EXHIBIT 10.1
AUDIT COMMITTEE SHARE AGREEMENT
This AUDIT COMMITTEE SHARE AGREEMENT dated as of the ___ day of
_______, 2003 (the "Agreement") is by and between Quest Resource Corporation, a
Nevada corporation (the "Company") and Xxxx X. Xxxxxxxx ("Xxxxxxxx").
WHEREAS, Xxxxxxxx has been elected a director of the Company and has
experience and expertise in business and financial matters sufficient to qualify
for service on the audit committee of the board of directors (Committee); and
WHEREAS, the Company has elected Xxxxxxxx to the Committee and Xxxxxxxx
has been appointed as the Audit Committee Financial Expert for an indefinite
term; and
WHEREAS, Xxxxxxxx agrees to accept this appointment to the Committee ,
upon the terms and subject to the conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements contained herein, and of other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Company and
Executive hereby agree as follows
DUTIES
Duties. During the period of service on the audit committee, Xxxxxxxx
will work to fulfill the responsibilities set forth in the Audit Committee
Charter, as determined in the judgement of Xxxxxxxx and other members of the
Audit Committee.
COMPENSATION PERIOD
Compensation Period. The term of compensation for Xxxxxxxx'x audit
committee service under this Agreement shall begin on the Agreement Date and
terminate May 31, 2005. Compensation terms for continued service will be
negotiated at that time.
COMPENSATION.
(a) On the date of election to the Committee, the Company
shall xxxxx Xxxxxxxx as compensation for his services hereunder 25,000
restricted shares of the Company's Common Stock (restricted shares).
(b) 9,000 of the restricted shares shall vest and become
nonforfeitable and transferable on the date of this agreement. An
additional 8,000 of the restricted shares shall vest and become
nonforfeitable and transferable on each of June 1, 2004 and June 1,
2005. In the event that Xxxxxxxx resigns the Committee assignment
before the respective vesting dates, all restricted shares that have
not vested as of such date shall be forfeited by Xxxxxxxx and shall not
vest or become nonforfeitable or transferable. In the event that
Xxxxxxxx resigns the committee assignment in conjunction with a change
in control of the
Company, all remaining unvested restricted shares shall immediately
vest and become nonforfeitable and transferable.
(c) The Company may include on the certificates for the
restricted shares a legend that refers to the restrictions imposed by
this Agreement. Promptly after any Restricted Shares vest and become
nonforfeitable and transferable, the Company shall cause a new
certificate or certificates evidencing unrestricted shares of Common
Stock to be issued without such a legend in exchange for the
certificate evidencing the Restricted Shares.
OTHER BENEFITS
Expenses. During the period of service on the committee, the Xxxxxxxx
shall be entitled to receive prompt reimbursement for all reasonable related
expenses incurred by Xxxxxxxx upon the receipt by the Company of accounting
therefor in accordance with practices, policies and procedures applicable to
directors and senior executives of the Company.
MISCELLANEOUS
Beneficiary. If Xxxxxxxx dies prior to receiving all of the amounts
payable to him in accordance with the terms of this Agreement, such amounts
shall be paid to one or more beneficiaries designated by Xxxxxxxx in writing to
the President of the Company during his lifetime, or if no such Beneficiary is
designated, to Executive's estate. Executive, without the consent of any prior
Beneficiary, may change his designation of Beneficiary or Beneficiaries at any
time or from time to time by a submitting to the President of the Company a new
designation in writing.
Assignment; Successors. Xxxxxxxx may not assign his rights and
obligations under this Agreement. The Company may not assign its rights and
obligations under this Agreement without the prior written consent of Xxxxxxxx
except to a successor of the Company's business which expressly assumes the
Company's obligations hereunder in writing. This Agreement shall be binding upon
and inure to the benefit of Xxxxxxxx, his estate and Beneficiaries, the Company
and the successors and permitted assigns of the Company.
Nonalienation. Compensation and benefits payable under this Agreement
shall not be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, charge, garnishment, execution or levy of any
kind, either voluntary or involuntary, prior to actually being received by
Xxxxxxxx or a Beneficiary, as applicable, and any such attempt to dispose of any
right to benefits payable hereunder shall be void.
Severability. If one or more parts of this Agreement are declared by
any court or governmental authority to be unlawful or invalid, such unlawfulness
or invalidity shall not invalidate any part of this Agreement not declared to be
unlawful or invalid. Any part so declared to be unlawful or invalid shall, if
possible, be construed in a manner which will give effect to the terms of such
part to the fullest extent possible while remaining lawful and valid.
Captions. The names of the Articles and Sections of this Agreement are
for convenience of reference only and do not constitute a part hereof.
Amendment; Waiver. This Agreement shall not be amended or modified
except by written instrument executed by the Company and Xxxxxxxx. A waiver of
any term, covenant or condition contained in this Agreement shall not be deemed
a waiver of any other term, covenant or condition, and any waiver of any default
in any such term, covenant or condition shall not be deemed a waiver of any
later default thereof.
Notices. All notices hereunder shall be in writing and delivered by
hand, by nationally-recognized delivery service that guarantees overnight
delivery, or by first-class, registered or certified mail, return receipt
requested, postage prepaid, addressed as follows:
If to the Company, to: Quest Resource Corporation
X.X. Xxx 000, 000 Xxxx Xxxx Xx.
Xxxxxxxx, Xxxxxx 00000
Attention: Xxxxxxx X. Xxxx
with a copy to: Xxxxxxx Xxxxxxxx Xxxxxx LLP
0000 Xxxxx Xxxx.
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxxxxx
If to Xxxxxxxx, to: Xxxx X. Xxxxxxxx
0000 Xxxx Xxxxx
Xxxxxxx Xxxxxxx, Xxxxxx 00000
Either party may from time to time designate a new address by notice given in
accordance with this Section. Notice shall be effective when actually received
by the addressee.
Counterparts. This Agreement may be executed in several counterparts, each of
which shall be deemed to be an original but all of which together will
constitute one and the same instrument.
Entire Agreement. This Agreement forms the entire agreement between the parties
hereto with respect to the subject matter contained in this Agreement and,
except as otherwise provided herein, shall supersede all prior agreements,
promises and representations regarding employment, compensation, severance or
other payments contingent upon termination of employment, whether in writing or
otherwise.
Applicable Law. This Agreement shall be interpreted and construed in accordance
with the laws of the State of Kansas, without regard to its choice of law
principles.
Survival of Xxxxxxxx'x Rights. All of Xxxxxxxx'x rights hereunder, including his
rights to compensation, shall survive the termination the termination of this
Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
date first above written.
QUEST RESOURCE CORPORATION
By: /s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx, President
/s/ Xxxx X. Xxxxxxxx
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Xxxx X. Xxxxxxxx
