CONSULTANT
ENGAGEMENT AGREEMENT
This Agreement supercedes and replaces the Corporate Advisor Engagement
Agreement, (except as to those shares of Sun River Energy, Inc. previously
issued to Consultant), made the 7th day of May, 2009, by and between Sun River
Energy, Inc. (the "Company"), located at 0000 Xxxxxxx Xxxx, Xxxxxx, Xxxxxxxx
00000 and Xxx Xxxxxx (the "Consultant"), located at 0000 Xxxx Xxxxxx, Xxxxxx,
Xxxxxxxx 00000.
Sun River Energy, Inc. hereby engages Xxx Xxxxxx, as Consultant, under
the following terms and conditions, to be effective as of October 1, 2009.
WHEREAS, the Company desires professional guidance and advice regarding
Energy Exploration and Development and desires Consultant to aid it in business
matters; and
WHEREAS, Consultant has expertise in the area of energy exploration and
project development and implementation; and is willing to act as an advisor to
the Company upon the terms and conditions set forth in this Agreement;
WHEREAS, Consultant is to be hereby engaged to act as President of Sun
River Energy, Inc. on a part-time basis.
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises herein contained, the parties hereto agree as follows:
1. Duties, Scope of Agreement, and Relationship of the Parties
(a) The company hereby agrees to retain Consultant as President,
consistent with Consultant's expertise and ability in energy exploration and
development, and Consultant agrees to so act for the Company during the term of
this Agreement under the Job Description attached as Exhibit B. All parties
understand that Consultant has many other business interests and will devote as
much time as in his discretion as necessary to perform his duties under this
Agreement. In addition, the company understands that consultant's efforts on
behalf of his other interests are the sole and separate property of Consultant.
(b) The services rendered by consultant to the company pursuant to this
Agreement shall be as an independent contractor at times and dates convenient to
Consultant, and this Agreement does not make Consultant the employee of the
Company for any purpose whatsoever. No right or authority is granted to
Consultant to assume or to create any obligation or responsibility, in excess of
$2,500, express or implied, on behalf of or in the name of the company, expect
as authorized by Resolution of the Board of Directors. The company shall not
withhold for Consultant any federal or state taxes from the amounts to be paid
to consultant hereunder, and Consultant agrees that he will pay all taxes due on
such amounts.
(c) Consultant agrees to make available to Company his services as
President on an as needed basis on reasonable request. Consultant shall provide
planning and other advisory services as are necessary to carryout the business
of the Company.
2. Compensation
(a) The Company will pay $6,000 per month on the 15th day of each month to
Consultant as a consulting fee. These payments will be made to the account and
entity designated by Consultant.
(b) Stock compensation is detailed in Exhibit "A".
(c) Other forms of compensation may occur depending on the nature of a specific
engagement and only upon the mutual agreement of both parties.
3. Expenses
The Company shall reimburse Consultant for all pre-approved reasonable
and necessary expenses incurred by it in carrying out its duties under this
Agreement including travel. Consultant shall submit related receipts and
documentation with his request for reimbursement.
4. Renewal; Termination
(a) This Agreement shall continue in effect for 6 months and
thereafter, if not then terminated, shall be renewed annually until terminated
by the parties. Either the Company or the Consultant may terminate this
Agreement by giving the other party fifteen (15) days written notice.. However,
termination of Consultant by the Company shall not relieve the Company of its
financial obligations to Consultant as defined herein.
(b) Subject to the continuing obligations of Consultant under Section 5
below, either party may terminate this Agreement at any time if the other party
shall fail to fulfill any material obligation under this Agreement and shall not
have cured the breach within 10 days after having received notice thereof.
(c) Termination or expiration of this Agreement shall not extinguish
any rights of compensation that shall accrue prior to the termination.
5. Confidential Information
(a) "Confidential Information," as used in this Section 5, means
information that is not generally known and that is proprietary to the Company
or that the Company is obligated to treat as proprietary. This information
includes, without limitation:
(i) Trade secret information about the Company and its products;
(ii) Information concerning the Company's business as the Company
has conducted it since the Company's incorporation or as it
may conduct it in the future; and
(iii)Information concerning any of the Company's past, current,
or possible future products, including (without limitation)
information about the Company's research, development,
engineering, purchasing, manufacturing, accounting,
marketing, selling, or leasing efforts.
(b) Any information that Consultant reasonably considers Confidential
Information, or that the Company treats as Confidential Information, due to its
unique nature purchased or developed by the Company, not available in the public
domain or licensed or copyrighted information will be presumed to be
Confidential Information (whether Consultant or others originated it and
regardless of how obtained).
(c) Except as required in its duties to the Company, Consultant will
never, either during or after the term of this Agreement, use or disclose such
aforedescribed Confidential Information to any person not authorized by the
Company to receive it.
(d) If this Agreement is terminated, Consultant will promptly turn over
to the Company all records and any compositions, articles, devices, apparatus
and other items that disclose, describe, or embody Confidential Information,
including all copies, reproductions, and specimens of the Confidential
Information in its possession, regardless of who prepared them. The rights of
the Company set forth in this Section 5 are in addition to any rights of the
Company with respect to protection of trade secrets or confidential information
arising out of the common or statutory laws of the State of Colorado or any
other state or any country wherein Consultant may from time to time perform
services pursuant to this Agreement. This Section 5 shall survive the
termination or expiration of this Agreement.
6. False or Misleading Information
The Company warrants that it will provide Consultant with accurate
financial, corporate, and other data required by Consultant and necessary for
full disclosure of all facts relevant to any efforts required of Consultant
under this Agreement. Such information shall be furnished promptly upon request.
If the Company fails to provide such information, or if any information provided
by the Company to Consultant shall be false or misleading, or if the Company
omits or fails to provide or withholds relevant material information to
Consultant or to any professionals engaged pursuant to paragraph 5(d) above,
then, in such event, any and all fees paid hereunder will be retained by
Consultant as liquidated damages and this Agreement shall be null and void and
Consultant shall have no further obligation hereunder. Further, by execution of
this Agreement, the Company hereby indemnifies Consultant from any and all costs
for expenses or damages incurred, and holds Consultant harmless from any and all
claims and/or actions that may arise out of providing false or misleading
information or by omitting relevant information in connection with the efforts
required of Consultant under this Agreement.
7. Consultant's Best efforts and No Warranty of Information
Consultant shall use its best efforts to use reliable information and
scientific techniques associated with the oil and gas business. However,
Consultant makes no warranty as to the completeness or interpretation of such
information, nor does Consultant warrant the information with regard to errors
or omissions contained therein. Any reserve estimates, price calculations, price
forecasts, exploration potential predictions or similar information provided by
Consultant are, or may well be estimates only, and should not be considered
predictions of actual results.
8. Miscellaneous
(a) Successors and Assigns. This Agreement is binding on and ensures to the
benefit of the Company. Company cannot assign this Agreement without
Consultant's written agreement.
(b) Modification. This Agreement may be modified or amended only by a
writing signed by both the Company and Consultant.
(c) Governing Law. The laws of Colorado will govern the validity,
construction, and performance of this Agreement. Any legal proceeding related to
this Agreement will be brought in an appropriate Colorado court, and both the
Company and Consultant hereby consent to the exclusive jurisdiction of that
court for this purpose.
(d) Construction. Wherever possible, each provision of this Agreement will
be interpreted so that it is valid under the applicable law. If any provision of
this Agreement is to any extent invalid under the applicable law, that provision
will still be effective to the extent it remains valid. The remainder of this
Agreement also will continue to be valid, and the entire Agreement will continue
to be valid in other jurisdictions.
(e) Waivers. No failure or delay by either the Company or Consultant in
exercising any right or remedy under this Agreement will waive any provision of
the Agreement, nor will any single or partial exercise by either the Company or
Consultant of any right or remedy under this Agreement preclude either of them
from otherwise or further exercising these rights or remedies, or any other
rights or remedies granted by any law or any related document.
(f) Captions. The headings in this Agreement are for convenience only and
do not affect this Agreement's interpretation.
(g) Entire Agreement. This Agreement supersedes all previous and
contemporaneous oral negotiations, commitments, writings, and understandings
between the parties concerning the matters in this Agreement.
(h) Notices. All notices and other communications required or permitted
under this Agreement shall be in writing and sent by registered first-class
mail, postage prepaid, and shall be effective five days after mailing to the
addresses stated below. These addresses may be changed at any time by like
notice.
In the case of the Company:
Sun River Energy, LLC
Attention: Xxxxxx Xxxxx
c/o 0000 Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
Ph: 000-000-0000
Fx: 000-000-0000
In the case of Consultant:
Xxx X. Xxxxxx
Leaverite Exploration, Inc.
0000 X. Xxxxxx Xx.
Xxxxxx, Xxxxxxxx 00000
Ph. 000-000-0000
Fx. 000-000-0000
E-mail: XxxXxxxxx@xxx.xxx
(i) Indemnification. Company agrees to indemnify and hold harmless
Consultant from any and all claims, actions, liabilities, costs, expenses,
including attorney fees arising from claims made against Consultant in
connection with Company's possession or use of advice, guidance, materials,
information, data or other services provided by Consultant under this Agreement.
(j) Conflicts of Interest. Company acknowledges that Consultant is engaged
in the business of providing petroleum consulting for other oil and gas
companies within the United State and Canada. In the event Consultant is
requested by Company to provide advice and guidance on or about geographical
areas that may create a potential conflict of interest between Consultant's
other business matters and the Company's operations, Consultant shall not be
required by Company to render advice and guidance on such an area. Company and
Consultant shall use their best efforts to notify each other of any potential
conflicts of interests. In any event, Consultant's general knowledge that
Company plans to engage, or is actively engaging, in oil and gas exploration
within an area shall in no way preclude Consultant, or Consultant's business
entities, from performing land services or consulting for other oil and gas
companies within the same area.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the September 23, 2009.
"The Company" "Consultant"
SUN RIVER ENERGY, INC. XXX XXXXXX
By: By:
------------------------ -----------------------------
Exhibit A
Term Sheet - Stock Grants
I. Stock Grants.
A. Company will grant Executive 10,000 shares of Company common
stock on the day effective of engagement.
B. Future additional Grants shall occur as follows:
1. Vesting. Subject to continuation of engagement under this
or a subsequent agreement, (i) 10,000 shares at the end of 1st
quarter of engagement hereunder and, (ii) an additional 10,000
shares each calendar quarter thereafter, contingent on the
continuation of engagement for at least 6 months of the term.
Vesting will be accelerated on a Change in Control, for that
current quarter.
2. Executive will enter into a six (6) month lock-up agreement
with Company, to be released upon reasonable written notice,
in discretion of Company.
II. Change in Control.
A. For purpose of the options, "Change in Control" means: (a)
the consummation of a merger or consolidation of the Company
with or into another entity or any other transaction, the
stockholders of the Company immediately prior to such
merger, consolidation or other transaction own or
beneficially own immediately after such merger,
consolidation or other transaction 50% or more of the voting
power of the outstanding securities of each of (i) the
continuing or surviving entity and (ii) any direct or
indirect parent entity of such continuing or surviving
entity; (b) the sale, transfer or other disposition of all
or substantially all of the Company's assets to a Person
which is not owned or controlled by the Company or its
stockholders immediately prior to such sale, transfer or
other disposition; (c) individuals who, immediately
following the effective date of this Agreement, constitute
the Board (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board; provided,
however, that any individual becoming a director thereafter
whose election, or nomination for election by the Company's
shareholders, was approved by a vote of at least a majority
of the directors then comprising the Incumbent Board shall
be considered as though such individual were a member of the
Incumbent Board; or (d) any transaction as a result of which
any Person is the "Beneficial Owner" (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing at least 20% of the
total voting power represented by the Company's then
outstanding voting securities. For purposes of this
definition of Change in Control, the term "Persons" means,
acting individually or as a group, an individual or a
corporation, limited liability company, partnership, joint
venture, trust, unincorporated organization, association,
government agency or political subdivision thereof or other
entity.
Exhibit B
Job Description
A. Consultant will be involved in day-to-day decisions
involving selection of Projects to work on, and what
resources to allocate to individual Projects.
B. Consultant has specific experience in the fields of geology,
geophysics, and geochemistry as relevant to oil and gas
prospects and plays. Consultant will make this expertise
available to the Company. Company will recognize that in
matters outside the specific expertise of Consultant,
including but not limited to Drilling, Reservoir, and
Completion Engineering, and Land, Gas Marketing, and
Pipeline Construction, outside personnel should be
consulted.
C. Consultant will make specific recommendations for additional
personnel necessary to continue intelligent pursuit of a
Project or Projects. Such additional personnel may be in the
form of new hires or Consultants. Consultant will not make
such recommendations without due consideration for the needs
of the Company. The Company will make every effort to enable
the Consultant to form the team necessary to further the
Company's interests. Company will not hire or otherwise
obtain team members without the input of Consultant.
