CONSULTING AGREEMENT
This
Consulting Agreement (“Agreement”) is made this
2
nd day
of July, 2007 by and between Williston Basin Interstate Pipeline
Company (“WBI”) (“Company”) and John K.
Castleberry (“Consultant”).
WHEREAS,
Consultant will be resigning as Executive Vice President -
Administration of MDU Resources Group, Inc. and was previously
the President and Chief Executive Officer of WBI for a number
of years; and
WHEREAS,
Consultant has gained extensive knowledge of the natural gas
transportation and oil and gas industries through his many
years of work in the industries prior to and since joining the
Company and, in particular, he has extensive knowledge about
the lawsuits involving the Elk Basin Storage Reservoir and
plans to expand the boundaries of the Elk Basin Storage
Reservoir; and
WHEREAS,
Consultant’s overall industry knowledge and his
knowledge of the Company’s operations
(“Operations”), including his knowledge of the
Company’s lawsuits and expansion, make his continuing
advice to the Company of particular value; and
WHEREAS,
Consultant desires to provide services to the Company as an
independent, self-employed consultant;
NOW,
THEREFORE, in consideration of the mutual covenants contained
herein, it is agreed as follows:
DEFINITION
1.
As used in this Agreement, the term “WBI” includes MDU
Resources Group,
Inc. and all of its subsidiaries, affiliates, divisions, officers,
directors, employees, agents, and their insurers.
RETENTION
2.
Company hereby retains Consultant to (a) oversee and manage the
litigation involving the Elk Basin Storage Reservoir and to consult
with and advise Company with respect to the litigation and (b) to
consult with and advise Company with respect to the Company’s
Operations and such other matters involving the natural gas
pipeline and oil and gas industries as Company and its
representatives may reasonably request (“Consulting
Services”). Consultant agrees to provide such Consulting
Services. Consultant agrees to use his best efforts
and
abilities to faithfully and diligently promote the Company's
interests and to ensure the efficient and economic use of
Company’s resources. Consultant shall consult with and obtain
approval from the Company with regard to decisions that may
significantly impact the litigation or the operation of
Company’s pipeline system such as decisions to shut in wells
or perform well testing. Consultant may act as a representative of
the Company to the extent authorized in this
paragraph.
TERM
3.
The term of this Agreement shall be two (2) years commencing
July 9, 2007 or for a shorter period of time if Company
determines Consultant’s services are no longer required or
if, after December 31, 2007, Consultant determines he can no longer
provide such services.
RETAINER
4.
Consultant shall receive compensation for 2007 payable at the rate
of two hundred and fifty dollars ($250.00) per hour. If Consultant
has not billed 500 hours by December 15, 2007, Company will pay
Consultant, by December 31, 2007, the difference between the amount
billed and one hundred and twenty-five thousand dollars
($125,000.00). After December 31, 2007, Company will pay Consultant
two hundred and fifty dollars ($250.00) per hour.
ROUTINE EXPENSES COMPENSATION
5.
Company shall reimburse Consultant for itemized expenses to the
extent such expenses were reasonably incurred with respect to this
Agreement. Such expenses include travel, lodging, meals, business
telephone calls, photocopying, and other authorized expenses. In
order for Consultant to more effectively and timely provide
Consulting Services to Company, Company agrees to provide, during
the term of this Agreement, a Blackberry to Consultant and to pay
the expenses associated with it. Consultant will not be reimbursed
for the expense of maintaining a home office.
INVOICES
6.
Consultant shall submit monthly written invoices of time spent
performing consulting services, itemizing in reasonable detail the
dates on which services were performed, the number of hours spent
on such dates, and a brief description of the services
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