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THIS INDEPENDENT CONTRACTOR AGREEMENT (the
“Agreement”) is
made as
of the 1
st day
of November, 2005.
BETWEEN:
ACCESS ENERGY INC..
(the
“Company”)
-
and -
CONISTON INVESTMENT CORP.
(the
“Contractor”)
(collectively
referred to as the “Parties”)
RECITALS:
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A.
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The
Company is engaged in the business of hydrocarbon exploration,
development and production.
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B.
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Mr.
Paul Parisotto (“Parisotto”) has been elected a
director of the Company; and
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C.
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The
Company has agreed to retain the services of the
Contractor.
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THEREFORE, the
Parties agree as follows:
1.1
The
term of this Agreement shall be for the period (the
“Term”) commencing on November 1, 2005 and
terminating on October 31,
2006 (the
“Agreement Expiry Date”), unless extended further
or terminated earlier, all in accordance with the provisions
contained herein.
1.2
Unless
either Party not less than 60 days prior to the Agreement
Expiry Date then in effect hereunder, gives notice to the
other Party that this Agreement will not be renewed, the
Agreement Expiry Date will be amended to the next anniversary
date of the Agreement Expiry Date and the Agreement will
continue, unamended.
1.3
Notwithstanding
the foregoing, the Term may expire before an Agreement Expiry
Date in the event that: (a) Parisotto in performing the
Services either by omission or commission, engages in conduct
which would entitle the Company to terminate him for cause;
(b) Parisotto is no longer employed by the Contractor; or (c)
following a Change of Control as set forth in section 7 of
this Agreement.
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2.
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SERVICES TO BE PROVIDED
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The
Company hereby retains the Contractor for the purposes of
providing only such services as the Parties may agree from
time to time during the Term (the “Services”). For
more particularity, the Services will include, but not be
limited to the following:
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(a)
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consulting
and advisory services provided by the Contractor on matters with
respect to the acquisition, exploration, development and production
of hydrocarbons in western Canada and the western United States,
and in particular Saskatchewan;
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(b)
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assisting
the Company in negotiation of a joint venture agreement between
indigenous aboriginal peoples (“Aboriginal People”) and
the Company;
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(c)
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establishing
and maintaining a working relationship between the Aboriginal
Peoples and the Company;
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(d)
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assisting
the Company in the formation of a team of technical experts for
assessment of the potential for development on the lands of the
Aboriginal Peoples including, drilling, seismic and data
analysis;
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(e)
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assisting
the Aboriginal Peoples on a “as required basis” in
matters between the Aboriginal Peoples and both provincial and
federal and state authorities as they relate to the interests of
Company; and
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(d)
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the
Contractor may be requested to undertake such other related
assignments as the Company may from time to time
request.
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The
Contractor agrees that it will retain Parisotto and cause
Parisotto to devote his principal time and attention to
providing the Services but there shall be no set hours of work
to provide the Services. The Contractor may, however; retain
from time to time such personnel as it deems appropriate in
order to provide the Services.
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3.1
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In
consideration of the Services provided, the Company shall pay to
the Contractor a fee of: (i) $260,000.00
per
annum (the “Fee”) plus applicable Goods and Services
Tax (“GST”) payable monthly; (ii) $1,000,000.00 (the
“Dene Fee”) in the event the Company enters into an
agreement with the Buffalo River Dene Nation and/or its associates
or affiliates to develop hydrocarbon opportunities in a defined
area within Treaty 10 lands which includes the traditional and
historically occupied and used lands of the Buffalo River Dene
Nation (the “Dene”); and (iii) the Contractor will also
be entitled to receive a 1.25% non-convertible overriding royalty
based on 100% production (“GORR”) from any and all
projects that Contractor bring to the Company (the “Royalty
Fee”). The Royalty Fee is governed by Article 3 of the
“Farmout & Royalty Procedure”, as such term is
defined by the 1997 Canadian Association of Petroleum Landman
Farmount & Royalty Procedure” (the “LFRP
Procedure”).
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3.2
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If
the interest of any party in the projects brought to the attention
of the Company (the “Project Lands”) by the Contractor
is now or hereafter shall become encumbered by any royalty,
overriding royalty, production payment or other charge of a similar
nature (the “Encumbrance”), other than the
“Lessor’s Royalty” as such term is defined in the
LFRP Procedure, such Encumbrance shall be charged to and paid
entirely by the party whose interest is or becomes thus encumbered.
No party which acquires an interest in the Project Lands shall by
virtu
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