EXHIBIT 10.3
CONSULTING AGREEMENT
THIS AGREEMENT ("Agreement"), made and entered into as of the 9th day of
September, 2003, by and between Olympic Resources Ltd., a Wyoming corporation
("Olympic"), and Xxxxx Xxxxxxx, an individual residing in Xxxx Xxxxxxxxx,
Xxxxxxx Xxxxxxxx, Xxxxxx and doing business as DWP Consultants ("Consultant").
W I T N E S S E T H:
WHEREAS, Olympic has entered into that certain Agreement (the "Omnibus
Agreement") dated July 8, 2003, and as amended on August 28, 2003 and September
9, 2003, with Whittier Energy Company, a Nevada corporation ("Whittier") and WEC
Acquisition, Inc., a Wyoming corporation wholly owned by Olympic ("Newco"); and
WHEREAS, pursuant to the terms of the Omnibus Agreement, Newco and Whittier
will enter into that certain Agreement and Plan of Merger, dated July 8, 2003,
and as amended on August 29, 2003 and September 9, 2003 (the "Plan of Merger"),
whereby Newco will be merged with and into Whittier (the "Merger") and whereby
the former shareholders of Whittier shall receive in the aggregate a controlling
share of Olympic's capital stock upon the Effective Time (as defined in the Plan
of Merger); and
WHEREAS, Consultant has been retained as President and Chief Executive
Officer and a member of the Board of Directors of Olympic in accordance with the
terms and provisions of that certain Development Services Agreement dated March
1, 2001 (the "Services Agreement"); and
WHEREAS, Consultant has agreed to resign as President and Chief Executive
Officer and director of Olympic effective as of the Effective Time; and
WHEREAS, Olympic and Consultant desire to terminate the Services Agreement
in exchange for the premises set forth in this Agreement, and to continue
certain services of Consultant as herein contemplated, and the parties hereto
desire to document herein their agreements relating to the matters so described;
NOW, THEREFORE, for and in consideration of the premises and of the mutual
covenants and agreements contained herein, Consultant and Olympic hereby agree
as follows:
1. Term and Duties. Consultant shall resign as President and Chief
Executive Officer of Olympic effective as of the Effective Time. Executive and
Olympic agree, upon the Effective Time of the Merger, that the Development
Services Agreement dated March 1, 2001 between Olympic and Executive shall be
terminated and shall have no ongoing force or effect, and specifically further
agree that no further payments of any sort shall be due to Consultant under the
terms of the Development Services Agreement for any period following the
Effective Time. During the period commencing on the Effective Time and ending on
that date which is the six-month anniversary of the Effective Time (herein the
"Initial Term"), Consultant shall perform certain duties, functions and
responsibilities, all as requested by the Board of Directors of Olympic, which
services shall be similar to those Consultant has been providing to Olympic
pursuant to the Services Agreement, excluding those services specifically
incidental to being an officer of Olympic. The parties hereto understand and
agree that during the Initial Term, Consultant shall be entitled to compensation
as contemplated in Section 2(a) below. During the Initial Term, Consultant shall
devote his skill, attention and best efforts to the business of Olympic to the
extent necessary to discharge the responsibilities assigned to him by the Board
of Directors of Olympic. Additionally, for a period of twenty-four months
following the expiration of the Initial Term, Consultant shall make himself
available for appropriate consulting assignments in exchange for the
consideration contemplated in Section 2(b) below.
2. Compensation.
(a) Initial Term Amount and Warrant.
(i) Olympic shall pay to Consultant during the Initial Term the
amount ("Initial Term Amount") of $10,216.50 Canadian dollars per
month, with such Initial Term Amount being due and payable in
accordance with Olympic's customary payroll practices.
(ii) Olympic shall issue to Consultant a non-transferable
warrant, substantially in the form of Exhibit A attached hereto, to
purchase 450,000 shares of the common stock of Olympic at an exercise
price of $0.20 USD per share (the "Xxxxxxx Warrant"). The Xxxxxxx
Warrant shall, pursuant to its terms and conditions, automatically be
exercised upon the date immediately preceding the first anniversary of
the Effective Time.
(b) Subsequent Term Amount.
(i) For the period of twenty-four months immediately following
the Initial Term, Consultant shall earn $10,216.50 Canadian dollars
per month, of which (A) $5,108.25 Canadian dollars shall be paid by
Olympic to Consultant in cash and (B) $5,108.25 shall accrue as
deferred compensation (the "Deferred Amount"); and
(ii) On the date immediately preceding the first anniversary of
the Effective Time, the Xxxxxxx Warrant automatically shall be
exercised according to its terms and the entire Deferred Amount,
including all remaining payments owed pursuant to Section 2(b)(i),
shall be applied toward the aggregate exercise price of the Xxxxxxx
Warrant at a fixed exchange rate of $0.73411 USD for each $1.00
Canadian dollar; provided, however, that, notwithstanding anything
herein to the contrary, in the event that there are outstanding any
Pending Claims (as defined in the Escrow Agreement) as of the first
anniversary of the Effective Time, the shares of common stock of
Olympic issued pursuant to the automatic exercise of the Xxxxxxx
Warrant shall be placed in escrow and subject to the terms and
conditions of the Escrow Agreement.
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(c) Expenses. Consultant shall be entitled to receive prompt
reimbursement for all reasonable business expenses incurred by Consultant,
as shall be approved by Olympic.
(d) Benefit Plans. At no time hereunder shall Consultant be entitled
to participate in or receive benefits under any of Olympic's employee
benefit plans, policies, practices or arrangements.
3. Termination. This Agreement shall terminate on the second anniversary
of the last day of the Initial Term.
4. Confidential Information. Consultant shall hold in strictest
confidence and shall not directly or indirectly use for his own personal benefit
or for the benefit of anyone else or disclose to anyone else (including, without
limitation, any natural person, corporation, partnership or any other form of
entity or person) any of the confidential and proprietary information of Olympic
or any of its subsidiaries, except with the prior written consent of Olympic or
to the extent necessary in connection with Consultant's duties hereunder or
unless required by a court of law; provided, however, that Consultant may use
information with respect to Olympic's interest in the Goliad County, Texas
project (the "Goliad Project") for the purpose of purchasing the Goliad Project
from Olympic at cost. The provisions of this Section 4 shall continue in effect
notwithstanding the termination of this Agreement and shall be in addition to
Consultant's common law obligations to Olympic as an employee, officer and
director (or as a former employee, officer and director).
5. No Conflicting Agreements. Consultant represents and warrants to
Olympic that he is not a party to any agreement, contract, or understanding,
whether employment or otherwise, that would in any way restrict or prohibit him
from undertaking or performing his duties and obligations under this Agreement.
6. Withholding Taxes. Olympic shall withhold from any payments to be made
to Consultant hereunder such amounts as shall be required by federal, state, and
local withholding tax laws.
7. Covenant Not to Compete. Without the prior written consent of Olympic,
which consent shall not be unreasonably withheld, Consultant shall not, for a
period commencing on the Effective Time hereof and ending on the second
anniversary of the last day of the Initial Term, directly or indirectly, engage
or participate in any manner whatsoever, either personally or in any status or
capacity, including but not limited to as an employer, employee, associate,
member, officer, director, owner (excluding an owner of less than 5% of the
equity of any business), salesman, representative, principal, agent, trustee,
servant or consultant or by means of any corporation, partnership,
proprietorship or other legal entity or device, in any business or activity
which is in direct or indirect competition with Olympic or its subsidiaries
within twenty (20) miles of any geographic location where Olympic owns, controls
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or operates oil and gas interests and properties; provided, however, that no
such restriction shall exist as to the information relating to the Goliad
Project if Consultant (or an affiliate thereof) purchases such project from
Olympic at cost. In the event that the terms of this Section 7 should ever be
deemed to exceed the time or geographic limitations permitted by applicable law,
then such terms shall be reformed to the maximum time or geographic limitations
permitted by applicable law. In the event of a breach by Consultant of the terms
of this Section 7, Olympic shall be entitled to an injunction restraining him
from engaging or participating in such business or activity. However, nothing in
this Section 7 shall be construed as prohibiting Olympic from pursuing any other
remedies available to Olympic for the breach by Consultant of the terms of this
Section 7, or any other terms of this Agreement, including the recovery of
damages from Consultant. The term of this Section 7 shall continue in effect
notwithstanding the termination of this Agreement. The restrictive covenants
upon Consultant set forth in this Section 7 are the essence of this Agreement:
they shall be construed as independent of any other provision of this Agreement,
and the existence of any claim or cause of action against Olympic, whether
predicated on this Agreement or not, shall not constitute a defense to the
enforcement by Olympic of the restrictive covenants contained herein.
8. Assignment. This Agreement is personal in nature and none of the
parties hereto shall assign or transfer this Agreement or any rights or
obligations hereunder without the prior written consent of the other parties
hereto; provided, however, that in the event of any consolidation or merger of
Olympic with or into any other corporation or any sale or transfer of all or
substantially all of the assets of Olympic, this Agreement shall inure to the
benefit of and be binding on the successor to Olympic's business and assets.
9. Notices. For purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered personally or mailed by certified
or registered mail, return receipt requested, postage prepaid:
If to Consultant, to: Xx. Xxxxx Xxxxxxx
0000 Xxxxx Xxxx
Xxxx Xxxxxxxxx, X.X., X0X0X0
Telefax: (000) 000-0000
If to Olympic, to: Olympic Resources Ltd.
c/o Whittier Energy Company
0000 Xx Xxxxxx Xxxx
Xxxxxxxx, XX 00000 XXX
Attention: Xxxxx Xxxxxx, Vice President
Telefax: (000) 000-0000
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with a copy to: Xxxxxxxx & Knight LLP
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000 XXX
Attention: Xxxxxx Xxxxxx
Telefax: (000) 000-0000
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
10. Miscellaneous. No provision of this Agreement may be amended,
modified, waived, or discharged unless such amendment, modification, waiver, or
discharge is in writing and signed by the party against whom the amendment,
modification, waiver, or discharge is sought to be enforced. No waiver by either
party at any time of any breach or default in the performance of any provision
of this Agreement to be performed by the other party shall be deemed a waiver of
any similar or dissimilar provision at the same time or at any prior or
subsequent time. The validity, interpretation, construction, and performance of
this Agreement shall be governed by the laws of the State of Nevada.
11. Severability; Validity. Every provision in this Agreement is intended
to be severable. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement. If any provision of this Agreement is deemed or held to be
invalid or unenforceable, there shall be added automatically to this Agreement
in lieu thereof a provision as similar in terms to such invalid or unenforceable
provision as may be possible and be valid and enforceable.
12. Headings. The headings contained herein are for reference purposes
only and shall not in any way affect the meaning or interpretation of any
provision of this Agreement.
13. Entire Agreement. This Agreement constitutes the entire agreement of
the parties hereto relating to the subject matter hereof (it being understood
that this Agreement is not intended to cover the terms of Consultant's
relationship with Olympic as a member of its Board of Directors), and there are
no written or oral terms or representations made by any party other than those
contained herein.
14. Term of Offer. Consultant acknowledges that he has had no fewer than
twenty-one days to consider the terms of this Agreement prior to its execution.
15. Effective Date. This Agreement will become effective and enforceable
following the date of Consultant's execution of this Agreement at the Effective
Time of the Merger.
16. Consultation With an Attorney. Consultant acknowledges that he has
been advised that he had the right to consult an attorney before executing this
Agreement.
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17. Voluntary Agreement. Consultant acknowledges that his execution of
this Agreement was knowing and voluntary and that he had a reasonable time to
deliberate regarding its terms.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date and year first written above.
OLYMPIC RESOURCES LTD.
By: /s/ Xxxxx Xxxxxxx
--------------------------------------------
Xxxxx Xxxxxxx, President
CONSULTANT:
/s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx, d/b/a DWP Consultants
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EXHIBIT A
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Xxxxxxx Warrant
