CONSULTING AGREEMENT
This Consulting Agreement (the "Agreement") is made and entered into
this 1st day of January 2002 by and between Altair International Inc., an
Ontario corporation (the "Company"), and Irvine Management Consulting Inc., a
California corporation ("Consultant"; collectively with the Company, the
"Parties").
In consideration of the mutual promises made herein and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Parties hereto agree as follows:
1. Purpose: The Company hereby engages Consultant for the term
specified in Paragraph 2 hereto to render corporate advisory services to the
Company upon the terms and conditions set forth herein.
2. Term: Nonexclusive Nature of Services; and Termination. Subject to
earlier termination as provided below, the term of this Agreement is twelve
months from the date hereof (the "Term"). Notwithstanding the foregoing, this
Agreement may be terminated with or without cause at any time by the Company or
Consultant upon no fewer than 48 hours written notice. This Agreement is
non-exclusive on the part of both Parties.
3. Duties of Consultant: During the term of this Agreement,
Consultant shall, upon the request of the Company, provide the Company with
advice regarding strategic business planning, potential acquisitions by the
Company, corporate finances (other than capital raising) and general marketing.
Consultant shall devote such time and effort to the performance of its duties
hereunder as it shall determine is reasonably necessary. Consultant may look to
such others for such factual information and research upon which to base its
advice to the Company hereunder, as Consultant shall deem appropriate.
4. Compensation: In consideration for the services rendered by
Consultant, the Company shall pay Consultant an initial payment of $10,000 on or
before January 10, 2002. In addition, the Company shall grant Consultant
warrants in the form attached hereto as Exhibit A (the "Warrants") with respect
to 200,000 common shares of the Company. The Warrants and any common shares of
the Company issuable thereunder are hereinafter referred to as the "Securities."
5. Expenses of Consultant: Consultant shall pay all of its own
expenses in connection with the services provided hereunder.
6. Liability of Consultant: In furnishing the Company with advice and
other services as herein provided, neither Consultant nor any officer, director
or agent of Consultant shall be liable to the Company or its creditors for
errors of judgment of Consultant in the performance of its duties under this
Agreement, provided, however, that Consultant agrees to indemnify and hold the
Company harmless as provided in Section 8.
(a) It is further understood and agreed that Consultant may rely
upon information furnished to it by the Company and that, except as herein
provided, Consultant shall not be accountable for any loss suffered by the
Company by reason of the Company's action or inaction on the basis of any
advice, recommendation or approval of Consultant or its respective partners,
employees or agents.
1
(b) The Company acknowledges that all opinions and advice (written
or oral) given by Consultant to the Company in connection with this engagement
are intended solely for the benefit and use of the Company in considering the
transaction to which they relate, and the Company agrees that no person or
entity other than the Company shall be entitled to make use of or rely upon the
advice of Consultant to be given hereunder, and no such opinion or advice shall
be used for any other purpose or reproduced, disseminated, quoted or referred to
at any time, in any manner or for any purpose, nor may the Company make any
public references to Consultant, or use Consultant's name in any annual reports
or any other reports or releases of the Company without Consultant's prior
written consent or as otherwise required by law or judicial or administrative
process.
(c) The Company acknowledges that Consultant is not a registered
broker/dealer and therefore, Consultant will not, under any circumstances,
perform any of the following services for the Company:
(1) Make offers or sales of securities;
(2) Prepare research reports;
(3) Directly or indirectly promote or maintain a market for
the Company's common shares;
(4) Facilitate the offer or sale of securities or make a
market in any securities;
(5) Negotiate for the offer or sale of securities; or
(6) Any other transaction or activity requiring broker/dealer
registration.
Consultant covenants and agrees that it shall not, and is not being compensate
for providing, any of the aforementioned services to the Company.
(d) The Company further recognizes and acknowledges that
Consultant is not a registered investment advisor, does not hold itself out as
an investment advisor, and, as of the date of this Agreement, has no other
clients to whom it renders advisory services
8. Company Information:
(a) The Company shall furnish to Consultant all data, material and
other information relevant to the performance by Consultant of its obligations
under this Agreement, or particular projects as to which Consultant is acting as
advisor, which will permit Consultant to be appraised of all facts material to
the advice to be rendered, and all data, material or information reasonably
requested by Consultant. The Company acknowledges and agrees that in performing
its services under this engagement, Consultant may rely upon the data, material
and other information supplied by the Company without independently verifying
the accuracy, completeness or veracity of same. In the event that the Company
fails or refuses to furnish any such data, material or information reasonably
requested by Consultant, and thus prevents or impedes Consultant's performance
hereunder, any inability of Consultant to perform shall not be a breach of its
obligations hereunder.
(b) Except as contemplated by the terms hereof or as required by
applicable law, Consultant shall keep confidential all non-public information
provided to it by the Company and shall not disclose such information to any
third party or use such information for the benefit of any person other than the
Company without the Company's prior written consent. Notwithstanding the
foregoing, Consultant shall not be required to maintain confidentiality with
respect to information (i) which is or becomes part of the public domain; (ii)
of which Consultant had independent knowledge prior to disclosure; (iii) which
2
comes into the possession of Consultant or its employees or agents in the normal
and routine course of its own business from and through independent
non-confidential sources; or (iv) which is required to be disclosed by
Consultant pursuant to legal process or in accordance with governmental or
regulatory requirements. If Consultant is requested or required (by oral
questions, interrogatories, requests for information or document subpoenas,
civil investigative demands, or similar process) to disclose any confidential
information supplied to it by the Company, or the existence of other
negotiations in the course of its dealings with the Company or its
representatives, Consultant shall, unless prohibited by law, promptly notify the
Company of such request(s) so that the Company may seek an appropriate
protective order.
9. Indemnification:
(a) The Company agrees to indemnify and hold harmless Consultant,
(and the officers, directors, employees, agents, representatives and controlling
persons of Consultant) from and against any and all losses, claims, damages,
liabilities, costs and expenses (and all actions, suits, proceedings or claims
in respect thereof) and any legal or other expenses in giving testimony or
furnishing documents in response to a subpoena or otherwise (including, without
limitation, the reasonable costs of investigating, preparing or defending any
such action, suit, proceeding or claim, whether or not in connection with any
action, suit, proceeding or claim in which Consultant is a party), as and when
incurred, directly or indirectly, caused by, relating to, based upon or arising
out of (a) any information provided by the Company to Consultant under this
Agreement, (b) the Company's breach of any covenant or other provision in this
Agreement or the inaccuracy of any information provided by the Company to
Consultant under this Agreement.
(b) Consultant agrees to indemnify and hold harmless the Company
(and its officers, directors, employees, agents, representatives and controlling
persons) from and against any and all losses, claims, damages, liabilities,
costs and expenses (and all actions, suits, proceedings or claims in respect
thereof) and any legal or other expenses in giving testimony or furnishing
documents in response to a subpoena or otherwise (including, without limitation,
the reasonable costs of investigating, preparing or defending any such action,
suit, proceeding or claim, whether or not in connection with any action, suit,
proceeding or claim in which the Company is a party), as and when incurred,
directly or indirectly, caused by, relating to, based upon or arising out of
Consultant's breach of any covenant or other provision in this Agreement or the
inaccuracy of any representation or warranty of Consultant in this Agreement.
(c) The obligations of the Parties under the Section shall survive
the termination of this Agreement.
10. Investment Representations. Consultant represents and warrants to
the Company as follows:
(a) Authorization. This Agreement constitutes Consultant's valid
and legally binding obligation, enforceable in accordance with its terms subject
to applicable bankruptcy, insolvency, and other similar laws affecting
creditors' rights, and rules of law governing specific performance, and
Consultant has full power and authority to enter into this Agreement.
(b) Representations Not Made by Company. Consultant represents and
affirms that none of the following information has ever been represented,
3
guaranteed or warranted to Consultant, expressly or by implication, by any
person: (i) the approximate or exact length of time that Consultant will be
required to remain a security holder of the Company; (ii) the percentage of
profit and/or amount of or type of consideration, profit or loss to be realized,
if any, as a result of an investment in the Company; or (iii) the possibility
that the past performance or experience on the part of the Company or any
affiliate, or any officer, director, employee or agent of the foregoing, might
in any way indicate or predict the results of ownership of any Security or the
potential success of the Company's operations.
(c) Purchase for Own Account. Consultant is the sole and true
party in interest, is acquiring the Securities for his/her/its own account for
investment, is not purchasing the Securities for hereby for the benefit of any
other person, and has no present intention of holding or managing the Securities
with others or of selling, distributing or otherwise disposing of any portion of
the Securities. Consultant (i) if an individual, is a citizen of the United
States, is at least 21 years of age, and is a bona fide permanent resident of
and is domiciled in the state set forth below Consultant's name in Section 12
hereof, (ii) if an entity, is duly organized and in good standing in its
jurisdiction of organization and has its principal place of business in the
state set forth below Consultant's name in Section 12 hereof.
(d) Disclosure and Review of Information. Consultant acknowledges
and represents that he/it has received and reviewed a copy of (A) the Company's
Annual Report on Form 10-K, as amended, for the fiscal year ended December 31,
2000, (B) the Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 2001, and (C) the Company's Current Report on Form 8-K filed with
the SEC on January 4, 2002 (the "Current Filings") and has been given a
reasonable opportunity to review all documents, books and records of the Company
pertaining to this investment, and has been supplied with all additional
information concerning the Company and the Securities that has been requested by
Consultant, has had a reasonable opportunity to ask questions of and receive
answers from the Company or its representatives concerning this investment, and
that all such questions have been answered to the full satisfaction of
Consultant. Consultant has received, and acknowledges that he/it is receiving,
no representations, written or oral, from the Company or its officers,
directors, employees, attorneys or agents other than those contained in this
Agreement and the Current Filings. In making his/her decision to purchase the
Securities, Consultant has relied solely upon its review of the Current Filings,
this Agreement, and independent investigations made by it or its representatives
without assistance of the Company.
(e) Speculative Investment. Consultant understands that (i) he/it
must bear the economic risk of the investment in the Securities for an
indefinite period of time because the Warrants and the common shares issuable
upon exercise of the Warrants have not been registered under the Securities Act
or qualified under the Securities Act or the securities laws of any other
jurisdiction and (ii) his/its investment in the Company represented by the
Securities is highly speculative in nature and is subject to a high degree of
risk of loss in whole or in part. Consultant has adequate means of providing for
his/her current needs and possible contingencies, and is able to bear the high
degree of economic risk of this investment, including, but not limited to, the
possibility of the complete loss of Consultant's entire investment and the
limited transferability of the Securities, which may make the liquidation of
this investment impossible for the indefinite future.
(f) Accredited Consultant Status. Consultant is an "accredited
Consultant" within the meaning of Rule 501(a) promulgated under the Securities
Act, in that Consultant (a) is a natural person (i) whose individual net worth,
or joint net worth with his spouse, presently exceeds $1,000,000, or (ii) who
4
had individual net income in excess of $200,000 in each of the two most recent
years or joint income with his spouse in excess of $300,000 in each of those
years and has a reasonable expectation of reach that same income level in the
current year, or (b) is an entity in which all of the equity owners satisfy the
definition of accredited Consultant set forth in subsection (a).
(g) Investment Experience. Consultant has experience as a
Consultant in securities and acknowledges that it can bear the economic risk of
its investment in the Securities. By reason of Consultant's 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,
Consultant has the capacity to protect its own interests in connection with its
purchase of the Securities. Consultant has the financial capacity to bear the
risk of this investment and has received from the Company all information it has
requested and considers necessary or appropriate for deciding whether to
purchase the Securities. If an entity, Consultant has not been organized solely
for the purpose of acquiring the Securities.
(h) Restricted Securities. Consultant understands that the
Warrants and the common shares issuable upon exercise of the Warrants are and
will be "restricted securities" under the Securities Act of 1933, as amended
(the "Securities Act") inasmuch as they are being acquired from the Company in a
transaction not involving a public offering, and that, under the Securities Act
and applicable regulations thereunder, such securities may be resold without
registration under the Securities Act only in certain limited circumstances. In
this connection, Consultant represents that he/it is familiar with Rule 144
promulgated under the Securities Act, as presently in effect, and understands
the resale limitations imposed thereby and by the Securities Act. Consultant
further confirms and agrees that the Company is under no obligation to register
the re-sale of the Warrants or the common shares issuable upon exercise of the
Warrants under the Securities Act or any state securities laws.
(i) Legends. Consultant understands that the certificates
evidencing the Warrants and the common shares issuable upon the exercise thereof
will bear the legend set forth below, together with any other legends required
by the laws of the Province of Ontario and any other state or province with
jurisdiction:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR QUALIFIED UNDER APPLICABLE STATE
SECURITIES LAWS AND HAVE BEEN TAKEN FOR INVESTMENT PURPOSES ONLY
AND NOT WITH A VIEW TO OR FOR SALE IN CONNECTION WITH ANY
DISTRIBUTION THEREOF. THESE SECURITIES MAY NOT BE SOLD OR
OTHERWISE TRANSFERRED UNLESS A REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, IS IN EFFECT WITH RESPECT TO
SUCH SECURITIES OR THE COMPANY HAS RECEIVED AN OPINION IN FORM AND
SUBSTANCE SATISFACTORY TO THE COMPANY PROVIDING THAT AN EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933,
AS AMENDED, IS AVAILABLE.
The legend set forth above shall be removed by the Company from any
certificate evidencing any of the Securities only (i) upon receipt by the
Company of an opinion in form and substance satisfactory to the Company that
such legend may be removed pursuant to Rule 144 promulgated under the Securities
Act, or (ii) upon confirmation that a registration statement under the
Securities Act is at that time in effect with respect to the legended Security
and that such transfer will not jeopardize the exemption or exemptions from
registration pursuant to which the respective Security was issued.
5
11. Independent Contractor: Consultant shall perform its services
hereunder as an independent contractor and not as an employee of the Company. It
is expressly understood and agreed to by the Parties hereto that Consultant
shall have no authority to act for, represent or bind the Company or any
affiliate thereof in any manner, except as may be agreed to expressly by the
Company in writing from time to time.
12. Miscellaneous:
(a) This Agreement constitutes the entire agreement and
understanding of the Parties hereto and supersedes any and all previous
agreements and understandings, whether oral or written, between the Parties with
respect to the matters set forth herein.
(b) Any notice or communication permitted or required hereunder
shall be in writing and shall be deemed sufficiently given if hand-delivered or
(i) sent postage prepaid by registered mail, return receipt requested, or (ii)
received by facsimile, to the respective Parties as set forth below, or to such
other address as either party may notify the other in writing:
If to Company: Altair International Inc.
------------- 0000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attn: President
If to Consultant:
---------------- Irvine Management Consulting Inc.
0000 Xxxxxxxxx #000
Xxxxxx Xxxxx, XX 00000
Fax: (000) 000-0000
Attn: Xxxxxxxxxxx Xxxxxx
(c) This Agreement shall be binding upon and inure to the benefit
of each of the Parties hereto and their respective successors, legal
representatives and assigns.
(d) This Agreement may be executed in any number of counterparts,
each of which together shall constitute one and the same original document.
(e) No provision of this Agreement may be amended, modified or
waived, except in a writing signed by all of the Parties hereto.
(f) This Agreement shall be construed in accordance with and
governed by the laws of the State of Nevada, without giving effect to conflict
of law principles.
(g) This Agreement may not be assigned by either party without the
express written consent of the other party, which consent may be withheld or
granted in such party's sole discretion. Any attempted assignment or delegation
without such consent will be void.
6
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
COMPANY:
Altair International Incorporated
an Ontario corporation
/s/ Xx Xxxxxxxxx
----------------------------------
By: Xx Xxxxxxxxx
Its: Chief Financial Officer
CONSULTANT:
Irvine Management Consultants Inc.,
a California corporation
/s/ Xxxxxxxxxxx Xxxxxx
----------------------------------
By: Xxxxxxxxxxx Xxxxxx
Its:
-----------------------------
7
Exhibit A
to
Consulting Agreement
Warrant
[see attached]
8
