AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS
AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "AGREEMENT") made
this
10th day of December, 2008 (the "EFFECTIVE DATE"), between
Foothills Resources,
Inc., a Delaware corporation with its principal place of business
located at
4540 California Avenue, Suite 550, Bakersfield, California 93309,
its
affiliates, subsidiaries, successors and assigns (the "COMPANY"),
and W. Kirk
Bosche, an individual residing at 14619 Carols Way Drive, Houston,
Texas 77070
(the "EXECUTIVE").
WHEREAS, the Company employs the Executive (collectively, the
"PARTIES") as
its Chief Financial Officer pursuant to the terms of an employment
agreement
dated April 6, 2006 between the Parties (the "ORIGINAL AGREEMENT");
and
WHEREAS, the Company recognizes that it is in the best interests of
the
Company and its shareholders to retain capable and experienced
executive
officers such as the Executive; and
WHEREAS, the Executive is willing to continue serving the Company
in the
capacity set forth above; and
WHEREAS, the Company and the Executive desire to amend and restate
the
Original Agreement to comply with Section 409A of the Internal
Revenue Code of
1986, as amended (the "CODE").
NOW,
THEREFORE, in consideration of the covenants and promises
contained
herein, the Parties agree as follows:
1.
EMPLOYMENT
PERIOD. The Company shall continue to employ the Executive,
and the Executive agrees to continue to serve the Company in
the
position of Chief Financial Officer in accordance with the terms
and
subject to the conditions of this Agreement continuing until
such
employment is terminated in accordance with the provisions of
paragraph 11, in which case the provisions of paragraph 11
shall
control (the "TERM").
The
Executive affirms that no obligation exists between the Executive
and
any other entity which would prevent or impede the Executive's
immediate and
full performance of every obligation of this Agreement.
2.
POSITION AND
DUTIES. During the Term, the Executive shall serve in,
and assume duties and responsibilities consistent with, the
position
of Chief Financial Officer, unless and until otherwise instructed
by
the Company. During the Term, the Executive agrees to devote
his
working time, as set forth in Paragraph 4 hereof, using his
skill,
energy and best business efforts on behalf of the Company. During
the
Term,
Executive shall not engage in any other employment, consulting
or other business activity without the prior written consent of
the
Company, which consent shall not be unreasonably withheld.
3.
NO CONFLICTS.
The Executive covenants and agrees that for so long as
he is employed by the Company, he shall inform the Company of each
and
every business opportunity related to the business of the Company
of
which he becomes aware, and that he will not, directly or
indirectly,
exploit any such opportunity for his own account, nor will he
render
any services to
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any other person or business, acquire any interest of any type in
any
other business or engage in any activities that conflict with
the
Company's best interests or which is in competition with the
Company.
4.
DAYS/HOURS OF
WORK AND WORK WEEK. The Executive shall normally work 5
days per week and his hours of work shall be appropriate with
the
nature of the Executive's duties and responsibilities with the
Company, it being recognized that such duties and
responsibilities
require flexibility in the Executive's work schedule.
5.
LOCATION. The
locus of the Executive's employment with the Company
shall be the Company's corporate headquarters located in
Bakersfield,
California.
6.
COMPENSATION.
(a) BASE SALARY.
During the Term, the Company shall pay, and the
Executive agrees to accept, in consideration for the
Executive's
services hereunder, pro rata semi-monthly payments of the
annual
salary of One Hundred Seventy Five Thousand Dollars
($175,000.00), less all applicable taxes and other appropriate
deductions. In addition, the Board shall review the Executive's
base salary annually and shall determine whether upward
adjustment is appropriate given the Company's operating
performance over the relevant Term.
(b) ANNUAL BONUS.
During the Term of this Agreement, the Executive
shall be eligible to receive an annual bonus in an amount to be
determined by the Board for each calendar year (or pro-rata
portion thereof in the case of a period of less than twelve
(12)
months) to be awarded and paid in the Board's sole discretion
based on its review of the operating performance of the Company
during the fiscal year to which the bonus pertains. Such review
by the Board shall be based on an evaluation of the Company's
results of operations relative to the Company's achievement of
certain milestones established for the Company's operational
performance, and milestones established for the Executive's
performance, that shall be agreed to by the Executive and the
Board from time to time. Each annual bonus shall be paid by the
Company to the Executive promptly after the first meeting of
the
Board following the previous calendar year, but in no case
later
than March 30th of each year.
7.
EXPENSES. During
the Term, the Executive shall be entitled to payment
for or reimbursement of any and all reasonable expenses paid or
incurred by the Executive in connection with and related to the
performance of his duties and responsibilities for the Company.
All
requests by the Executive for payment for or reimbursement of
such
expenses shall be supported by appropriate invoices, vouchers,
receipts or such other supporting documentation in such form
and
containing such information as the Company may from time to
time
reasonably require, evidencing that the Executive, in fact,
incurred
or paid such expenses.
8.
VACATION. During
the Term of this Agreement, the Executive shall be
entitled to accrue twenty five (25) vacation days per year.
9.
STOCK
OPTIONS.
(a) GRANT OF OPTIONS.
The Company shall issue to the Executive an
option to acquire two hundred thousand (200,000) shares of the
Company's common stock (the "COMMON
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STOCK"), pursuant to the Company's then current stock option
plan
(the "PLAN"). The exercise price of the option to be granted
pursuant to this paragraph 9(a) shall be equal to the fair
market
value per share of the Common Stock on the date of grant.
(b) VESTING AND
EXERCISE OF OPTIONS. The option to be granted
pursuant to paragraph 9(a) shall vest as follows: 25% of the
shares of Common Stock underlying such option will vest on the
date of grant, and the remaining 75% of the shares of Common
Stock underlying the option will vest in equal annual on the
first, second and third anniversaries of the date of grant.
10.
OTHER BENEFITS.
(a) During the Term,
the Company shall purchase term life insurance,
the beneficiary of which shall be the Executive's estate, with
a
benefit amount equal to or greater than One Million Dollars
($1,000,000.00), subject to the insurability of the Executive
over the Term.
(b) During the Term,
the Executive shall be eligible to participate
in Company-sponsored benefit plans (collectively, the "BENEFIT
PLANS") all in accordance with the Company's policies as in
effect from time to time and in substantially the same manner
and
at substantially the same levels as the Company makes such
opportunities available to the Company's employees.
11.
TERMINATION OF
EMPLOYMENT.
(a) DEATH. In the
event that during the Term, the Executive dies,
this Agreement and the Executive's employment with the Company
shall automatically terminate and the Company shall have no
further obligations to the Executive or his heirs,
administrators
or executors with respect to compensation and benefits accruing
thereafter, except for the obligation to pay to the Executive's
heirs, administrators or executors any earned but unpaid base
salary and vacation pay, and reimbursement of any and all
reasonable expenses paid or incurred by the Executive in
connection with and related to the performance of his duties
and
responsibilities for the Company during the period ending on
the
termination date. The Company shall deduct, from all payments
made hereunder, all applicable taxes, including income tax,
FICA
and FUTA, and other appropriate deductions.
(b) DISABILITY. In the
event that, during the Term, the Executive
shall be prevented from performing his duties and
responsibilities hereunder to the full extent required by the
Company by
reason of a Disability (as defined below), this
Agreement and the Executive's employment with the Company shall
automatically terminate and the Company shall have no further
obligations to the Executive or his heirs, administrators or
executors with respect to compensation and benefits accruing
thereafter, except for the obligation to pay the Executive's
heirs, administrators or executors any earned but unpaid base
salary and vacation pay, and reimbursement of any and all
reasonable expenses paid or incurred by the Executive in
connection with and related to the performance of his duties
and
responsibilities for the Company during the period ending on
the
termination date. The Company shall deduct, from all payments
made hereunder, all applicable taxes, including income tax,
FICA
and FUTA. For
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purposes of this Agreement, "DISABILITY" shall mean a physical
or
mental disability that, in the Board's discretion, based upon
the
medical opinions of two qualified physicians specializing in
the
area or areas of the Executive's affliction, one of whom shall
be
chosen by the Board and one of whom shall be chosen by the
Executive, prevents the performance by the Executive, with or
without reasonable accommodation, of his duties and
responsibilities hereunder for a continuous period of not less
than six consecutive months.
(c) CAUSE.
(i) At any time during
the Term, the Company may terminate this
Agreement and the Executive's employment hereunder for
Cause. For purposes of this Agreement, "CAUSE" shall mean:
(a) the willful and continued failure of the Executive to
perform substantially his duties and responsibilities for
the Company (other than any such failure resulting from a
Disability) after a written demand by the Board for
substantial performance is delivered to the Executive by the
Company, which specifically identifies the manner in which
the Board believes that the Executive has not substantially
performed his duties and responsibilities, which willful and
continued failure is not cured by the Executive within
thirty (30) days of his receipt of such written demand; (b)
the conviction of, or plea of guilty or nolo contendere to a
felony, after the exhaustion of all available appeals; or
(c) fraud, dishonesty, competition with the Company,
unauthorized use of any of the Company's or any of its
subsidiary's trade secrets or confidential information, or
gross misconduct which is materially and demonstratively
injurious to the Company. Termination under paragraphs
11(c)(i)(b) and
11(c)(i)(c) above shall not be subject to
cure.
(ii) Termination of the Executive for Cause pursuant to
paragraph
11(c)(i)(a) shall be made by delivery to the Executive of a
copy of the written demand referred to in paragraph
11(c)(i)(a), or pursuant to paragraphs 11(c)(i)(b) or (c) by
delivery to the Executive of a written notice from the
Board, either of which shall specify the basis of such
termination, the conduct justifying such termination, and
the particulars thereof and finding that in the reasonable
judgment of the Board, the conduct set forth in paragraph
11(c)(i)(a), 11(c)(i)(b) or 11(c)(i)(c), as applicable, has
occurred and that such occurrence warrants the Executive's
termination of employment. Upon receipt of such demand or
notice, the Executive, shall be entitled to appear before
the Board for the purpose of demonstrating that Cause for
termination does not exist or that the circumstances which
may have constituted Cause have been cured in accordance
with the provisions of paragraph 11(c)(i)(a). No termination
shall be final until the Board has reached a determination
regarding "Cause" following such appearance.
(iii) Upon termination of this Agreement for Cause, the Company
shall have no further obligations or liability to the
Executive or his heirs, administrators or executors with
respect to compensation and benefits thereafter, except for
the obligation to pay the Executive any earned but unpaid
base salary and vacation pay, and reimbursement of any and
all reasonable expenses paid or incurred by the Executive in
connection with and related to the performance of his duties
and responsibilities for the Company during the period
ending on the termination date. The Company shall deduct,
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from all payments made hereunder, all applicable taxes,
including income tax, FICA and FUTA, and other appropriate
deductions.
(d) GOOD REASON.
(i) At any time during
the Term, subject to the conditions set
forth in paragraph 11(d)(ii) below, the Executive may
terminate this Agreement and the Executive's employment with
the Company for Good Reason. For purposes of this Agreement,
for "GOOD REASON" shall mean the occurrence, without the
Executive's consent, of (i) a material diminishment of the
Executive's job assignment, duties, responsibilities or
reporting relationships which is inconsistent with his
initial position hereunder or any later agreed upon
amendment of that position; (ii) a material reduction in the
Executive's base compensation or total compensation package,
including benefit plans and programs; or (iii) a material
breach of the terms of this Agreement by the Company, or any
permitted successor or assignee.
(ii) The Executive shall be entitled to terminate this
Agreement
and his employment with the Company for Good Reason at any
time, provided (A) that he has delivered written notice to
the Company of his intention to terminate this Agreement and
his employment with the Company for Good Reason within 5
business days
after either (1) the date on which the
Executive receives written notice from the Company of the
occurrence of any event included within the meaning of Good
Reason under paragraph 11(d)(i) or (2) the date on which the
Executive obtains actual knowledge of the occurrence of any
event included within the meaning of Good Reason under
paragraph 11(d)(i), and (B) Executive's termination of
services to the Company occurs within two years following
the initial occurrence, without the Executive's consent, of
any event included within the meaning of Good Reason under
paragraph 11(d)(i). Such notice, if given by the Executive
pursuant to clause (b) of the preceding sentence, shall
specify in reasonable detail the circumstances claimed to
provide the basis for such termination for Good Reason.
Notwithstanding the
