $

  	
  30
  MM

  	
   

  	
  $

  	
  1,500,000

  	
   

  	
  $

  	
  900,000

  	
   

  	
  $

  	
  600,000

  
	
  $

  	
  100
  MM

  	
   

  	
  $

  	
  5,000,000

  	
   

  	
  $

  	
  4,000,000

  	
   

  	
  $

  	
  1,000,000

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  1,600,000

  






 


 


 

















 


The
amount payable to Berthel in this example would be one-half of the $1,600,000
fee reduction, which is $800,000.


 


2.             Tom Berthel has provided and shall
continue to provide consulting services to ADSI as reasonably requested by ADSI
through April 30, 2008.  In consideration
of these services, ADSI agrees to issue Tom Berthel an option (“Consulting
Option”) to purchase shares of ADSI common stock pursuant to an ADSI stock
option plan under development.  The
Consulting Option will be for a number of shares equal to 250,000 less the
number of shares provided in an option granted to Tom Berthel for his first
year of service as a member of the ADSI Board of Directors.  The Consulting Option (a) shall be
exercisable at the fair market value of the ADSI common stock on the date
granted; (b) shall expire on April 30, 2010; and (c) shall be issued promptly
upon finalization of the ADSI option plan.


 


3.             Except as otherwise specifically
agreed to herein, all notices and other communications made pursuant to this
Agreement shall be in writing and when (i) delivered in person, (ii) by
registered or certified mail-return receipt requested, (iii) by recognized
commercial carrier or overnight courier or (iv) by facsimile transmission,
shall be deemed given (a)upon receipt, (b) five days after the notice has been
deposited in the mail, postage prepaid, by registered or certified mail, return
receipt requested, (c) one business day after the notice has been delivered to
such courier service marked for overnight delivery, or (d) the same business
day if faxed prior to 5:00 PM Eastern time, or the next business day if faxed
after 5:00PM Eastern time or on a day other than a business day.  All notices sent shall be sent to the
respective address indicated herein or as otherwise designated pursuant to this
Section 7.


 


4.             This Agreement sets forth the
entire understanding of the parties relating to the subject matter hereof and
supersedes and cancels any prior communications, understanding and agreements
and cannot be modified or changed, nor can any of its provisions be waived,
except by written agreement executed by both parties hereto.


 


5.             This Agreement shall be governed by
and construed in accordance with the laws of the State of Delaware.   In the event of a disagreement between the
parties all parties agree to be subject to and submit to personal jurisdiction
of the state and federal courts located in the State of New York.


 


6.             If any term, provision, covenant or
restriction contained in this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void, unenforceable or against
its regulatory policy, the remainder of the terms, provisions, covenants and
restriction contained in this Agreement shall remain in full force and effect
and shall in no way be affected, impaired or invalidated.


 


IN WITNESS WHEREOF, the parties hereto execute this Agreement as of the
day and date set out above.


 


	
  American
  Defense Systems, Inc.

  	
   

  	
  Thomas
  J. Berthel

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Thomas F. Cusack

  	
   

  	
  By:
  /s/

  
	
  Title:

  	
  VP,
  Corp Counsel, Secy