6
LAND SERVICES CONSULTING AGREEMENT
THIS AGREEMENT is made and entered into this 27th day of December, 2002
by and between PETROL OIL AND GAS, INC. ("Petrol") and XXXX X. XXXXXX
("Xxxxxx").
RECITALS:
A. Petrol is a Nevada corporation engaged in the business of oil
and gas leasing and production with its principal office located at 0000 X.
Xxxxxxxxx Xxx, Xxx Xxxxx, XX 00000.
X. Xxxxxx is a natural person who is engaged in business as a
land professional with his place of business located at 0000 Xxxxxxxx Xx.,
Xxxxxxxx, Xxxxx 00000.
C. From time-to-time Petrol has need for the services of land
professionals; Xxxxxx has the requisite experience and qualifications to
provide such services; Xxxxxx desires to provide such services pursuant to
the terms of this agreement.
NOW, THEREFORE, in consideration of the mutual promises set forth below
and other good and valuable consideration the parties agree as follows:
1. Land Professional Services: Xxxxxx shall provide to Petrol land
professional services in the nature of the following specific duties: (i)
acquisition of mineral interests and the recording of such interests (whether
by leasehold or fee interest) in the Office of the Register of Deeds of
Xxxxxx, Xxxxxxxxx and Xxxxxxxx Counties, Kansas (ii) conduct any and all
necessary due diligence and title work on leased properties, including
checking title from patent forward to present on both surface and mineral
interests, lien and encumbrance searches in the appropriate deed offices,
searching for the existence of liens, encumbrances and title defects by
reviewing the records of the clerk of the respective district courts of
Xxxxxx, Greenwood and Xxxxxxxx Counties, Kansas, and prepare all
recapitulations, compilations and other written reports reasonably requested
by Petrol management. Except as otherwise agreed, Xxxxxx shall not be
obligated under this agreement to negotiate and arrange for the execution of
agreements concerning easements and surface uses or negotiate and arrange for
the execution of consents, declarations, designations, notices or
stipulations. In performing his services hereunder, Xxxxxx agrees to abide
by the Code of Ethics of the American Association of Professional Landmen
(AAPL) and shall conduct business in accordance with the Standards of
Practice of the AAPL as adopted and promulgated from time-to-time. A copy of
the Code and Standards is attached hereto as an exhibit and incorporated and
made a part of this Agreement.
2. Term of Agreement: This Agreement shall remain in effect for one
(1) year commencing upon execution hereof. Petrol may terminate this
contract at any time "for cause." As used herein, the term "for cause" shall
mean Xxxxxx'x failure to abide by any material term of this Agreement,
provided, however, that Petrol's termination of this agreement shall not
terminate the Option Rights as defined and set forth in Paragraph 3, below.
3. Payment: Except as otherwise agreed to in writing, Petrol shall
pay Xxxxxx for his services exclusively with stock and stock options as
follows:
a. Petrol Stock Grant: Petrol hereby grants to Xxxxxx Three Hundred
Twenty Five Thousand (325,000) shares of common stock $.01 par
value of Petrol. To the extent possible, Petrol shall take all
reasonable and necessary steps to register such shares as free
trading in any market where Petrol is listed in the future, if any.
b. Petrol Stock Option: Petrol hereby grants to Xxxxxx the right,
privilege and option (the "Option Rights") to purchase a total of
Three Hundred Twenty Five Thousand (325,000) shares of common stock
$.01 per value of Petrol (the "Option Shares"). The Option Rights
are fully vested and exercisable immediately. The exercise price
per share shall be Fifty Cents ($.50).
Upon execution of this Agreement, the Option Rights shall be
exercisable at any time and from time to time, in whole or in part
for a period of Thirty Six (36) months, after such time Xxxxxx
shall forfeit all right and privilege to all unexercised options.
The Option Rights shall be exercised by written notice directed to
Petrol, accompanied by a check payable to Petrol for the Option
Shares being purchased. Petrol shall make immediate delivery of
such purchased shares, fully paid and non-assessable, and to the
extent applicable, fully registered and registered in the name of
Xxxxxx.
Petrol currently has total authorized common shares of one
hundred million (100,000,000). If, and to the extent that the
number of authorized shares of common stock of Petrol shall be
increased beyond such 100,000,000, or reduced from 100,000,000 by
whatever action, including but not limited to change of par value,
split, reclassification, distribution or a dividend payable in
stock, or the like, the number of shares subject to the Stock
Option and the option price per share shall be proportionately
adjusted. If, however, Petrol, for any reason, issues additional
common stock in any amount up to the 100,000,000 shares authorized,
no such adjustment shall be applicable. If Petrol is reorganized,
consolidated or merged with another corporation, Xxxxxx shall be
entitled to receive Option Rights covering shares of such
reorganized, consolidated, or merged company in the same
proportion, at an equivalent price, and subject to the same
conditions as the Option Rights as set forth above. For purposes
of the preceding sentence, the excess of the aggregate fair market
value of the shares subject to the option immediately after any
such reorganization, consolidation, or merger over the aggregate
option price of such shares shall not be more than the excess of
the aggregate fair market value of all shares subject to the Option
Rights immediately before such reorganization, consolidation, or
merger over the aggregate option price of such shares, and the new
option or assumption of the old Option Rights shall not give
Xxxxxx additional benefits which he did not have under the old
Option Rights, or deprive him of benefits which he had under the
old Option Rights. Xxxxxx shall have no rights as a stockholder
with respect to the Option Shares until exercise of the Stock
Option and payment of the Option Price as herein provided.
4. Expense Reimbursement/Allowance: The parties hereto agree and
acknowledge that Xxxxxx shall pay all out-of-pocket expenses incurred in
connection with the performance of the services provided under this
Agreement, provided, however, if Petrol requires Xxxxxx to perform any
services outside of the geographic area of Xxxxxx, Greenwood and Xxxxxxxx
Counties, Kansas, Xxxxxx shall be entitled to reimbursement for such
expenses. All expenses subject to reimbursement shall be reasonable and
necessary and in an amount not to exceed $110.00 per diem. All reimbursable
expenses shall be agreed upon by the parties, in writing, in advance of the
time such expenses are incurred.
5. Choice of Venue: The parties hereto consent to submit any dispute
arising out of, or with respect to this Agreement or the performance of this
Agreement to the exclusive jurisdiction and venue of the state district court
located in Xxxxxx County, Kansas, United States of America.
6. Entire Agreement: This writing constitutes the entire Agreement
between the parties hereto concerning the subject matter hereof; supersedes
all existing agreements between them; and, cannot be changed or terminated
except as provided herein or as stated in a written agreement signed by both
parties.
7. Choice of Law: This Agreement is made in, and shall be interpreted
in accordance with the laws of the United States of America, State of Nevada
applicable to contracts to be performed entirely within the State, and
without regard to principles of conflicts of laws.
8. Counterparts: This Agreement may be executed in one or more
counterparts, all of which when taken together shall constitute one and the
same Agreement.
AGREED TO AS OF THE DATE FIRST WRITTEN ABOVE.
PETROL OIL AND GAS, INC.
By:/s/ Xxxx Xxxxxxxx
Xxxx Xxxxxxxx, President
/s/ Xxxx Xxxxxx
Xxxx X. Xxxxxx
