Document:

fs1a6ex10xx_greensol.htm

Exhibit 10.20

 

Yu Zu Tang

Consultancy Agreement

 

 

 

Dated the 27th day of April 2010

 

 

 

DAI QINGCHOU

 

(戴慶儔)

 

 

and

 

GLORIOUS PIE LIMITED

 

 

 

 

 

CONSULTANCY AGREEMENT

 

for Yu Zu Tang

 

(御足堂)

 

 

  

  

  

 

 

TABLE OF CONTENTS

 

 

	
Clauses

	
    Page

	  	  	  
	  	  	  
	
1

	
INTERPRETATION

	
1

	
2

	
THE CENTRE

	
3

	
3

	
SCOPE OF WORK

	
3

	
4

	
TERM

	
4

	
5

	
OPERATION

	
4

	
6

	
LICENSES

	
5

	
7

	
CONSIDERATION AND PAYMENT

	
6

	
8

	
BOOKS AND RECORDS

	
7

	
9

	
COVENANTS AND WARRANTIES

	
7

	
10

	
DAMAGE, DESTRUCTION AND CONDEMNATION OF THE CENTRE

	
8

	
11

	
DEFAULT AND TERMINATION

	
9

	
12

	
CONFIDENTIALITY

	
10

	
13

	
FORCE MAJEURE

	
11

	
14

	
GOVERNING LAW AND JURISDICTION

	
13

	
15

	
MISCELLANEOUS

	
13

	 	 	 
	
SCHEDULE 1 - THE CENTRE

	
16

	
SCHEDULE 2 - LICENCES

	
17

	
EXECUTION PAGE

	
18

 

  

  

  

 

Yu Zu Tang

Consultancy Agreement

 

CONSULTANCY AGREEMENT

 

 

This Agreement is made on the 27th day of April 2010 between:-

 

	
(1)  

	
DAI QINGCHOU (戴慶儔), holder of the Identity Card of China number 4425271960243355 of 中国广东省东莞巿长安镇乌沙同达路同和一巷14号        (the “Proprietor”); and

 

	
(2)

	
GLORIOUS PIE LIMITED, a company incorporated with limited liabilities under the laws of British Virgin Islands whose registered office is situated at Sea Meadow House, Blackburne Highway, Road Town, Tortola, British Virgin Islands (the “Consultant”).

 

 

Whereas:-

 

	
(A)

	
The Proprietor is entitled to run a massage business in the Centre (Refer to Clause 2 and Schedule 1 for details) and has obtained all the licences required by the laws of China and the Relavant Authorities (Refer to Schedule 2 for details).

 

	
(B)

	
To introduce an effective operating system on energy saving and cost control, the Proprietor therefore appoints the Consultant to provide consultancy services on eco-operation and interior design of the Centre.

 

	
(C)  

	
In return for the consultancy services, the Proprietor shall pay the Consultancy Fee to the Consultant in accordance with Clause 6 of this Agreement.

 

 

It is agreed as follows:-

 

	
1.  

	
INTERPRETATION

 

	
1.1  

	
Definitions

 

“Agreement” shall mean this Consultancy Agreement, together with the Schedules hereto, in each case as from time to time amended by the parties hereto and includes all Licences and consents granted under it.

 

“Centre” shall mean the Centre in the form and structure situated on the location as described in Schedule 1 operated under the name “御足堂(Yu Zu Tang)”.

 

  

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Consultancy Agreement

 

“Centre Employee” shall mean any person employed by the Proprietor or the Centre Manager at the Centre or elsewhere (whether on a full-time or part-time basis) in connection with the operation of the Centre, including the general manager, the director of marketing and the financial controller of the Centre (or serving such functions, regardless of the specific titles given to such individuals).

 

“Centre Manager” shall mean an individual or a company engaged and to be paid by the Proprietor for providing his expert services in managing the Centre in accordance with the terms set out in this Agreement and the relevant employment contract which shall be entered into between the individual or company and the Proprietor.

 

“China” shall mean the People’s Republic of China.

 

“Confidential Information” shall mean any information of a confidential nature including, without limitation, details of guests of the Centre, contractual rates, supplier details, employees’ salaries and wages, managers policies and procedures, information held on the reservation system of the Centre including guest history, direct mail database of customers, accounting and statistical information and any other information produced by the Centre Manager to the Proprietor relevant to the Centre. Notwithstanding the foregoing, the Centre Manager shall be entitled to use the Confidential Information in the normal course of their business to the same extent as similar information is used for all or groups of their Centres including, but not limited to and by way of example only, for marketing and guest tracking databases, direct mailings and sales activities, inclusion on reservation systems, development of best practices, financial analysis and use by professional advisers.

 

“Consultancy Fee” shall have the meaning ascribed to it in Clause 7.1.

 

“Fiscal Year” shall mean 1st June in one year to 31st May of the following year (both days inclusive) for all purposes, except that the first fiscal year shall commence on the date of execution of this Agreement and end on 31st May of the following year (both days inclusive) and the last fiscal year shall end on the date of the expiration of the Term (both days inclusive).

 

“Government” shall mean the Central Government of China.

 

“Hong Kong” shall mean the Hong Kong Special Administrative Region of China.

 

  

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Consultancy Agreement

 

“Legal Requirements” shall mean:

 

	
(i)  

	
any ordinance or statutory provision, proclamation, rule, regulation, code, order, resolution, notice, rule of court, bylaw or other instrument (having the force of law); and

 

	
(ii)  

	
any rulings, directions, guidelines and/or decision of any Relevant Authorities (having the force of law)

 

for the time being in force in China applicable to or regulating the management or operation of the Centre or this Agreement, and “Legal Requirement” shall mean any one of them.

 

“Licences” shall mean all licences, permits, approvals, certificates (statutory or otherwise) in relation to the operation of the massage centre or the performance by the parties of their respective obligations hereof as required by the Relevant Authorities or institutions under the applicable laws and regulations of each party’s place of incorporation and/or the location of the Centre.

 

“Relevant Authorities” shall mean any Government departments, Government agencies, public bodies, regulatory bodies and any bodies, boards, committees or panels formed under or pursuant to any ordinance or statutory provision, rule, regulation, order, resolution, notice, bylaw or other instrument having the force of law from time to time in China and any utility providers or companies, and “Relevant Authority” shall mean any one of them.

 

“Representative” shall mean an invidiual being a China citizen or a company incorporated under the laws of China whom the Consultant has appointed to receive any payments on its behalf in relation to this Agreement.

 

“Term” shall have the meaning ascribed to it in Clause 4;

 

“Total Centre Income” shall mean all income generated from any parts of the operation of the Centre.

 

	
1.2  

	
References in this Agreement to a “person’ include an individual, company, partnership, joint venture, association, organisation or trust (in each case, whether or not having separate legal personality).

 

	
1.3  

	
Words importing one gender shall include all genders and words importing the singular shall include the plural and vice versa.

 

	
2.  

	
THE CENTRE

 

The Proprietor confirms that the Centre is in the form and structure situated on the location described in Schedule 1.

 

3.             SCOPE OF WORK

 

The Consultant agrees to provide the following services:-

 

  

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Consultancy Agreement

 

3.1           Eco-operation Consultancy

 

	
  

	
3.1.1

	
to advise the Proprietor and the Centre Manager on the overall management and operation strategies on energy savings and cost control of the Centre; and

 

	
  

	
3.1.2

	
to introduce the state-of-the-art ecologically-friendly concept into the management and operations of the Centre in order to achieve sustainable development which shall in turn reduce the cost of operations of the Centre effectively.

 

3.2           Interior Design

 

	
  

	
3.2.1

	
to procure suitable professions to design the interior of the Centre in an eco-friendly and sustainable manner which shall not only save costs on energy-related expenses but also contribute to a better environment of Dongguan as a whole; and

 

	
  

	
3.2.2

	
to assist the Proprietor to supervise the decoration works derived from its design and to realize the same. The works are to be carried out by contractors engaged by the Proprietor with the consent of the Consultant of such an engagement.

 

	
  

	
3.2.3

	
For avoidance of any doubt, all items purchased by the Proprietor shall at all times be owned by and are properties of the Proprietor except those invested in by the Consultant which shall at all times be owned by and are properties of the Consultant. Upon the expiration or earlier termination of the Term for whatsoever reason, the Consultant is entitled to remove and take away all items the Consultant purchased such that the costs of such removal, transportation and storage of such items are to be borne solely by the Proprietor. The Consultant is also entitled to recover the net asset value of renovation on the Centre, which is the cost minus depreciation. Depreciation is based on the five-year straight-line method used by the Consultant.

 

4.             TERM

 

The term of this Agreement shall be a period of seven (7) years commencing from the date of execution of this Agreement (the “Term”) and is renewable subject to the mutual agreement of the Proprietor and the Consultant.

 

5.             OPERATION

 

	
5.1

	
The Proprietor may consult the Consultant on the Centre operations.

 

  

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5.2

	
The Consultant is not entitled to name any entity to the board of directors responsible for the management of the Centre. The Consultant shall, however, be kept well-informed of the regular meetings of the management where strategic decisions in regards of the operations and financial issues of the Centre are made. The Consultant shall receive copies of the agenda and minutes of regular meetings and monthly revenue record for its information.

 

	
5.3

	
The Proprietor shall have the sole discretion and authority in the selection and appointment of a Centre Manager who is to act as the exclusive operator and manager of the Centre and to supervise, direct and control the management, operation and promotion of the business of the Centre during the Term.

 

	
5.4

	
The Centre Manager is authorized by the Proprietor to have the sole discretion and authority in the selection and employment of all Centre Employees necessary for the proper operation of the Centre. All costs and expenses in relation to and in connection with the employment of Centre Employees shall be borne solely by the Proprietor.

 

	
6.  

	

LICENSES

 

	
6.1

	
The Proprietor shall comply with all relevant regulations and laws of China in running the Centre business. The Proprietor shall have applied for and used its best endeavours to obtain and maintain in its own name all licences, permits and consents required in connection with the management and operation of the businesses of the Centre with effect from the date upon which the same are required. All costs and expenses for applying, renewing and maintaining of the licences and permits shall be borne solely by the Proprietor.

 

	
6.2

	
The Proprietor hereby warrants and confirms that to his best knowledge there is no pending litigation and/or claim alleging a breach of the Centre on this licensing issue and undertakes to do all possible legal remedial acts and fully indemnifies the Consultant if there are any instances of breach.

 

  

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6.3

	
Subject to prior appointment with the Proprietor, the Consultant and its agents shall, throughout the Term, have the right to inspect all such licences and permits, for the purpose of ensuring its interest which might be adversely affected due to any possible interruptions of the operation of the Centre which may arise as a consequence of the absence of such licences or permits.

 

	
6.4

	
Subject to prior appointment with the Proprietor (except in case of emergency), the Consultant and its agents shall, throughout the Term, have the right of reasonable access to all parts of the Centre (save for and except those parts which have been leased, licensed or occupied by guests, tenants or licencees) to enable the Consultant to evaluate the operation, upkeep, management and control of the Centre, and to ensure that the Centre Manager has duly complied with the conditions imposed under all relavant licences and permits.

 

	
7.  

	
CONSIDERATION ANDY PAYMENT

 

	
7. 1

	

Consideration

 

In consideration of the consultancy services contemplated in this Agreement, the Consultant shall be entitled to a montly payment of RMB 100,000 or 20% of the Total Centre Income (whichever higher), the amount of which shall be net of any costs that the Proprietor shall be solely responsible for (the “Consultancy Fee”).

 

	
7.2  

	
Payment

 

	
7.2.1  

	
For so long as this Agreement is in subsistence, the Consultancy Fee shall be paid by the Proprietor to the Consultant on a monthly basis, i.e. within five (5) Buisness Day starting from the end of each month.

 

	
  

	
7.2.2

	
Payments shall be made in cash or credited directly to the bank account of the Representative by way of cash transfer, the amount of which shall be net of any cost-deductions. The details of the bank account shall be provided as and when necessary.

 

	
  

	
7.2.3

	
All monies payable by the Proprietor shall be paid in full, free of any restrictions or conditions and without set-offs or counterclaims or otherwise. If any payments due under this Agreement are subject to any deductions or withholdings for any present or future fees, liabilities or other charges imposed by any competent governmental authority, then an additional amount shall be paid or reimbursed to the Consultant as is necessary so that the amount actually received by the Consultant equals the full amount payable or reimbursable under this Agreement.

 

  

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8.

	

BOOKS AND RECORDS

 

	
8.1

	

Books and Records

 

	
  

	
8.1.1

	
The Proprietor shall procure and supervise the Centre Manager to keep accurate, full and adequate books of account and other records of the operation of the Centre in accordance with generally-accepted accounting principles adopted in Hong Kong.

 

	
  

	
8.1.2

	
All such books and records regarding the revenue of the Centre shall be kept at the Centre or such other place as the parties agree and shall be available to the Consultant during the Term and its agents to inspect, audit and take copies at the Centre (or such other place as the parties agree) at all reasonable times and upon prior appointment with the Centre Manager and without disruption to or interference with the normal operations of the Centre.

 

	
8.2  

	

Revenue Records

         

The Proprietor shall deliver or procure the Centre Manager to deliver to the Consultant by the 15th day following the end of each calendar month, the documentation showing the revenue and turnover of the Centre for the preceding calendar month and the Fiscal Year to date and certified as true and correct by the financial controller of the Centre.

 

	
9.

	

COVENANTS AND WARRANTIES

	
9. 1

	

Covenants

                      

	
  

	
Both the Proprietor and the Consultant covenant and warrant to perform all of their respective obligations as contemplated under the terms and provisions of this Agreement.

 

	9.2 	

Warranties and Undertakings of the Proprietor

          

	
  

	
9.2.1

	
The Proprietor warrants that he is in the position with all  the rights and powers under relevant laws and/or regulations of Relevant Authorities of China to enter into this Agreement;

 

	
  

	
9.2.2

	
The Proprietor warrants that he is entitled to the ownership and the exclusive right to use and engage in activities to generate income with the the Centre as described in Schedule 1;

 

	
  

	
9.2.3

	
All Licences required to run the Centre businesses as contemplated under this Agreement have been acquired and shall be renewed as may be required from time to time pursuant to Clause 6 including but not limited to those listed in Schedule 2 as required;

 

  

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9.2.4

	
The Proprietor also warrants and confirms that there is no pending litigation / claim against him which may affect the title / ownership held of the Centre by him, etc.; and

 

	
  

	
9.2.5

	
The Proprietor undertakes to indemnify all losses of any sorts suffered by the Consultant pursuant to this Clause 9.2.

 

	10	

DAMAGE, DESTRUCTION AND CONDEMNATION OF THE CENTRE

	10.1 	

Damage or Destruction

          

If the Centre or any portion thereof shall be damaged or destroyed at any time during the Term by fire, water, storm, wind, typhoon, defective construction, white ants, earthquake, subsidence of the ground or any calamity which is not caused by the negligent act or default of the Proprietor, the Centre Manager or any or its servants, agents, employees, contractors or licensees (excluding guests staying at the Centre or visitors of the Centre) so as to make the Centre or the relevant portion thereof inaccessible, unfit or unsuitable for the operation of the Centre in accordance with the requirements set out in this Agreement and at a reasonable operating standard, the Proprietor shall with due diligence, repair, rebuild or replace the Centre so that after such repairing, rebuilding or replacement, the Centre shall be substantially the same as prior to such damage or destruction. At the Proprietor’s option, with the written approval of the Consultant, the Centre Manager (or its nominee) shall arrange for such works to be carried out for and on behalf of the Proprietor. The Proprietor shall pay for the costs and expenses of such repairing, rebuilding and replacing out of its own funds.

 

	10.2 	

Condemnation

 

If the whole or any part of the Centre is condemned as a dangerous structure or a demolition order or closing order shall become operative in respect of the Centre or any part thereof so as to make the Centre or the relevant portion thereof inaccessible, unfit or unsuitable for the operation of the Centre in accordance with any requirements set out by Relevant Authority, the Proprietor shall, subject to compliance with such prohibitions or restrictions (if any) imposed by the Relevant Authority concerned, with due diligence, repair, rebuild or replace the Centre so that after such repairing, rebuilding or replacement, the Centre shall be substantially the same as prior to such damage or destruction. At the Proprietor’s option, with the written approval of the Consultant, the Centre Manager (or its nominee) shall arrange for such works to be carried out for and on behalf of the Proprietor. The Proprietor shall pay for the costs and expenses of such repairing, rebuilding and replacing out of its own funds.

 

  

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	10.3  	

Indemnity on Damage or Destruction or Condemnation

         

Shall any of the incidents pursuant to Clause 10.1 or Clause 10.2 take place during the Term regardless of the person being held responsible for the same, the Proprietor agrees to indemnify all losses suffered by the Consultant derived from such temporary or persistent interruption of operation of the Centre. The exact amount of such indemnity to be paid shall be agreed upon and determined by mutual agreement between the Proprietor and the Consultant depending on the degree and duration of the actual interruption of the operation of the Centre.

	11.	

DEFAULT AND TERMINATION

 

	11.1	

Events of Termination

 

The following shall constitute events of termination:

 

	
  

	
11.1.1

	
persistent and material failure of the Proprietor to pay the full sum of the Consultancy Fee due to the Consultant for a continuous period of  thirty (30) days after two (2) written notice has been given by the other party;

 

	
  

	
11.1.2

	
failure of the Proprietor to supervise the Centre Manager to manage and operate the Centre in accordance with a reasonable operating standard in any material respect;

 

	
  

	
11.1.3

	
the failure of a party to perform, keep or fulfil any of the other covenants, undertakings, obligations, conditions, representations or warranties set forth in this Agreement which is capable of remedy and (a) if such failure(s) has or have a material adverse effect on the operation of the Centre or the rights and duties of any party hereto and (b) if such failure is not remedied within thirty (30) days after receipt by the defaulting party of a written notice giving particulars of the breach and requiring it to be remedied;

 

	
  

	
11.1.4

	
the filing of a voluntary petition in bankruptcy or insolvency or a petition for reorganization under any bankruptcy law by any party and such party is not discharged within forty-five (45) days thereafter;

 

	
  

	
11.1.5

	
the consent to an involuntary petition in bankruptcy or insolvency or the failure to vacate within forty-five (45) days from the date of entry thereof any order approving an involuntary petition by any party;

 

	
  

	
11.1.6

	
the appointment of a receiver for all or any substantial portion of the property of any party, which appointment is not discharged within forty-five (45) days thereafter;

 

  

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11.1.7

	
the entering of an order, judgment or decree by any court of competent jurisdiction, adjudicating any party a bankrupt or insolvent, or approving a petition seeking reorganization, or appointing a receiver, trustee or liquidator of all or a substantial part of such party’s assets (except any dissolution or liquidation for the purpose of and followed by a reconstruction, amalgamation, reorganisation, merger or consolidation approved by the Proprietor, and except any proposed debt financing or refinancing other than when insolvent), and such party is not relieved thereof within forty-five (45) days thereafter;

 

	
  

	
11.1.8

	
any party ceases, or threatens to cease, to carry on business, and such cessation, or threatened cessation, shall continue for a period of forty-five (45) days thereafter; or

 

	
  

	
11.1.9

	
any party is required by law or compelled by any court or any competent government authority to terminate this Agreement, and such party is not relieved of such a requirement or compulsion within forty-five (45) days thereafter.

 

	11.2 	

Termination on Sale of the Centre

          

In the event of the direct or indirect sale, transfer, assignment or other disposal of the Centre or any part thereof by the Proprietor or any agreement or arrangement the result or net effect of which is the direct or indirect sale, transfer, assignment, divestment, agreement, arrangement or other disposal of any interest (legal, beneficial, economic or otherwise) in the Centre the Proprietor shall be entitled to terminate this Agreement by giving a three (3) months written notice of termination to the Consultant with an abundant amount of compensation to the Consultant in form of cash payment, the amount of which is to be suggested by the Consultant and to be agreed by the Proprietor. The key consideration in determining the amount shall be the duration remaining in  the Term.

 

	11.3 	

Effects of Termination

   

	
  

	
11.3.1

	
The rights of termination granted under this Agreement shall be without prejudice to any other right or remedies of any party in respect of the breach concerned or any other breach.

 

	
  

	
11.3.2

	
Any termination of this Agreement for any reason whatsoever shall not affect any rights or obligations incurred, or arising out of circumstances which have been existed prior to such termination.

 

	12 	

CONFIDENTIALITY

	12.1 	

Confidentiality Obligations

     

Subject to Clause 12.2, each party shall keep confidential all Confidential Information and all information received or obtained pursuant to the provisions of this Agreement and all information received or obtained as a result of entering into or performing this Agreement which relates to:

 

  

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12.1.1

 

12.1.2

 

12.1.3 

	
the provisions of this Agreement and any other document referred to in this Agreement;

 

the negotiations relating to this Agreement; and

 

the other parties.

              

	12.2 	

Permitted Disclosures

           

Any party may disclose information which would otherwise be confidential if and to the extent:

 

	
  

	

12.2.1

 

12.2.2

	

required by the Legal Requirements;

 

required by any securities exchange or regulatory or governmental body,wherever situated;

 

	
  

	
12.2.3

	
required to vest the full benefit of this Agreement in any party or enforce this Agreement;

 

	
  

	
12.2.4

	
such disclosure is to the professional advisers, auditors and bankers of any party or otherwise pursuant to the terms of this Agreement on the same confidential basis;

 

	
  

	
12.2.5

 

12.2.6  

	
the information has come into the public domain through no fault of that party; and

 

the other parties have given prior written approval to the disclosure.

             

	13 	

FORCE MAJEURE

           

	13.1	

Exclusion of Liability

           

	 	
Subject to Clause 13, neither the Proprietor nor the Consultant shall be liable for any failure to observe or perform, or continue observance or performance of, any of its obligations or liabilities under this Agreement during the Term to the extent that, and for so long as, such observance or performance is prevented by an event of force majeure (as defined below) provided that the affected party gives to such other party immediate written notice of the occurrence of such an event with details of the event concerned, the extent of the prevention to which it gives rise, and any information then available as to its likely duration.

 

  

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	13.2	

Force Majeure

           

	 	
For the purpose of this Clause 13, an “event of force majeure” is an event beyond the reasonable control of either party and which (including the consequential damage and effect) causes the whole or a substantial part of the Centre to be or become unsuitable for operation as a Centre or which causes the prevention of observance or performance of the said obligations or liabilities which could not reasonably have been avoided by that party, which shall mean boycotts, embargoes, governmental restrictions, any epidemics, pandemics and other infectious diseases (but excluding severe acute respiratory syndrome), terrorist attacks, wars, war-like actions, civil commotion riots, uprising, revolutions, earthquakes, other natural occurrence or any other event beyond the control of that party. For the avoidance of doubt, neither the Proprietor nor the Consultant (in either case, “Notifying Party”) shall be excused from a Notifying Party’s observance or performance of any of its aforesaid obligations or liabilities on the ground of an event of force majeure, unless that event of force majeure affecting such Notifying Party shall be beyond the reasonable control of such notifying party.

 

	
13.3  

	
Information and Action

 

	 	
The party giving the notice shall at all times thereafter keep the other party informed and at its own costs and expenses take all reasonable actions and do all things as are within its reasonable control with a view to the cessation or removal, or the reduction to the maximum extent, (in each case as soon as possible) of the prevention of observance or performance concerned. All costs and expenses reasonably incurred by the Consultant under this Clause 13.3 shall be borne solely by the Proprietor.

 

	13.4	

Cessation

           

	 	
Immediately upon any such cessation, removal or reduction (whether or not because of action taken by the party which gave the notice), that party shall give a further written notice to such other party to that effect and forthwith thereafter, that party shall observe or perform, or resume observance or performance of, (but in the case of any such reduction only to the extent thereof) the obligation and/or liability under this Agreement whose observance or performance was previously prevented by the relevant event of force majeure.

 

	13.5	

Further Notice to Terminate

 

	 	
If, within three (3) months after service of a notice under Clause 13.1, further notice has not been given under Clause 13.4 to the effect that the force majeure concerned has wholly ceased to cause and/or been removed from causing such prevention, either party may at any time after expiry of the said three (3) months give to the other not less than one (1) month’s written notice to terminate the Term at the end of the notice period, such notice to provide that if during the notice period the force majeure concerned has wholly ceased to cause and/or been removed from causing such prevention and appropriate notice is given under Clause 13.4 to that effect then the written notice served under this Clause 13.5 shall be withdrawn.

 

  

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	14	

GOVERNING LAW AND JURISDICTION

          

	14.1	

Governing law

                    

This Agreement shall be governed by and construed in accordance with the laws of Hong Kong. In the event of any dispute or controversy arising out of or related to this Agreement, the parties hereto hereby irrevocably submit to the non-exclusive jurisdiction of the courts of Hong Kong.

 

	14.2 	

Service of Process

               

Each of the parties irrevocably agree that any writ or other notice of process, judgment or order shall be effectively served on it in connection with any suit, action or proceeding before the courts of Hong Kong if addressed and delivered to its registered office. However, nothing in the foregoing shall affect the right to serve any such document in any other manner permitted by the laws of Hong Kong.

 

	15	

MISCELLANEOUS

           

	15.1	

Interpretation

 

	
  

	
15.1.1

	
The headings of the Clauses of this Agreement and all of Schedules are inserted for convenience only and are not intended to affect the meaning of any of the provisions.

 

	
  

	
15.1.2

	
All Schedules to this Agreement are an integral part of this Agreement and all terms defined in this Agreement and the Schedules shall have the same meaning throughout this Agreement and its Schedules.

 

	
  

	
15.1.3

	
References in this Agreement to “Clauses” and “Schedules” are, except the context otherwise requires, references to the clauses of and schedules to this Agreement.

 

	15.2 	

Non-Waiver

           

	 	
The failure of either party to insist upon strict adherence to any provisions of this Agreement on any occasion shall not be considered as a waiver of any right thereafter to insist upon strict adherence to that provision or any other provision of this Agreement.

 

	15.3	

Severability

 

	 	
Should any of the provisions of this Agreement, or portions thereof, be found to be invalid by any court of competent jurisdiction, the remainder of this Agreement shall nonetheless remain in full force and effect.

 

  

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	15.4	

Modification

           

	 	
No modification of, addition to or waiver of any of the terms and condition hereof or any of the rights, obligations or defaults under this Agreement, shall be effective unless made in writing and signed by all parties to this Agreement.

 

	15.5	

Approvals

           

Whenever any party is requested under this Agreement to give its approval, consent or expression of satisfaction or acceptability to any matter, such approval, consent or expression of satisfaction or acceptability shall be given in writing, and shall not be withheld or delayed unreasonably unless this Agreement otherwise expressly provides. If a party shall desire the approval, consent or expression of satisfaction or acceptability of the other party hereto to any matter, such party shall give notice to such other party that it requests such approval, consent or expression 

of satisfaction or acceptability, specifying in such notice the matter as to which such approval, consent or expression of satisfaction or acceptability is requested.

 

	15.6 	

Notice

           

Any notice, notification or other communication under or in relation to this Agreement shall:

 

	
  

	
15.6.1

	
be given or made in writing and shall be delivered by hand to, or sent by prepaid post or by facsimile to the appropriate person, address or facsimile number previously communicated for that purpose by the parties to this Agreement, or such other address or facsimile number as the party to which it is given or made may have for the time being substituted therefore by notice in accordance with this Clause 15.6 to the party giving or making the same; and

 

	
  

	
15.6.2

	
in the case of delivery:

 

	
(i)  

	
by hand or sending by post be effectively given or made upon receipt at that address;

 

	
(ii)  

	
by facsimile be deemed to be effectively given or made upon production of a transmission report by the machine from which the facsimile was sent which indicates that the facsimile was sent in its entirety to the facsimile number of the recipient and provided that a hard copy of the notice so served by facsimile was posted the same day as the notice was served by electronic means.

 

  

14

  

 

Yu Zu Tang

Consultancy Agreement

 

	15.7	

Rights of Inspection

           

	 	
The Consultant and its agents shall have the right to inspect and access the Centre during the Term upon prior appointment with the Centre Manager. Such inspections shall be conducted without disruption to or interference with the normal operations of the Centre.

 

	15.8	

Interpretation of Covenants

          

	 	
Any obligation on the Proprietor and/or the Consultant not to do and/or not to omit anything shall include an obligation not to permit or suffer that thing to be done or omitted.

 

	15.9	

Statutes

           

Any reference in this Agreement to any ordinance or any other statute, regulation, by-law, direction, guideline, recommendation or other provision (by whatever name called), or to any section, article, paragraph or other part of any of the foregoing, shall be deemed to be a reference to the same as for the time being amended, modified, added to or re-enacted.

 

  

15

  

 

Yu Zu Tang

Consultancy Agreement

 

SCHEDULE 1

 

THE CENTRE

 

 

 

	 	 
	
 基本资料:

	 
	 	 
	 地址:	  东莞市长安镇振安路乌沙路段
	 	 
	 占地面积:  	 995平方米
	 	 
	 建筑面积:	 3,083平方米
	 	 
	 高度:    	 11.8米
	 	 
	 建筑物座数及层数:   	 1座3层
	 	 
	 房间种类及数目:  	 互动房19间
	 	 沐足房40间
	 	 推拿房16间
	 	 水池套房4间
	 	 澡堂1间
	 	 
	 餐厅数目:            	 西餐厅1间
	 	 

 

	  

地图:

	 

                              

 

御足堂

  

16

  

 

Yu Zu Tang

Consultancy Agreement

 

SCHEDULE 2

 

 

LICENCES

 

 

	
1.  

	
个人独资企业营业执照

 

	
2.  

	
公共场所卫生许可证

 

	
3.  

	
盲人保健按摩机构资格证

 

	
4.  

	
税务登记证

 

  

17

  

 

Yu Zu Tang

Consultancy Agreement

 

EXECUTION PAGE

IN WITNESS whereof, the parties hereto have duly executed this Agreement the day and year first above written.

	
SIGNED by

DAI QINGCHOU (戴慶儔)

In the presence of:-

	
)

)

)

)

)

)

 

 

/s/Qing Chou Tai

 

	
SIGNED by

TAI CHI YIP

its director

for and on behalf of

GLORIOUS PIE LIMITED

In the presence of :-

	
)

)

)

)

)

)

 

 

/s/Chi Yip Tai

 

 

 

18

 

  

SCHEDULE 1

 

THE CENTRE

 

Basic Information:

 

 

	Address:	Dongguan City Chang An Town Wusha Road Zhangan
	Section	 
	 	 
	Land Area:	995 square meters
	 	 
	Construction Area:	3,083 square meters
	 	 
	Height:	11.8 meter
	 	 
	Blocks and levels:	1Block 3 Levels
	 	 
	Types and Number of Room:	Interactive room                    19
	 	Foot massage room              40
	 	Body massage room             16
	 	Pool suite                                 4
	 	Bathroom                                 1
	 	  
	Restaurant:	Western                       1
	 	 
	Map:	 

                                                     

  

19

  

 

SCHEDULE 2

 

LICENCES

 

	
1.  

	
Sole-proprietorship Business License

	
2.  

	
Public Hygiene Permit

	
3.  

	
Blind Massage Organization Certificate

 

	
4.  

	
Tax Registration Certificate

 

 

 

20ex10_1.htm

 

THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED  (THE “ACT”) OR ANY OTHER APPLICABLE SECURITIES LAW OF ANY STATE OR OTHER JURISDICTION, AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT INCLUDING BUT NOT LIMITED TO REGULATION S PROMULGATED UNDER THE ACT. THESE SECURITIES CANNOT BE TRANSFERRED, OFFERED, OR SOLD IN THE UNITED STATES OR TO A “U.S. PERSON” (AS THAT TERM IS DEFINED IN REGULATION S PROMULGATED UNDER THE ACT) UNLESS SUCH SECURITIES ARE REGISTERED UNDER THE ACT OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE COMPANY AND ITS COUNSEL.  HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE ACT.

 

SUBSCRIPTION AGREEMENT

FOR

AMERICAN POWER CORP.,

a Nevada corporation

 

This subscription agreement (this “Subscription Agreement”) is entered into by and between American Power Corp., a Nevada corporation (the “Company”), and the person or entity executing the Subscription Agreement (the “Subscriber”).  In this Subscription Agreement, the pronoun “it” means “he,” “she,” or “it,” as appropriate.  All terms not otherwise defined herein shall have the original meaning as defined in that certain Stock Issuance Agreement dated September 10, 2010 between the Company and Subscriber (the “Stock Issuance Agreement”). This Subscription Agreement is intended to be read in conjunction with the Company’s quarterly and annual reports and any definitive proxy statements (collectively, the “Reports”) filed with the Securities and Exchange Commission (“SEC”).  All of the Company’s SEC filings, including the Reports, may be reviewed and accessed via the SEC’s website at http://www.sec.gov.  (As used herein, Subscription Agreement, Stock Issuance Agreement and Reports shall collectively be referred to as the “Disclosure Documents”).

1.           Offering.  The Company is offering for sale to the Subscriber, and the Subscriber is offering to purchase from the Company, Units at the Unit Price determined to be $0.89 per Unit on the date hereof (the “Offering”), subject to the terms, conditions, acknowledgements, representations, and warranties stated herein and in the Stock Issuance Agreement.  Each Unit consists of one (1) share of common stock of the Company (“Share”) and one share purchase warrant (each a “Warrant”). Each Warrant shall entitle the Subscriber to purchase one additional share (each a “Warrant Share”) of Common Stock, at an exercise price equal to 150% of the Unit Price at which the Unit containing the Warrant being exercised was issued, for a period of three (3) years from the date such Warrant is issued.

2.           Subscription.  The Subscriber hereby irrevocably subscribes to purchase from the Company the number of Units and at the aggregate purchase price (the “Purchase Price”) set forth on the execution page to this Subscription Agreement titled “SUBSCRIPTION AGREEMENT SIGNATURE PAGE.”

3.           Purchase.  The Subscriber shall have tendered and delivered an Advance to the Company in the amount representing the Purchase Price set forth on the Subscription Agreement Signature Page, along with the execution and delivery of this Subscription Agreement.

4.           Acceptance or Rejection of Subscription.  The Subscriber understands and agrees that the Company reserves the right, in its sole discretion, to reject this subscription, in whole or in part if the Subscriber (a) failed to deliver the Advance as payment of the Purchase Price, (b) failed to deliver a completed Subscription Agreement, or (c) constitutes a “U.S. Person” as such term is defined in Rule 902(k) of Regulation S under the Securities Act of 1933, as amended (the “Act”), until there has been notice of acceptance of the Subscriber’s subscription.  In the event of rejection of this subscription, the Company and Subscriber shall take all actions deemed necessary or advisable to remedy such disqualifying matter causing rejection of the subscription.  Upon acceptance of the subscription by the Company, the Company will deliver to the Subscriber an “accepted” Subscription Agreement, and cause the Units to be promptly issued to the Subscriber.

5.           Subscriber’s Representations, Warranties, Covenants.  The Subscriber hereby represents, warrants and covenants to the Company as follows, realizing that the Company intends to rely on these representations, warranties, and covenants, which shall survive the acceptance of the Subscriber’s subscription by the Company:

5.1           Purchase For Own Account.  The Subscriber (a) is purchasing the Units, or Shares underlying the Warrants (the Units, Shares, Warrants and Shares underlying the Warrants are collectively referred to hereafter as the “Securities”) for its own benefit and account (not as a nominee or agent) for investment purposes only and not with an intent or view to, or for, resale, distribution or fractionalization thereof, in whole or in part, (b) has no present arrangement or intention to sell or distribute the Securities, or to grant participation in the Securities, and (c) does not have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participation to such person, or to any third person, with respect to any of the Securities.

5.2           Speculative Investment.  The Subscriber represents and warrants that it understands that an investment in the Securities is speculative and involves substantial risks, including the possible loss of the entire investment, and Subscriber represents and warrants that it is in a position to lose the entire amount of such investment.  In order to understand the risks involved with such investment, Subscriber represents and warrants that it has carefully read and understood the Disclosure Documents and “Risk Factors” set forth in Section 6 of this Subscription Agreement.

5.3           Independent Review.  In making the decision to invest in the Company and subscribe for Units, the Subscriber has (a) received, read and is familiar with the Subscription Agreement, Stock Issuance Agreement and Reports (b) been given access and the opportunity to ask any and all questions it had, and to receive answers from the Company or any person acting on its behalf concerning the Company, its business plan, management and current financial condition, and/or the terms and conditions of the offer and sale of the Units, and Subscriber has received complete and satisfactory answers to any such inquiries, (c) has relied solely upon the information contained within this Subscription Agreement or upon information obtained in its own investigation, and represents and warrants that neither the Company, nor any officer, employee, agent, or affiliate of the Company has made any representations other than those contained within this Subscription Agreement, (d) understands that the attorneys, accountants or other professionals who have been employed to perform services on the Company’s behalf have NOT been employed to represent the interests of the Subscriber, and understands that it should consult with and rely on its own counsel or advisors for independent legal, accounting, financial and tax advice concerning this investment in the Company, including but not limited to advice as to the legality of any resale of the Securities, tax or other consequences of such investment in the Company, and the suitability of the investment for the Subscriber, and (e) acknowledges that the Reports have been accessible and available for inspection and that the appropriate officers of the Company have been available to answer any questions concerning this investment.  The Subscriber represents and warrants it is solely responsible for its own due diligence investigation of the Company and its analysis of the merits and risks of an investment in the Company.

5.4           Pre-existing Relationship with the Company or Sufficient Business and Financial Experience.  The Subscriber represents and warrants that: (i) it has a preexisting personal or business relationship with the Company or any of the Company’s officers, directors or controlling persons, or (ii) by reason of its business or financial experience or the business or financial experience of its professional advisors who are unaffiliated with and who are not compensated by the Company or any affiliate or selling agent of the Company, directly or indirectly, it could be reasonably assumed to have the capacity to protect its own interests in connection with the purchase of the Securities.  A “preexisting personal or business relationship” will be deemed to exist where the Subscriber has personal or business contacts with the Company, or any officer, director or controlling person of the Company, of such a nature and duration that would enable a reasonably prudent purchaser to be aware of the character, business acumen and general business and financial circumstances of the Company or person with whom such relationship exists.

5.5           No Advertisement or General Solicitation.  The offer and sale of the Units has not been advertised through any article, notice or other communication published in any newspaper, magazine, or similar media or broadcast over television or radio, or through any seminar or meeting whose attendees have been invited by any general solicitation or general advertising, and the Subscriber is not purchasing as a result of any such advertisement or solicitation.

5.6           Authority to Purchase the Units and to Execute Subscription Agreement.  The Subscriber has all the requisite power, authority and capacity to acquire and hold the Securities and to execute, deliver and comply with the terms of each of the instruments required to be executed and delivered by the Subscriber in connection with the subscription for the Units as contemplated by this Subscription Agreement, and such execution, delivery and compliance does not conflict with, or constitute a default under, any instruments governing the Subscriber, any law, regulation or order, or any agreement to which the Subscriber is a party or by which the Subscriber may be bound.  The Subscriber hereby adopts, accepts and agrees to be bound by all the terms and provisions of this Subscription Agreement, and, if this subscription is accepted in whole or in part, to perform and comply with any obligations therein imposed.

5.7           Partnership, Corporation or Trust.  If the Subscriber is a partnership, corporation or trust, the person executing this Subscription Agreement on its behalf represents and warrants that (i) it has made due inquiry to determine the truthfulness of the representations and warranties made pursuant to this Subscription Agreement, and (ii) it is duly empowered, authorized, and qualified (and if the Subscriber is a trust, by the trust agreement) to make this investment and to enter into and execute this Subscription Agreement on behalf of such entity.

5.8           Restricted Securities.  The Subscriber acknowledges that the Securities have not been registered or qualified under any federal or state securities laws in reliance upon exemptions from the registration requirements of such laws, and the Securities may not be transferred by the undersigned except in compliance with the registration requirements of such laws or pursuant to available exemptions from registration.  The offer and sale of the Securities has not been approved or disapproved by the SEC or any state regulatory authority, and any representation to the contrary is unlawful.

5.9           Legend.  The Subscriber understands and agrees that the certificate(s) or the documents representing the Securities will bear one or more restrictive legends determined by counsel to the Company to be necessary or appropriate in order to comply with United States federal or state securities law or to secure or protect any applicable exemptions from registration or qualification, including a legend in substantially the following form and the Subscriber agrees to abide by the terms thereof:

  

  

  

 

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED  (THE “ACT”) OR ANY OTHER APPLICABLE SECURITIES LAW OF ANY STATE OR OTHER JURISDICTION, AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT PROVIDED BY REGULATION S PROMULGATED UNDER THE ACT. THESE SECURITIES CANNOT BE TRANSFERRED, OFFERED, OR SOLD IN THE UNITED STATES OR TO A “U.S. PERSON” (AS THAT TERM IS DEFINED IN REGULATION S PROMULGATED UNDER THE ACT) UNLESS SUCH SECURITIES ARE REGISTERED UNDER THE ACT OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE CORPORATION AND ITS COUNSEL. HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE ACT.

5.10           Compliance with Securities Law.  The Subscriber will not sell or otherwise transfer the Securities except as permitted under the Act and applicable United States state securities laws or an exemption therefrom, provided that the Subscriber delivers to the Company an opinion of counsel (which opinion and counsel are satisfactory to the Company) confirming the availability of such exemption upon the Company’s request.

5.11           Resale.  Subscriber may resell the Securities hereunder only pursuant to registration under the Act, or pursuant to an available exemption from registration and subject to an available exemption under Rule 144 promulgated under the Act (“Rule 144”). The Securities may be sold following six (6) months from the date Subscriber purchases the Securities so long as the Subscriber is not an “affiliate” of the Company and all the conditions set forth under Rule 144 have been satisfied.

5.12           Company’s Reliance on Information Provided.  The Subscriber understands that the Securities are being offered and sold to it in reliance on specific exemptions from the registration requirements of the United States federal and state securities laws and that the Company is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgments and understandings of the Subscriber set forth herein to determine the applicability of such exemptions and the suitability of the Subscriber to acquire the Securities.

5.13           Not a U.S. Person.  The Subscriber represents and warrants that it is not a “U.S. person” as such term is defined in Rule 902(k) of Regulation S under the Act.  A definition of “U.S. person” includes but is not limited to the following: (i) any natural person resident of the U.S.; (ii) any partnership or corporation organized or incorporated under the laws of the U.S.; (iii) any estate of which any executor or administrator is a U.S. person; and (iv) any partnership or corporation if (1) organized or incorporated under the laws of any foreign jurisdiction, and (2) formed by a U.S. person principally for the purpose of investing in securities not registered under the Act, unless it is organized or incorporated, and owned, by accredited investors who are not natural persons, estates or trusts.  The Subscriber represents that it is a bona fide resident of, and is domiciled in, the country so designated on the signature page hereto.

5.14            No Written or Oral Representations. No person or entity, including the Company or agents of the Company, has made any written or oral representations or warranties, expressly or by implication to the Subscriber, (a) that any person will resell or repurchase the Securities, (b) that any person will refund the Purchase Price for the Units, (c) as to the future price or value of the Securities, (d) as to the appropriate or exact length of time that Subscriber will be required to hold the Securities, (e) as to the percentage of profit and/or amount or type of consideration, profit, or loss to be realized, if any, as a result of an investment in the Securities, or (f) as to the amount of distributions that the Company will make.

5.15            Subscription Rejection Right.  The Subscriber acknowledges that the Company reserves the right to reject its subscription, to accept any subscription in part only, or to prorate subscriptions, if the Subscriber (a) fails to deliver the Advance as payment of the Purchase Price, (b) fails to deliver a completed Subscription Agreement, or (c) constitutes a “U.S. Person” as such term is defined in Rule 902(k) of Regulation S under the Act.

5.16            Subsequent Changes.  All information which the Subscriber has provided to the Company, including but not limited to all information given herein concerning itself, investor status, address, residence, financial position and knowledge and experience of financial and business matters are correct and complete as of the date of the execution of the Subscription Agreement, and that if there should be any material change in such information prior to this Subscription Agreement being accepted by the Company, the Subscriber will immediately provide the Company with such information.  The Subscriber will promptly notify the Company of any material fact or circumstance that would cause any of the foregoing representations to be untrue, incomplete, or misleading.

6.           Risk Factors.  In addition to the risks otherwise disclosed in the Reports and elsewhere in this Subscription Agreement, the Subscriber acknowledges and understands the risks involved with an investment to purchase the Units, including, but not limited to, the risks described below:

6.1           Speculative.  The Subscriber understands that an investment in the Securities is speculative and involves substantial risks, including the possible loss of the entire investment, and understands the risks and uncertainties discussed in this Subscription Agreement.

6.2           Investment Risk; No Operating History.  The Subscriber understands that the Company is currently in a development stage and has no operating history nor any history of profitability.  The Company reserves the right to obtain additional capital to develop its operations and complete its business plans.  There is no assurance that the Company can obtain additional capital to accomplish the foregoing or successfully complete its business plans.  As such, the Subscriber’s investment in the Company involves a high degree of risk which may result in a loss of all or substantially all of the Subscriber’s investment.

6.3           No Review of Fairness.  No federal or state agency has passed upon the Securities nor has made any finding, recommendation or determination as to the fairness of this investment.

6.4           No Representations Concerning Suitability.  The Company has made no representations or recommendations to the Subscriber concerning whether the purchase of the Securities is a suitable investment for it.  The Subscriber and its representative, if any, have the sole responsibility for determining whether this investment is suitable for the Subscriber.  The Company is not responsible to the Subscriber for making any such determination.

6.5           Unit Price May Fluctuate.  In accordance with the Stock Issuance Agreement, the Unit Price and the exercise price of the Warrants may fluctuate from time to time based upon market conditions and trading activity of the Company’s Common Stock.

6.6           Illiquid Investment.  The Subscriber’s investment in the Company is an illiquid investment, and the Subscriber must bear the economic risk of its investment.

6.7           The Securities Are Not Registered With The SEC Nor With Any State Securities Authorities.  The Securities will not be registered under the Act nor under any state securities laws nor the securities laws of any other country in reliance upon specific exemptions from registration under the provisions of the Act and applicable state securities laws and the laws of other countries.  The Securities issued will be deemed "restricted securities" and may not be sold, transferred or otherwise disposed of without an effective registration statement under the Act or an exemption therefrom.  As a result, the Securities may be transferred or resold only if the Securities have been registered or there is an available exemption from registration and the certificates representing the Securities will bear a legend to this effect.  The Securities are being offered in reliance upon an exemption from the registration provisions of the Act, pursuant to Regulation S promulgated thereunder.

6.8           Dilution in Initial Equity Interest.  Any further issuance by the Company of any additional Securities of the Company will dilute any equity interest of the Subscriber.  No assurances can be given that the Company will not issue additional securities that will have the effect of diluting the equity interest of the Subscriber.

6.9           Due Diligence and Investigation.  The offer and sale of the Units is not underwritten by or being offered through investment bankers or underwriters.  There has not been an independent review of matters covered in the Subscription Agreement by any such professionals or other professionals.  Subscriber must rely solely upon its own investigation and analysis of the risks in making this investment decision.

6.10           No Established Public Trading Market.  Even though the Company’s Common Stock is traded over-the-counter by quotation on the OTC Bulletin Board under the symbol “AMNP” the Subscriber realizes there is no established public trading market for the Securities.

6.11           Penny Stock Regulations Affect the Company’s Stock Price, Which May Make it More Difficult to Sell.  Broker-dealer practices in connection with transactions in “penny stocks” are regulated by certain penny stock rules adopted by the SEC. Penny stocks generally are equity securities with a price per share of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ Stock Market, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the risks in the penny stock market. The broker-dealer must also provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer’s account. In addition, the penny stock rules generally require that prior to a transaction in a penny stock the broker-dealer make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for a stock that becomes subject to the penny stock rules.  The Securities are subject to the penny stock rules, and investors may find it more difficult to sell their securities.

  

  

  

 

7.           Indemnification.  The Subscriber agrees to indemnify and hold the Company and any person, if any, who controls the Company, within the meaning of Section 15 of the Act, and the Company’s officers, directors, agents, attorneys, and affiliates harmless from and against all damages, losses, costs and expenses, including reasonable attorneys’ fees and expenses reasonably incurred in the investigation or preparation in defense of any litigation commenced or threatened or any claim whatsoever, which they may incur by reason of the failure by the Subscriber to comply with the terms and conditions of this Subscription Agreement, or by reason of any misrepresentation or breach of any warranty or covenant made by the Subscriber herein, or in any document provided by the Subscriber to the Company in connection with the Subscriber’s investment in the Securities.  The Subscriber further agrees that the provisions of this Section shall survive (a) the sale, transfer or any attempted sale or transfer of all or a portion of the Securities, and (b) the death of the Subscriber.

8.           Termination, Cancellation or Revocation.  The Subscriber agrees that it may not cancel, terminate, or revoke this Subscription Agreement or any agreement made by it hereunder and that this Subscription Agreement shall survive the death or disability of the Subscriber and shall be binding upon the Subscriber’s heirs, executors, administrators, successors, and assigns, who shall execute a substantially similar agreement.

9.           Modification.  Neither this Subscription Agreement nor any provisions hereof shall be modified, discharged or terminated except by an instrument in writing signed by the party against whom any modification, discharge or termination is sought.

10.           Notices.  Any notice, demand or other communication that any party hereto may be required, or may elect, to give to anyone interested hereunder shall be deemed given (a) three (3) business days after mailing if sent by registered or certified mail, return receipt requested, addressed to such address as may be given herein, (b) immediately if delivered personally at such address, including by overnight delivery service, or (c) immediately if communicated by facsimile to the person entitled to such notice, provided, however, that acknowledgment of the receipt of such facsimile notice is returned to the person giving notice, it being understood that such acknowledgment shall not be unreasonably withheld.

11.           Payment of Expenses.  Subject to the provisions of this Subscription Agreement, the Company, on the one hand, and the Subscriber, on the other hand, will pay all fees and expenses (including, without limitation, legal fees and expenses) incurred by them in connection with the transactions contemplated hereunder.

12.           Counterparts.  This Subscription Agreement may be executed through the use of separate signature pages (including by facsimile) or in any number of counterparts, and each of such counterparts shall, for all purposes, constitute one agreement binding on all the parties, notwithstanding that all parties are not signatories to the same counterpart.

13.           Binding Effect.  Except as otherwise provided herein, this Subscription Agreement shall be binding upon and inure to the benefit of the parties and their heirs, executors, administrators, successors, legal representatives and assigns.  The obligation of the Subscriber and the agreements, representations, warranties and acknowledgments herein contained shall be deemed to be made by and be binding upon the Subscriber and the heirs, executors, administrators and successors of the Subscriber.

14.           Entire Agreement.  This instrument, including all appendices, exhibits and schedules attached hereto which have been incorporated by reference into this Subscription Agreement, contain the entire agreement of the parties with respect to the subject matter of this Subscription Agreement, and there are no representations, covenants or other agreements except as stated or referred to herein.

15.           Assignability.  This Subscription Agreement is not transferable or assignable by the Subscriber except as provided herein.

16.           Applicable Law.  This Subscription Agreement shall be governed by and construed in accordance with the laws of the State of Nevada as applied to residents of that state entering into contracts wholly to be performed in that state, without regards to conflicts of laws principles.  The Subscriber hereby agrees that any suit, action, or proceeding arising out of or relating to this Subscription Agreement, any amendments or any replacements hereof, and any transactions or agreements relating hereto shall be brought in the courts of, or the Federal courts in, the State of Nevada, County of Washoe, and the Subscriber hereby irrevocably consents and submits to the jurisdiction of such courts for the purposes of any such suit, action or proceeding, and the Subscriber agrees that service of process on the Subscriber in such suit, action or proceeding may be made in the same way as is prescribed by this Subscription Agreement for other notices.  The Subscriber hereby waives, and agrees not to assert against the Company or any assignee thereof, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, (a) any claim that he or she is not personally subject to the jurisdiction of the above-named courts or that his or her property is exempt or immune from setoff, execution or attachment, either prior to judgment or in execution thereof, and (b) to the extent permitted by applicable law, any claim that such suit, action or proceeding is brought in an inconvenient forum or that the venue of suit, action or proceeding is improper or that this subscription agreement or any amendments or any replacements hereof may not be enforced in or by such courts.  Venue for such actions as set forth above is intended to be inclusive.

17.           Waiver of Jury Trial.  The parties to this Subscription Agreement hereby waive any right that they may otherwise have to a trial by jury in any suit, action, or proceeding that arises out of or relates to this Subscription Agreement, any amendments to or any replacements of this Subscription Agreement, and any transactions or agreements relating to this Subscription Agreement.  The parties understand that, as a result of this waiver, the facts relating to any dispute that is covered by this waiver will be tried, if necessary, to a judge rather than to a jury.

18.           Severability.  If any provision or portion of this Subscription Agreement is held to be unenforceable or invalid for any reason, the remaining provisions and portions of this Subscription Agreement shall be unaffected by such holding.

  

  

  

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

SUBSCRIPTION AGREEMENT SIGNATURE PAGE

In addition to the foregoing, the Subscriber hereby certifies that it (a) agrees to all the terms and conditions of this Subscription Agreement, (b) meets the suitability standards set forth in this Subscription Agreement, and (c) is a resident of the jurisdiction indicated below.

 

I. NUMBER OF SUBSCRIBED UNITS.  Subscriber subscribes to purchase 449,438 Units

(at $0.89 per Unit) of the Company (“Units”). Each Unit Consists of one Share and one Warrant.

 

II. PURCHASE PRICE.  The total purchase price of the Units (the number of Units multiplied by price per Unit) is $400,000 (the “Purchase Price”).

 

III. WARRANTS. The attached Warrants entitle the Subscriber to purchase 449,438 additional shares of Common Stock, at an exercise price of $1.34 for a period of 3 years from the date the Warrant is issued.

The Subscriber directs the Company to issue, register and deliver the certificates representing the Shares as follows:

	
REGISTRATION INSTRUCTIONS:

	
DELIVERY INSTRUCTIONS:

	
 

 

_______________________

Name to appear on certificate

 

 

____________________________________

Tax ID / Corporate ID # / Cert. Incorporation #

 

 

_______________________________________

Address

 

 

	
 

 

________________________________

Name and account reference, if applicable

 

 

____________

Contact name

 

 

___________________________________

Address

 

 

____________________________________

Telephone number

 

	
EXECUTED by the Subscriber this _______ day of__________, _____. By executing this Agreement, the Subscriber certifies that the Subscriber is resident in the jurisdiction shown as the “Address of the Subscriber”. The address of the Subscriber will be accepted by the Company as a representative as to the address of residency for the Subscriber.

 

	
WITNESS:

	
EXECUTION BY SUBSCRIBER:

	
 

___________________________

Signature of witness

 

 

____________________________

Name of witness

 

 

____________________________

Address of witness

 

 

	
 

 

X _____________________________                                                               

Authorized signatory

 

 

 

_________________________________

Name of authorized signatory (please print)

	
ACCEPTED this _______ day of ___________, 2011.

AMERICAN POWER CORP.

Per:

 

___________________________

Authorized signatory

	
 

__________________________

Address of Subscriber (residence)

 

 

____________________________

Telephone number and e-mail address

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00183-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00183-of-00352.parquet"}]]