KennyHillEmploymentContract_011011




EXHIBIT 3.1




EMPLOYMENT  AGREEMENT
THIS  EMPLOYMENT   AGREEMENT,   made  this  day  of , 2011,    by and between Victory Energy Corporation,   a Nevada corporation (hereinafter  called "Company"),  and
Kenneth E. Hill.,  an individual  residing  at 11617   Woodland Hills Trail,  Texas 78732 (hereinafter called "Employee").


                                           BACKGROUND


Company wishes to employ Employee  and Employee wishes  to enter into the employ of
Company on the terms and conditions  contained  in this Agreement.


NOW,  THEREFORE,   in consideration   of  the  facts,  mutual  promises   and  covenants contained  herein  and intending  to  be legally bound  hereby,  Company  and Employee  agree  as follows:


1.    Definitions.  As  used  herein,  the  following  terms  shall  have  the  meanings  set  forth below unless the contexts otherwise  requires.


"Affiliate"   shall  mean  any  person  or entity  that  directly,  or  indirectly  through  one  or more intermediaries,  controls, or is controlled by, or is under common control with,  Company.


"Arbitrable  Claims"  shall have the meaning specified in Section  12.  l hereof.


"Base  Salary" shall  mean  the annual  rate of base pay  set forth in  Section  5 .1,   as such amount may be adjusted from time  to time.


"Board" shall mean the Board of Directors of Company.


"Business"  shall mean the business conducted by Company in the past and on the date of execution    of   this   Agreement,    including    business    activities    under    investigation    or   in developmental   stages,  all  other   business   activities   which   flow  therefrom   by  a  foreseeable expansion  of the present  activities  of Company,  all business  activities  which  may be developed by Company   during  the  period  of  Employee's    employment   by  Company,   and  all  business activities now conducted  by Company  or any Affiliate  or which may be developed  by Company or any Affiliates during such period as foreseeable  expansions  of their present activities.


"Cause"  shall mean




of duty;
 
(a) Unsatisfactory  performance,  incompetence,   unfitness  for service,  or habitual  neglect





(b) Gross negligence;







(c) Insubordination  or willful failure to perform required duties;




(d) Material failure to carry out directives  of the Board or superior  Company  officers  or to perform Employee's  duties under this Agreement;


(e) Willful violation of any express direction of the Board of Directors  or any supervisor of Employee  or willful violation  of any rule, regulation,  policy, or plan established  by Company from time to time regarding the conduct of its employees  and/or its business;


(f) Willful misconduct;


(g)  Fraud,  misappropriation   or  dishonesty   relating  to  or  involving   Company   in  any material way;


(h) Conviction  of a crime involving dishonesty,  breach of trust, mental or physical  harm to any person, or moral turpitude  whether or not related to Employee's  employment  or entry of a plea of nolo contendere (or similar plea) to a charge of such an offense;


(i) Possession,  use or being under the influence of any unlawful  controlled  substance  on Company property  or on Company business;  or use or being under the influence  of alcohol to an extent that it interferes  on a continuing  and material  basis with the performance  of Employee's duties under the Agreement;


G) Supplying  materially  misleading   information  to Company  or for Company's   use  in any  application   or  other   document   provided   by  Employee   to  the  Company   submitted   m connection with Employee's  employment  with the Company and/or selection  employment;


(k)  Willful  unauthorized   disclosure   or  use  of  Confidential   Information,  unless   such disclosure  or use was (i) believed  in good faith by Employee  to be appropriate  in the course of properly carrying out Employee's  duties under the Agreement,  or (ii) required  by law;


(1) Material breach of this Agreement  and failure to cure such breach within ten (10) days after written  notice thereof;


(m)  Willful   violation   of  Sections  8  or  9  of  this  Agreement   relating  to  confidential information and inventions;


(n) Material  conflict  of interest  not disclosed  in advance  in writing  by Employee  to the
Board and approved  in writing by the Board; or


(o) Willful conduct contrary to the best interest of Company;


"Company  Property"  shall have the meaning specified  in Section 7.4 hereof. "Competitive  Activity"  shall have the meaning  specified in Section 8.3  hereof. "Confidential  Information"  shall have the meaning specified in Section 8.1   hereof.




"Disability"  shall have the meaning specified  in Section 7. I  hereof. "Effective  Date" shall mean date the agreement commences. "Inventions"  shall have the meaning specified in Section 9.1  hereof.
"Restricted  Area" shall have the meaning specified  in Section 8.4 hereof.


••Restricted Period"  shall have the meaning specified  in Section 8.4 hereof.


"Period  of Employment"   shall mean the period  Employee  is employed  under the terms of this Agreement,  as it may be renewed, extended,  or modified.


"Subsidiary"  shall mean any corporation  in which  Company  owns directly  or indirectly
50% or more  of the Voting Stock or 50% or more  of the equity; or any other venture  in which it owns  either  50%  or more  of the  voting  rights  or 50%  or more  of the  equity,  or in which  the Company serves as Managing  Partner.


"Voting  Stock"  shall mean  capital  stock  of any  class  or classes  having  general  voting power under ordinary  circumstances,  in the absence  of contingencies,  to elect the directors  of a corporation.


2. Employment. Company hereby employs Employee and Employee hereby accepts employment  by Company  for  the period  and upon  the  terms  and  conditions  specified  in this Agreement.


3. Position and Responsibilities.


3.1       Employee   shall   serve   in  the  position   of  Vice   President   and   Chief Operating Officer  and shall have such authority  and responsibilities  as Company may determine from  time  to  time  consistent   with  such  position.  Employee   shall  perform   any  other  duties reasonably  required  by Company  the Board and supervisors  to be specified  and, if requested  by Company.  shall serve as an officer or director of Company  or any Subsidiary  without  additional compensation.


3.2       During  the  Period  of Employment,  (i) Employee's   entire  working  time, energy, skill and best efforts shall be devoted to the performance  of Employee's  duties hereunder in a manner  which  will faithfully  and diligently  further the business  and interests  of Company; and (ii) except upon the prior written consent  of Company,  Employee  shall not accept any other employment,  or engage, directly or indirectly,  in any other business,  commercial, or professional activity (whether or not providing  compensation)  that is or may be competitive  with Company or any Affiliate,  or that  might  create a conflict  of interest  with  Company  or any  Affiliate,  or that otherwise might interfere with the business of Company or any Affiliate.    Employee  may engage in charitable,  civic,  fraternal,  professional  and trade  association  activities  that  do not interfere materially with Employee's  obligations  to Company.






3.3            Employee   shall work out of Company's   principal   executive  office in the
City of Austin, Texas.  It is acknowledged  that Employee's  duties may require extensive   travel.


4. Tenn.  This agreement  shall commence  on the Effective  Date and shall continue  unless earlier terminated under Section 7 herein.


5.  Compensation.


5.1       For all of the services rendered by Employee  to Company,  Employee  shall receive:  Base Salary at the gross annual rate of one hundred  eighty thousand  Dollars ($180,000), payable  in installments  in accordance with Company's regular payroll practices in effect from time to time. All compensation under this Agreement shall be paid less withholdings required by law and less deductions agreed to by Company and Employee.


Employee's Base Salary will be reviewed from time to time in accordance with the established procedures of Company for adjusting salaries for similarly-situated employees and may be adjusted in the sole discretion of the Company or the Board.


6. Benefits. During the Period of Employment, Company shall provide Employee the following benefits:


6.1       The  benefits made generally available by the  Company to  similarly- situated employees,  in accordance with the benefit plans established by the Company,  and as may be amended from time to time in the Company's sole discretion.


6.2      Employee shall be entitled to Three (3) weeks paid vacation during each year, subject to Company's generally applicable policies relating to vacations. Employee shall take vacations at such time or times as shall be approved by Company, which approval shall not be withheld unreasonably.


6.3      Company will  reimburse Employee for  all  reasonable and  necessary expenses incurred by Employee in connection with the performance of Employee's duties upon receipt of supporting documentation in  accordance with  Company's  regular reimbursement procedures and practices in effect from time to time. The Board of Directors from time to time may require prior approval for individual expense items in excess of pre-established aggregate amounts for a fixed period or in excess of pre-established amounts for any type of expenditure during any fixed period.


7. Termination.


7.1         At-Will Employment.


(a) The employment of Employee shall be at-will.   The Employee or Company may terminate Employee's employment at any time, without any advance notice, for any or no reason,  notwithstanding anything to the contrary contained in or arising  from any


statements,   policies  or  practices   of  the  Company  relating   to  the  employment,   discipline,  or termination   of its employees. Upon and after such termination, all obligations of the Company under this Agreement shall cease.


(b) If Employee  is unable to perform the essential duties or responsibilities of his position specified hereunder due to partial or total disability or incapacity resulting from a mental or physical illness, injury or any other cause for a period of Twelve (12) consecutive weeks or for a cumulative period of Ninety (90) business days during any Twelve (12) month period ("Disability"), then, to the extent permitted by law, Company shall have the right to terminate Employee's employment.  The Company shall pay to employee all compensation to which Employee is entitled up through the date of termination, and thereafter all obligations of the Company under this Agreement shall cease.


7.2     If Employee dies during the Period of Employment, Employee's employment with the Company shall terminate or on the last day of the calendar month in which the death occurs.  The Company shall pay to Employee's beneficiaries or estate, as appropriate, any compensation then due and owing.  Thereafter, all obligations of the Company under this Agreement shall cease except as otherwise provided by law or by Company-sponsored benefit plans.


7.3.      For Cause. Company may terminate Employee's employment relationship with Company at any time for Cause. Upon Employee's termination for Cause the Company shall pay Employee all compensation that may be due and owing through the date of termination and, thereafter, all obligations of the Company under this Agreement shall cease.


7.4      Termination Obligations.


(a) All tangible Company Property shall be returned promptly to Company upon termination of the Period of Employment. For purposes of this Agreement, Company Property means all equipment and all tangible and intangible information relating to Company, its employees and its customers or vendors furnished to, obtained by or prepared by Employee or any other person during the course of or incident to employment by Company are and shall remain the sole property of Company ("Company Property"). Company Property shall include, but not be limited to, computer equipment, books, manuals, records, reports, notes, correspondence, contracts, customer lists, business cards, advertising, sales, financial, personnel, operations, and manufacturing materials and information, data processing reports, computer programs, software, customer information and records, business records, price lists or information, and samples, and in each case shall include all copies thereof in any medium, including paper, electronic and magnetic media and all other forms of information storage.


(b) Upon termination of the Period of Employment, Employee shall be deemed to have resigned from all offices and directorships then held with Company or any Affiliate.


(c)  Employee's   obligations  under  this  Section  7.4  on  Termination
Obligations, Section 9 on Confidential Information and Competitive Activity,  Section 9 on


Inventions,   Section  10 on Arbitration,  Section  12.5   on Injunctive  Relief,  and  Section  12.6  on Attorneys'  Fees and Expenses  shall survive the termination  of the Period of Employment  and the expiration  or termination  of this Agreement.


(d) Following  any  termination  of the  Period  of Employment,  Employee shall cooperate fully with Company in all matters  relating to completing  pending  work on behalf of Company  and the orderly transfer  of work to other employees  of Company.  Employee  shall also  cooperate  in the defense  of any  action  brought  by any  third party  against  Company  that relates in any way to Employee's  acts or omissions  while employed by Company.


8.   Confidential  Information  and Competitive  Activity.


Employee  hereby acknowledges  that, during and solely as a result of his employment  by Company,  Employee  has  received  and will  continue  to receive  special  training  and  education with  respect  to the operations  of Company's   business  and other  related  matters,  and  access to confidential  information  and business  and professional  contacts. In consideration  of such special and  unique   opportunities    afforded   by   Company   to  Employee   as  a  result   of  Employee's employment,  the Employee  hereby agrees as follows:


8.1        "Confidential    Information"  shall   mean   any   information,    tangible   or intangible,  relating  to  the  Company  or  to  its  products,  finances,  budgets,  methods,  policies, procedures, business  or other plans, computer or other data, techniques, research  or development projects   or  results,   customers   or  clients,  employees,   trade   secrets,  or  other  knowledge   or processes   of  or  developed  by  Company  or  any  other  confidential   information  relating  to  or dealing  with  the business  of  Company,  made  known  to Employee  or learned  or acquired  by Employee  while  in  the  employ  of  Company,   but  Confidential   Information   shall  not  include information   lawfully  known  generally  by  [or  readily  accessible  to]  the  trade  or  the  general public.


8.2       During  the  Period   of  Employment,   Employee   shall  use  and  disclose Confidential   Information  only  for the  benefit  of Company  and  only  as necessary  to  carry  out Employee's   responsibilities   under this  Agreement.  After  the Period  of Employment,  Employee shall not, directly or indirectly,  disclose  to any person  or entity, or use for the direct or indirect benefit   or  any  person  or  entity,  any  Confidential   Information,   without  the  express   written permission  of Company.  The foregoing  provisions  shall be in addition to (and not a limitation  of) any  legally   applicable   protections   of  Company's   interest  in  confidential   information,   trade secrets, and the like.


8.3       During  the Period  of Employment,  Employee  shall not engage  anywhere directly or indirectly  in (as a principal,  shareholder,  partner,  director,  officer,  agent,  employee, consultant or otherwise) or be financially  interested  in any business which is involved in business activities  which are the same as, similar to, or in competition  with business  activities  carried on by Company  ("Competitive  Activity").


8.4       For  one  year  after  the  Period   of  Employment   ("Restricted   Period"), Employee shall not engage in Competitive  Activity in any county of any state in which Company conducted  business  at any  time  during  the Period  of Employment  ("Restricted  Area"),  unless such Competitive  Activity  can be carried out without  any use or disclosure  whatsoever  of trace secrets.


8.5       During the Period of Employment  (and during the Restricted  Period in the Restricted  Area),  Employee  shall not directly  or indirectly  solicit,  induce  or attempt  to induce any   employee,   customer,    independent    contractor   or   supplier   of   Company   to   terminate employment  or any other relationship  with Company.


8.6       Nothing  contained  in this Section  8  shall prevent  Employee  from holding for investment  no more  than  one  percent  (1 %) of any  class of equity  securities  of a company whose  securities  are publicly  traded  on a national  securities  exchange  or in a national  market system.


8.7       Employee  acknowledges   that  the  restrictions  contained  in  the  foregoing Sections 8.2 through  8.5, in view of the nature of the business  in which Company is engaged,  are reasonable   and  necessary   in  order  to  protect  the  legitimate  interests  of  Company,   that  their enforcement  will not impose a hardship on Employee  or significantly  impair Employee's   ability to  earn  a  livelihood   and  that  any  violation   thereof   would  result   in  irreparable   injuries   to Company. Employee  therefore  acknowledges  that,  in the event of Employee's  violation  of any of these restrictions,  Company  shall be entitled to obtain from any court of competent  jurisdiction preliminary  and permanent  injunctive  relief  as well as damages  and an equitable  accounting  of all  earnings.   profits   and  other  benefits   arising  from  such  violation,   which   rights  shall  be cumulative and in addition  to any other rights or remedies to which Company may be entitled.


8.8       If the  Restricted  Period  or the  Restricted  Area  specified  in  Sections  8.4 and 8.5 above should be adjudged  unreasonable  in any proceeding,  then the period  of time shall be reduced  by such amount  or the area shall be reduced  by the elimination  of such portion  or both such reductions  shall be made so that such restrictions  may be enforced for such time and in such area as is adjudged  to be reasonable.  If Employee  violates any of the restrictions  contained in the foregoing  Sections 8.4 and 8.5, the Restricted Period shall be extended  by a period equal to the  length  of  time  from  the  commencement   of  any  such  violation   until  such  time  as  such violation shall be cured by Employee  to the satisfaction  of Company.  Employee hereby expressly consents to the jurisdiction  of any court within  the Restricted  Area to enforce  the provisions  of this Section  8, and agrees to accept  service of process  by mail relating  to any such proceeding. Company  may  supply  a  copy  of  Section  8  of  this  Agreement   to  any  future  or  prospective employer of Employee.


9.         Inventions.


9.1       "Inventions"  shall mean any and all writings, original works or authorship, inventions,   ideas,  trademarks,   service  marks,  patents,   copyrights,   know-how,  improvements, processes,    designs,    formulas,    discoveries,    technology,    computer    hardware    or   software, procedures and/or techniques  which  Employee may make, conceive,  discover, reduce to practice


or develop,  either  solely  or jointly  with  any  other  person  or persons,  at  any time  during  the Period of Employment,  whether or not during working hours and whether or not at the request or upon the suggestion  of Company,  which relate to or are useful in connection  with any business now or hereafter carried on or contemplated  by Company,  including  developments   or expansions of its present fields of operations.


9 .2       Employee  shall  make  full  disclosure  to  Company  of  all  Inventions  and shall  do  everything   necessary   or  desirable   to  vest  the  absolute   title  thereto   in  Company. Employee  shall write  and prepare  all specifications  and procedures  regarding  such  inventions, improvements,  processes,  procedures  and techniques   and otherwise  aid and  assist  Company  so that Company can prepare  and present  applications  for copyright  or Letters Patent therefore  and can secure such copyright  or Letters Patent wherever  possible,  as well as reissues,  renewals,  and extensions thereof,  and can obtain the record title to such copyright  or patents  so that  Company shall  be the  sole and  absolute  owner  thereof  in  all  countries  in  which  it may  desire  to  have copyright  or  patent  protection.   Employee  shall  not  be  entitled  to  any  additional   or  special compensation  or reimbursement  regarding  any Invention.


9.3       All  Inventions   shall  be  the  sole  and  exclusive  property   of  Company. Employee  agrees  to,  and  hereby  does,  assign  to  Company  all  of Employee's   right,  title,  and interest (throughout  the United  States and in all foreign countries),  free and clear of all liens and encumbrances,  in and to each Invention.


10.        Arbitration.


10.1       Arbitrable  Claims.   To  the  fullest  extent  permitted  by  law,  all  disputes between  Employee  (and his attorneys,  successors  and assigns)  and Company  (and its Affiliates, shareholders,  directors,  officers,   employees,  agents,  successors,   attorneys  and assigns) relating  in any  manner  whatsoever   to  the  employment   or  termination   of  Employee,   including,   without limitation,  all disputes  arising under this Agreement  ("Arbitrable  Claims"),   shall be resolved  by arbitration. All persons and entities  specified in the preceding  sentence  (other than Company  and Employee)  shall be considered  third-party  beneficiaries  of the rights  and obligations  created  by this  Section  on Arbitration.   Arbitrable  Claims  shall  include,  but  are  not  limited  to,  contract (express or implied) and tort claims  of all kinds, as well as all claims  based on any federal,  state or local law, statute or regulation,  excepting  only claims under applicable  workers'  compensation law  and  unemployment   insurance   claims.  By  way  of  example  and  not  in  limitation   of the foregoing,  Arbitrable  Claims  shall include any claims arising under Title VII of the Civil Rights Act of  1964, the Age Discrimination  in Employment  Act, the Americans  with  Disabilities  Act and the California Fair Employment  and Housing Act.


10.2       Procedure.   Arbitration  of  Arbitrable  Claims  shall  be in accordance  with the National Rules for the Resolution of Employment  Disputes of the American Arbitration Association,   as  amended   ("AAA   Employment   Rules"),   as  augmented   in  this   Agreement. Arbitration  shall be initiated as provided  by the AAA  Employment  Rules,  although the written notice  to  the  other  party  initiating  arbitration   shall  also  include  a  statement  of  the  claim(s) asserted  and the facts upon which the claim(s)  are based.  Arbitration  shall be final and binding upon the parties  and shall be the exclusive  remedy  for all Arbitrable  Claims.  Either  party  may


bring an action in court to compel  arbitration  under this Agreement  and to enforce an arbitration award.  Otherwise,  neither  party shall initiate or prosecute  any lawsuit  or administrative  action in any way related to any Arbitrable  Claim.  All arbitration  hearings under  this Agreement  shall be conducted  in Austin,  Texas,   and  the  laws  of the  State  of  Texas  shall  apply  to  any  disputes submitted  to  arbitration.     THE  PARTIES   HEREBY   WAIVE   ANY  RIGHTS   THEY  MAY HAVE   TO  TRIAL   BY  JURY   IN  REGARD   TO  ARBITRABLE   CLAIMS,   INCLUDING, WITHOUT   LIMITATION,   ANY  RIGHT  TO  TRIAL  BY  JURY   AS  TO  THE  MAKING, EXISTENCE,  VALIDITY  OR ENFORCEABILITY   OF THE AGREEMENT  TO ARBITRATE.


10.3     Arbitrator   Selection   and  Authority.   All  disputes   involving   Arbitrable Claims  shall  be  decided   by  a  single  arbitrator.   The  arbitrator  shall  be  selected  by  mutual agreement  of the parties within  thirty (30) days of the effective  date of the notice  initiating  the arbitration.  If the parties cannot agree on an arbitrator, then the complaining  party shall notify the AAA and request  selection  of an arbitrator  in accordance  with the AAA Employment  Rules. The arbitrator  shall  have  authority  to  award  equitable  relief,  damages,   costs  and  fees  (including attorneys'  fees) to the same extent that, but not greater than, a court would have. The fees of the arbitrator shall be paid by the Company  would  render this Section of Arbitration  unenforceable, in  which  case  the  arbitrator  shall  apportion   said  fees  so  as  to  preserve   enforceability.   The arbitrator shall  have  exclusive  authority  to  resolve  all  Arbitrable   Claims,  including,  but  not limited  to,  whether   any  particular   claim  is  arbitrable   and  whether   all  or  any  part  of  this Agreement  is void or unenforceable.


10.4       Continuing   Obligations.    The  rights  and  obligations   of  Employee   and Company  set  forth  in this  Section  on Arbitration   shall  survive   the  termination  of Employee's employment  and the expiration  of this Agreement.


11. Prior Agreements  Employee  represents  to Company:  (a) that there are no restrictions, agreements   or  understandings,   oral  or  written,  to  which  Employee   is  a  party  or  by  which Employee  is bound that prevent  or make unlawful  Employee's  execution  or performance  of this Agreement;   and  (b)  none   of  the  information   supplied   by  Employee   to  Company   or  any representative  of Company  or placement  agency  in connection  with Employee's  employment  by Company  misstated  a material  fact or omitted  information  necessary  to make  the  information supplied  not  materially  misleading;   and  (c) Employee   does  not  have  any  business  or  other relationship  that creates a conflict between the interests of Employee  and the Company.


12. Miscellaneous.


12.1       Binding  Nature  of  Agreement.   This  Agreement   shall  be  binding  upon Company   and  shall  inure  to  the  benefit   of  Company,   its  present   and  future   Subsidiaries, successors and assigns, including  any transferee  of the business  operation, as a going concern,  in which  Employee   is  employed   and  shall  be  binding   upon  Employee,   Employee's    heirs  and personal  representatives.   None  of  the  rights  or  obligations   of  Employee   hereunder   may  be assigned  or delegated,  except that  in the event of Employee's   death  or Disability,   any rights of Employee  hereunder  shall be transferred  to Employee's  estate  or personal  representative,   as the case may be.  Company may assign its rights and obligations  under this Agreement  in whole or in part to any one or more  Subsidiaries  or successors.   Any entity into which Company  is merged  or


with which Company  is consolidated  or which acquires the business of Company or the business unit  in which  Employee  is  to  be  principally  employed  shall  be deemed  to  be a successor  of Company for purposes hereof.


12.2      Provisions   Separable.   The provisions  of this  Agreement are  independent of and  separable  from  each  other,  and  no provision   shall  be affected  or rendered   invalid  or unenforceable  by virtue of the fact that for any reason any other or others of them may be invalid or unenforceable  in whole or in part.


12.3     Entire   Agreement.   This  Agreement   contains   the  entire  understanding among the parties  hereto  with  respect  to the subject  matter  hereof, and supersedes  all prior and contemporaneous   agreements  and understandings,   express  or implied,  oral or written,  except as herein  contained.  This Agreement  may not be modified  or amended  other than by an agreement in writing executed  by Employees  and the President/CEO  of the Company. To the extent that the practices,  policies  or procedures   of Company,  now  or in the  future,  are inconsistent   with  the terms  of this Agreement,  the  provisions  of this  Agreement  shall  control.  Notwithstanding   the foregoing,  nothing herein shall limit the application  of any generally applicable  Company policy, practice,  plan  or the  terms  of  any  manual  or  handbook   applicable  to  Company's   employees generally.


12.4       Interpretation.  This  Agreement  shall be construed as a whole,  according  to its  fair  meaning,  and  not  in  favor  of  or  against  any  party.  By  way  of  example  and  not  in limitation, this  Agreement  shall not  be construed  in favor  of the party  receiving  a benefit  nor against the party responsible  for any particular  language in this Agreement.


12.5       Injunctive  Relief.   Notwithstanding  anything  contained  in this  Agreement to the contrary,  if Employee  commits  a breach,  or threatens  to commit  a breach,  of any of the provisions  of Sections  8 or 9, Company  shall  have the following  rights  and remedies  (each  of which shall be independent  of the other, and shall be severally  enforceable,  and all of which shall be in addition to, and not in lieu of, any other rights and remedies  available to Company at law or in equity):


(a)        The   right   and   remedy   to   have   the   provisions    of   this   Agreement specifically   enforced   by  any   court   having   equity   jurisdiction,    it  being   acknowledged    by Employee  that  any  such  breach  or  threatened  breach  will  or  may  cause  irreparable   injury  to Company  and that money  damages  will  or may  not provide  an adequate  remedy  to Company; and


(b)       The right and remedy  to require  Employee  to account  for and pay over to Company all compensation,  profits,  monies, increments,  things of value or other benefits  derived or received by Employee  as the result  of any acts or transactions  constituting  a breach  of any of the provisions  of Sections  8 or 9 of this Agreement,  and Employee  hereby agrees to account  for and pay over all such compensation, profits, monies,  increments,  things of value or other benefits to the Company.


Employee   specifically   agrees  not  to  object   to  any application   made   by the Company  to  any court  having  equity jurisdiction,  seeking  an injunction  restraining  Employee from committing,  threatening  or continuing  any violation  of Sections 8 or 9 of this Agreement.


12.6     Attorneys'   Fees and Expenses.  In the event that  any action,  suit or other proceeding  at law or in equity is brought to enforce the provisions  of this Agreement, or to obtain money  damages  for the breach  thereof, and such action  results  in the award  of a judgment  for money  damages  or in the  granting  of any  injunction  in favor  of Company,  then  all reasonable expenses,  including,  but not limited to, reasonable  attorneys'  fees and disbursements   (including those incurred on appeal) of Company in such action, suit or other proceeding,  shall (on demand of Company)  forthwith  be paid  by Employee.  If  such action  results  in a judgment  in favor  of Employee,  then all reasonable  expenses,  including, but not limited to, reasonable  attorneys'  fees and disbursements  (including  those incurred on appeal) of Employee  in such action, suit or other proceeding,  shall (on demand of Employee)  forthwith be paid by Company.




2011.
 
IN  WITNESS   WHEREOF,  the  parties  have  executed  this  Agreement   on January_,









COMPANY


Victory Energy Corporation, A Nevada  corporation
By:    




Its:       Chief Executive  Officer






EMPLOYEE Kenneth E. Hill


By:
Kenneth E.  Hill