Document:

ex10.02

  
 EXHIBIT 10.02
 

 CONSULTING AGREEMENT
 

 This CONSULTING AGREEMENT (hereinafter “Agreement”) is effective as of the 1st day of February 2013, by and between CONSOLIDATION SERVICES, INC., a Delaware corporation (the “Company”) and Sean Kirwan (the “Consultant”).
 

 Whereas, Consultant has experience and expertise, useful to the Company, in the heavy equipment rental serving mining, construction and infrastructure development businesses.
 

 Whereas, the Company wishes to engage Consultant to serve as its President and would like to compensate Consultant for fulfilling that role.
 

 NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, the parties, intending to be bound legally, to the Agreement as follows:
 

 1.  Engagement.
 

 (a)  The Company agrees to engage Consultant to perform the services of In-house Counsel and acting Vice President (“Vice President”) of the Corporation for the period commencing on February 1, 2013, through January 31, 2014 (the “Primary Term”), unless Consultant’s engagement under this Agreement is terminated or extended pursuant to Paragraphs 5, 6 or 7 of this Agreement.
 

 (b)  Duties.  During the Term, Consultant shall serve as Vice President of the Corporation and shall report to the CEO of the Corporation.  If requested by the Chairman of the Board of Directors of the Corporation, Consultant shall also serve, without additional compensation or as an acting officer or director of any subsidiary, affiliate or joint venture of the Corporation. Consultant shall perform such duties and services as are incidental to the positions he holds or as he may, from time to time, be requested to hold by the CEO of the Corporation.  The Consultant will devote attention, skill, and energy to the business of the Corporation, and will use his best efforts to promote the success of the Corporation’s business, and will cooperate fully in the advancement of the best interests of the Corporation.  Consultant will devote up to 20 hours weekly to the Corporation’s activities at the direction of the CEO.  Nothing in this Agreement, however, will prevent the Consultant from engaging in additional business activities, personal investments and community affairs that are not inconsistent with the Consultant’s duties under this Agreement.
 

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 (c)  Primary Office.  Consultant’s primary office location shall be 2300 W. Sahara Ave. Suite 800 Las Vegas, Nevada.  Consultant is also authorized to work from a home office.
 

 2.  Compensation.
 

 The Company shall issue and Consultant shall accept, as compensation for serving as Vice President of the Company from February 1st 2013 until January 31st 2014, two hundred thousand (200,000) shares of the Company’s common stock.
 

 3.  Business Expense Reimbursement.
 

 Upon presentation of receipts by Consultant, the Company shall, within fifteen (15) business days, reimburse Consultant for all reasonable travel, entertainment and other similar business expenses incurred by him in the performance of his duties hereunder.
 

 5.  Termination of Engagement.
 

 (a)  By Company.  Notwithstanding Section 1(a) of this Agreement, the Consultant’s engagement hereunder may be terminated by the Company, prior to the expiration of the Term of this Agreement, as follows:
 

 i.  Automatically, upon the death of the Consultant.
 

 ii.  On the date on which the Company notifies the Consultant of the termination of his engagement for Cause.  For purposes of this Agreement “Cause” shall mean:
 

 (1)  Habitual neglect or insubordination (defined as a refusal to execute or carry out lawful and prudent directions from the Board) where Consultant has been given written notice of the acts or omissions constituting such neglect or insubordination and Consultant has failed to cure such conduct, within thirty (30) days following notice;
 

 (2)  Participation in any fraud against the Company.
 

 (b)  By Consultant.  Notwithstanding Section 1(a) of this Agreement, Consultant may terminate the employment relationship prior to the expiration of the Term of this Agreement, as follows:
 

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 i.  By first giving the Company thirty (30) days’ advance notice of his intention to terminate his engagement; or 
 

 ii.  In the event of a material breach of the Agreement or the engagement relationship by the Company, including non-timely payment for services rendered, Consultant may terminate the Agreement without advance notice.
 

 6.  Consequences of Termination.
 

 Following the termination of Consultant’s Engagement pursuant to Paragraph 5, above, the Company shall have no further obligation to the Consultant. For any termination, voluntary or involuntary, the Company shall reimburse the Consultant for all reasonable expenses Consultant incurred in connection with his engagement and supported by receipts submitted to the Company within thirty (30) days of the date of separation.
 

 7.  Expiration and Renewal.
 

 Unless notice of termination is provided in accordance with Paragraphs 5, this Agreement shall continue for one (1) year, unless extended. Nothing shall preclude the parties from extending the Agreement for a longer period provided that it is acknowledged by a written document signed by both parties.
 

 8.  Assignment of Rights.
 

 The Company may assign all of its rights and obligations under this Agreement to any person or entity acquiring the principal assets used and useful in the operation of the Company provided such entity is financially able to honor the obligations to the Consultant under the terms of this Agreement, and the Company has secured the written consent of Consultant.
 

 This Agreement shall not be terminated by Company’s voluntary or involuntary dissolution or by any merger in which Company is not the surviving or resulting corporation, or on any transfer of all or substantially all of the Company’s assets.  In the event of any such merger or transfer of assets, where the Consultant has provided his written consent, the provisions of this Agreement shall be binding on and inure to the benefit of the surviving business entity or the business entity to which assets shall be transferred.  The Company shall require a purchaser, buyer or assignee to fully assume the Company’s obligations set forth herein prior to the purchase or assignment.
 

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 9.  Representations and Warranties.
 

 The Company represents and warrants to the Consultant that this Agreement has been duly authorized, executed and delivered by the Company, is the legal obligation of the Company and is enforceable as to the Company in accordance with its terms.
 

 10.  Governing Law.
 

 This Agreement shall be construed in accordance with and shall be governed by, the laws of the State of Delaware without giving effect to rules governing conflicts of law.
 

 11.  Entire Agreement.
 

 This Consulting Agreement contains the entire understanding and agreement between the parties relating to the subject matter hereto except as otherwise referred to herein, and supersedes any prior agreement between the parties, whether written or oral.  Neither this Agreement nor any provision hereof may be waived, modified, amended, changed, discharged or terminated, except by an agreement in writing, signed by the party against whom enforcement of any waiver, modification, change, amendment, discharge or termination is sought.  To the extent any employee handbook or similar policies of the Company are inconsistent with the Agreement, this Agreement shall control and govern.
 

 12.  Counterparts.
 

 This Agreement may be executed in counterparts, each of which shall be deemed an original, and such counterparts together shall constitute a single instrument.
 

 13.  Provisions Schedule.
 

 To the extent any one or more of the provisions of this Agreement shall be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby but shall remain in full force and effect.
 

 14.  Headings.
 

 The section headings herein are for convenience only and shall not be used in interpreting or construing this Agreement.
 

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 15.  Notices.
 

 Any notice required or permitted to be given under the provisions of this Agreement shall be in writing and shall be deemed to have been duly delivered and received (i) on the date of personal delivery, or (ii) on the date of receipt (as shown on the return receipt) if mailed by certified or registered mail, return receipt requested, postage prepaid, or sent by Federal Express or similar courier service, with all charges prepaid, in each case addressed to the following persons at the following addresses, or to such other person or other addressed to the following persons at the following addresses, or to such other person or other addresses as either party may designate by notice in writing to the other party to this Agreement.
 

 

 	 	
	 (a) To the Consultant
	 Sean Kirwan

	  
	 2030 Highland Drive

	  
	 Newport Beach, CA 92660

	  
	  

	 (b) To the Company:
	 CONSOLIDATION SERVICES, INC.

	  
	 2300 W. Sahara Ave

	  
	 Suite 800

	  
	 Las Vegas, NV 89102

	  
	 Atten: Gary Kucher

	  
	  

	 With a copy to:
	 Elliot H. Lutzker 

	  
	 Davidoff Hutcher & Citron LLP 

	  
	 605 Third Ave., 34th Floor 

	  
	 New York, NY 10158 

 

 16.  Agreement to Arbitrate.
 

 Any controversy or claim arising out of or relating to this Agreement, or breach of this Agreement, shall be settled by arbitration in accordance with the Arbitration rules of the American Arbitration Association, or any arbitral forum mutually agreed to in writing by the parties.  The arbitrator shall issue a written decision that will provide for any and all damages otherwise available in a court of law.  Judgment on the award rendered by arbitrator may be entered in any court having jurisdiction.    
 

 

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 There shall be one arbitrator selected by the parties. The Company shall pay all fees and costs associated with the arbitration, including the attorney’s fees and costs of Consultant should the arbitrator conclude that the Company breached the Agreement in any respect, or Consultant is awarded any money, benefits or damages as a result of the arbitration.
 

 This Agreement does not create, and shall not be construed as creating any rights enforceable by any person not a party to this Agreement, other than as provided in Paragraph 8, assignment of rights.
 

 

 

 

 

 

 

 

 

 

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 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first hereinabove written.
 

 CONSOLIDATION SERVICES, INC.
 

 

 By:   /s/ Gary Kucher
   Gary Kucher, CEO
 

 

 Dated: 1/28/2013
 

 

 

 CONSULTANT
 

 

 By: /s/ Sean Kirwan
   Sean Kirwan
 

 Dated: 1/25/2013
 

 

 

 

 

 

 7ex10-1.htm

Exhibit 10.1

Subscription Agreement

This subscription (this “Subscription”) is dated ______, 2013, by and between the investor identified on the signature page hereto (the “Investor”) and China Armco Metals, Inc., a Nevada corporation (the “Company”), whereby the parties agree as follows:

 

1.           Subscription.

Investor agrees to buy and the Company agrees to sell and issue to Investor such number of shares (the “Shares”) of the Company’s common stock, $0.001 par value per share (the “Common Stock”), as set forth on the signature page hereto, for an aggregate purchase price (the “Purchase Price”) equal to the product of (x) the aggregate number of Shares the Investor has agreed to purchase and (y) the purchase price per Share as set forth on the signature page hereto.  The Purchase Price is set forth on the signature page hereto.

 

The Shares have been registered on a Registration Statement on Form S-3, Registration No. 333-184354 (the “Registration Statement”).  The Registration Statement has been declared effective by the Securities and Exchange Commission (the “Commission”) and is effective on the date hereof.  A final prospectus supplement will be delivered to the Investor as required by law.

 

The completion of the purchase and sale of the Shares (the “Closing”) shall take place at a place and time (the “Closing Date”) to be specified by the Company, dated _______, 2013 (the “Agreement”).  Upon satisfaction or waiver of all the conditions to closing set forth in the Agreement, at the Closing, (i) the Investor shall pay the Purchase Price by wire transfer of immediately available funds to  the Company on Annex A, and (ii) the Company shall cause the Shares to be delivered to the Investor with the delivery of the Shares to be made through the facilities of The Depository Trust Company’s DWAC system in accordance with the instructions set forth on the signature page attached hereto under the heading “DWAC Instructions” (or, if requested by the Investor on the signature page hereto, through the physical delivery of certificates evidencing the Shares to the residential or business address indicated thereon).

 

2.           Company Representations and Warranties.  The Company represents and warrants that:  Except as disclosed on Schedule 2 of the Company Disclosure Schedule (a) it has full corporate power and authority to enter into this Subscription and to perform all of its obligations hereunder; (b) this Subscription has been duly authorized and executed by, and when delivered in accordance with the terms hereof will constitute a valid and binding agreement of, the Company enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the rights and remedies of creditors generally or subject to general principles of equity; (c) the execution and delivery of this Subscription and the consummation of the transactions contemplated hereby do not conflict with or result in a breach of (i) the Company’s Certificate of Incorporation or Bylaws and amendments thereto through the date hereof, or (ii) any material agreement to which the Company is a party or by which any of its property or assets is bound; (d) the Shares when issued and paid for in accordance with the terms of this Subscription will be duly authorized, validly issued, fully paid and non-assessable; (e) the Registration Statement and any post-effective amendment thereto, at the time it became effective, did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; (f) the prospectus contained in the Registration Statement, as amended and/or supplemented, did not contain as of the effective date thereof, and as of the date hereof does not contain, any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; and (g) all preemptive rights or rights of first refusal held by stockholders of the Company and applicable to the transactions contemplated hereby have been duly satisfied or waived in accordance with the terms of the agreements between the Company and such stockholders conferring such rights.

 

  

  

  

 

3.           Investor Representations, Warranties and Acknowledgments. 

(a)      The Investor represents and warrants that: (i) it has full right, power and authority to enter into this Subscription and to perform all of its obligations hereunder; (ii) this Subscription has been duly authorized and executed by the Investor and, when delivered in accordance with the terms hereof, will constitute a valid and binding agreement of the Investor enforceable against the Investor in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the rights and remedies of creditors generally or subject to general principles of equity; (iii) the execution and delivery of this Subscription and the consummation of the transactions contemplated hereby do not conflict with or result in a breach of (A) the Investor’s certificate of incorporation or by-laws (or other governing documents), or (B) any material agreement or any law or regulation to which the Investor is a party or by which any of its property or assets is bound; (iv) it has had full access to the base prospectus included in the Registration Statement, as amended and/or supplemented as of the date hereof, and the Company’s periodic reports and other information incorporated by reference therein, and was able to read, review, download and print such materials; (v) in making its investment decision in this offering, the Investor and its advisors, if any, have relied solely on the Company’s public filings with the Commission; (vi) it is knowledgeable, sophisticated and experienced in making, and is qualified to make, decisions with respect to investments in securities representing an investment decision like that involved in the purchase of the Shares; (vii) the Investor and the Investor’s attorney, accountant, purchaser representative and/or tax advisor, if any (collectively, “Advisors”), have received and have carefully reviewed this Subscription Agreement, the Company’s SEC filings, and each of the transaction documents and all other documents requested by the Investor or its Advisors, if any, and understand the information contained therein, prior to the execution of this Subscription Agreement; (viii) all documents, records, and books pertaining to the investment in the Shares including, but not limited to, all information regarding the Company and the Shares, have been made available for inspection and reviewed by the Investor and its Advisors, if any; (ix) the Investor and its Advisors, if any, have had a reasonable opportunity to ask questions of and receive answers from the Company’s officers and any other persons authorized by the Company to answer such questions, concerning, among other related matters, the prospectus, the Shares, the transaction documents and the business, financial condition, results of operations and prospects of the Company and all such questions have been answered by the Company to the full satisfaction of the Investor and its Advisors, if any; (x) the Investor has taken no action which would give rise to any claim by any person for brokerage commissions, finders’ fees or the like relating to this Subscription Agreement or the transactions contemplated hereby; (xi) The Investor is not relying on the Company or any of its respective employees or agents with respect to the legal, tax, economic and related considerations of an investment in any of the Shares and the Investor has relied on the advice of, or has consulted with, only its own Advisors; (xii) the investor is satisfied that it has received adequate information with respect to all matters which it or its Advisors, if any, consider material to its decision to make this investment; (xiii) the Investor has had no position, office or other material relationship within the past three years with the Company or persons known to it to be affiliates of the Company; (xiv) except as set forth below, the Investor is not a, and it has no direct or indirect affiliation or association with any, member of FINRA or an Associated Person (as such term is defined under the NASD Membership and Registration Rules Section 1011) as of the date hereof; and (xv) neither the Investor nor any group of Investors (as identified in a public filing made with the Commission) of which the Investor is a part in connection with the offering of the Shares, acquired, or obtained the right to acquire, twenty percent (20%) or more of the Common Stock (or securities convertible into or exercisable for Common Stock) or the voting power of the Company on a post-transaction basis.

 

  

(If no exceptions, write “none.” If left blank, response will be deemed to be “none.”)

(b)      The Investor also represents and warrants that, other than the transactions contemplated hereunder, the Investor has not directly or indirectly, nor has any person acting on behalf of or pursuant to any understanding with the Investor, executed any transactions in securities of the Company, including “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act (“Short Sales”), during the period commencing from the time that the Investor first became aware of the proposed transactions contemplated hereunder until the date hereof (the “Discussion Time”).  The Investor has maintained the confidentiality of all disclosures made to it in connection with this transaction (including the existence and terms of this transaction).

 

  

  

  

 

4.           Investor Covenant Regarding Short Sales and Confidentiality.  The Investor covenants that neither it nor any affiliates acting on its behalf or pursuant to any understanding with it will execute any transactions in securities of the Company, including Short Sales, during the period after the Discussion Time and ending at the time that the transactions contemplated by this Subscription are first publicly announced through a press release and/or Form 8-K.  The Investor covenants that until such time as the transactions contemplated by this Subscription are publicly disclosed by the Company through a press release and/or Form 8-K, the Investor will maintain the confidentiality of all disclosures made to it in connection with this transaction (including the existence and terms of this transaction).

 

5.           Miscellaneous.

This Subscription constitutes the entire understanding and agreement between the parties with respect to its subject matter, and there are no agreements or understandings with respect to the subject matter hereof which are not contained in this Subscription.  This Subscription may be modified only in writing signed by the parties hereto.

This Subscription may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument and shall become effective when counterparts have been signed by each party and delivered to the other parties hereto, it being understood that all parties need not sign the same counterpart.  Execution may be made by delivery by facsimile.

The provisions of this Subscription are severable and, in the event that any court or officials of any regulatory agency of competent jurisdiction shall determine that any one or more of the provisions or part of the provisions contained in this Subscription shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision or part of a provision of this Subscription and this Subscription shall be reformed and construed as if such invalid or illegal or unenforceable provision, or part of such provision, had never been contained herein, so that such provisions would be valid, legal and enforceable to the maximum extent possible, so long as such construction does not materially adversely effect the economic rights of either party hereto.

All communications hereunder, except as may be otherwise specifically provided herein, shall be in writing and shall be mailed, hand delivered, sent by a recognized overnight courier service such as Federal Express, or sent via facsimile and confirmed by letter, to the party to whom it is addressed at the following addresses or such other address as such party may advise the other in writing:

To the Company:  as set forth on the signature page hereto.

To the Investor:  as set forth on the signature page hereto.

All notices hereunder shall be effective upon receipt by the party to which it is addressed.

(e)      This Subscription shall be governed by and interpreted in accordance with the laws of the State of New York for contracts to be wholly performed in such state and without giving effect to the principles thereof regarding the conflict of laws.  To the extent determined by such court, the prevailing party shall reimburse the other party for any reasonable legal fees and disbursements incurred in enforcement of or protection of any of its rights under this Subscription.

 

If the foregoing correctly sets forth our agreement, please confirm this by signing and returning to us the duplicate copy of this Subscription.

 

  

  

  

 

	  	
CHINA ARMCO METALS, INC.

	  	  	  
	  	
By:

	
 ____________________________________

	  	  	
Name:

	
 

Number of Shares:____________________________

Purchase Price per Share: $____________________

Aggregate Purchase Price: $____________________

 

	  	
Title:

 

Address for Notice:

 

One Waters Park Drive, Suite 98

San Mateo, CA

Attention:  Chief Executive Officer

 

	  	  	  
	
INVESTOR: ________________________________

	  	  
	  	  	  
	
By:  ________________________________________

	  	  
	
        Name:

	  	  
	
        Title:

	  	  
	  	  	  
	
Select method of delivery of Shares:

	  	  
	  	  	  
	
o DWAC DELIVERY

	  	  
	
DWAC Instructions:

	  	  
	  	  	  
	
Name of DTC Participant (broker-dealer at which the account or accounts to be credited with the Shares are maintained):

	  	
 

_____________________________________

	  	  	  
	
DTC Participant Number:

	  	
_____________________________________

	  	  	  
	
Name of Account at DTC Participant being

credited with the Shares:

	  	
 

_____________________________________

	  	  	  
	
Account Number at DTC Participant being credited

with the Shares:

	  	
 

_____________________________________

	  	  	  
	
o  PHYSICAL DELIVERY OF CERTIFICATES

	  	  
	
Delivery Instructions:

	  	  
	  	  	  
	
Name in which Shares should be issued:

 

_______________________________________

	  	
Address for delivery:

c/o  _______________________________

Street:   ____________________________

City/State/Zip: ______________________  

Attention: __________________________

Telephone No.: ____________________  

 

  

  

  

Company Disclosure Schedule

Schedule 2

The Subscription Agreement for the July 2008 offering of the Company (the “2008 Offering”) provides that while the purchasers own any securities sold in the offering, such securities are subject to anti-dilution protections. In the event the Company issues any shares of common stock or securities convertible into or exercisable for shares of common stock to any third party purchaser at a price per share of common stock or exercise price per share which is less than the per share purchase price of the shares of common stock in this offering, or less than the exercise price per warrant share, respectively, without the consent of the purchasers then holding securities issued in this offering, the purchaser is given the right to apply the lowest such price to the purchase price of shares purchased and still held by the purchaser and to shares issued upon exercise of the warrants and still held by the purchaser (which will result in the issuance of additional shares to the purchaser) and to the exercise price of any unexercised warrants.  The sale of Common Stock pursuant to this Subscription Agreement will trigger the 2008 Offering anti-dilution protections.  The 2008 Offering is described in a Form 8-K filed by the Company with the Securities and Exchange Commission on August 1, 2008.

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