exv10w2



 





Exhibit 10.2




ADMINISTRATIVE SERVICES AGREEMENT




     This ADMINISTRATIVE SERVICES AGREEMENT (this “Agreement”) is dated as of                     , 2008 by and
between Whiting Oil and Gas Corporation, a Delaware corporation, (the “Company”), and
Whiting USA Trust I, a statutory trust formed under the laws of the State of Delaware (the
“Trust”).



     WHEREAS, pursuant to a Conveyance of Net Profits Interest of even date herewith (the
“Conveyance”), the Company and Equity Oil Company, an Affiliate of the Company, have
conveyed to the Trust a net profits interest in certain oil and gas properties (the “Net
Profits Interest”);



     WHEREAS, in connection with the conveyance of the Net Profits Interest, the Company has agreed
to provide certain administrative services for the Trust in exchange for an administrative services
fee as described herein.



     NOW, THEREFORE, in consideration of the premises and the covenants hereinafter contained and
for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intended to be legally bound hereby, it is agreed as follows:



ARTICLE I

DEFINITIONS




     Section 1.01 Definitions. As used in this Agreement, the following terms have the respective
meanings set forth below or set forth in the Sections referred to below:



     “Administrative Services Fee” has the meaning set forth in Section 3.01.



     “Affiliate” means with respect to a specified person, any person that directly or
indirectly controls, is controlled by, or is under common control with, the specified person. As
used in this definition, the term “control” (and the correlative terms “controlling,” “controlled
by,” and “under common control”) shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a person, whether through ownership
of voting securities, by contract or otherwise.



     “Agreement” has the meaning set forth in the introductory paragraph.



     “Business Day” means each Monday, Tuesday, Wednesday, Thursday and Friday that is not
a day on which banking institutions in New York, New York or Denver, Colorado are authorized or
obligated by law or executive order to close.



     “Company” has the meaning set forth in the introductory paragraph.



     “Conveyance” has the meaning set forth in the recitals.



     “External Expenses” means the actual out-of-pocket fees, costs and expenses incurred
by the Company in connection with the provision of the Services.



 









 





     “Force Majeure” shall mean any cause beyond the reasonable control of the Company,
including the following causes: acts of God, strikes, lockouts, acts of the public enemy, wars or
warlike action (whether actual or impending), arrests and other restraints of government (civil or
military), blockades, embargoes, insurrections, riots, epidemics, landslides, lightning,
earthquakes, fires, sabotage, tornadoes, named tropical storms and hurricanes, and floods, civil
disturbances, terrorism, mechanical breakdown of machinery or equipment, explosions, confiscation
or seizure by any government or other public authority, any order of any court of competent
jurisdiction, regulatory agency or governmental body having jurisdiction.



     “Net Profits Interest” has the meaning set forth in the recitals.



     “person” shall mean any individual, partnership, limited liability company,
corporation, trust, unincorporated association, governmental agency, subdivision, or
instrumentality, or other entity or association.



     “Services” has the meaning set forth in Section 2.01.



     “Termination Date” has the meaning assigned to such term in the Conveyance.



     “Trust” has the meaning set forth in the introductory paragraph.



     “Trust Agreement” means that certain Amended and Restated Trust Agreement of even date
herewith among the Company, the Trustee and Wilmington Trust Company, as the same may be amended
from time to time.



     “Trustee” means The Bank of New York Trust Company, N.A.



     Section 1.02 Construction. Unless the context requires otherwise: (a) any pronoun used in this
Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular
form of nouns, pronouns and verbs shall include the plural and vice versa; (b) references to
Articles and Sections refer to Articles and Sections of this Agreement; (c) the terms “include,”
“includes,” “including” or words of like import shall be deemed to be followed by the words
“without limitation;” and (d) the terms “hereof,” “herein” or “hereunder” refer to this Agreement
as a whole and not to any particular provision of this Agreement. The headings contained in this
Agreement are for reference purposes only, and shall not affect in any way the meaning or
interpretation of this Agreement.



ARTICLE II

SERVICES




     Section 2.01 Services. Subject to the terms of this Agreement and in exchange for the payment described in
Section 3.01, the Company hereby agrees to provide the Trust with such accounting,
bookkeeping and informational services as are necessary to comply with Article III of the
Conveyance and such other administrative services of similar character and scope to the foregoing
that the Trustee may reasonably request the Company to provide during the term of this Agreement
(the “Services”).



2









 





     Section 2.02 Performance of Services by Others. The parties hereby agree that in discharging the
Company’s obligations under this Agreement, the Company may, in its sole discretion, engage any
other person, including its Affiliates, to perform the Services (or any part of the Services) on
its behalf and that the performance of the Services (or any part of the Services) by any such
person shall be treated as if the Company performed such Services itself. Notwithstanding the
foregoing, nothing contained herein shall relieve the Company of its obligations hereunder.



     Section 2.03 Intellectual Property. Any (i) inventions, whether patentable or not, developed or
invented, or (ii) copyrightable material (and the intangible rights of copyright therein)
developed, in each case by the Company, its Affiliates or its or their employees in connection with
the performance of the Services shall be the property of the Company; provided, however, that the
Trust shall be granted an irrevocable, royalty-free, non-exclusive and non-transferable right and
license to use such inventions or material; and provided further, however, that the Trust shall
only be granted such a right and license to the extent such grant does not conflict with, or result
in a breach, default, or violation of a right or license to use such inventions or material granted
to the Company by any person other than an Affiliate of the Company. Notwithstanding the
foregoing, the Company will use all commercially reasonable efforts to grant such right and license
to the Trust.



     Section 2.04 Independent Status. It is expressly acknowledged by the parties hereto that each
party is an “independent contractor” and nothing in this Agreement is intended nor shall be
construed to create an employer/employee relationship, or a joint venture or partnership
relationship, or to allow any party to exercise control or direction over the other party. Except
as required in connection with the performance of the Services, neither the Company nor any agent,
employee, servant, contractor or subcontractor of the Company or any of its Affiliates shall have
the authority to bind the Trust to any contract or arrangement. Neither the Trust nor the Trustee
shall be liable for the salary, wages or benefits, including workers’ compensation insurance and
unemployment insurance, of any employee, agent, servant, contractor or subcontractor of the Company
or its Affiliates by virtue of this Agreement.



     Section 2.05 Warranties; Limitation of Liability. The Company will use commercially reasonable
efforts to provide the Services in a good and workmanlike manner in accordance with the sound and
prudent practices of providers of similar services. EXCEPT AS SET FORTH IN THE PRECEDING SENTENCE,
THE COMPANY MAKES NO (AND HEREBY DISCLAIMS AND NEGATES ANY AND ALL)
WARRANTIES OR REPRESENTATIONS WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO THE SERVICES. IN NO
EVENT WILL THE COMPANY OR ANY OF ITS AFFILIATES BE LIABLE TO ANY OF THE PERSONS RECEIVING ANY
SERVICES OR TO ANY OTHER PERSON FOR ANY EXEMPLARY, PUNITIVE, DIRECT, INDIRECT, INCIDENTAL,
CONSEQUENTIAL OR SPECIAL DAMAGES RESULTING FROM ANY ERROR IN THE PERFORMANCE OF SUCH SERVICE,
REGARDLESS OF WHETHER THE PERSON PROVIDING SUCH SERVICE, ITS AFFILIATES OR OTHERS MAY BE WHOLLY,
CONCURRENTLY, PARTIALLY OR SOLELY NEGLIGENT OR OTHERWISE AT FAULT, EXCEPT TO THE EXTENT SUCH
EXEMPLARY, PUNITIVE, DIRECT, INDIRECT, INCIDENTAL, CONSEQUENTIAL OR SPECIAL DAMAGES ARE PAID BY THE
PARTY INCURRING SUCH DAMAGES TO A PERSON THAT IS NOT A PARTY TO THIS



3









 




AGREEMENT. THE PROVISIONS OF
THIS SECTION 2.05 WILL SURVIVE TERMINATION OF THIS AGREEMENT.




     Section 2.06 Disputes. Should there be a dispute over the nature or quality of the Services or the
calculation or allocation of the Administrative Services Fee, the Company and the Trustee, on
behalf of the Trust, shall first attempt to resolve such dispute, acting diligently and in good
faith, using the past practices of the Company and the Trustee as guidelines for such resolution.
If the Company and the Trustee are unable to resolve any such dispute within thirty days, or such
additional time as may be reasonable under the circumstances, the dispute shall be resolved by
arbitration in accordance with the provisions of Article XI of the Trust Agreement. The provisions
of this Section 2.06 will survive termination of this Agreement.



ARTICLE III

ADMINISTRATIVE SERVICES FEE




     Section 3.01 Administrative Services Fee. The Trust shall pay to the Company in immediately
available funds, on or before the 60th day following each calendar quarter, an administrative
services fee of $50,000 (the “Administrative Services Fee”). In the event that this
Agreement is terminated during a calendar quarter pursuant to Section 5.01, the amount of
the Administrative Services Fee for such calendar quarter shall be based upon the pro rata portion
of the Administrative Services Fee that shall have accrued during such quarter up to and including
the date of termination of this Agreement. In addition to the Administrative Services Fee, the
Trust shall reimburse the Company on or before the 60th day following each calendar quarter for all
reasonable and necessary External Expenses associated with the provision of Services in the
preceding quarter as set forth in a reasonably detailed invoice provided by the Company to the
Trust on or before the 50th day following each calendar quarter, but only to the extent that the
Company certifies to the Trustee that the Company was unable to perform the Services in the
ordinary course of its business for which it incurred the External Expenses.



     Section 3.02 Set-Off. In the event that the Company owes the Trust a sum certain in an uncontested amount under
any other agreement, then any such amounts may, in the sole discretion of the Company, be
aggregated and the Trust and the Company shall discharge their obligations by netting those amounts
against any amounts owed by the Trust to the Company under this Agreement.



ARTICLE IV

FORCE MAJEURE




     Section 4.01 Force Majeure. The Company’s obligation under this Agreement shall be excused when
and to the extent its performance of that obligation is prevented due to Force Majeure. The
Company shall promptly notify the Trustee that it is prevented from performing its obligations by
reason of Force Majeure and shall exercise due diligence to end its inability to perform as
promptly as practicable. Notwithstanding the foregoing, the Company shall not be required to
settle any strike, lockout or other labor dispute in which it or any of its Affiliates may be
involved.



4









 





ARTICLE V

MISCELLANEOUS




     Section 5.01 Term and Termination. This Agreement shall become effective on the date of this
Agreement and shall continue until the Termination Date unless earlier terminated by mutual
agreement of the parties to this Agreement. Upon termination of this Agreement in accordance with
this Section 5.01, all rights and obligations under this Agreement shall cease except for
(i) obligations that expressly survive termination of this Agreement, (ii) liabilities and
obligations that have accrued prior to such termination, including the obligation to pay any
amounts that have become due and payable prior to such termination, and (iii) the obligation to pay
any portion of the Administrative Services Fee that has accrued prior to such termination, even if
such portion has not become due and payable at the time of termination.



     Section 5.02 Notice. All notices and other communications provided for or permitted hereunder
shall be made in writing by hand delivery, by facsimile, by courier guaranteeing overnight delivery
or by first-class mail, return receipt requested, and shall be deemed given (i) when made, if made
by hand delivery, (ii) upon confirmation, if made by facsimile, (iii) one (1) Business Day after
being deposited with such courier, if made by overnight courier or (iv) on the date indicated on
the notice of receipt, if made by first-class mail, to the parties as follows:



     (a) if to the Trust or the Trustee, to:


Whiting USA Trust I

c/o The Bank of New York Trust Company, N.A.

919 Congress Avenue, Suite 500

Austin, Texas 78701

Attention: Mike J. Ulrich

Facsimile No.: (512) 236-9275



with a copy to:



Bracewell & Giuliani LLP

111 Congress Avenue, Suite 2300

Austin, Texas 78701

Attention: Tom Adkins

Facsimile No.: (512) 479-3940



if to the Company, to:



Whiting Petroleum Corporation

1700 Broadway, Suite 2300

Denver, Colorado 80290-2300

Attention: Michael J. Stevens

Facsimile No.: (303) 390-5590




5









 







with a copy to:



Foley & Lardner LLP

777 East Wisconsin Avenue

Milwaukee, WI 53202-5306

Attention: Benjamin F. Garmer, III

Facsimile No.: (414) 297-4900



or to such other address as such person may have furnished to the other persons identified in this
Section 5.02 in writing in accordance herewith.




     Section 5.03 Entire Agreement, Supersedure. This Agreement constitutes the entire agreement of the
parties relating to the matters contained herein, superseding all prior contracts or agreements,
whether written or oral, relating to the matters contained herein.



     Section 5.04 Effect of Waiver or Consent. Except as otherwise provided in this Agreement, a waiver
or consent, express or implied, to or of any breach or default by any party in the performance by
that party of its obligations under
this Agreement is not a consent or waiver to or of any other breach or default in the performance
by that party of the same or any other obligations of that party under this Agreement.



     Section 5.05 Amendment or Modification. This Agreement may be amended or modified from time to
time only by a written instrument executed by each of the parties to this Agreement.



     Section 5.06 Assignment. Except as provided in Section 2.02, no party to this Agreement
shall have the right to assign its rights or obligations under this Agreement without the consent
of the other party to this Agreement.



     Section 5.07 Counterparts. This Agreement may be executed in any number of counterparts with the
same effect as if all parties to this Agreement had signed the same document. All counterparts
shall be construed together and shall constitute one and the same instrument.



     Section 5.08 Severability. If any provision of this Agreement or the application thereof to any
party to this Agreement or circumstance shall be held invalid or unenforceable to any extent, the
remainder of this Agreement and the application of such provision to other party to this Agreement
or circumstances shall not be affected thereby and shall be enforced to the greatest extent
permitted by law.



     Section 5.09 Further Assurances. In connection with this Agreement and all transactions
contemplated by this Agreement, each party hereto agrees to execute and deliver such additional
documents and instruments and to perform such additional acts as may be necessary or appropriate to
effectuate, carry out and perform all of the terms, provisions and conditions of this Agreement and
all such transactions.



6









 





     Section 5.10 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF DELAWARE.



7









 





     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written
above.



	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	WHITING OIL AND GAS CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

Michael J. Stevens
	 	 
	 

	 	Title:
	 	Vice President and Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 	 	WHITING USA TRUST I	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	The Bank of New York Trust Company, N.A.,
not in its individual capacity but solely as
trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

Mike J. Ulrich
	 	 
	 

	 	Title:
	 	Vice President	 	 







8