Common use of FIRST YEAR COMPENSATION Clause in Contracts

FIRST YEAR COMPENSATION. In consideration for all services rendered by Executive under this Agreement during the first year of the Term, the Company shall not pay Executive any cash compensation but shall provide annual compensation in the form of stock options ("Base Compensation") as follows: the Company shall issue to Executive Stock Options ("Stock Options") exercisable into one million (1,000,000) shares of Common Stock of the Company pursuant to the terms of the 2010 Sun River Energy, Inc. Stock Option and Award Incentive Plan, as amended (the "Stock Plan"). The Stock Options shall be issued to Executive on the Effective Date and shall be earned and vest 1/36th each month thereafter (each a "Vesting Date") during the Term. The exercise price of the Stock Options shall equal the average fair market value of a share of the Company's common stock on the Effective Date of the PSA is between the Parties. Finally, the Company shall cause Common Stock obtained through the Stock Options to be registered pursuant to the terms of the Stock Plan on Form S-8.