CONSULTING AGREEMENT
99-5
This Agreement made as of the 31st day of January, 2003.
B E T W E E N:
ASPEN GROUP RESOURCES CORPORATION,
a Corporation incorporated under the laws of the Yukon Territory
(the "Corporation")
OF THE FIRST PART
and
XXXXXX XXXXXXXXX, an individual residing in the State of Florida
(the "Executive")
OF THE SECOND PART
WHEREAS the Corporation carries on the business of oil and gas exploration, exploitation and development (the "Corporation Business");
AND WHEREAS the Corporation believes that the Executive has management skills that are required in relation to the Corporation Business;
NOW THEREFORE this Agreement witnesses that in consideration of the sum of One ($1.00) Dollar of lawful money of Canada and other good and valuable consideration now paid by each of the parties hereto to the other, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:
1.
Agreement to Serve as a Consultant
By executing this Agreement, the Corporation engages the Executive as a consultant and the Executive accepts such engagement and agrees to perform the consulting services described in Article 4 below (the "Services"), all according to the terms and conditions of this Agreement. The consulting relationship between the Executive and the Corporation created hereby shall be that of an independent contractor, and the Executive shall not be treated as an employee for Federal or other income tax purposes, and shall be responsible for paying his own estimated income and self-employment taxes with respect to all compensation paid to him hereunder. Except as may be otherwise specifically set forth herein, the Executive shall not be entitled to any of the benefits of employee status otherwise available to employees of the Corporation. Notwithstanding anything herein to the contrary, the Executive shall be indemnified and held harmless by the Corporation for any and all of his actions authorized by the Corporation or instructed by the Corporation to be taken and taken in good faith.
2.
Term
Subject to Article 9 of this Agreement, the term of this Agreement shall be for a period commencing on October 24, 2002 and ending on December 31, 2003 (the "Term").
3.
Termination at End of Term
Prior to the expiry of the Term, either the Executive or the Corporation may terminate this Agreement at any time by giving the other at least sixty (60) days prior written notice of termination, or a period of prior notice which has been otherwise mutually negotiated and agreed upon by the parties hereto.
4.
Services to be Provided
(i)
During the term of this Agreement, the Consultant shall:
(a)
Provide management services and advice to the Corporation;
(b)
Fulfill the role of Chief Executive Officer ("CEO") of the Corporation at the discretion of the Board, and to fulfill all such duties and responsibilities as are consistent with such role including, but not limited to, managing the day to day operations of the Corporation, developing strategic direction for the Corporation to enhance shareholder value, working in conjunction with the Board of Directors of the Corporation, establishing the budgets for various departments of the Corporation, hiring employees, and developing, implementing and managing business plans for the Corporation;
(c)
To make decisions on the appointment and supervision of the senior management team; and
(d)
To perform, to the best his ability, utilizing all of his skill and experience, tasks reasonably assigned to the Executive from time to time by the Board of the Corporation.
(ii)
The Corporation agrees to make available to the Executive such information and resources as are necessary to enable the Executive to perform his duties and fulfill his responsibilities as the CEO of the Corporation.
(iii)
The Executive shall be a voting member of the Board of Directors of the Corporation.
5.
Commitment
During the term of this Agreement, the Executive shall devote his full employment time and commitment to the Corporation Business, of a minimum of forty (40) hours per week to performing the Services under this Agreement at the business premises of the Corporation.
6.
Compensation
During the Term of this Agreement, the Executive shall be compensated as follows:
(i)
The Executive shall be paid TWO HUNDRED FIFTY THOUSAND ($250,000.00) dollars (United States Funds) per year as compensation for the Services provided under this Agreement. The amount is accrued and paid to the Executive on a retroactive basis to the date of the commencement of the Term under this Agreement.
(ii)
The Executive may elect on a monthly basis to receive the compensation in Common Shares of the Corporation, at a rate which is acceptable to the Board of Directors and the relevant regulatory bodies, including subject to approval of The Toronto Stock Exchange.
(iii)
The Executive will be eligible for coverage under the Corporation's hospitalisation insurance.
7.
Expenses
The Corporation shall reimburse the Executive for all expenses reasonably incurred by the Executive in connection with his services as may be approved by the Corporation from time to time. Such expenses shall include reasonable amounts for telephone and fax, and a reasonable car allowance. For all such expenses, the Executive shall furnish the Corporation statements and vouchers in such form and with such reasonable detail as shall be reasonably required by the Corporation.
8.
Payment
The Corporation agrees to pay the Executive within seven (7) days of receipt of an invoice from the Executive. It is anticipated that the Executive will generate monthly invoices.
9.
Termination
Notwithstanding the provisions of Section 3 herein, the Corporation may terminate the Executive hereunder for cause by delivering to the Executive written notice of termination and such termination shall be effective upon delivery of such notice. For the purposes hereof, the term "cause" means serious misconduct or misfeasance detrimental to the interests of the Corporation by the Executive.
10.
Termination Upon Death or Disability
This Agreement shall terminate upon the death of the Executive or at the Corporation's election, if the Executive becomes unable, by reason of physical or mental disability, with or without reasonable accommodation, to perform the essential functions under this Agreement for the minimum disability period. The term "minimum disability period" means three consecutive months or shorter periods aggregating ninety (90) business days or more in any twelve (12) month period. The determination of whether grounds for termination exist under this section shall be made in good faith by the Corporation.
11.
Confidentiality
(i)
Except as is necessary for the Executive to render the services hereunder or as otherwise required by law, all knowledge and information concerning the business operations and financial affairs or condition of the Corporation acquired by the Executive as a result of the Executive's services to the Corporation, excepting knowledge or information generally available to the public by means of disclosure other than by the Executive, is confidential information acquired in the strictest confidence.
(ii)
Without limiting the generality of the foregoing, confidential information shall include in particular any knowledge or information respecting the Corporation's inventions, designs and methods, systems, improvements, trade secrets, customer information, or other private or confidential matters, and all confidential information shall be held by the Executive in trust for the sole benefit of the Corporation.
(iii)
The Executive shall not disclose directly or indirectly (except for the benefit of the Corporation) to any person, business, corporation or other entity not authorized by the Corporation, or otherwise use, any secret or any confidential information or other knowledge or data of the Corporation whether held in trust by the Executive, whether or not obtained, acquired or developed by the Executive.
12.
Further Assurances
The parties hereto covenant and agree that they will from time to time and all times hereafter, upon every reasonable request of the other, promptly make, do and execute, all such further acts, deeds or assurances as may be reasonably required for the purposes of implementing the matters contemplated by this Agreement.
13.
Time of Essence
Time shall be of the essence of this Agreement.
14.
Notices
All notices, requested, demands or other communications under this Agreement or in connection herewith shall be delivered or sent by registered mail, postage fully prepaid, addressed to the other party or delivered to such other party as follows:
(i)
in the case of the Corporation, addressed to:
c/o WeirFoulds LLP
Barristers & Solicitors
000 Xxxx Xxxxxx Xxxx
Xxxxx 0000, The Exchange Tower
Toronto, Ontario
M5X 1J5
Attention: Xx. Xxxxx X. Xxxx
Fax: (000) 000-0000
(ii)
in the case of the Executive, addressed to:
Xx. Xxxxxx Xxxxxxxxx
0000 Xxxxx Xxxxx Xxxxxxx
Xxxxxx Xxxxxx, Xxxxxxx
00000, X.X.X.
Fax:
(000) 000-0000
or at such address as any of the said parties shall by written notice to the other direct. All notices, requested, demands and other communications so given shall be considered effective upon the date of delivery, if delivered, and on the third business day following the mailing thereof, if mailed, to the address stated above for the applicable party. In the event of a mail strike or postal interruption at any time during the term of this Agreement, all notices, requested, demands and other communications shall be delivered.
15.
Successors and Assigns
This Agreement is personal to, and may not be assigned or otherwise transferred by the Executive.
16.
Governing Law
This Agreement shall be governed by and construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein.
IN WITNESS WHEREOF the parties hereto have duly executed and delivered this Agreement on the date first above written.
IN WITNESS WHEREOF, the parties have executed this ____________ as of the date first above written.
ASPEN GROUP RESOURCES CORPORATION Per NAME: XXXXX X. XXXX Title: Director I have the authority to bind the Corporation | ||
Witness | XXXXXX XXXXXXXXX |
