AOP Agreement Form

AOP AGREEMENT

This AOP Agreement (the "Agreement") is entered into as of Effective Date: by and between Party A Name: with principal address , and Party B Name: with principal address .

RECITALS

WHEREAS, the Parties desire to cooperate in the joint conduct of certain operations and to define their respective rights and obligations with respect thereto;

WHEREAS, the Parties intend that profits, losses and responsibilities arising from the operations described herein be allocated in accordance with the terms of this Agreement;

WHEREAS, the Parties desire to set forth the procedures for management, accounting, distributions, confidentiality and termination in a single binding agreement;

NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1. DEFINITIONS

1.1 "AOP" means the activities, operations and procedures described in Section 3, to be conducted by the Parties pursuant to this Agreement.

1.2 Terms defined in this Agreement shall have the meanings set forth herein. Captions are inserted for convenience only and shall not affect interpretation.

2. TERM

This Agreement shall commence on the Effective Date set forth above and shall continue for an initial term of months, unless earlier terminated in accordance with Section 12. Thereafter the Agreement shall automatically renew for successive one year terms unless either Party provides written notice of non-renewal at least days prior to the end of the then-current term.

3. SCOPE OF OPERATIONS

The Parties shall jointly undertake the following activities and related tasks in furtherance of the AOP:

Each Party shall perform its duties with due care, skill and in compliance with applicable laws and industry standards. No Party shall commit the other Party to any material obligation without prior written consent.

4. CAPITAL CONTRIBUTIONS

4.1 Initial Contributions. Party A shall contribute the amount of and Party B shall contribute the amount of to fund the AOP activities. Contributions shall be made in lawful currency and credited to each Party's capital account.

4.2 Additional Contributions. No Party shall be required to make additional contributions except as agreed in writing. If additional funding is necessary, Parties shall agree in writing on amount and timing.

5. ALLOCATION OF PROFITS AND LOSSES

5.1 Profits and Losses shall be allocated between the Parties as follows: Party A and Party B . Such allocations shall be made in accordance with generally accepted accounting principles and this Agreement.

5.2 Tax Allocations. For tax reporting purposes, allocations shall be made in accordance with the Parties' economic arrangement and applicable tax law. Each Party shall report its share of income and loss on its own tax returns.

6. MANAGEMENT AND VOTING

6.1 Management. The Parties shall mutually manage the AOP. Day-to-day operations shall be supervised by Manager: , who shall act subject to the terms of this Agreement.

6.2 Voting. Except as otherwise provided, decisions shall be made by unanimous consent of the Parties. For matters specified by the Parties in writing, voting shall be based on the profit allocation percentages set forth in Section 5.

7. ACCOUNTING AND RECORDS

7.1 Books and Records. Accurate books and records shall be maintained reflecting all transactions of the AOP and shall be available for inspection by either Party upon reasonable prior notice.

8. DISTRIBUTIONS

Distributions of available cash shall be made quarterly unless the Parties otherwise agree in writing. Distributions shall be made in proportion to the Parties' respective allocation percentages after provision for reserves determined in good faith by the Parties.

9. CONFIDENTIALITY

Each Party shall keep confidential and not disclose to any third party any non-public information obtained from the other Party in connection with the AOP, except as required by law or with prior written consent. This obligation shall survive termination of this Agreement for a period of three years.

10. REPRESENTATIONS AND WARRANTIES

Each Party represents and warrants that it has the full power and authority to enter into this Agreement, that the execution and performance of this Agreement has been duly authorized, and that this Agreement is binding and enforceable against such Party in accordance with its terms.

11. INDEMNIFICATION

Each Party shall indemnify and hold harmless the other Party from and against any and all losses, liabilities, claims, damages and expenses (including reasonable attorneys' fees) arising out of the indemnifying Party's breach of this Agreement, negligence or willful misconduct.

12. TERMINATION

This Agreement may be terminated: (a) by mutual written agreement of the Parties; (b) by either Party upon material breach by the other Party that remains uncured for a period of days after written notice; or (c) as otherwise provided in this Agreement.

13. NOTICES

All notices required or permitted under this Agreement shall be in writing and delivered to the address set forth below or to such other address as a Party may designate by notice:

14. AMENDMENTS AND WAIVER

No amendment, modification or waiver of any provision of this Agreement shall be effective unless in writing and signed by both Parties. The waiver by either Party of any breach shall not operate as a waiver of any subsequent breach.

15. COUNTERPARTS

This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. Signatures transmitted by facsimile or electronic image shall be binding.

16. GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the State of , without regard to its conflict of laws principles.

17. ENTIRE AGREEMENT

This Agreement, including any exhibits and schedules executed contemporaneously herewith, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings and negotiations, whether written or oral.

18. SEVERABILITY

If any provision of this Agreement is held to be invalid, illegal or unenforceable, the remaining provisions shall continue in full force and effect and the invalid, illegal or unenforceable provision shall be replaced by a valid provision that most closely approximates the Parties' original intent.

MISCELLANEOUS

The Parties acknowledge that they have had the opportunity to seek independent legal counsel prior to executing this Agreement and that they understand the terms contained herein.

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