Document:

Exhibit
      4.2

    Consulting
      Agreement of Aaron Foley

    
 

    
      CONSULTING
        AGREEMENT

      

      THIS
        CONSULTING AGREEMENT, dated July 18, 2006 (this “Agreement”),
        between NOVASTAR RESOURCES, LTD., a Nevada corporation (“Company”)
        and
        AARON FOLEY, an individual (“Consultant”).
        For
        the purposes of this Agreement, either of the above shall be referred to
        as a
“Party”
and
        collectively as the “Parties”.

      

      Company
        desires to retain Consultant to perform the Services (as defined below) and
        Consultant desires to perform the Services for Company, subject to the terms
        and
        conditions set forth below.

      

      NOW,
        THEREFORE, in consideration of the premises and mutual covenants hereinafter
        contained, the parties hereto intending to be legally bound hereby agree
        as
        follows:

      

      1.    Appointment
        of Consultant.
        Company
        hereby appoints Consultant and Consultant hereby agrees to render services
        to
        Company to assist Company with its
        business strategy, management and corporate expansion goals.

      

      2.    Services.
        Subject
        to the terms of this Agreement, Consultant agrees to act as a consultant
        on
        behalf of Company and will render strategic and financial advisory services
        (the
“Services”)
        on a
        non-exclusive basis as outlined below: 

       

      
        	 	
                ·

              	
                Assist
                  Company in developing a business
                  strategy.

              

      

       

      
        	 	
                ·

              	
                Assist
                  Company in developing an acquisition strategy and
                  structure.

              

      

       

      
        	 	
                ·

              	
                Assist
                  Company in performing due
                  diligence.

              

      

       

      
        	 	
                ·

              	
                Assist
                  Company in analyzing relevant financial and operating data.
                  

              

      

       

      
        	 	
                ·

              	
                Assist
                  Company in preparing a projection model, and other financial
                  models.

              

      

       

      
        	 	
                ·

              	
                Assist
                  Company in connection with investor relations.

              

      

       

      
        	 	
                ·

              	
                Other
                  services as mutually agreed to by Company and
                  Consultant.

              

      

       

      3.    Term.
        The
        term (“Term”)
        of
        this Agreement shall commence on the date first written above and shall expire
        twelve (12) months thereafter; provided,
        however, that this Agreement may be extended for additional periods of one
        (1)
        year
        with the
        mutual consent of the parties hereto. Notwithstanding
        the foregoing, this Agreement may be terminated by either party, with or
        without
        cause, at any time following upon sixty (60) days written notice to that
        effect
        to the other party.

       

      4.    Compensation.
        

       

      (a)    For
        the
        services rendered and performed by Consultant during the term of this Agreement,
        Company shall, as soon as practicable after the date hereof: pay to Consultant
        a
        total of Thirty-Five
        Thousand (35,000)
        shares
        of
        Company’s Common Stock (the “Fee”).
        These
        shares will be restricted stock and Company’s transfer agent will be instructed
        to imprint a standard restrictive legend that refers to transfer restrictions
        under the Securities Act of 1933, as amended and to impose stop transfer
        restrictions against the shares.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (b)    Upon
        termination of this Agreement for any reason, Consultant expressly understands
        and agrees that Company’ sole obligation shall be to pay Consultant the
        Fee.

      

      (c)     Reimbursement
        of any reasonable travel expenses, if any, shall be made according to Company’
corporate policy. Consultant shall be reimbursed for other reasonable and
        necessary expenses actually incurred or paid by Consultant during the term
        or
        any extension thereof in the performance of the Services within twenty (20)
        business days of the submission and approval by Company of expense statements,
        vouchers, or other supporting information reasonably acceptable to Company.
        

      

      5.    Termination.
        Consultant’s engagement hereunder shall terminate at the end of the Term or any
        extension thereof as set forth in Section
        3
        hereof
        or sooner upon the occurrence of any of the following events:

       

      (a)    The
        termination of Consultant hereunder by Company at its option, for any reason
        or
        no reason, to be exercised by sixty (60) days’ written notice from Company to
        Consultant.

       

      (b)    The
        incapacity or death of Consultant.

       

      (c)    Upon
        delivery of written notice by Company to Consultant, if Consultant materially
        breaches this Agreement; provided that the Company gives Consultant a
        description of the material breach and at least twenty (20) days to cure
        such
        breach.

       

      6.    Confidentiality.
        Consultant will not disclose to any other person, firm or corporation, nor
        use
        for its own benefit, during or after the Term of this Agreement,
        any trade secrets or other information designated as confidential by Company
        which is acquired by Consultant in the course of performing services hereunder.
        Any financial advice rendered by Consultant pursuant to this Consulting
        Agreement may not be disclosed in any manner without the prior written approval
        of Company.

       

      7.    Independent
        Contractor.
        Consultant and Company hereby acknowledge that Consultant is an independent
        contractor. Consultant shall not hold itself out as,
        nor
        shall it take any action from which others might infer that it is an agent
        of or
        a joint venture of Company. All taxes and other expenses are also responsibility
        of Consultant.

       

      8.    Work
        For Hire.

       

      (a)    The
        parties acknowledge and agree that all rights, including without limitation
        ownership, patent and copyright, in any software, materials, reports (including,
        without limitation, report books, reference materials and other literature
        relating to Company’ products or services or otherwise related to the Services),
        memoranda, graphics, logos or other work product prepared by Consultant pursuant
        to the terms of this Agreement, or otherwise for Company (hereinafter the
        “Work
        Product”)
        vest
        in Company. The parties expressly acknowledge that the Work Product was
        specially ordered or commissioned by Company and further agree that it shall
        be
        considered a “Work Made for Hire” within the meaning of the copyright laws of
        the United States and that Company is entitled, as sole author, to the copyright
        and all other rights therein, throughout the world, including but not limited
        to, the right to make such changes therein and such uses thereof, as it may
        determine in its sole and absolute discretion. If, for any reason, the Work
        Product is not considered a “work made for hire” under the copyright laws of the
        United States as aforesaid, then Consultant hereby grants and assigns to
        Company, its successors and assigns, all of Consultant’s right, title and
        interest in the Work Product, including, but not limited to, the copyright
        therein throughout the world (and any renewal, extension or reversion copyright
        now or hereafter provided), and all other rights therein of any nature
        whatsoever, whether now known or hereafter devised including, but not limited
        to, the right to make changes therein, and such uses thereof, as Company
        may
        determine in its absolute discretion. Consultant also agrees to keep necessary
        records, made alone or with others during the course of performing Services
        pursuant to this Agreement, and agrees to furnish Company, upon request,
        with
        all such records.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      

      (b)    If
        Company is unable, after reasonable effort, to secure Consultant’s signature on
        any application for patent, copyright, trademark or other analogous registration
        or other documents regarding any legal protection relating to a Work Product,
        whether because of Consultant’s physical or mental incapacity or for any other
        reason whatsoever, Consultant hereby irrevocably designates and appoints
        Company
        and its duly authorized officers and agents as Consultant’s agent and
        attorney-in-fact, to act for and in Consultant’s behalf and stead to execute and
        file any such application or applications or other documents and to do all
        other
        lawfully permitted acts to further the prosecution and issuance of patent,
        copyright or trademark registrations or any other legal protection thereon
        with
        the same legal force and effect as if executed by Consultant.

      

      9.    Proprietary
        Information

       

      (a)    For
        purposes of this Agreement, “proprietary information” means information relating
        to the business of Company or any affiliated or subsidiary entity and shall
        include (but shall not be limited to) information encompassed in all Work
        Product, specifications, drawings, graphics, logos, designs, computer programs,
        source code, object code, models, methodologies, algorithms, user documentation,
        plans, formulas, proposals, marketing and sale plans, financial information,
        costs, pricing information, customer information, and all methods, concepts
        or
        ideas in or reasonably related to the business of Company or information
        of
        customers or clients of Company which Company is required to maintain as
        confidential.

       

      (b)    Consultant
        agrees to regard and preserve as confidential, all proprietary information,
        whether or not it has such information in writing, other physical or magnetic
        form or such information is contained in Consultant’s memory or the memory of
        any of Consultant’s agents or employees. Consultant shall not, without written
        authority from Company to do so, directly or indirectly, use for the benefit
        or
        purpose, nor disclose to any other person or entity, either during the term
        of
        Consultant’s engagement hereunder or thereafter, except as required by the
        conditions of Consultant’s engagement hereunder, any proprietary
        information.

       

      (c)    Consultant
        shall not disclose any reports, recommendations, conclusions or other results
        of
        the Services or the existence or the subject matter of this contract without
        the
        prior written consent of Company. In Consultant’s performance hereunder,
        Consultant shall comply with all legal obligations Consultant may now or
        hereafter have regarding the information or other property of any other person,
        firm or corporation.

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      (d)    The
        foregoing obligations of this Paragraph shall not apply to any part of the
        information that (i) has been disclosed in publicly available sources of
        information, (ii) is, through no fault of Consultant, hereafter disclosed
        in
        publicly available sources of information, (iii) can be demonstrated to Company’
satisfaction that it is now in the possession of Consultant without any
        obligation of confidentiality, or (iv) has been or is hereafter lawfully
        disclosed to Consultant by a third party, but only to the extent that the
        use or
        disclosure thereof has been or is rightfully authorized by that third
        party.

      

      10.    Injunctive
        Relief.
        Consultant acknowledges that the injury to Company resulting from any violation
        by Consultant of any of the covenants contained in this Agreement will be
        of
        such a character that Company cannot be adequately compensated by money damages,
        and, accordingly, Company may, in addition to pursuing its other remedies,
        obtain an injunction from any such violation; and no bond or other security
        shall be required in connection with such injunction.

      

      11.    Entire
        Agreement/Modification/Survival.
        This
        Agreement sets forth the entire understanding of the Parties relating to
        the
        subject matter hereof, and supersedes
        and cancels any prior communications, understandings and agreements between
        the
        Parties. This Agreement is non-exclusive and cannot be modified or changed,
        nor
        can any of its provisions be waived, except by written agreement signed by
        all
        Parties. The
        terms
        and conditions of Paragraphs 7, 9, 10, 11 and 12 hereof shall survive the
        termination of this Agreement or completion of the Services as the case may
        be.

      

      12.    Assignment.
        Consultant shall be the primary provider of the Services and Consultant shall
        not assign this Agreement or delegate Consultant’s duties hereunder and shall
        not subcontract any of the Services to be performed hereunder without the
        prior
        written consent of Company.

      

      13.    Governing
        Law.
        This
Agreement
        shall be governed by the laws of the State of New York without reference
        to the
        conflict of law principles thereof. In the event of any dispute as to the
        Terms
        of this Consulting Agreement, the prevailing Party in any litigation shall
        be
        entitled to reasonable attorney's fees.

       

      14.    Notices.
        Any
        notice required or permitted hereunder shall be given in writing (unless
        otherwise specified herein) and shall be deemed effectively given
        upon personal delivery or seven business days after deposit in the United
        States
        Postal Service, by (a) advance copy by fax, (b) mailing by express courier
        or
        registered or certified mail with postage and fees prepaid, addressed
to
        each
        of the other Parties thereunto entitled at the addresses specified on the
        signature page hereto, or at such other addresses as a Party may designate
        by
        ten days advance written notice to each of the other Parties at the addresses
        above and to the attention of the persons that have signed below.

       

      

      [signature
        page follows]

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      IN
        WITNESS WHEREOF, the parties hereto have duly executed this Consulting Agreement
        with
        full
        authority
        as of
        the date first above written.

       

      

      COMPANY:

      

      NOVASTAR
        RESOURCES, LTD.

      
 

      /s/
        Seth Grae    

      Seth
        Grae

      President

      

      

      CONSULTANT:

      
 

      /s/
        Aaron Foley   

      Aaron
        Foley

       

      
        
           

        

          5DEMAND PROMISSORY NOTE
                             ----------------------

$500,000.00                                                   September 14, 2006

      FOR VALUED RECEIVED, Smart Energy Solutions, Inc., a Nevada corporation
("Payor"), promises to pay to EGFE, Ltd. ("Payee") the principal sum of Five
Hundred Thousand and 00/100 ($500,000.00) Dollars with interest accruing on the
unpaid principal balance commencing the date hereof at the rate of twelve (12%)
percent. The principal and accrued interest under this promissory note (the
"Note") shall, at the election of Payee, become immediately due and payable in
full ten (10) business days after Payor's receipt of written demand for payment
from Payee.

      Each of the following events shall constitute an event of default
hereunder: (a) Payor's failure to make payment of any amount due hereunder after
the same shall become due and payable in accordance with the terms hereof and
such failure continues for twenty (20) business days after Payor receives from
Payee written notice of such failure; (b) Payor files a voluntary petition in
bankruptcy or an involuntary petition is filed against it and not dismissed
within ten (10) days. Payor hereby waives presentment, demand for payment,
protest, and all other demands and notices in connection with the delivery,
acceptance, performance and enforcement of this Note and authorizes Payee,
without notice or further consent, to grant extensions of time in the payment of
any monies under this Note, and to waive compliance of any provision of this
Note.

      This Note may be prepaid by Payor, in whole or in part, at any time
without penalty.

      This Note shall be construed, performed, and enforced in accordance with
the laws of the State of New Jersey. Payor and Payee hereby irrevocably consent
to the in personam jurisdiction of the state or federal courts located in the
State of New Jersey, in connection with any action or proceeding arising out of
or relating to this Note or the transactions and the relationships established
hereunder. Payor and Payee hereby agree that such courts shall be the venue and
exclusive and proper forum in which to adjudicate such matters and that they
will not contest or challenge the jurisdiction or venue of these courts.

      This Note shall be binding upon and inure to the benefit of Payor and
Payee and their permitted successors and assigns.

      IN WITNESS WHEREOF, Payor has executed this Demand Promissory Note the day
and year first above written.

                                                SMART ENERGY SOLUTIONS, INC.

                                                By:    /s/ Pete Mateja
                                                       ---------------
                                                Name:  Pete Mateja
                                                Title: Chief Executive Officer

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