CONSULTING AGREEMENT

 

 

 

WHEREAS, company is a publicly- held corporation with its stock trading on the OTC BB Markets under the symbol HWSYD: and

 

WHEREAS, the Company desires to engage the services of consultant to represent the company in the area of investor's communications and public relations with existing shareholders, brokers, dealers, and other investment professionals as to the company's current and proposed activities, and to consult with management concerning such Company activities.

 

NOW THEREFORE, In Consideration of the promises and the mutual covenant and agreements hereinafter set forth, the parties hereto covenant and agree as follows:

 

1.

Term of Agreement, Company hereby agrees to retain the consultant to act in a consulting capacity to the company and the consultant hereby agrees to provide services to the company commencing on 05-21-2010 for a term of one year.

 

2.

Duties of Consultant, The consultant agrees that it will generally provide the following services through its officers and employees during the term specified in section 1:

 

a.

consult and assist the Company in developing and implementing appropriate plans and means for presenting the company and its business plans, strategy and personal to the financial community, and creating the foundation for subsequent financial public relations efforts:

b.

Introduce the Company to the financial community.

c.

With the cooperation of the Company, maintain an awareness during the term of this Agreement of the Company's plans, strategy and personnel, as they may evolve during such a period, and consult and assist the Company in communicating appropriate information regarding such plans, strategy and personnel to the financial community;

d.

Assist and consult the Company with respect to its (i) relations with stockholders (ii) relations with brokers, dealers, analysts and other investment professional, and (iii) financial public generally;

e.

Perform the functions generally assigned to stockholder relations and public relations depat

tments in major corporations, including responding to telephone

and written inquiries (which may be referred to the Consultant by the Company); assisting in the preparation of press releases for the Company with the Company's involvement and approval of all press releases, reports and communications with or to shareholders, the investment community and the general public; consulting with respect to the timing, form, distribution and other matters related to such releases, reports and communications; and at the Company's request and subject to the Company's securing its own rights to the use of its names, marks, and logos, consulting with respect to corporate symbols, logos, names, the presentation of such symbols, logos and other matters relating to corporate image.

 

 

f.

Upon the Company's direction and approval, disseminate information regarding the company to shareholders, brokers, dealers, and other investment community professional and the general investing public.

g.

Upon the Company's approval conduct meetings, in person or by the telephone, with , brokers, dealers, analyst and other investment professionals to communicate with them regarding the company's plans, goals and activities the company in preparing for press conferences and other forums involving the media, investment professionals and the general investment public.

h.

At the Company's request , review business plans, strategies, mission statements budgets, proposed transactions and other plans for the purpose of advising the company of the public relations implications thereof; and

i.

Otherwise perform as the company's consultant for public relations with the financial professionals.

 

3.

Allocation of Time and Energies. The consultant herby promises to perform and discharge faithfully the responsibilities which may be assigned to the consultant from time to time by the officers and dully authorized representatives of the company in connection with the conduct of its financial and public relations and communication activities, so long as such activities are in compliance with the applicable securities laws and regulations. Consultant and staff shall diligently and thoroughly provide the consulting services required hereunder. Although no specific hours-per day requirement will be required, consultant and the company agree that consultant will perform the duties set forth herein above in a diligent and professional manner. The parties acknowledge and agree that a dispropo rtionately large amount of the effort to be expended and the cost to be incurred by the consultant and the benefits to be received by the company are expected to occur within or shortly after the first two months of the effectiveness of this Agreement. It is explicitly understood that consultant's performance of it duties hereunder will in no way be measured by the price of the company's common stock nor the trading volume of the company's common stock. It is also understood that the company is entering into this agreement with A.S. Austin Company or Andrew S. Austin (ASA) a Nevada Corporation and not any individual member of ASA and as such , Consultant will not be deemed to have breached this Agreement if any member, officer or director of ASA leaves the firm or dies or becomes physical ly unable to perform any meaningful activities during the term of this agreement, provided the Consultant otherwise performs its obligation under this Agreement.

 

4.

Remuneration. As full and complete compensation for services in this agreement, the company shall compensate ASA as follows:

 

4.1 For undertaking this engagement and for other good and valuable consideration, the company agrees to Issue to the Consultant a total 7500,000 shares common stock of Hawk Systems, Inc, as a "Commencement Bonus", with the 750,000 shares of the company's common stock to be delivered to consultant within five (5) days business days of 5/21/2010 This commencement bonus shall be issued to the Consultant immediately following the execution of this agreement and shall, when issued and delivered to Consultant, be fully paid and non-assessable. The Company understands and agrees that Consultant has foregone significant opportunities to accept this engagement and that the Company derives substantial benefits from the execution of this agreement and the ability to announce its relationsh ip with consultant. The 750,000 shares of common stock issued as a Commencement Bonus, therefore, constitute payments for consultant's agreement to consult to the Company and are nonrefundable, non-apportionable, and non-ratable retainer, such shares of common stock are not a prepayment for future services. If the company decides to terminate this Agreement prior to 05-20-2011 for any reason whatsoever, it is agreed and understood that Consultant will not be requested or demanded by the company to retur n any of the shares of common stock paid to it as Commencement Bonus hereunder. Further if and in the event the Company is acquired in whole or in part, during the term of this agreement, it is agreed and understood Consultant will not be requested or demanded by the Company to return any of the 750,000 shares of common stock paid to it hereunder. It is further agreed that if at any time during the term of this agreement, the Company or substantially all of the assets are merged with or acquired by another entity, or some other change occurs in the legal entity that constitutes the Company, the Consultant shall retain and will not be requested by the Company to return any of the Commencement Bonus 750,000 shares.

 

 

4.2 The Commencement Bonus shares issued pursuant to this agreement shall be issued in the names of A. S. Austin Company TAX ID# 20-4970311.

 

4.3 With each transfer of shares of the common stock to be issued pursuant to this agreement ( Collectively, the "shares"), Company shall cause to be issued a certificate representing the common stock and a written Opinion of counsel for the Company stating that said shares are validly issued fully paid and non assessable and that the issuance and eventual transfer of them to consultant has

been dully authorized by the Company. Company verifies that all shares issued to consultant pursuant to this agreement shall have been validly issued, fully paid and non-assessable and that the issuance and any transfer of them to Consultant shall have been duly authorized by the company's board of directors.

 

4.4 Consultant acknowledges that the shares of common stock to be issued pursuant to this Agreement ( Collectively the "shares") have not been registered under the securities Act of 1933, and accordingly are "restricted securities" within the meaning of Rule 144 of the act. As such, the shares may not be resold or transferred unless the Company has received an opinion of counsel reasonably satisfactory to the Company that such resale or transfer is exempt from the registration requirements of the Act.

 

4.5 Grant of Warrants. The company shall grant and deliver to A. S. Austin Company warrants (the Warrants) to purchase up to 500,000 shares of the common stock (the Common Stock). Such warrants to be granted ratably over the term of this Agreement on the first day of each Calendar Month. The warrants shall be exercisable at any time or from time to time commencing on The grant date at an exercise price of $ .55 per share, subject to customary stock splits and the like and payable in cash (including check, bank draft or money order).

 

4.6 In connection with the acquisition of the shares, hereunder, the Consultant represents and warrants to the Company, to the best of its/his knowledge, as follows.

 

a.

Consultant acknowledges that the Consultant has been afforded the opportunity to ask questions of and receive answers from duly authorized officers and other representatives of the Company concerning an investment in the shares and any additional information which the consultant has requested.

 

b.

Consultant's investment in restricted securities is reasonable in relation to the consultant's net worth, which is in excess of ten (10) times the consultant's cost basis in shares. Consultant has had experience in investments in restricted and publicly traded securities, and Consultant has had experience in investments in speculative securities and other investments which involve the risk of loss of investments. Consultant acknowledges that an investment in the shares is speculative and involves the risk of loss. Consultant has the request knowledge to assess the relative merits and risk of this investment without the necessity of relying upon other advisors, and consultant can afford the risk of loss of his entire investment in the shares. Consultant is (i) an accredited investor as that term is defined in Regulation D promulgated under the Securities Act of 1933, and (ii) a purchaser described in section 25102(f ) (2) of the California Corporate Securities Law of 1968, as amended.

c.

Consultant is acquiring the shares for the Consultants own account for long —term investment and not with a view toward resale or distribution thereof except in accordance with applicable laws.

 

4.7 Additionally, for a period of two years after the effective date hereof, should the Company make any public offering of its securities pursuant to an effective registration statement under the securities act of 1933 or 1934 as amended, Consultant shall be entitled, and the Company agrees to include in such registration any or all of the common stock given to consultant by the company as consideration hereunder (commonly referred to as "Piggyback Registration Rights"). Such piggyback registration rights include, at the consultants option registration on Form S-1. All such registration rights shall be subject to customary market stand — off and underwriter cutback provisions.