Document:

rwc3000amendment.htm

                                                                                                                                    

    Exhibit 10.23

     

    

    FIRST AMENDMENT TO
LEASE

    (EXPANSION)

    

    This First Amendment to Lease (the
“Agreement”) is entered into as of April 30, 2007, by and between WESTPORT OFFICE PARK, LLC, a
California limited liability company (“Landlord”), and SHUTTERFLY, INC., a Delaware
corporation ("Tenant"), with respect to the following facts and
circumstances:

    

    A.  Landlord and Tenant are
parties to that certain Lease Agreement dated July 5, 1999 (the “Initial Lease
Agreement), as amended by the Commencement Letter dated September 8, 1999, a
letter agreement dated December 28, 1999, Amendment No. 1 dated January 11,
2000, Amendment No. 2 dated May 21, 2001, Amendment No. 3 dated July 6, 2004,
and Amendment No. 4 (“Amendment No. 4”) dated April 28, 2005 (collectively, the
“Original Lease”), of certain premises (the “Existing Premises”) within the
building commonly known as 2800 Bridge Parkway, Redwood City, California, and
more particularly described in the Original Lease.  Capitalized terms
used and not otherwise defined herein shall have the meanings given those terms
in the Original Lease.

    

    B.  Landlord and Tenant
desire to amend the Original Lease to add additional space on the terms and
conditions provided herein.

    

    IT IS THEREFORE, agreed as
follows:

    

    
      	
              1.  

            	
              As
      used in this Agreement, the following terms have the following
      meanings:

            

    

    

    “3000
Bridge Building” means the commercial office building located at 3000 Bridge
Parkway, Redwood City, California.

    

    “Expansion
Space” means a portion of the 3000 Bridge Building, containing approximately
12,036 square feet of rentable area, commonly known as Suites 102 and 103 and
more particularly shows on Exhibit “A-1”
attached hereto.  For purposes of this Agreement, “rentable area”
shall be calculated pursuant to the Standard Method for Measuring Floor Area in
Office Buildings (ANSI/BOMA Z65.1, 1996).  Notwithstanding anything to
the contrary in this Agreement, the recital of the rentable area herein above
set forth is for descriptive purposes only.  Tenant shall have no
right to terminate the Lease or receive any adjustment or rebate of any Basic
Rent or Additional Rent payable hereunder if said recital is
incorrect.  The Tenant has inspected the Expansion and is fully
familiar with the scope and size thereof and agrees to pay the full Basic Rent
and Additional Rent set forth herein in consideration for the use and occupancy
of said space, regardless of the actual number of squire feet contained
therein.

    

    “Expansion Space Commencement Date”
shall mean June 1, 2007.

    

    

    2. Effective
on the Expansion Space Commencement Date, the Premises shall be expanded to
include the Expansion Space.  Accordingly, effective on the Expansion
Space Commencement Date, the following terms of the Original Lease are amended
as follows:

    

    2.1           The
Expansion Space is added to the Premises such that the Premises shall be
comprised of the Existing Premises and the Expansion Space, and Exhibit “A-1”
attached hereto is hereby added to Exhibit “A” to the
Original Lease.

    

    2.2           Landlord
and Tenant acknowledge that the provisions of Amendment No. 4 with respect to
management fee, tenant maintenance, expenses of operation, management and
maintenance of Common Areas in Buildings, utilities, and taxes that currently
apply in the Original Lease to the Existing Premises are based on Tenant
occupying the entire building in which the Existing Premises is
located.  Accordingly, with respect to the Expansion Space the
following provisions of the Initial Lease Agreement shall apply to the Expansion
Space and the amendments of those sections made after the Initial Lease
Agreement shall not be taken into account in determining Tenant’s obligations
with respect to the Expansion Space: Paragraphs 4D, 4E, 7, 10, 11, and
12.  To the extent any costs are not generally applicable to the
Building and the 3000 Bridge Building or to Common Areas, the amounts of those
costs payable by Tenant shall be determined independently for the Existing
Premises and the Expansion Space.

    

    2.3           Tenant
agrees to pay Landlord a Basic Rent for the Expansion Space in accordance with
the following schedule:

    

    
      	
              Period

            	
              Annual
      Basic Rent

            	
              Monthly
      Basic Rent

            
	
              June
      1, 2007 – June 30, 2007

            	
              N/A

            	
              Abated

            
	
              July
      1, 2007 – June 30, 2008

            	
              $281,642.40

            	
              $23,470.20

            
	
              July
      1, 2008 – June 30, 2009

            	
              $303,357.20

            	
              $25,275.60

            
	
              July
      1, 2009 – May 31, 2010

            	
              N/A

            	
              $27,081.00

            

    

    

    The
Monthly Basic Rent for the second month and estimated Additional Rent for the
first month after the Expansion Space Commencement Date shall be payable upon
the execution of this Agreement.  The Monthly Basic Rent for the
Expansion Space shall be payable in the manner provided for in the Original
Lease.

    

    2.4           Paragraph
6 is amended to increase Tenant’s non-exclusive parking spaces by thirty-nine
(39) spaces, or from one hundred sixty-one (161) spaces to two hundred (200)
spaces.

    

    2.5           The
Term with respect to the Expansion Space shall be coterminous with the Existing
Premises.  In the event that Tenant exercises its extension option or
a termination right under the Original Lease, such extension or termination
shall apply to the entire Premises then subject to the Original Lease (including
the Expansion Space).

    

    3. Tenant
may take possession of the Expansion Space upon the full execution and delivery
of this Agreement.  Tenant’s possession of the Expansion Space prior
to the Expansion Space Commencement Date shall be on all the terms and
conditions of the Original Lease, as amended hereby, except that Tenant shall
not be obligated to pay Basic Rent or Additional Rent.  After the
Expansion Space Commencement Date, Tenant’s obligation with respect to Basic
Rent and Additional Rent shall be provided in the Original Lease, as amended by
this Agreement.

    

    4. Except as
provided in Section 5, below, Tenant shall accept the Expansion Space in its “AS
IS” condition.  Tenant agrees that Landlord has no obligation and has
made no promise to alter, remodel, improve, or repair the Expansion Space, or
any part thereof, or to repair, bring into compliance with applicable laws, or
improve any condition existing in the Expansion Space as of the Expansion Space
Commencement Date.  The taking of possession of the Expansion Space by
Tenant shall be conclusive evidence that the Expansion Space and the Building
were in good and satisfactory condition at the time possession was taken by
Tenant.  Neither Landlord nor Landlord’s agents have made any
representations or promises with respect to the condition of the 3000 Bridge
Building, the Expansion Space, the land upon which the 3000 Bridge Building is
constructed, the present or future suitability or fitness of the Expansion Space
or the 3000 Bridge Building for the conduct of Tenant’s particular business, or
any other matter or thing affecting or related to the 3000 Bridge Building or
the Expansion Space, and no rights, easements or licenses are acquired by Tenant
by implication or otherwise except as expressly set forth in this Original
Lease.  Any improvements or personal property located in the Expansion
Space are delivered without any representation or warranty from Landlord, either
express or implied, of any kind, including without limitation, title,
merchantability, or suitability for a particular purpose.  Tenant
shall deliver to Landlord any modifications to Tenant’s insurance required under
the Original Lease to reflect the addition of the Expansion Space and Tenant’s
entry into the Expansion Space prior to the delivery of possession to
Tenant.

    

    5. Notwithstanding
Section 4, above, Landlord warrants that the roof, structural components of the
Building, HVAC system, electrical and plumbing systems, doors, elevator, parking
lot or site lighting (the “Covered Items”), other than those constructed by
Tenant, shall be in good operating condition on the date possession of the
Premises is delivered to Tenant.  If a non-compliance with such
warranty exists as of the delivery of possession, or if one of such Covered
Items should malfunction or fail within sixty (60) days after the delivery of
possession to Tenant, Landlord shall, as Landlord’s sole obligation with respect
to such matter, promptly after receipt of written notice from Tenant setting
forth in reasonable detail the nature and extent of such non-compliance,
malfunction or failure, rectify the same at Landlord’s expense.  If
Tenant does not give Landlord the required notice within sixty (60) days after
the delivery of possession to Tenant, Landlord shall have no obligation with
respect to that warranty other than obligations regarding the Covered Items set
forth elsewhere in the Lease.

    

    6. Landlord
and Tenant acknowledge that Tenant may desire to make certain Alterations to the
Expansion Space in accordance with Article 9 of the Lease (“Tenant’s
Work”).  So long as no default shall be declared and existing under
the Original Lease (as amended by this Agreement) as of the date Tenant requests
reimbursement of the Allowance (as defined below), Landlord agrees to reimburse
Tenant up to, and not to exceed the sum of One Hundred Eight Thousand Five
Hundred Forty Dollars ($180,540.00) (the “Allowance”) (based on a $15.00 prsf of
the Premises).  Landlord shall pay the Allowance to Tenant upon
delivery to Landlord of “Tenant’s Completion Notice” (as defined below)
according to the terms and conditions of this Section 6.   The
Allowance shall be used to reimburse Tenant for hard and/or soft costs incurred
in connection with Tenant’s Work (“Tenant’s Work Costs”); provided, however, in
no event shall the Allowance be used to pay for any of Tenant’s trade fixtures,
equipment or inventory.  Upon the completion of Tenant’s Work, Tenant
shall submit to Landlord a written notice indicating that Tenant has completed
the construction and performance of Tenant’s work in accordance with the
provisions of Article 9 of the Original Lease, as amended by this Agreement,
which notice shall be accompanied by all of the following (collectively,
“Tenant’s Completion Notice”): (i) copies of paid invoices and final,
unconditional lien waivers from Tenant’s general contractor and all
subcontractors and material suppliers, showing that full payment has been
received for the construction of Tenant’s Work; (ii) certification from Tenant’s
architect that all of Tenant’s Work has been completed substantially in
accordance with the plans and specifications therefor (approved by Landlord, to
the extent Landlord’s approval of such plans and specifications was required
under Article 9 of the Original Lease, as amended by this Agreement) and all
local governmental and quasi-governmental authorities with jurisdiction; and
(iii) a copy of the building permit for Tenant’s Work has been finally
approved.  The Allowance shall be available for a single reimbursement
to Tenant during the period from June 1, 2007 through December 31, 2007 (the
“Window”).  Any portion of the Allowance not requested by Tenant
within the Window shall be deemed forfeited by Tenant and shall no longer be
available for disbursement to or for the account of Tenant.  The
parties understand and agree that under no circumstances shall Landlord, either
by this Agreement or otherwise, have any responsibility for the space planning
design.  In approving of any space planning or construction plans and
specifications, Landlord is doing so only for its own benefit and does not
thereby accept any responsibility that such design and construction has been
completed in conformance with all applicable laws, is free from any errors or
omissions by the professionals completing such work, is suitable for the purpose
for which it is designed or constructed or is otherwise in conformance with
recognized industry standards and requirements for such work.

     

    7. The
following new Paragraph 54 is added to the Lease:

    

        54.           TENANT’S
RIGHT OF FIRST OFFER

    

    54.1           As
used herein, “Offer Space” means any space in the 3000 Bridge
Building.  Landlord shall give Tenant a written notice (the
“Availability Notice”) identifying the particular Offer Space (the “Specific
Offer Space”) that is Available (as defined below).  Landlord shall
not be obligated to given an Availability Notice until Landlord determines that
Landlord shall commence the marketing of any of the Offer Space because such
space shall become Available for lease to third parties.  As used
herein, “Available” means that the space (i) is not part of the Premises, (ii)
is not then subject to a lease, (iii) is not then subject to any rights of
tenant to renew their lease or expand their premises as set forth in their
lease, and (iv) is not then subject to any negotiations between Landlord and an
existing tenant.  Without limiting the foregoing, Offer Space shall
not be Available if it is subject to a renewal or extension right of a tenant,
whether or not such right or extension is pursuant to an express written
provision in its lease, regardless of whether any such renewal or extension is
consummated pursuant to a lease amendment or a new lease.

    

    54.2           The
location and configuration of the Specific Offer Space shall be determined by
Landlord in its reasonable discretion; provided that Landlord shall have no
obligations to designate Specific Offer Space that would result in any space not
included in the Specific Offer Space being not Configured for Leasing (as
defined below).  For purposes of this Lease, “Configured for Leasing”
means the applicable space must have convenient access to the central corridor
on the applicable floor and must have a size and configuration that complies
with all applicable building codes and other laws and is such that Landlord
judges, in its reasonable discretion, that Landlord will be able to lease such
space to a third party.  The Availability Notice shall:

    
      	
               
      

            	
              (a)

            	
              Describe
      the particular Specific Offer Space (including rentable area, useable area
      and location);

               

            

    

    
      	
            	
              (b)

            	
              Include
      an attached floor plan identifying such space;

               

            

      	
            	
              (c)

            	
              
                State
      the date (the “Specific Offer Space Delivery Date”) the space will be
      available for delivery to Tenant; and

                 

              

            

      	
            	
              (d)

            	
              Specify
      the Base Rent for the Specific Offer
Space.

            

    
 

    54.3           If
Tenant wishes to exercise Tenant’s rights set forth in this Article 54 with
respect to the Specific Offer Space, then within five (5) business days of
delivery of the Availability Notice to Tenant, Tenant shall deliver irrevocable
notice to Landlord (the “First Offer Exercise Notice”) offering to lease the
Specific Offer Space on the terms and conditions as may be specified by Landlord
in the Availability Notice.

    

    54.4           In
the event Tenant fails to give a First Offer Exercise Notice in response to any
Availability Notice, Tenant shall have no further rights to receive an
Availability Notice and Tenant’s rights under this Article 54 shall terminate
and Landlord shall be free to lease the Offer Space to anyone on any terms at
any time during the Term, without any obligation to provide Tenant with any
further right to lease that space.

    

    54.5           If
Tenant timely and validly gives the First Offer Exercise Notice in response to
any Availability Notice, Tenant shall have no further rights to receive an
Availability Notice and Tenant’s rights under this Article 54 shall terminate
and Landlord shall be free to lease the Offer Space to anyone on any terms at
any time during the Term, without any obligation to provide Tenant with any
further right to lease that space.

    

    
      	
               
      

            	
              (a)

            	
              The
      Specific Offer Space shall be part of the Premises under this Lease (so
      that the term “Premises” in this Lease shall refer to the space in the
      Premises immediately before the Specific Offer Space Delivery Date plus
      the Specific Offer Space);

               

            

    

    
      	
            	
              (b)

            	
              Base
      Rent for the Specific Offer Space shall be specified in the Availability
      Notice.

               

            

      	
            	
              (c)

            	
              Tenant’s
      lease of the Specific Offer Space shall be on the same terms and
      conditions as affect the original Premises from time to time, except as
      otherwise provided in this section.  Tenant’s obligation to pay
      Rent with respect to the Specific Offer Space shall begin on the Offer
      Space Delivery Date.  The Offer Space shall be leased to Tenant
      in its “as-is” condition and Landlord shall not be required to construct
      improvements in, or contribute any tenant improvement allowance for, the
      Offer Space.  Tenant’s construction of any improvements in the
      Specific Offer Space shall comply with the terms of this Lease concerning
      alterations.

               

            

      	
            	
              (d)

            	
               If
      requested by Landlord, Landlord and Tenant shall confirm in writing the
      addition of the Specific Offer Space to the Premises on the terms and
      conditions set forth in this section, but Tenant’s failure to execute or
      delivery such written confirmation shall not affect the enforceability of
      the First Offer Exercise Notice.

            

    

     

    54.7           Tenant’s
rights and Landlord’s obligations under this Article 54 are expressly subject to
and conditioned upon there not existing a default by Tenant under this Lease,
either at the time of delivery of the First Offer Exercise Notice or at the time
the Specific Offer Space is to be added to the Premises.

    

    54.8           It
is understood and agreed that Tenant’s rights under this Article 54 are personal
to Tenant and not transferable.  In the event of any assignment or
subletting of the Premises or any part thereof, this expansion right shall
automatically terminate and shall thereafter be null and void.

    
 

        8. Except as
otherwise provided herein, all of the terms and conditions of the Original Lease
shall continue to apply during the Extension Term; provided, however, that there
shall be no rent credit, and that there shall be no improvement allowance,
Landlord construction obligations or other initial concessions with respect to
the Extension Term, except as provided in Paragraph 6 of this Agreement, and
Tenant shall have no further option to extend the term.

    
     9. Landlord
hereby represents and warrants to Tenant that it has dealt with no broker,
finder or similar person in connection with this Agreement, and Tenant hereby
represents and warrants to Landlord that it has dealt with no broker, finder or
similar person in connection with this Agreement, other than NAI BT Commercial
(“Landlord’s Broker”) and Studley, Inc. (“Tenant’s Broker”).  Landlord
and Tenant shall each defend and indemnify and hold the other harmless with
respect to all claims, causes of action, liabilities, losses, costs and expenses
(including without limitation attorneys’ fees) arising from a breach of the
foregoing representation and warranty.  The commission with respect to
this Agreement shall be paid to Landlord’s Broker by Landlord pursuant to a
separate agreement.  Landlord’s Broker will pay Tenant’s Broker a
commission pursuant to a separate agreement.  Nothing in this
Agreement shall impose any obligation on Landlord to pay a commission or fee to
any party other than Landlord’s Broker.

        

        10. Time is
of the essence of this Agreement and the provisions contained
herein.

     

        11. As
additional consideration for this Agreement, Tenant hereby certifies
that:

    

    
      	
              (a)

            	
              The
      Original Lease (as amended hereby) is in full force and
      effect.

               

            

    

    
      	
              (b)

            	
              Tenant
      is in possession of the Premises.

               

            

    

    
      	
              (c)

            	
              Rent
      has been paid through April 30, 3007.

               

            

    

    
      	
              (d)

            	
              To
      Tenant’s knowledge, there are no uncured defaults on the part of Landlord
      or Tenant under the Original Lease.

               

            

      	
              (e)

            	
              All
      of Landlord’s obligations with respect to construction of tenant
      improvements in the Premises and payment of Tenant improvement allowance
      have been satisfied, except those provided for in Paragraph 6 of this
      Agreement.

               

            

      	
              (f)

            	
              There
      are no existing offsets or defenses which Tenant has against the
      enforcement of the Original Lease (as amended hereby) by
      Landlord.

               

            

      	
              (g)

            	
              All
      of the representations and warranties of Tenant in the Original Lease are
      hereby remade.

            

    

              

        12. Except as
specifically provided herein, the terms and conditions of the Original Lease as
amended hereby are confirmed and continue in full force and
effect.  This Agreement shall be binding on the heirs, administrators,
successors and assigns (as the case may be) of the parties
hereto.  This Agreement and the attached exhibits, which are hereby
incorporated into and made a part of this Agreement, set forth the entire
agreement between the parties with respect to the matters set forth
herein.  There have been no additional oral or written representations
or agreements.  Under no circumstances shall Tenant be entitled to any
Rent abatement, improvement allowance, leasehold improvements, or other work to
the Premises, or any similar economic incentives that may have been provided to
Tenant in connection with entering into the Original Lease, unless specifically
set forth in this Agreement.  Tenant agrees that neither Tenant nor
its agents or any other parties acting on behalf of Tenant shall disclose any
matters set forth in this Agreement or disseminate or distribute any information
concerning the terms, details or conditions hereof to any person, firm or entity
without obtaining the express written consent of Landlord.  In the
case of any inconsistency between the provisions of the Original Lease and this
Agreement, the provisions of this Agreement shall govern and
control.  Submission of this Agreement by Landlord is not an offer to
enter into this Agreement but rather is a solicitation for such an offer by
Tenant.  Landlord shall not be bound by this Agreement until Landlord
has executed and delivered the same to Tenant.

     

        13. Effective
as of the date hereof, all references to the “Lease” shall refer to the Original
Lease, as amended by this Agreement.

     

        14. To
satisfy compliance with the Employee Retirement Income Security Act of 1974, as
amended, Tenant represents and warrants to Landlord and The Prudential Insurance
Company of America, a New Jersey corporation (“Prudential”), that:

     

               (a) Tenant is
not an “employee benefit plan” (as that term is defined in Section 3(3) of
ERISA); and

     

               (b) Tenant is
not acquiring the Property as a plan asset subject to ERISA but for Tenant’s own
investment account; and

     

               (c) Tenant is
not an “affiliate” of Prudential as defined in Section IV(b) or PTE
90-1;

     

               (d) Tenant is
not a “part in interest” (as that term is defined in Section 3(14) of ERISA) to
the Virginia Retirement System; and

     

               (e) Tenant
agrees to keep the identity of the Virginia Retirement System confidential,
except to the extent that Tenant may be required to disclose such information as
a result of (i) legal process, or (ii) compliance with ERISA or other Laws
governing Tenant’s operations.

    

    

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

    

    

    

    Landlord:

    

    WESTPORT OFFICE PARK LLC

    a California limited liability
company

    

    By:           THE
PRUDENTIAL INSURANCE

    COMPANY OF AMERICA, a

    New Jersey corporation, its
member

    

    By:           /s/
JoLynn Chow Miller

    Director & Second Vice
President

    

    

    

    

    

                                    Tenant:

                                                                    SHUTTERFLY,
INC.,

                         a
Delaware corporation

    

     

                                  By:           /s/
Stephen E. Recht

                         Its:           Secretary
& CFO

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    

    EXHIBIT
A-1

    

    EXPANSION
SPACEex10_1.htm

    
      

    

    Exhibit
10.1

     

    
      EMPLOYMENT
AGREEMENT

    

    
      VICE
PRESIDENT AND

    

    
      CHIEF
GEOPHYSICIST

    

    
       

    

    
       

    

    
      THIS
AGREEMENT is made and entered into this 1st
day of November, 2007 by and between SCS CORPORATION, a Delaware corporation
(the "Company"), and James R. Spear ("Executive").

    

    
       

    

    
      WITNESSETH:

    

    
       

    

    
      WHEREAS,
Executive and the Company deem it to be in their respective best interests to
enter into an agreement providing for the Company's employment of Executive
pursuant to the terms herein stated;

    

    
       

    

    
      NOW,
THEREFORE, in consideration of the premises and the mutual promises and
agreements contained herein, it is hereby agreed as follows:

    

    
       

    

    
      
        	 	
                1.

              	
                Effective
      Date. This Agreement shall be effective as of the 1st
      day of November, 2007 which date shall be referred to herein as the
      "Effective Date".

              

      

    

    
       

    

    
      2.     Position
and Duties.

    

    
       

    

    
      
        	 	
                (a)

              	
                Heretofore,
      Executive has worked extensively as a geoscientist with heavy emphasis on
      geophysics whereby the Executive has been at least partly responsible and
      part of exploration teams as well as development teams and has been a part
      of drilling programs that involved over 500 successful oil wells both
      onshore and offshore, both domestically and internationally, and whereas
      the company is looking to upgrade its in-house oil and gas exploration
      team. Henceforth, the Company, as provided for in the Company's by-laws
      with regard to appointment of officers by Hyperdynamics' and SCS
      Corporation's Chief Executive Officer (CEO), hereby employs Executive as
      its Vice President and Chief Geophysicist, pursuant to the terms of this
      Agreement commencing as of the Effective Date for the "Term of Employment"
      (as herein defined below). In this capacity, Executive shall devote his
      best efforts and full business time and attention to the performance of
      the services as determined by the Board of Directors and Chief Executive
      Officer of Hyperdynamics Corporation and shall report directly to the
      Company's CEO and also provide copies of reports to Hyperdynamics' Chief
      Executive Officer, should that person be
  different.

              

      

    

    
       

    

    
      (b)   The
duties of the Executive shall be as follows:

    

    
      
        	 	
                1.

              	
                Complete
      compliance of all work required to meet and exceed the technical
      requirements of the 2006 PSC between SCS Corporation and the Republic of
      Guinea.

              

      

    

     

    
      
        
           

        

        
          Page
1 of 7

          
            

          

        

        
           

        

      

    

     

    
      
        	 	
                2.

              	
                Assist
      in the business plan as it relates to implementation of all exploration
      work.

              

      

    

    
      
        	 	
                3.

              	
                Interface
      with Hyperdynamic's investor relations and public relations to insure
      regular technical updates regarding the progress of the Company's
      technical work towards the goal of drilling and making an oil or gas
      discovery offshore Guinea.

              

      

    

    
      
        	 	
                4.

              	
                Assistance
      with the budget for SCS Corporation (SCS) and SCS Corporation Guinee SARL
      (SCSG) and submitting the budget for approval by Hyperdynamics Board of
      Directors.

              

      

    

    
      
        	 	
                5.

              	
                Detailed
      monitoring and management of all exploration work programs associated with
      2006 PSC.

              

      

    

    
      
        	 	
                6.

              	
                Work
      within the internal controls as established by the company to be compliant
      with internal control policies and insider trading
    policies.

              

      

    

    
      
        	 	
                7.

              	
                In
      addition to these services, Executive shall provide services customarily
      incident to such offices and position and to such other services of a
      senior executive nature as may be reasonably assigned by the Chief
      Executive Officer of the parent company or requested by the Board of
      Directors (the "Board") of Hyperdynamics which may include services for
      one or more subsidiaries or affiliates of the
  Company.

              

      

    

    
       

    

    
      Executive
shall, in his capacity as an employee and officer of the Company, be responsible
to and obey the reasonable and lawful directives of Hyperdynamics' Chief
Executive Officer and the Board of Directors of Hyperdynamics Corporation and
SCS Corporation as well as abide by all the laws of the Republic of Guinea.
Executive is a key person with respect to every aspect of protecting and
enhancing the Company's rights under its 2006 Production Sharing Contract
between SCS Corporation and the Republic of Guinea that was signed on September
22, 2006. As a primary condition of employment, Executive understands and agrees
that he has a fiduciary responsibility and primary responsibility to protect and
maximize the value of the Company's rights to its oil and gas concession
offshore Guinea and furthermore as stipulated in the non-compete section below,
Executive agrees to uphold, support, and maximize the Company's rights to the
offshore concession for a minimum of five years after any termination of
Executive's employment by the Company.

    

    
       

    

    
      
        	 	
                3.

              	
                Full
      time employment.

              

      

    

    
      Executive
shall devote his full time (as defined below) and attention to such duties
involved in the protection and maximization of the value of the Company's
offshore oil and gas concession. Executive shall use his best efforts during the
Term of Employment to protect, encourage, and promote the interests of the
Company altogether in general and to build a ever growing positive public
opinion regarding the Company in the country of Guinea. Full time with respect
to this agreement is understood to be the time necessary for the Executive to
work to reasonably meet the objectives and implement the strategies of the
Company. The Executive's hours of specific work for the company are not limited
to any specific range of time during a work day but can be accomplished around
the clock and on weekends and/or holidays if deemed necessary by Hyperdynamics'
Chief Executive Officer or the Executive himself, and certain responsibilities
of Executive's responsibilities, as approved by Hyperdynamics' CEO may be done
at any physical location, including in or offshore the Republic of Guinea. As a
primary responsibility, Executive shall periodically and formally report to and
stay in constant communication with Hyperdynamics' CEO, always being a phone
call away unless prior approval of the Chief Executive Officer has been received
for Executive to travel out of cell phone coverage area.

    

     

    
      
        
           

        

        
          Page
2 of 7

          
            

          

        

        
           

        

      

    

     

    
      
        	
              	
                4.

              	
                Compensation.

              

      

    

    
       

    

    
      (a) Base
Salary. The Company shall pay to Executive during the Term of Employment a Base
salary at the rate of One Hundred Eighty Five Thousand dollars ($ 185,000.00)
per year.   Such salary shall be payable Bi-Weekly, Semi-monthly,
or monthly in accordance with the Company's normal payroll
procedures.

    

    
       

    

    
      (b) Bonuses.

    

    
       

    

    
      Bonus
1:

    

    
      $75,000

    

    
      Due upon the
completion of the minimum work required in the 1st
exploration
period of the 2006 PSC. Acquire seismic, process it, and interpret
it.   This may be paid at the option of the company with S8
registered
free trading stock.

      Bonus
2:

    

    
      $75,000

    

    
      Due
upon the signing of a drilling contract by Hyperdynamics or any of its
oil
company partners. This may be paid at the option of the company with
S8
registered free trading stock.

      Bonus
3:

    

    
      $75,000

    

    
      Due
upon completion of any farmouts. This may be paid at the option of the
company with S8 registered free trading stock.

      Bonus
4:

    

    
      $75,000
for each drilling operation that turns the bit to the right offshore
Guinea.
This may be paid at the option of the company with S8 registered free
trading stock.

    

    
       

    

    
      (c)  Employee
Stock Options. The Compensation committee has informed the CEO that an option
package has been approved for Executive. Upon execution of this Agreement
between Executive and the Company, the board of directors will document the
consent to grant the options approved by the compensation committee. Such Stock
Options to be granted will be:

    

     

    
      
        
           

        

        
          Page
3 of 7

          
            

          

        

        
           

        

      

    

     

    
      Fifty
thousand (50,000) 3-year S8 options with strike price equal to the closing price
on the first day of employment a reported by the American Stock Exchange.
Vesting is immediate for these initial options.

    

    
       

    

    
      Thirty
thousand (30,000) 3-year S8 options with strike price equal to the closing price
on the last day of each quarter of employment. Should this contract run through
initial expiration, Executive will obtain 360,000 options in total. Vesting for
each set of quarterly options will occur at the end of each quarter the
Executive remains employed as defined herein.

    

    
       

    

    
      Benefits
During the Term of Employment:

    

    
       

    

    
      (a)  Executive
shall be eligible to participate in any life, health and long-term disability
insurance programs, pension and retirement programs, stock option and other
incentive compensation programs, and other fringe benefit programs made
available to executive employees of the Company from time to time, and Executive
shall be entitled to receive such other fringe benefits as may be granted to him
from time to time by the Chief Executive Officer or Board of
Directors.

    

    
       

    

    
      (b)  Executive
shall be allowed two (2) weeks of vacation with pay on the same basis as other
executive employees of the Company. Executive shall devote his full time and
attention to such duties, except for sick leave, and excused leaves of absences
otherwise.

    

    
       

    

    
      (c)  The
Company shall reimburse Executive for reasonable business expenses incurred in
performing Executive's duties and promoting the business of the Company,
including, but not limited to, reasonable entertainment expenses, travel and
lodging expenses, following presentation of documentation in accordance with the
Company's business expense reimbursement policies.

    

    
       

    

    
      6.    Term;
Termination of Employment. As used herein, the phrase "Term of Employment" shall
mean the period commencing on the Effective Date and ending on the same date
three (3) years later; provided, however, that as of the expiration date of each
of (i) the initial Term of Employment and (ii) if applicable, any Renewal Period
(as defined below), the Term of Employment shall automatically be extended for a
one (1) year period (each a "Renewal Period") unless either the Company or
Executive provides Two (2) months' notice to the contrary. Notwithstanding the
foregoing, the Term of Employment shall expire on the first to occur of the
following:

    

    
       

    

    
      (a)  Termination
by the Company. Notwithstanding anything to the contrary in this Agreement,
whether express or implied, the Company may, at any time, terminate Executive's
employment for any reason by giving Executive at least 30 days' prior written
notice of the effective date of termination.

    

     

    
      
        
           

        

        
          Page
4 of 7

          
            

          

        

        
           

        

      

    

     

    
      (b)  Termination
by Executive. In the event that Executive's employment with the Company is
voluntarily terminated by Executive, the Company shall have no further
obligation hereunder from and after the effective date of termination. Executive
shall give the Company at least 30 days' advance written notice of his intention
to terminate his employment hereunder.

    

    
       

    

    
      (c)  Agreement
for Non-Compete upon Executive's Termination. Due to the sensitive technical
nature of the work of the Executive, if this agreement is terminated, it is
agreed that for a period of five (5) years that Executive will not take any
other position of contract or employment for services from or with any other
company in or with regard to the Republic of Guinea's oil and gas industry,
including all exploration, development and other areas of petroleum operations
as defined by the 2006 Production Sharing Contract Between SCS Corporation and
the Republic of Guinea, signed on September 22, 2006.Any breach of this
non-compete agreement would be a cause for damages due to the
company.

    

    
       

    

    
      (c)  Salary,
Benefits, Pay Upon Termination. In the event of termination of employment,
Executive shall receive all regular Base Salary due up to the date of
termination. The Company shall have no further obligation hereunder from and
after the effective date of termination and the Company shall have all other
rights and remedies available under this Agreement or any other agreement and at
law or in equity.

    

    
       

    

    
      7.    Confidential
Information and Non-Competition. During the Term of Employment and at all times
thereafter, Executive shall not, except as may be required to perform his duties
hereunder or as required by applicable law, disclose to others or use, whether
directly or indirectly, any Confidential Information regarding the Company.
"Confidential Information" shall mean information about the Company, its
subsidiaries and affiliates, and their respective clients and customers that is
not available to the general public. During Executive's employment tenure,
Executive shall work exclusively for Company full time and non-competitive basis
with 100% of Executive's efforts focused on upholding the interests of the
Company.

    

    
       

    

    
      8.    Return
of Company Documents. In the event Executive leaves the employment of Company
for whatever reason, Executive agrees to deliver to Company any and all property
situated on Company's premises and owned by Company including disks and other
storage media, filing cabinets or other work areas, is subject to inspection by
Company personnel at any time, with or without notice, for the purpose of
protecting Company's rights and interests in its intellectual
property.

    

    
       

    

    
      9.    Taxes.
All payments to be made to Executive under this Agreement will be subject to any
applicable withholding of federal, state and local income and employment taxes.
Any withholding regarding exercise of stock options will be determined by
including an opinion of a third party tax attorney paid by the company as
pertaining to any withholding that may be required or not
required.

    

     

    
      
        
           

        

        
          Page
5 of 7

          
            

          

        

        
           

        

      

    

     

    
      10.   Miscellaneous.
This Agreement shall also be subject to the following miscellaneous
considerations:

    

    
      (a)  Executive
and the Company each represent and warrant to the other that he or it has the
authorization, power and right to deliver, execute, and fully perform his or its
obligations under this Agreement in accordance with its
terms.

    

    
      (b)  This
Agreement contains a complete statement of all the arrangements between the
parties with respect to Executive's employment by the Company. This Agreement
supersedes all prior and existing negotiations and agreements between the
parties concerning Executive's employment, and this Agreement can only be
changed or modified pursuant to a written instrument duly executed by each of
the parties hereto.

    

    
      (c)  If
any provision of this Agreement or any portion thereof is declared invalid,
illegal, or incapable of being enforced by any court of competent jurisdiction,
the remainder of such provisions and all of the remaining provisions of this
Agreement shall continue in full force and effect.

    

    
      (d)  This
Agreement shall be governed by and construed in accordance with the internal,
domestic laws of the State of Texas.

    

    
      (e)  Any
rights of Executive hereunder shall be in addition to any rights Executive may
otherwise have under benefit plans, agreements, or arrangements of the Company
to which he is a party or in which he is a participant, including, but not
limited to, any Company-sponsored employee benefit plans. Provisions of this
Agreement shall not in any way abrogate Executive's rights under such other
plans, agreements, or arrangements.

    

    
      (f)  For
the purpose 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 or mailed by United States certified or registered mail,
return receipt requested, postage prepaid, addressed to the named Executive at
the address set forth below under his signature; provided that all notices to
the Company shall be directed to the attention of the Board of Directors with a
copy to the Secretary of the Company, or to such other address as either party
may have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon
receipt.

    

    
      (g)  Section
headings in this Agreement are included herein for convenience of reference only
and shall not constitute a part of this Agreement for any other
purpose.

    

    
      (h)  Failure
to insist upon strict compliance with any of the terms, covenants, or conditions
hereof shall not be deemed a waiver of such term, covenant, or condition, nor
shall any waiver or relinquishment of, or failure to insist upon strict
compliance with, any right or power hereunder at any one or more tunes be deemed
a waiver or relinquishment of such right or power at any other time or
times.

    

    
      (i)  This
Agreement may be executed in several counterparts, each of which shall be deemed
to be an original but all of which together will constitute one and the same
instrument. Signatures may be faxed if the parties are not in the same location
at signing.

    

     

    
      
        
           

        

        
          Page
6 of 7

          
            

          

        

        
           

        

      

    

     

    
      11.  Survival
of Provisions: The executory provisions of this Agreement will survive the
termination of this Agreement.

    

    
       

    

    
      IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day
and year first above written.

    

    
       

    

    
      	
              EXECUTIVE

            	 
      	
              COMPANY

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	
              BY:  /s/
      James R. Spear

            	 
      	
              BY:  /s/
      Kent P. Watts

            
	
              JAMES
      R. SPEAR

            	 
      	
              KENT
      P. WATTS

            

    

    
      	
              TITLE:

            	 
      	
              TITLE:

            
	
              VICE
      PRESIDENT

            	 
      	
              CHIEF
      EXECUTIVE OFFICER

            
	
              CHIEF
      GEOPHYSICIST

            	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      

    

    
      	
              ADDRESS:

            	 
      	
              ADDRESS:

            
	
              14819
      Hoya Court

            	 
      	
              One
      Sugar Creek Center Boulevard

            
	
              Houston,
      TX 77070

            	 
      	
              Suite
      125

            
	 
      	 
      	
              Sugar
      Land, Texas 77478

            
	 
      	 
      	 
      
	
              1
      November 2007

            	 
      	 
      

    

    
       

       

      Page
7 of 7

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00138-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00138-of-00352.parquet"}]]