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 XXXXXXX X.
XXXXXXXX ("Xxxxxxxx").
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.
Xxxxxxxxxx Xxx, Xxx Xxxxx, XX 00000.
X. Xxxxxxxx is a natural person who is engaged in business as a
land professional with his place of business located at 00000 Xxxxxx Xxxxxx,
Xxxxxxxx Xxxx, Xxxxxx 00000.
C. From time-to-time Petrol has need for the services of land
professionals; Xxxxxxxx has the requisite experience and qualifications to
provide such services; Xxxxxxxx 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: Xxxxxxxx shall provide to Petrol land
professional services in the nature of the following specific duties:
preparation and drafting of written agreements including but not limited to,
agreements concerning well location, waivers of surface use and other lease
provisions, damage release and compensation agreements related to drilling
operations, easement and right of way agreements, pooling and farmout
agreements, and such other consents, declarations, designations, memoranda,
notices, ratifications and stipulations by and between Petrol and any and all
surface owners (whether or not such surface owners are also lessors) in or
adjacent to Petrol mineral lease hold interests situated in Xxxxxx, Xxxxxxxx
and Xxxxxxxxx Counties, Kansas as may be needed from time-to-time. Except as
otherwise agreed, Xxxxxxxx shall not be obligated under this agreement to
record instruments in the land records or engage in due diligence title work
or negotiate the contents, arrange for execution or otherwise interface with
land owners in the field. In recognition of the fact that accurate
assessment of the field situation is a prerequisite to the preparation of
appropriate documentation, Xxxxxxxx shall work with and cooperate fully with
other Petrol landmen in connection with such services contemplated under this
agreement. In performing his services hereunder, Xxxxxxxx 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.
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 Xxxxxxxx'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 Xxxxxxxx for his services exclusively with stock and stock options as
follows:
a. Petrol Stock Grant: Petrol hereby grants to Xxxxxxxx Fifty
Thousand (50,000) 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 Xxxxxxxx the right,
privilege and option (the "Option Rights") to purchase a total of
Fifty Thousand (50,000) 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 Xxxxxxxx
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
Xxxxxxxx.
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, Xxxxxxxx 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
Xxxxxxxx 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. Xxxxxxxx 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 Xxxxxxxx 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 Xxxxxxxx to perform any
services outside of the metropolitan Kansas City area (defined as a radius of
fifty miles with the center of the radius being the intersection of 11th
Street and Main, Kansas City, Missouri) Xxxxxxxx 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 Xxxxxxx 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. This Agreement is non-assignable by either party.
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/ Xxxxxxx Xxxxxxxx
Xxxxxxx X. Xxxxxxxx
