Exhibit 10.13

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as of
November 1, 2005, by and between Barnabus Energy, Inc. (incorporated as Barnabus
Enterprises Ltd.), a Nevada corporation (hereinafter called the “Corporation”),
and Cheryl J. Bostater (hereinafter called the “Executive”).

 

WITNESSETH

 

In consideration of the compensation payable to Executive by the Corporation
pursuant to this Agreement, and the mutual promises, covenants, representations
and warranties contained herein, and other good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, the Parties hereto
agree as follows

 

1.          Employment and Position. The Corporation hereby employs the
Executive as Chief Financial Officer of the Corporation, and the Executive
hereby accepts said employment and agrees to render such services to the
Corporation on the terms and conditions set forth in this Agreement. During the
term of this Agreement, the Executive shall report directly to the Chief
Executive Officer of the Corporation and shall have such executive
responsibilities to and shall perform such executive services for the
Corporation as may be consistent with her title.

 

2.          Term. Subject to the provisions for extension and termination set
forth in this Agreement, the initial term of this Agreement will begin on
November 1, 2005 and shall terminate on October 31, 2008 unless sooner
terminated (“Initial Term”), provided that the term of this Agreement and the
Executive’s employment hereunder shall be deemed to be automatically extended
for additional terms of one-year each (each, an “Additional Term”) commencing on
the day after the expiration of the Initial Term or the previous Additional Term
unless either party elects to terminate this Agreement at the end of the Initial
Term or any Additional Term by giving the other party written notice of such
termination election at least ninety (90) days before the expiration thereof.
The Initial Term and all Additional Terms shall be referred to collectively as
the “Term.”

 

3.          Compensation. As compensation for all services to be performed by
the Executive under this Agreement, the Corporation shall compensate Executive
as follows:

 

(a)        Base Compensation. The Corporation shall pay the Executive base
compensation (“Base Salary”) equal to One Hundred Fifty Thousand Dollars
($150,000) per annum, which may be increased from time to time in such amounts
as are determined by the Board of Directors of the Corporation and shall not be
decreased without the Executive’s written consent. The term “Base Salary” shall
refer to the Base Salary as so increased. The Base Salary will be payable in
installments bimonthly. The Base Salary and all other remuneration paid to the
Executive shall be subject to applicable employment and income tax withholding
taxes.

 

 

 

 

(b)           Bonus. During the term of this Agreement, the Corporation may pay
the Executive such bonus payments as may be determined by the Board of Directors
of the Corporation based upon the Corporation’s achievement of the goals set
forth in the Corporation’s business plan as in effect from time to time.

 

(c)            Stock Options. On November 1, 2005, the Corporation shall issue
to Executive options (the "Options") to purchase one million four hundred seven
thousand eight hundred five (1,407,805) shares (the “Stock Option Grant”) of the
Corporation’s common stock (“Common Stock”). The Options shall have a term of
five (5) years and shall have an exercise price equal to the closing bid price
of the Corporation's common stock on November 1, 2005. The Stock Option Grant
shall vest in accordance with the provisions set forth on Exhibit A. Upon
vesting and the Executive’s exercise of the vested stock options, the stock
underlying the options included in the Stock Option Grant shall be duly
authorized, legally issued, fully paid and non-assessable.

 

(d)           Benefits. During the Term of this Agreement, the Executive shall
be eligible to participate in the standard fringe benefits package and incentive
compensation plans generally made available to the executive management
employees of the Corporation, as such benefits may be determined or changed from
time to time by the Board of Directors of the Corporation. The fringe benefits,
at the Corporation’s expense, will include at a minimum reasonable hospital and
major medical insurance for Executive and the family of the Executive, and three
weeks vacation time. The Corporation shall reimburse the Executive for Cobra
medical insurance costs until a company group medical plan can be put in place.

 

(e)            Expenses. During the Term of this Agreement, the Corporation
shall reimburse the Executive for any and all expenses reasonably incurred by
the Executive incident to the performance of the duties imposed upon Executive
hereunder and which are substantiated in accordance with reasonable policies and
procedures of the Corporation in effect from time to time.

 

(f)            Auto Allowance. During the Term of this Agreement, the
Corporation shall pay to the Executive an automobile allowance of Two Hundred
Fifty Dollars ($250) a month in addition to the Executive’s Base Salary.

 

4.              Professional Dues and Education. The Corporation will pay
Executive’s annual dues associated with any financial related professional
organizations. The Executive is required to attend continuing education courses
and conferences as part of membership in such professional organizations and she
is currently working on obtaining her CPA designation. The Corporation will pay
for any educational courses or conferences related to these activities.

 

5.              Directors’ and Officers’ Insurance. The Corporation shall
maintain a fully paid and valid Directors’ and Officers’ Insurance policy with
an A+ rated insurance company during the Term of this Agreement with $5 million
of coverage.

 

6.              Outside Activities. The Board of Directors is aware that
Executive is a significant shareholder and officer of Customatrix, Inc., a
financial consulting company. Executive will

 

 

 

continue to perform her duties as such for Customatrix on a part-time basis in
addition to her full-time duties as Chief Financial Officer for the Company.
Executive will disclose to the Board of Directors any customers or activities
that she is aware of that may pose a conflict of interest with the Company.
Notwithstanding the foregoing, the Company may enter into a Consulting Agreement
with Customatrix, Inc. to provide accounting, financial, or ERP system
implementation consulting services if it so chooses. Any and all consulting
services provided under such Consulting Agreement will be approved by the CEO or
Board of Directors. The terms and conditions of the Consulting Contract will be
on similar terms offered to other clients of Customatrix, Inc.

 

7.

Termination.

 

(a)            Death or disability. This Agreement shall terminate automatically
upon the Executive’s death.

 

The Corporation shall be entitled to terminate this Agreement because of the
Executive’s disability during the Term. Such termination shall only become
effective if (i) one hundred and eighty (180) days shall elapse after the date
on which the Corporation gives the Executive written notice of its intention to
effect such a termination, and (ii) during such 180-day period the Executive
shall not have returned to full-time performance of the Executive’s duties.

 

(b)           Termination by the Corporation. The Corporation may terminate this
Agreement for Cause at any time during the Term, at which time the Term shall
end. The Corporation shall give the Executive written notice of such
termination, setting forth in reasonable detail the specific conditions that it
considers to constitute Cause, and termination shall be effective thirty (30)
days after the delivery of such notice.

 

For purposes of this Agreement, the term “Cause” shall mean, when used with
respect to the termination of this Agreement by the Corporation, the conviction
of the Executive by a court of competent jurisdiction of a felony involving a
crime of fraud against the Corporation, such as embezzlement or other theft from
the Corporation, or the occurrence of a Failure to Perform. As used herein, a
"Failure to Perform" shall have occurred if (and only if) the Corporation's
Chief Executive Officer shall have advised the Executive in writing of
deficiencies in her performance of her duties as Chief Financial Officer, which
deficiencies shall be objectively measurable, and sixty (60) days after the
delivery of such writing to the Executive she shall not have corrected such
deficiencies.

 

(c)            Termination by Executive. The Executive may terminate this
Agreement for Good Reason at any time during the Term, at which time the Term
shall end. The Executive shall give the Corporation written notice of such
termination, setting forth in reasonable detail the specific conditions that the
Executive considers to constitute Good Reason, and termination shall be
effective thirty (30) days after the delivery of such notice.

 

For purposes of this Agreement, the term “Good Reason” means (a) any failure by
the Corporation to comply with any provision of the Agreement, other than an
isolated, insubstantial and inadvertent failure that is not taken in bad faith
and is remedied by the Corporation promptly

 

 

 

after receipt of notice thereof from the Executive; (b) the assignment to the
Executive of any duties or responsibilities inconsistent in any material respect
with those customarily associated with the positions held by the Executive
during the Term, (c) the occurrence of a Change of Control or (d) the relocation
of the Corporation's office to which the Executive is required to report on a
day-to-day basis outside of San Diego County, California.

 

For purposes of this Agreement, a “Change in Control” shall be deemed to have
occurred in any of the following events: (i) the acquisition by any individual,
entity or group of the beneficial ownership (as that term is defined in Rule
13d-3 under the Securities Exchange Act of 1934) of 25 percent of more of the
Common Stock (as defined below); provided, however, that any acquisition by
Corporation or its subsidiaries, or any employee benefit plan (or related trust)
of the Corporation or its subsidiaries, of 25% or more of the Common Stock shall
not constitute a Change in Control; or (ii) the consummation of a
reorganization, merger or consolidation or sale or other disposition of all or
substantially all of the assets of the Corporation (“Business Combination”), in
each case, with respect to which all or substantially all of the individuals and
entities who were the beneficial owners of the Common Stock immediately prior to
such Business Combination do not, following such Business Combination,
beneficially own, directly or indirectly, more than seventy-five percent (75%)
of the then outstanding shares of common stock of the corporation resulting from
such a Business Combination (including, without limitation, a corporation which
as a result of such transaction owns the Corporation or all or substantially all
of the Corporation’s assets either directly or through one or more
subsidiaries); or (iii) the approval by the stockholders of the Corporation of a
complete liquidation or dissolution of the Corporation.

 

8.

Obligations of the Corporation upon Termination

 

(a)            Termination other than Good Reason or for Cause, Death, or
Disability. If, during the Term, the Corporation terminates this Agreement due
to the death or disability of the Executive in accordance with Section 7(a) or
for Cause in accordance with Section 7(b), or the Executive terminates this
Agreement other than for Good Reason in accordance with Section 7(c), then the
Corporation shall pay to the Executive (or in the event of termination of
employment by reason of the Executive’s death, his legal representative or his
estate) in a lump sum in cash, within 30 days after the date of Termination, an
amount equal to the accrued but unpaid salary pursuant to Section 3(a).

 

(b)           Termination for Good Reason or other than for Cause. If the
Executive terminates this Agreement for Good Reason pursuant to Section 7(c) or
the Corporation terminates this Agreement other than pursuant to Section 7(b)
for Cause, then the Corporation shall pay to the Executive, in a lump sum in
cash within 30 days after the date of Termination, an amount equal to one
hundred fifty percent (150%) of the salary that the Corporation would have been
obligated to pay the Executive pursuant to Section 3(a) during the Calculation
Period if the Agreement had remained un-terminated until the end of the
Calculation Period less any salary that has already been paid. In addition, all
Options will automatically be vested.

 

As used herein, “Calculation Period” shall mean the period (i) beginning on the
first day of the Initial Term and (ii) ending on: (A) the last day of the
Initial Term if termination occurs

 

 

 

more than sixty (60) days before the end of the Initial Term, (B) the last day
of the first Additional Term if termination occurs sixty (60) days or fewer from
the end of the Initial Term or during such Additional Term before sixty (60)
days from the end thereof, or (C) the last day of the next succeeding Additional
Term if termination occurs sixty (60) days or less from the end of any
Additional Term.

 

(c)           Obligation to reimburse expenses. The obligation of the
Corporation under Sections 3(d)-(f) shall survive the termination of this
agreement.

 

9.

Confidential Information

 

(a)           Nondisclosure. The Executive shall not, during or after the period
during which the Executive is employed by the Corporation, disclose any
Confidential Information (as such term is defined herein) to any Person for any
reason or purpose whatsoever, other than in connection with the performance of
his duties under this Agreement. The term “Confidential Information” shall mean
all confidential information of or relating to the Corporation and any of its
Affiliates, including without limitation, financial information and data,
business plans and information regarding prospects and opportunities (such as,
by way of example only, client and customer lists and acquisition, disposition,
expansion, product development and other strategic plans), but does not include
any information that is or becomes public knowledge by means other than the
Executive’s breach or nonobservance of his obligations described in this Section
9. Notwithstanding the foregoing, the Executive may disclose such Confidential
Information as he may be legally required to do so in connection with any legal
or regulatory proceeding; provided, however, that the Executive shall provide
the Corporation with prior notice of any such required or potentially required
disclosure and the Corporation may at its own expense seek appropriate
confidential treatment of any such Confidential Information that may be so
required to be disclosed in connection with any such legal or regulatory
proceeding. The Executive’s obligation to refrain from disclosing any
Confidential Information under this Section 9 shall continue in effect in
accordance with its terms following any termination of this Agreement. The
Executive acknowledges that he will not use any Confidential Information for any
reason after his employment with the Corporation is terminated other than as
permitted in this Section 9.

 

(b)           Injunctive Relief. The Executive acknowledges and agrees that the
Corporation will have no adequate remedy at law, and would be irreparably
harmed, if the Executive breaches or threatens to breach any of the provisions
of this Section 9. The Executive agrees that the Corporation shall be entitled
to equitable and/or injunctive relief to prevent any breach or threatened breach
of this Section 9, and to specific performance of each of the terms of this
Section 9 in addition to any other legal or equitable remedies that the
Corporation may have. The Executive further agrees that she shall not, in any
equity proceeding relating to the enforcement of the terms of this Section 9,
raise the defense that the Corporation has an adequate remedy at law.

 

(c)            Special Severability; Survivability. The terms and provisions of
this Section 9 are intended to be separate and divisible provisions and if, for
any reason, any one or more of them is held to be invalid or unenforceable,
neither the validity nor the enforceability of any other

 

 

 

provision of this Agreement shall thereby be affected. This Section 9 shall
survive the expiration or termination of this Agreement.

 

10.           Full Settlement; Mitigation. The Corporation’s obligation to make
the payments provided for in, and otherwise to perform its obligations under,
this Agreement shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action that the Corporation may have against
the Executive or others other than a claim, right or action for fraud. In no
event shall the Executive be obligated to seek other employment or take any
other action by way of mitigation of the amounts payable to the Executive under
any of the provisions of this Agreement and such amounts shall not be reduced,
regardless of whether the Executive obtains other employment.

 

11.            Indemnification. The Corporation shall pay or indemnify the
Executive to the full extent permitted by law for all expenses, costs,
liabilities and legal fees which the Executive may incur in the discharge of his
duties hereunder.

 

12.           Notices. All demands, notices, requests, consents and other
communications required or permitted under this Agreement shall be in writing
and shall be personally delivered or sent by facsimile machine (with a
confirmation copy sent by one of the other methods authorized in this Section
12), commercial (including FedEx) or U.S. Postal Service overnight delivery
service, or, deposited with the U.S. Postal Service mailed first class,
registered or certified mail, postage prepaid, as set forth below.

 

If to Corporation, addressed to:

 

Barnabus Enterprises Ltd.

Suite 2410

West Georgia Street

Vancouver, British Columbia

Canada V6E 2N7

Attention: Chief Executive Officer

Fax (604) 682-5564

 

If to the Executive:

 

Cheryl J. Bostater

11058 Carolota St.

San Diego, Ca 92129

Fax (858) 630-2647

 

Notices shall be deemed given upon the earliest to occur of (i) receipt by the
party to whom such notice is directed; (ii) if sent by facsimile machine, on the
day (other than a Saturday, Sunday or legal holiday in the jurisdiction to which
such notice is directed) such notice is sent if sent (as evidenced by the
facsimile confirmed receipt) prior to 5:00 p.m. Pacific Time and, if sent after
5:00 p.m. Pacific Time, on the day (other than a Saturday, Sunday or legal
holiday in the jurisdiction to which such notice is directed) after which such
notice is sent; (iii) on the first

 

 

business day (other than a Saturday, Sunday or legal holiday in the jurisdiction
to which such notice is directed) following the day the same is deposited with
the commercial carrier if sent by commercial overnight delivery service; or (iv)
the fifth day (other than a Saturday, Sunday or legal holiday in the
jurisdiction to which such notice is directed) following deposit thereof with
the U.S. Postal Service as aforesaid. Each party, by notice duly given in
accordance therewith may specify a different address for the giving of any
notice hereunder.

 

13.           Binding Effect; Benefits. This Agreement will be binding upon and
will inure to the benefit of the parties hereto and their respective heirs,
successors and assigns. Notwithstanding anything contained in this Agreement to
the contrary, nothing in this Agreement, expressed or implied, is intended to
confer on any person other than the parties hereto or their respective heirs,
successors, executors, administrators or assigns any rights, remedies,
obligations or liabilities under or by reason of this Agreement. There are no
third party beneficiaries to this Agreement.

 

14.           Entire Agreement. This Agreement constitutes the final written
expression of all of the agreements between the Parties with respect to the
subject matter hereof and supersedes all understandings and negotiations
concerning the matters specified herein. No addition to or modification of any
provision of this Agreement will be binding upon any party unless made in
writing and signed by the party to be bound.

 

15.           Governing Law. This Agreement is entered into in and will be
governed by and construed in accordance with the internal laws of the State of
California, without reference to principles of conflict of laws.

 

16.           Withholding. The Corporation may withhold from any amounts payable
under this Agreement such taxes as shall be required to be withheld pursuant to
any applicable law or regulation.

 

17.           Headings. Headings of the Sections of this Agreement are for the
convenience of the parties only, and will be given no substantive or
interpretive effect whatsoever.

 

18.           No Conflict. Subject to Section 6, the Executive represents and
warrants that performance of the terms of this Agreement will not breach or
conflict with any agreement entered into by the Executive, and that the
Executive will not enter into any agreement in conflict herewith..

 

19.           Assignability. Neither party hereto may assign any of its or his
rights or obligations hereunder without the prior written consent of the other
party hereto, which consent may be withheld in the sole discretion of such other
party.

 

20.           Waivers. The failure or delay of the Corporation at any time to
require performance by the Executive of any provision of this Agreement, even if
known, will not affect the right of the Corporation to require performance of
that provision or to exercise any right, power or remedy hereunder, and any
waiver by the Corporation of any breach of any provision of this Agreement
should not be construed as a waiver of any continuing or succeeding breach of

 

 

 

such provision, a waiver of the provision itself, or a waiver of any right,
power or remedy under this Agreement. No notice to or demand on the Executive in
any case will, of itself, entitle the Executive to any other or further notice
or demand in similar or other circumstances.

 

21.           Construction. Unless the context of this Agreement otherwise
clearly requires, (i) references in this Agreement to the plural include the
singular, the singular the plural, the masculine the feminine, the feminine the
masculine and the part the whole and (ii) the word “or” will not be construed as
exclusive and the word “including” will not be construed as limiting.

 

22.           No Strict Construction. This Agreement has been prepared jointly
and will not be strictly construed against either party.

 

23.           Counterparts. This Agreement may be executed in any number of
original or faxed counterparts, each of which when so executed and delivered
shall be deemed an original, but all of which shall together constitute one and
the same agreement.

 

IN WITNESS WHEREOF, the Corporation and the Executive have executed this
Agreement on the day and year first above written.

 

BARNABUS ENERGY, INC.

 

By:

David Saltman, Chief Executive Officer

 

 

Cheryl J. Bostater

 

 

 

EXHIBIT A

STOCK OPTION GRANT VESTING PROVISIONS

 

Provided that the Agreement has not earlier been terminated, on each December
31, March 31, June 30 and September 30 commencing December 31, 2005 and ending
on June 30, 2008, 117,317 stock options shall vest, and on September 30, 2008,
all the options in the Stock Option Grant that remain unvested shall vest as set
forth in the following table:

 

Date of

Vesting

 

Stock Option

Vesting on Date

 

Aggregate Stock Options

Vested Through Date

 

Stock Options

Remaining Unvested

 

 

 

 

 

 

 

 

 

 

 

 

 

1,407,805

December 31, 2005

 

117,317

 

117,317

 

1,290,488

March 31, 2006

 

117,317

 

234,634

 

1,173,171

June 30, 2006

 

117,317

 

351,951

 

1,055,854

September 30, 2006

 

117,317

 

469,268

 

938,537

December 31, 2006

 

117,317

 

586,585

 

821,220

March 31, 2007

 

117,317

 

703,902

 

703,903

June 30, 2007

 

117,317

 

821,219

 

586,586

September 30, 2007

 

117,317

 

938,536

 

469,269

December 31, 2007

 

117,317

 

1,055,853

 

351,952

March 31, 2008

 

117,317

 

1,173,170

 

234,635

June 30, 2008

 

117,317

 

1,290,487

 

117,318

September 30, 2008

 

117,318

 

1,407,805

 

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