CONSULTING AGREEMENT
This
Consulting Agreement (“Agreement”) is made this 2nd
day of
July, 2007 by and between Williston Basin Interstate Pipeline Company (“WBI”)
(“Company”) and Xxxx X. Xxxxxxxxxxx (“Consultant”).
WHEREAS,
Consultant will be resigning as Executive Vice President - Administration of
MDU
Resources Group, Inc. and was previously the President and Chief Executive
Officer of WBI for a number of years; and
WHEREAS,
Consultant has gained extensive knowledge of the natural gas transportation
and
oil and gas industries through his many years of work in the industries prior
to
and since joining the Company and, in particular, he has extensive knowledge
about the lawsuits involving the Elk Basin Storage Reservoir and plans to expand
the boundaries of the Elk Basin Storage Reservoir; and
WHEREAS,
Consultant’s overall industry knowledge and his knowledge of the Company’s
operations (“Operations”), including his knowledge of the Company’s lawsuits and
expansion, make his continuing advice to the Company of particular value;
and
WHEREAS,
Consultant desires to provide services to the Company as an independent,
self-employed consultant;
NOW,
THEREFORE, in consideration of the mutual covenants contained herein, it is
agreed as follows:
DEFINITION
1. As
used
in this Agreement, the term “WBI” includes MDU Resources Group,
Inc. and all of its subsidiaries, affiliates, divisions, officers, directors,
employees, agents, and their insurers.
RETENTION
2. Company
hereby retains Consultant to (a) oversee and manage the litigation involving
the
Elk Basin Storage Reservoir and to consult with and advise Company with respect
to the litigation and (b) to consult with and advise Company with respect to
the
Company’s Operations and such other matters involving the natural gas pipeline
and oil and gas industries as Company and its representatives may reasonably
request (“Consulting Services”). Consultant agrees to provide such Consulting
Services. Consultant agrees to use his best efforts and
abilities to faithfully and diligently promote the Company's interests and
to
ensure the efficient and economic use of Company’s resources. Consultant shall
consult with and obtain approval from the Company with regard to decisions
that
may significantly impact the litigation or the operation of Company’s pipeline
system such as decisions to shut in xxxxx or perform well testing. Consultant
may act as a representative of the Company to the extent authorized in this
paragraph.
TERM
3.
The term
of this Agreement shall be two (2) years commencing July 9, 2007 or
for a shorter period of time if Company determines Consultant’s services are no
longer required or if, after December 31, 2007, Consultant determines he can
no
longer provide such services.
RETAINER
4. Consultant
shall receive compensation for 2007 payable at the rate of two hundred and
fifty
dollars ($250.00) per hour. If Consultant has not billed 500 hours by December
15, 2007, Company will pay Consultant, by December 31, 2007, the difference
between the amount billed and one hundred and twenty-five thousand dollars
($125,000.00). After December 31, 2007, Company will pay Consultant two hundred
and fifty dollars ($250.00) per hour.
ROUTINE
EXPENSES COMPENSATION
5.
Company
shall reimburse Consultant for itemized expenses to the extent such expenses
were reasonably incurred with respect to this Agreement. Such expenses include
travel, lodging, meals, business telephone calls, photocopying, and other
authorized expenses. In order for Consultant to more effectively and timely
provide Consulting Services to Company, Company agrees to provide, during the
term of this Agreement, a Blackberry to Consultant and to pay the expenses
associated with it. Consultant will not be reimbursed for the expense of
maintaining a home office.
INVOICES
6. Consultant
shall submit monthly written invoices of time spent performing consulting
services, itemizing in reasonable detail the dates on which services were
performed, the number of hours spent on such dates, and a brief description
of
the services rendered. Consultant shall submit written documentation and
receipts where available itemizing the dates and amounts of expenses incurred.
The Company shall pay Consultant the amount due within 15 days after invoices
are received by the Company.
PLACE
AND TIME OF CONSULTING SERVICES
7. All
Consulting Services will be performed at Consultant’s home office or at such
other locations and at such times as Company and Consultant may agree
upon.
INDEPENDENT
CONTRACTOR
8. Consultant
shall at all times be an independent contractor and shall not be or represent
himself as a co-venturer or employee of Company. Consultant may act as a
representative of the Company only to the extent described in paragraph 2.
As an
independent contractor, Consultant shall be responsible for payment of any
and
all taxes arising out of Consultant’s activities under this Agreement and shall
have no right to any benefits offered to employees by Company. Because
Consultant is an independent contractor, Company will not withhold any income
or
social security taxes in connection with compensation it pays to Consultant.
Consultant shall be solely responsible for and agrees to pay all federal, state
and local unemployment and workers’ compensation insurance, fees and taxes, as
applicable, in connection with compensation and Consulting Services performed
hereunder, and shall indemnify Company, its directors, officers, and employees
for any and all claims, losses, expenses (including attorney fees), fines,
penalties, or lawsuits arising from any failure of consultant to pay such taxes
or other items for which he is responsible.
AGREEMENT
TERMINATION
9. Notwithstanding
paragraph 3, Company may terminate this Agreement without further payment
liability by written notice to Consultant upon the occurrence of any one of
the
following events:
| a. |
Consultant,
in connection with the Consulting Services, (i) engages in willful
misconduct contrary to the Agreement requirements or (ii) engages
in
illegal conduct or willfully engages in other misconduct materially
injurious to Company or its
businesses.
|
| b. |
Consultant
fails to observe or perform any covenant, agreement, or other obligation
to be observed or performed by him hereunder within thirty (30) days
after
written notice from Company.
|
DEATH
OR DISABILITY OF CONSULTANT
10.
If,
prior to the end of the term of this Agreement, Consultant dies or becomes
disabled or otherwise unable to perform Consulting Services hereunder for health
reasons, this Agreement shall terminate. Notwithstanding this provision, Company
agrees to pay Consultant the amount agreed upon for 2007 as provided in
Paragraph 4 hereof.
CONFIDENTIALITY
11. Consultant
recognizes that during the course of this Agreement performance he may acquire
knowledge or confidential business information or trade secrets. Consultant
agrees to keep all such confidential information in a secure place and further
agrees not to publish, communicate, divulge, use, or disclose, directly or
indirectly, for his own benefit or the benefit of another, either during or
after Agreement performance, any such confidential business information or
trade
secrets. Upon termination or expiration of this Agreement, Consultant shall
either destroy all records, data, information, and other documents produced
or
acquired during the performance of this Agreement, and all copies thereof,
or
shall deliver same to Company pursuant to the agreement of the parties. Any
such
material not destroyed shall remain the property of Company. This obligation
of
confidentiality shall continue notwithstanding the destruction or delivery
of
the documents or other material to the Company. This obligation of
confidentiality shall not apply with respect to information that (a) is
available to Consultant from third parties on an unrestricted basis; or (b)
is
disclosed by Company to others on an unrestricted basis.
CONFLICTS
OF INTEREST
12. Consultant
shall not act as agent for, consultant to, or as an officer, employee, or other
representative of any subcontractor or supplier to Company, or serve in any
of
the foregoing capacities for any of Company’s competitors or prospective
competitors, without giving prior written notice to Company. During
the term of this Agreement, Consultant will not accept work, enter into a
contract, or accept an obligation from any third party, inconsistent or
incompatible with Consultant's obligations or the scope of services rendered
for
Company under this Agreement. Consultant warrants that there is no other
contract or duty on his part inconsistent with this Agreement.
Consultant hereby warrants that there is no conflict of interest between
Consultant’s other consulting services or employment, if any, and the activities
to be performed hereunder. Consultant shall advise Company if a conflict of
interest arises in the future. Either Company or Consultant may terminate this
Agreement if a conflict of interest occurs.
If the Consultant’s actions create a conflict of interest and, as a result, the
Company or Consultant terminates this Agreement, Consultant will be paid only
for the hours worked prior to creating the conflict of interest. If a conflict
of interest arises which was not a result of Consultant’s actions and, as a
result, the Company or Consultant terminates this Agreement, Company agrees
to
pay the Consultant the amount agreed upon for 2007 as provided in Paragraph
4.
Consultant agrees to indemnify the Company from any and all loss or liability
incurred by reason of the alleged breach by Consultant of any services
agreement he may have with any third party.
ASSIGNABILITY
13. This
Agreement shall not be transferred or assigned, in whole or in part, by
Consultant or Company without the prior written consent of the
other.
CHOICE
OF LAW
14. Any
dispute under this Agreement, or related to this Agreement, shall be
decided
in accordance with the laws of the State of North Dakota.
REPORTS
15. Consultant,
as directed by Company, shall provide oral or written reports with respect
to
the Consulting Services provided under this Agreement.
AGREEMENTS
SUPERSEDED
16. This
Agreement supersedes all prior oral or written agreements, if any, between
the
parties and constitutes the entire agreement between the parties. The Agreement
cannot be orally changed or modified. This Agreement may be supplemented,
amended, or revised only in writing by agreement of the parties.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as
of the date and year above written.
WILLISTON
BASIN INTERSTATE XXXX
X.
XXXXXXXXXXX
PIPELINE
COMPANY CONSULTANT
By: /s/
Xxxxx X.
Xxxxxx By:
/s/
Xxxx X.
Xxxxxxxxxxx
Xxxxx
X.
Xxxxxx Xxxx
X.
Xxxxxxxxxxx
Executive
Vice President and
Chief
Operating Officer
