Employment Agreement

This Employment Agreement (the "Agreement") is made and entered into, effective
as of December 31, 2010 (the "Effective Date"), by and between EnerJex
Resources, Inc., a Nevada corporation (the "Company"), and Robert G. Watson, Jr.
("Employee"), with reference to the following facts:

Recitals:

The parties have agreed to execute this Agreement in order to memorialize the
terms and conditions on which the Company shall employ Employee from and after
the Effective Date of this Agreement.

Agreements:

Now, Therefore, the parties hereto, intending to be legally bound, do hereby
agree as follows:

1.           Position and Duties

1.1         Position and Title.  The Company hereby hires Employee to serve as
the Chief Executive Officer of the Company.

(a)        Limits on Authority.  Employee shall perform his duties as Chief
Executive Officer of the Company pursuant to this Agreement in compliance with
applicable law, consistent with such direction as the Company's Board of
Directors provides to Employee from time to time, and in accordance with
Company's policies and procedures as published from time to time.

(b)        Annual Reviews.  Following each annual anniversary of the Effective
Date of this Agreement, the Board of Directors may review Employee's performance
of his duties pursuant to this Agreement and advise Employee of the results of
that review.

(c)        Reporting and Authority.  Employee shall report to the Company's
Board of Directors.  Subject to the power and authority of the Company's Board
of Directors to govern the affairs of the Company, Employee shall have full
authority and responsibility for supervising and managing the daily affairs of
the Company, including (i) working with the Company's Board of Directors to
develop and approve business objectives, policies and plans that improve profit
and growth objectives, (ii) communicating business objectives and plans within
the Company, (iii) ensuring that plans and policies are promulgated to and
implemented by subordinate managers, (iv) directing operations to achieve
planned performance goals and developing management systems to effectively
control each Company unit, (v) ensuring that each operating unit provides those
functions required for achieving its business objectives and that each unit is
properly organized, staffed and directed to fulfill its responsibilities, (vi)
developing the organization and personnel, products, facilities, technology, and
appropriate financial resources to secure the position of the Company and to
facilitate its planned development, (vii) directing periodic reviews of the
Company's strategic market position and combining this information with
corollary analysis of the Company's products and financial resources, (viii)
providing periodic financial information concerning the operations of the
business, human resources and sales growth plans to the Company's Board of
Directors, and (ix) ensuring that the operation of the Company complies with
applicable laws.

1.2         Acceptance.  Employee hereby accepts employment by the Company in
the capacity set forth in Section 1.1, above, and agrees to perform the duties
of such position from and after the Effective Date of this Agreement in a
diligent, efficient, trustworthy, and businesslike manner.  Employee agrees
that, to the best of the Employee's ability and experience, Employee at all
times shall loyally and conscientiously discharge all of the duties and
responsibilities imposed upon Employee pursuant to this Agreement.

 
 

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1.3        Business Time.  Employee shall devote his exclusive business time to
the performance of his duties under this Agreement.  Except with the prior
written approval of the Board of Directors of the Company, Employee may not be
employed by or provide paid consulting services to any business enterprise other
than the Company and its affiliates.

1.4        Location.  Employee shall perform his duties under this Agreement
from the offices maintained by Employee in San Antonio, Texas, and from the
Company's offices in Overland Park, Kansas.  Employee acknowledges and agrees
that from time to time he shall be required to travel (at the cost and expense
of the Company) to other locations outside of San Antonio, Texas, and Overland
Park, Kansas, in order to discharge his duties under this Agreement.

1.5         Term.  The term of this Agreement shall commence as of the Effective
Date and shall expire on December 31, 2012, subject to sooner termination
pursuant to Section 4, below.

2.           Compensation.  The Company shall compensate Employee for his
services pursuant to this Agreement as follows:

2.1        Salary.  The Company shall pay to Employee an annual salary in the
amount of One Hundred Fifty Thousand Dollars ($150,000.00) ("Base
Compensation"), payable in periodic installments in accordance with the
Company's regular payroll practices as in effect from time to time.  Such annual
salary shall be subject to periodic increases, in such amounts (if any) as the
Board of Directors may determine to be appropriate, at the time of Employee's
annual review pursuant to Section 1.1(b), above, or at such other times (if any)
as the Board of Directors may select.

2.2        Annual Bonus.  For each calendar year during the term of this
Agreement, Employee shall be eligible to receive a cash bonus in such amount,
and subject to achievement of such individual and Company-wide performance
criteria, as the Board of Directors determines to be appropriate.

2.3        Company Stock.  Subject to approval of the Company's Board of
Directors, which the Company shall seek at the first meeting of the Board held
after the Effective Date of this Agreement, the Company shall grant to Employee
an option to purchase nine hundred thousand (900,000) shares of the Company's
Common Stock.  That option will be exercisable at a price per share equal to the
fair market value of the Company's Common Stock on the date on which that option
is approved by the Board, and will be subject to the terms of the Company's
Stock Incentive Plan, as amended and as in effect from time to time. In no such
case will the option exercise price be less than $0.40 per share.

2.4        Vacation.  Employee shall accrue four (4) weeks' paid vacation in
each period of twelve (12) consecutive months of employment during the term of
this Agreement.  If Employee accumulates four (4) weeks' accrued and unused
vacation time, then further accruals shall cease until Employee's accrued and
unused vacation time is less than four (4) weeks.

2.5        Other Fringe Benefits.  The Company shall either (a) provide health
insurance coverage for Employee and his dependents under the Company's group
health insurance plan, at the cost and expense of the Company, or (b) at the
election of Employee, reimburse Employee up to One Thousand Dollars ($1,000.00)
per month for an individual health insurance plan procured by Employee.  In
addition to the foregoing, Employee shall be eligible for coverage under such
other fringe benefits as are provided to the Company's employees generally from
time to time.

 
 

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2.6         Reimbursement of Expenses.  The Company shall reimburse Employee for
authorized expenses incurred by Employee in the performance of Employee's
duties, provided that such expenses are reasonable in amount, incurred for the
benefit of the Company, and are supported by itemized accountings and expense
receipts submitted to the Company prior to any reimbursement.

3.           Board Position.  On or promptly following the Effective Date of
this Agreement, the Company shall cause Employee to be nominated for election to
the Company's Board of Directors.

4.           PROPRIETARY INFORMATION

4.1         No Improper Use of Third-Party Confidential Information.  Employee
acknowledges that the Company does not desire to obtain improperly any
proprietary or confidential information owned by any company or other person
with whom Employee now has or heretofore has had a consulting engagement or
employment relationship, and therefore agrees that (a) Employee shall not bring
to the Company or share with any employee or other representative of the Company
any written, electronic, or other materials containing any confidential
information belonging to any such current or former employer or other person,
and (b) Employee shall not provide any such information in any other form to the
Company (or any representative of the Company) in violation of any agreements or
any other obligations that Employee may owe to any other persons.

4.2         Assignment of Inventions and Works of Authorship and Improvements.

(a)        Assignment.  Employee shall keep the Company fully informed of
inventions and works of authorship conceived by Employee (either alone or with
others) during Employee's engagement with the Company and hereby assigns to the
Company all rights in and to such inventions and works of authorship.  Employee
covenants and agrees that, upon the request of the Company, Employee shall make,
execute, and deliver such additional assignments and other instruments as may be
necessary or convenient for effectuating or further memorializing such
assignment.

(b)        Further Assurances.  Employee further agrees that (i) all such
inventions and works of authorship (to the extent of Employee’s interest
therein) shall be the property of the Company, (ii) Employee shall not assign to
any person other than the Company any interest therein, and (iii) Employee
shall, without charge to the Company, assign to the Company all of Employee's
right, title and interest in any such inventions and works of authorship, and
execute, acknowledge and deliver such instruments as are necessary to confirm
the ownership thereof by the Company.

(c)        Patents, Etc.  Upon the request and at the expense of the Company,
Employee shall (i) assist the Company or its nominees in obtaining patents,
copyright, trademark, or other right of protection for any such inventions and
works of authorship, in any country the Company determines to be appropriate,
and (ii) provide the Company all facts and data concerning any such inventions
and works of authorship for such applications and other documents as are
necessary to apply for and to obtain patents or other appropriate protection
therefor.

(d)        Depictions.  To deliver to the Company any and all sketches,
drawings, models, figures and other information with respect to any such
inventions and works of authorship immediately upon the request of the Company,
and, at the cost and expense of the Company, to cooperate with the Company in
prosecuting to completion any litigation or other proceedings necessary to
protect and enforce the proprietary rights of the Company therein.

 
 

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4.3        Nondisclosure, Non-Circumvention and Noncompetition.  Employee
agrees, as a condition of Employee's engagement hereunder, to execute and
deliver, concurrently herewith, that certain Nondisclosure and Non-Circumvention
Agreement in the form attached hereto as Appendix 1, and to perform Employee's
obligations thereunder.

4.4        Injunctive Relief.  The parties agree that due to the nature of the
position for which Employee is being employed engaged and the information that
Employee will receive during the course of Employee's employment hereunder, the
Company would be irreparably harmed by any violation, or threatened violation of
this Section 4 of this Agreement, and that the Company shall be entitled to an
injunction, without having to furnish any form of bond, prohibiting Employee
from any actual or threatened violation of Section 4 of this
Agreement.  Employee further agrees that the services to be performed by
Employee under this Agreement are of a special, unique, unusual, extraordinary
and intellectual character that gives them peculiar value to the Company, the
loss of which cannot be reasonably or adequately compensated in damages in an
action at law.  Employee agrees that the Company, in addition to any other
rights or remedies it may have, shall be entitled to injunctive and other
equitable relief to prevent or remedy a breach of this Agreement by Employee.

5.           Termination

5.1        Definitions.  For purposes of this Agreement, the term:

(a)        "Date of Termination" shall mean the date specified in the Notice of
Termination (as defined below).

(b)        "Disability" or "Disabled" shall mean that Employee either (i) is
unable to engage in any substantial gainful activity, with or without reasonable
accommodation, due to physical or mental impairment which can be expected to
result in death or to last for a continuous period of twelve (12) months or
more, or (ii) is, by reason of any medically determinable physical mental
impairment which can be expected to last for a continuous period of not less
than twelve (12) months, receiving income replacement benefits for a period of
not less than three months under an accident and health plan sponsored by the
Company.  Employee covenants and agrees to submit to a reasonable physical
examination by such licensed medical doctor for the purpose of evaluating
whether Employee is Disabled.

(c)        "Cause" shall mean (i) the willful and repeated failure by Employee
to substantially perform his duties with the Company (other than any such
failure resulting from Employee's incapacity due to Disability), after a written
demand for substantial performance is delivered to Employee by the Board, which
demand specifically identifies the manner in which the Board believes that
Employee has not substantially performed his duties and provides fourteen (14)
days for Employee to cure, or (ii) Employee's willfully engaging in conduct
which is demonstrably and materially injurious to the Company, monetarily or
otherwise.  For purposes hereof, no act, or failure to act, on Employee's part
shall be deemed "willful" unless done, or omitted to be done, by Employee not in
good faith and without reasonable belief that Employee's action or omission was
in the best interest of the Company.

(d)        "Notice of Termination" shall mean a written notice which is
delivered by the Company in connection with the Company's decision to terminate
Employee's employment with the Company, setting forth in reasonable detail the
reason for termination of Employee's employment.

 
 

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5.2         Termination by Company.

(a)        For Cause.  The Company may terminate this Agreement as of the Date
of Termination for Cause.   Notwithstanding the foregoing, Employee shall not be
deemed to have been terminated for Cause unless and until there shall have been
delivered to Employee a copy of a resolution duly adopted by the affirmative
vote of not less than three-quarters of the entire membership of the Board at a
meeting of the Board called and held for such purpose (after reasonable notice
to Employee and an opportunity for Employee, together with Employee's counsel,
to be heard before the Board), finding that in the good faith opinion of the
Board that Employee was guilty of conduct set forth above and specifying the
particulars thereof in reasonable detail, provided, however, that if at such
time Employee is a member of the Board of Directors, he shall abstain from
voting with respect to any matter relating to termination of his
employment.  Upon termination for Cause, the Company shall pay to Employee all
accrued and unpaid compensation for the period ending on the Date of Termination
(including payment for any accrued and unused vacation time and the Annual Bonus
accrued through the Date of Termination), and shall not be obligated to pay any
additional amounts to Employee hereunder.

(b)        Other than Cause or Disability.  Employee's employment is at will and
the Company may terminate this Agreement and Employee's employment for any
reason deemed sufficient by the Company, including by reason of Employee's
Disability, upon delivery of a Notice of Termination (or as of such date as is
specified therein).  However, in the event that Employee's employment is
terminated by the Company other than for Cause or by reason of his Disability,
then in addition to paying to Employee all accrued and unpaid wages due to
Employee for periods ended on or prior to the effective date of the termination
(including payment for any accrued and unused vacation time and the Annual Bonus
accrued through the Date of Termination), the Company shall pay to Employee (i)
the Base Compensation that Employee would have earned during the remainder of
Term of this Agreement, and (ii) if such termination occurs after the first date
as of which Employee has been employed hereunder for at least sixteen (16)
consecutive calendar months, then the Company also shall pay to Employee the
additional sum of One Hundred Thousand Dollars ($100,000).  Such amounts shall
be paid in equal periodic installments at the time when, and in the periodic
amounts in which, such Base Compensation would have been paid to Employee if he
had remained employed during the remainder of the Term hereof.

(c)        Disability.  By reason of Employee's Disability.  If the Company
elects to terminate Employee's employment hereunder by reason of Employee's
Disability, and if Employee is then covered by a disability income policy
sponsored by the Company, then in addition to all accrued and unpaid wages then
due to Employee (including payment for any accrued and unused vacation time and
the Annual Bonus accrued through the Date of Termination).

5.3         Termination by Employee. Employee may resign from employment and
terminate this Agreement at any time.  If Employee terminates this Agreement:

(a)        Disability.  By reason of Employee's Disability, and if Employee is
then covered by a disability income policy sponsored by the Company, then the
Company shall pay to Employee all accrued and unpaid wages due to Employee with
respect to all periods ended on or prior to the effective date of the
termination of Employee's employment hereunder, and the Company shall not owe
any additional amounts to Employee by reason of such termination.

(b)        Other.  Other than by reason of Employee's Disability, then the
Company shall pay to Employee all accrued and unpaid wages due to Employee with
respect to all periods ended on or prior to the effective date of the
termination of Employee's employment hereunder, and the Company shall not owe
any additional amounts to Employee by reason of such termination.

 
 

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5.4         Conditional Nature of Severance Payments.  Notwithstanding any other
provision of this Section 5 or any other provision of this Agreement to the
contrary:

(a)         Noncompete.  Employee acknowledges that the nature of the Company's
business is such that if Employee were to become employed by, or substantially
involved in, the business of a competitor of the Company during the period of
one (1) year following the termination of Employee's employment with the
Company, then it would be very difficult for Employee not to rely on or use the
Company's trade secrets and confidential information in connection with that
employment.

 
(i)         Thus, to avoid the inevitable disclosure of the Company's trade
secrets and confidential information, Employee acknowledges and agrees that his
right to receive the severance consideration described in Sections 5.2 and 5.3,
above (to the extent Employee is otherwise entitled to such payments thereunder)
shall be conditioned upon Employee not directly or indirectly engaging in
(whether as an employee, consultant, agent, proprietor, principal, partner,
stockholder, corporate officer, director or otherwise), or having any ownership
interest in or participating in the financing, operation, management or control
of, any person, firm, corporation or business that directly competes with
Company or is a customer of the Company and has operations located within a
radius of five (5) miles from any lease owned or operated by the Company.  If
Employee engages, invests, or otherwise participates in any competitive activity
described in this Section 5.4(a), then all severance payments consideration to
which Employee otherwise may be entitled under Section 5.2 and 5.3 above, as
applicable, thereupon shall cease.

(ii)         Notwithstanding the foregoing, Employee shall not be deemed to be
in violation of the foregoing restriction solely by reason of Employee's owning
not more than one percent (1.0%) of the equity securities of any corporation or
other business enterprise, the equity securities of which are listed for trading
on a national securities exchange.

(b)        Non-Solicitation.  Until the date one (1) year after the termination
of Employee's employment with the Company for any reason, Employee agrees and
acknowledges that Employee's right to receive the severance consideration
described in Sections 5.2 and 5.3 (to the extent Employee is otherwise entitled
to such payments thereunder) shall be conditioned upon Employee not either
directly or indirectly soliciting, attempting to hire, recruiting, encouraging,
taking away, hiring any employee of the Company or inducing or otherwise causing
an employee to leave his or her employment with the Company (regardless whether
to commence employment with Employee or with any other entity or person).  If
Employee engages in any such activity, then all severance consideration to which
Employee otherwise would be entitled under Sections 5.2 or 5.3, above, as
applicable, thereupon shall cease.

(c)        General Release.  Employee shall not be entitled to receive any of
the severance consideration described in Sections 5.2 and 5.3 above, unless
Employee executes and delivers to the Company, within fifteen (15) days of the
Date of Termination, a release in the form attached hereto as Appendix 2.

(d)        Resignation from Board.  Employee shall not be entitled to receive
any of the severance consideration described in Sections 5.2 and 5.3 above,
unless Employee resigns from the Board of Directors in accordance with Section
5.8, below.  If the Company requests such resignation until after payment of
severance consideration has commenced hereunder, then the Company shall be
excused from any further obligation to pay such severance consideration if
Employee thereafter fails to resign from the Board of Directors in accordance
with such Section 5.8.

5.5        Death.  This Agreement shall terminate automatically upon the death
of Employee.  If Employee's employment is terminated by reason of Employee's
death, then the Company shall pay to Employee's beneficiaries or legal
representatives (i) within 15 days, all accrued and unpaid Base Compensation and
vacation pay for all periods ended on or before the date of Employee's death,
and (ii) the Company shall not be obligated to make any further payments
hereunder.
 

 
 

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5.6         Mitigation.  Employee shall not be required to mitigate the amount
of any payment provided for in this Section 5 by seeking other employment or
otherwise, nor shall the amount of any payment or benefit provided for in this
Agreement be reduced by any compensation earned by Employee as a result of
employment by another employer, self employment earnings, by retirement
benefits, by offset against any amount claimed to be owing by Employee to the
Company, or otherwise.  No amounts payable to Employee under any plan or program
of the Company shall reduce or offset any amounts payable to Employee under this
Agreement.

5.7        Deferral in Commencement Per IRC §409A. The parties intend that any
amounts payable hereunder that could constitute "deferred compensation" within
the meaning of Section 409A of the Internal Revenue Code ("Section 409A") shall
comply with Section 409A, and this Agreement shall be administered, interpreted
and construed in a manner that does not result in the imposition of additional
taxes, penalties or interest under Section 409A.  The Company and Employee agree
to negotiate in good faith to make amendments to the Agreement, as the parties
mutually agree are necessary or desirable to avoid the imposition of taxes,
penalties or interest under Section 409A.  Notwithstanding the foregoing, the
Company does not guarantee any particular tax effect, and Employee shall be
solely responsible and liable for the satisfaction of all taxes, penalties and
interest that may be imposed on or for the account of Employee in connection
with the Agreement, as amended by this Amendment, (including any taxes,
penalties and interest under Section 409A), and none of the Company Group shall
have any obligation to indemnify or otherwise hold Employee (or any beneficiary)
harmless from any or all of such taxes, penalties or interest.

(a)         Notwithstanding anything in the Agreement to the contrary, in the
event that Employee is deemed to be a "specified employee" within the meaning of
Section 409A(a)(2)(B)(i) of the Internal Revenue Code and Employee is not
"disabled" within the meaning of Section 409A(a)(2)(C) of the Internal Revenue
Code, no payments in this Agreement that are "deferred compensation" subject to
Section 409A shall be made to Employee prior to the date that is six months
after the date of Employee's "separation from service" (as defined in Section
409A) or, if earlier, Employee's date of death.  Following any applicable six
month delay, all such delayed payments shall be paid in a single lump sum on the
earliest date permissible under Section 409A that is also a business day.

(b)         For purposes of Section 409A, each of the payments that may be made
under this Agreement shall be deemed to be a separate payment for purposes of
Section 409A.  Amounts payable under this Agreement shall be deemed not to be a
"deferral of compensation" subject to Section 409A to the extent provided in the
exceptions in Treasury Regulation §§ 1.409A-1(b)(4) ("short-term deferrals") and
(b)(9) ("separation pay plans," including the exceptions under subparagraph
(iii) and subparagraph (v)(D)) and other applicable provisions of Treasury
Regulation §§ 1.409A-1 through A-6.

(c)         With respect to the time of payments of any amounts under the
Agreement that are "deferred compensation" subject to Section 409A, references
in the Agreement to "termination of employment" (and substantially similar
phrases) shall mean "separation from service" within the meaning of Section
409A.

(d)         For the avoidance of doubt, it is intended that any indemnification
payment to Employee or expense reimbursement made hereunder shall be exempt from
Section 409A.  Notwithstanding the foregoing, if any indemnification payment or
expense reimbursement made hereunder shall be determined to be "deferred
compensation" within the meaning of Section 409A, then (i) the amount of the
indemnification payment or expense reimbursement during one taxable year shall
not affect the amount of the indemnification payments or expense reimbursement
during any other taxable year, (ii) the indemnification payments or expense
reimbursement shall be made on or before the last day of Employee's taxable year
following the year in which the expense was incurred, and (iii) the right to
indemnification payments or expense reimbursement hereunder shall not be subject
to liquidation or exchange for another benefit.  In addition, any reimbursements
for COBRA coverage premiums described in this Agreement shall be paid to
Employee as promptly as practicable, and in all events on or before the last day
of the third taxable year of Employee following the taxable year of the Company
in which Employee's employment terminated.

 
 

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5.8         Resignation from Board Following Termination.  Employee covenants
and agrees that (a) at any time following the termination of Employee's
employment with the Company for any reason, the Company may request that
Employee resign from the Board of Directors, and (b) within two (2) business
days following Employee's receipt of the Company's written request that Employee
resign from the Board of Directors of the Company, Employee shall tender to the
Company an immediately effective written resignation from the Company's Board of
Directors.

6.           Miscellaneous

6.1         Notices.  All notices permitted or required by this Agreement shall
be in writing, and shall be deemed to have been delivered and received (i) when
personally delivered, or (ii) on the third (3rd) business day after the date on
which deposited in the United States mail, postage prepaid, certified or
registered mail, return receipt requested, or (iii) on the date on which
transmitted by facsimile or other electronic means generating a receipt
confirming a successful transmission (provided that on that same date a copy of
such notice is deposited in the United States mail, postage prepaid, certified
or registered mail, return receipt requested), or (iv) on the next business day
after the date on which deposited with a regulated public carrier (e.g., Federal
Express) designating overnight delivery service with a return receipt requested
or equivalent thereof administered by such regulated public carrier, freight
prepaid, and addressed in a sealed envelope to the party for whom intended at
the address appearing on the signature page of this Agreement, or such other
address or facsimile number, notice of which is given in a manner permitted by
this Section 6.1.

6.2        Effect on Other Remedies.  Nothing in this Agreement is intended to
preclude, and no provision of this Agreement shall be construed to preclude, the
exercise of any other right or remedy which the Company may have by reason of
Employee's breach of his obligations under this Agreement.

6.3        Arbitration.  Except for any action seeking a temporary restraining
order, injunctive order, or other equitable relief, all disputes, claims and
controversies arising out of or relating to the interpretation or enforcement of
this Agreement, including but not limited to the determination of the scope or
applicability of the agreement to arbitrate set forth in this Section 6.3, shall
be determined by arbitration in San Antonio, Texas, or Los Angeles, California,
as determined by the party initiating the arbitration, before one arbitrator.
The arbitration shall be administered by JAMS pursuant to its Streamlined
Arbitration Rules and Procedures.  Judgment on the arbitrator's award may be
entered in any court of competent jurisdiction.  This Section 6.3 shall not
preclude parties from seeking provisional remedies in aid of arbitration from a
court of appropriate jurisdiction.  The arbitrator may, in the award, allocate
all or part of the costs of the arbitration, including the fees of the
arbitrator and the reasonable attorneys’ fees of the prevailing party.

6.4        Binding on Successors; Assignment.  This Agreement shall be binding
upon, and inure to the benefit of, each of the parties hereto, as well as their
respective heirs, successors, assigns, and personal representatives.

 
 

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6.5        Governing Law; Venue.  This Agreement shall be governed by and
construed in accordance with applicable provisions of the laws of the State of
Texas (without regard to application of its conflict-of-law principles), and
each party hereby consents to the jurisdiction of the courts of the State of
Texas for purposes of all actions commenced to construe or enforce this
Agreement.

6.6        Severability.  If any of the provisions of this Agreement shall
otherwise contravene or be invalid under the laws of any state, country or other
jurisdiction where this Agreement is applicable but for such contravention or
invalidity, such contravention or invalidity shall not invalidate all of the
provisions of this Agreement but rather it shall be construed, insofar as the
laws of that state or other jurisdiction are concerned, as not containing the
provision or provisions contravening or invalid under the laws of that state or
jurisdiction, and the rights and obligations created hereby shall be construed
and enforced accordingly.

6.7        Further Assurances.  Each party agrees, upon the request of another
party, to make, execute, and deliver, and to take such additional steps as may
be necessary to effectuate the purposes of this Agreement.

6.8        Entire Agreement; Amendment.  This Agreement (a) represents the
entire understanding of the parties with respect to the subject matter hereof,
and supersedes all prior and contemporaneous understandings, whether written or
oral, regarding the subject matter hereof, except the Nondisclosure and
Non-Circumvention Agreement by and between Employee and the Company, and (b) may
not be modified or amended, except by a written instrument, executed by the
party against whom enforcement of such amendment may be sought.

6.9        Counterparts; Electronic Signatures.  This Agreement may be executed
in counterparts, each of which shall be deemed an original and both of which,
taken together, shall constitute one and the same instrument, binding on each
signatory thereto.  A copy of this Agreement that is executed by a party and
transmitted by that party to the other party by facsimile or as an attachment
(e.g., in ".tif" or ".pdf" format) to an email shall be binding upon the
signatory to the same extent as a copy hereof containing that party's original
signature.

[Signatures appear on the following page.]

 
 

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In Witness Whereof, the parties hereto have executed this Employment Agreement,
effective as of the date set forth above.

"Company:"
 
"Employee:"
         
EnerJex Resources, Inc., a Nevada corporation
             
By
/s/ C. Stephen Cochennet
 
/s/ Robert G. Watson, Jr.
   
C. Stephen Cochennet, Chief Executive Officer
 
Robert G. Watson, Jr.
         
Address, Facsimile No. and Email for Notices:
 
Address, Facsimile No. and Email for Notices:
         
EnerJex Resources, Inc.
 
Mr. Robert G. Watson, Jr.
 
ATTN:  Chief Executive Officer
 
c/o RGW Energy, LLC
 
27 Corporate Woods, Suite 350
 
123 Evans Avenue
 
10975 Grandview Drive
 
San Antonio, TX  78209
 
Overland Park, KS  66210
         
Facsimile No.:  (___) ________________________
 
Facsimile No.:  (913) 754-7755
 
Email: ___________________________________
 
Email:  _____________________________________
     

 
 

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Appendix 1

Nondisclosure and Non-Circumvention Agreement

 
 

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Appendix 2

General Release

This General Release (the "Release") is made and entered into, dated for
reference purposes as of __________, 20__, and effective as of the date
identified below, by and between Robert G. Watson, Jr. ("Watson"), and EnerJex
Resources, Inc., a Nevada corporation (the "Company").

As a condition of and in order to induce the Company to pay to Watson the
severance pay due to Watson under that certain Employment Agreement between the
Company and Watson dated effective December ___, 2010, and as specifically
described in that certain Notice of Termination dated _________, 20__(the
"Notice of Termination"), the parties hereby agree as follows:

1.           Warranty.  Watson hereby warrants that he is the sole owner of the
claims identified in Section 2, below, and that he has not assigned to any other
person any right, title, or interest in or to any such claims.

2.           Release.  Watson hereby releases the Company, its subsidiaries and
affiliates, and each of its agents, employees, directors, shareholders, officers
and other agents (collectively, the "Company Released Parties") of and from any
and all costs, liabilities, losses, expenses, and compensation (the "Claims"),
except Excluded Claims (as defined below), which Watson has or hereafter may
have or be entitled to assert against any of the Company Released Parties
arising from or relating in any way to Watson's employment with the Company or
the termination of that employment, for any wrongful termination of employment,
including termination based on age, sex, race, disability or other
discrimination under the Civil Rights Act of 1964, as amended, the Age
Discrimination in Employment Act of 1967, as amended, or other federal, state,
or local laws prohibiting such discrimination, or under federal, state, or local
employment laws.  In connection with the foregoing, Watson further waives and
releases all rights, if any, which Watson may have under Section 1542 of the
California Civil Code, which reads in pertinent part as follows:  "A general
release does not extend to claims which the creditor does not know or suspect to
exist in his or her favor at the time of executing the release, which if known
by him or her must have materially affected his or her settlement with the
debtor."

3.           Excluded Claims.  The parties agree that the term "Excluded Claims"
means (i) claims for payment of the separation pay due under the Employment
Agreement, (ii) claims under any written stock option agreement between Watson
and the Company, (iii) claims for benefits under any qualified retirement plan
sponsored by the Company and in which Watson may participate, (iv) any right
that Watson may have to elect "COBRA" continuation coverage under any group
health plan sponsored by the Company, and (v) any right that Watson may have to
demand indemnification under the Articles of Incorporation or Bylaws of the
Company or any written Indemnification Agreement between the Company and Watson.

4.           Miscellaneous.  This Release shall be governed by and construed in
accordance with Texas law.  This Release (a) memorializes the entire
understanding and agreement between the Company and Watson regarding the subject
matter hereof, and supersedes all prior and contemporaneous understandings,
whether oral or written, regarding such matters, and (ii) may not be modified or
amended, except by a written instrument executed after the date hereof by Watson
and the Company.  If any action is commenced to construe or enforce this
Agreement or the rights and duties created herein, then the party prevailing in
that action shall be entitled to recover its attorneys' fees and costs in that
action, as well as all costs and fees of enforcing any judgment entered therein.
 

 
Appendix 2, Page 1 

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5.           Effective Date.  This Release shall become effective only if (a) it
is signed by the Company and Watson, and (b) Watson does not revoke this
Release, in writing, within seven (7) days following the date on which Watson
signs this Release (which date of Watson's signature is indicated below his
signature, below).

EnerJex Resources, Inc., a Nevada corporation
         
By
       
Name & title:
 
Robert G. Watson, Jr.
           
Date
 
Date

 

 
Appendix 2, Page 2 

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