CORPORATE ADVISOR
ENGAGEMENT AGREEMENT
AGREEMENT made as of this 1st day of June, 2010 by and between Sun
River Energy, Inc. (the "Company"), located at 0000 Xxxx Xxxxxx, Xxxxxx,
Xxxxxxxx 00000 and Xxxxx X. Xxxxxxx (the "Advisor"), located at 0000 00xx
Xxxxxx, Xxxxx 0000, Xxxxxx, XX 00000.
WHEREAS, the Company desires professional guidance and advice regarding
oil and gas Accounting, Financing, Control Processes, Sarbanes Oxley Compliance,
and SEC Compliance and desires Advisor to aid it in business matters; and
WHEREAS, Advisor has expertise in the area of oil and gas Accounting,
Financing, Control Processes, Sarbanes Oxley Compliance, and SEC Compliance; and
is willing to act as an advisor to the Company upon the terms and conditions set
forth in this Agreement;
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 Advisor on its Advisory Board
on energy business matters, consistent with Advisor's expertise and ability, and
Advisor agrees to consult with the Company during the term of this Agreement.
All parties understand that Advisor 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 Advisor's
efforts on behalf of his other interests are the sole and separate property of
Advisor.
(b) The services rendered by Advisor to the company pursuant to this
Agreement shall be as an independent contractor, and this Agreement does not
make Advisor the employee, agent, or legal representative of the Company for any
purpose whatsoever, including without limitation, participation in any benefits
or privileges given or extended by the Company to its employees. No right or
authority is granted to Advisor to assume or to create any obligation or
responsibility, express or implied, on behalf of or in the name of the company,
except as may be set forth herein. The company shall not withhold for Advisor
any federal or state taxes from the amounts to be paid to Advisor hereunder, and
Advisor agrees that he will pay all taxes due on such amounts.
(c) Advisor agrees to make available to Company its services as an
Advisor on an as needed basis on reasonable request. Advisor shall provide
planning for and other advisory services as the Company may specifically
request. Specific fees for each separate service rendered by Advisor shall be
established at the time Advisor is requested to undertake each service.
2. Compensation
(a) The Company will issue 20,000 shares of restricted common stock to Advisor
as a retainer. This retainer is based on Advisor's estimate of the billable
hours for services in Fiscal 2010 at a rate of $125.00 per hour for a maximum of
240 hours. The 20,000 shares represent all compensation that shall be paid to
the Advisor. Nothing within this agreement shall provide for any additional
compensation. Company shall issue said shares within sixty (60) days from the
execution of this Agreement by both parties.
(b)
1. The Shares owned by the Advisor are subject to forfeiture and
restrictions on transfer in accordance with the terms and conditions
of this Agreement. Subject to the terms of this Agreement, on each
month anniversary of the date of this Agreement, one eighth (1/8th) of
the Shares shall vest and no longer be subject to the repurchase right
set forth herein.
2. Other than as expressly reserved or restricted by this Agreement, the
Advisor shall have all the rights of a stockholder with respect to the
Shares unless and until the Company exercises its repurchase rights.
The Shareholders may not sell, transfer, alienate pledge or otherwise
encumber (i) any Share or fraction thereof, or any interest in a Share
or (ii) any other interest in this Agreement, until such Shares are no
longer subject to the Company's repurchase rights as set forth herein.
Dividends paid with respect to Shares in cash or property other than
shares or rights to acquire shares will be paid to the Advisor at the
time such dividends are paid to other stockholders. Dividends with
respect to Shares paid in shares or rights to acquire shares will be
added to and become a part of the Shares.
(c) If the Company intends to exercise its Repurchase Right with respect to
such Repurchased Stock, the Company must give Advisor written notice (the
"Repurchase Notice") that the Company is exercising its Repurchase Right
with respect to the Repurchased Stock, which Repurchase Notice will
constitute exercise of the Repurchase Right. The Company may exercise each
Repurchase Right with respect to all or any portion, of the Repurchased
Stock subject to such Repurchase Right, excepting those shares that have
vested under paragraph 2(b)(1) above. The Repurchase Right will not effect
shares in the calendar month in which the notice is given, allowing those
shares to vest. Such Repurchase Right will expire with respect to the
Repurchased Stock subject to such Repurchase Right to the extent not
exercised by the Company at the conclusion of the eight month term of this
agreement. The price per share for the Repurchased Stock will be $0.001 per
share (the "Repurchase Price").
(d) Other forms of compensation may occur depending on the nature of a specific
engagement and only upon the mutual agreement of both parties in writing.
3. Expenses
The Company shall reimburse Advisor for all pre-approved reasonable and
necessary expenses incurred by it in carrying out its duties under this
Agreement. Advisor shall submit related receipts and documentation with his
request for reimbursement.
4. Renewal; Termination
(a) This Agreement shall continue for one calendar year. The Agreement
may be terminated by either of the parties at any time with thirty (30) days
written notice.
(b) Subject to the continuing obligations of Advisor 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.
Either party may request an extension of this agreement within sixty
(60) days of the term of the agreement. If the Agreement is to be extended it
must be done so in writing with the extension to the agreement executed by both
parties.
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 Advisor reasonably considers Confidential
Information, or that the Company treats as Confidential Information, will be
presumed to be Confidential Information (whether Advisor or others originated it
and regardless of how it obtained it).
(c) Except as required in its duties to the Company, Advisor will
never, either during or after the term of this Agreement, use or disclose
confidential Information to any person not authorized by the Company to receive
it for a period of two (2) years after termination of this Agreement. However,
information in the possession of Advisor as of the Effective Date of this
Agreement, information that is public or becomes public, or information that is
required to be disclosed by a bona fide legal authority is exempt from this
Agreement.
(d) If this Agreement is terminated, Advisor 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 Advisor 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 Advisor with accurate
financial, corporate, and other data required by Advisor and necessary for full
disclosure of all facts relevant to any efforts required of Advisor 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 Advisor shall be false or misleading, or if the Company omits or
fails to provide or withholds relevant material information to Advisor 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 Advisor as liquidated damages
and this Agreement shall be null and void and Advisor shall have no further
obligation hereunder. Further, by execution of this Agreement, the Company
hereby indemnifies Advisor from any and all costs for expenses or damages
incurred, and holds Advisor 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 Advisor under
this Agreement.
7. Advisor's Best efforts and No Warranty of Information
Advisor shall use its best efforts to use reliable information and
scientific techniques associated with the oil and gas business. However, Advisor
makes no warranty as to the completeness or interpretation of such information,
nor does Advisor 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 Advisor
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 Advisor's
written agreement.
(b) Modification. This Agreement may be modified or amended only by a
writing signed by both the Company and Advisor.
(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 Advisor 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 Advisor 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
Advisor 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: Xxx Xxxxxx
c/o 0000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Ph: 000-000-0000
Fx: 000-000-0000
E-mail: xxxxxxx@xxxxxxxxxxxxxx.xxx
In the case of Advisor:
Xxxxx X. Xxxxxxx
0000 00xx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
Ph: 303-519-0240
Fx: 000-000-0000
E-mail: xxxxxxxx@xxxxxxxxxxxxxxxxx.xxx
(i) Indemnification. Company agrees to indemnify and hold harmless Advisor
from any and all claims, actions, liabilities, costs, expenses, including
attorney fees arising from claims made against Advisor in connection with
Company's possession or use of advice, guidance, materials, information, data or
other services provided by Advisor under this Agreement.
(j) Conflicts of Interest. Company acknowledges that Advisor is engaged in
the business of providing petroleum consulting for other oil and gas companies
within the United State and Canada. In the event Advisor is requested by Company
to provide advice and guidance on or about geographical areas that may create a
potential conflict of interest between Advisor's other business matters and the
Company's operations, Advisor shall not be required by Company to render advice
and guidance on such an area. Company and Advisor shall use their best efforts
to notify each other of any potential conflicts of interests. In any event,
Advisor'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
Advisor, or Advisor'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 date and year first above written.
"The Company" "Advisor"
SUN RIVER ENERGY, INC. XXXXX X. XXXXXXX
By:/s/ Xxx Xxxxxx By:/s/ Xxxxx X. Xxxxxxx
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Xxx Xxxxxx, President Xxxxx X. Xxxxxxx
