Unassociated Document


    Employment
      Agreement Between

     

    Tejas
      Securities Group, Inc. and Kurt E. Morales

     

    This
      Agreement is entered into by and between Tejas Securities Group, Inc.
      hereinafter referred to as "Company" and Kurt E. Morales (hereinafter referred
      to as "Employee"), as of June 1, 2006. 

     

    NOW,
      THEREFORE, in consideration of the mutual promises, conditions and covenants
      as
      hereinafter set forth, the parties hereto agree as follows:

     

    
      	1.  	
              Term;
                Employment-At-Will.
                Subject to the terms and conditions herein contained, the Company
                hereby
                employs Employee, and Employee hereby accepts such employment, commencing
                on the date of this Agreement. NOTWITHSTANDING ANYTHING IN THIS AGREEMENT,
                OR ANY ORAL OR WRITTEN REPRESENTATIONS TO THE CONTRARY, THE PARTIES
                UNDERSTAND AND AGREE THAT EMPLOYEE'S EMPLOYMENT WITH THE COMPANY
                MAY BE
                TERMINATED BY EITHER PARTY AT ANY TIME FOR ANY REASON, WITH OR WITHOUT
                CAUSE, AND WITH OR WITHOUT NOTICE. Nothing in this Agreement is intended
                to create a contractual obligation on the part of Employee to serve
                the
                Company for any specified period of time or on the part of the Company
                to
                Employee for any specified period of time. Texas is an employment-
                at-
                will state, and Employee is employed by Company pursuant to this
                doctrine.

            


    

     

    
      	2.  	
              Position
                and Duties.
                During Employee's employment hereunder, Employee will hold the position
                as
                a Director of Accounting and/or such other position(s) as the Company
                may
                determine in its sole discretion. Employee shall, at all times, comply
                with the federal securities acts, the rules, regulations, mandates
                from
                the SEC, interpretations and other directives issued by the NASD,
                and any
                stock commodity or option exchange or state or political subdivision
                or
                self regulatory organization with whom the Company or Employee is
                registered or licensed or to which jurisdiction they are subject.
                The
                undersigned Employee has received and carefully reviewed the Company's
                Policy and Operational Manual (the "Manual"), designed to assure
                compliance with applicable laws, rules and regulations, and shall
                comply
                with all the provisions of the Manual, including all updates thereto
                delivered by the Company from time to time. In addition, Employee
                shall
                comply with all applicable written policies for employees established
                from
                time to time by the Company. Failure to so comply with the Manual
                and any
                other written policies of the Company in accordance with this paragraph
                shall constitute a material breach of this
                Agreement.

            


    

     

    
      	3.  	
              Compensation.
                For all services which Employee may render to the Company or its
                affiliates and/or subsidiaries in any capacity during the term hereof,
                Employee will receive and the Company hereby agrees to pay the yearly
                salary of $110,000 to the Employee. In addition, the Company hereby
                agrees
                to pay the Employee $10,000 upon the effective transfer of the Employee’s
                NASD licenses to the Company.

            


    

     

    
      
        
        

      

      
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      	4.  	
              Start
                Date.
                The Employee will commence employment at the Company on June 1st,
                2006.

            


    

     

    
      	5.  	
              Benefits.
                In addition to the compensation described in Section 3 above, Employee
                shall be eligible to receive and/or participate in employee benefits
                commensurate with Employee's position with the Company, all subject
                to the
                terms and conditions of the various benefits plans, as outlined in
                summary
                fashion below and which may be changed from time to time by the Company
                without notice. 

            


    

     

    
      	a.  	
              401(k)
                Plan

            


    

     

    
      	b.  	
              Medical
                and Dental

            


    

     

    
      	c.  	
              Life
                Insurance and Disability

            


    

     

    
      	d.  	
              Vacation:
                Employee shall be entitled to 2 weeks paid vacation annually which
                vacation shall accrue in accordance with the Company's vacation policies
                for similarly situated employees.

            


    

     

    
      	6.  	
              Payments
                upon Termination.
                Should this Agreement and your employment terminate by the occurrence
                of
                any event, then all salary, benefits and rights under this Agreement
                shall
                cease upon such termination. Nothing contained in this Agreement
                shall
                prevent your receipt of benefits otherwise due terminated employees
                consistent with the terms contained in the Company's published policies
                or
                plans with respect to profit sharing, group insurance coverage, employee
                stock options and restricted
                shares.

            


    

     

    
      	7.  	
              Termination.
                This agreement may be terminated at any time by either party by written
                notice which notice shall specify the effective date of termination.
                Notice shall be deemed given upon transmission via facsimile or by
                placement of such written notice in the U.S. mail, postage prepaid,
                addressed to the other party hereto, either at my last known address
                as
                contained in the Company's records or to the Company at its principal
                place of business. 

            


    

     

    
      	a.  	
              This
                Agreement will terminate automatically and without notice if Employee
                is
                disqualified as a registered broker by the NASD.
                

            


    

     

    
      	b.  	
              Upon
                termination, Employee will immediately deliver to the Company all
                funds,
                property, records and supplies of every kind belonging to the
                Company.

            


    

     

    
      	c.  	
              Upon
                termination, Employee will cease holding himself or herself out as
                a
                broker or employee of the Company or its
                affiliates.

            


    

     

    
      
        
        

      

      
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        	d.  	
                Employee
                  agrees that upon termination, any and all outstanding obligations
                  owed by
                  Employee to the Company shall be immediately due and payable and
                  that any
                  debit balances shall be paid within thirty (30) days. Employee
                  understands, accepts and agrees that failure to pay such balances
                  will
                  result in a Form U-5 notation reflecting
                  same.

              


      

       

    

    
      	8.  	
              Confidential
                Material.
                Employee will be given access to, receive and be entrusted with
                confidential information, including but in no way limited to development,
                marketing, organizational, financial, management, administrative,
                production, distribution and sales information, data, specifications
                and
                processes presently owned or at any time in the future developed,
                by the
                Company or its affiliates, agents or consultants, or used presently
                or at
                any time in the future in the course of its business that is not
                otherwise
                part of the public domain (collectively, the "Confidential Material").
                All
                such Confidential Material is considered secret and is acknowledged
                by
                Employee to be made available to Employee in confidence. Except in
                the
                performance of Employee's duties under this Agreement, Employee shall
                not,
                directly or indirectly for any reason whatsoever, disclose or use
                any such
                Confidential Material, unless such Confidential Material ceases (through
                no fault of Employee) to be confidential because it has become part
                of the
                public domain. All records, files, drawings, documents, equipment
                and
                other tangible items, wherever located, relating in any way to the
                Confidential Material or otherwise to the Company's or its affiliates'
                business, which Employee prepares, uses or encounters, shall be and
                remain
                the Company's or its affiliates' sole and exclusive property and
                shall be
                included in the Confidential Material. Upon termination of this Agreement
                by any means, or whenever requested by the Company, Employee shall
                promptly deliver to the Company any and all of the Confidential Material,
                not previously delivered to the Company, that may be or at any previous
                time has been in the possession or under the control of Employee
                or its
                employees or agents.

            


    

     

    
      	9.  	
              Non-Solicitation.
                During the term of, and in the event of the termination of this Agreement
                for any reason, Employee (and any corporation or entity of which
                Employee
                is a director, officer, employee or greater than 5% shareholder)
                shall not
                for a period of one year after
                termination:

            


    

     

    
      	a.  	
              Solicit
                for employment or engagement and then employ or engage any employee
                of the
                Company or any of its affiliates or subsidiaries or any person who
                is an
                independent contractor involved in rendering services to the Company
                or
                any of its affiliates or subsidiaries; or


            


    

     

    
      	b.  	
              Make
                any public statement concerning the Company, any of its affiliates
                or
                subsidiaries, or Employee's employment by the Company unless previously
                approved by the Company, except as may be required by law; or
                

            


    

     

    
      	c.  	
              Induce,
                attempt to induce or knowingly encourage any Customer of the Company
                or
                any of its affiliates or subsidiaries to divert any business or income
                from the Company or any of its affiliates or subsidiaries or to stop
                or
                alter the manner in which they are then doing business with the Company
                or
                any of its affiliates or subsidiaries.


            


    

     

    
      
        
        

      

      
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      	d.  	
              The
                term "Customer" shall mean any individual or business firm that was
                or is
                a customer or client of, or one that was or is a party in a selling
                agreement with, or whose business was actively solicited by, the
                Company
                or any of its affiliates or subsidiaries at any time, regardless
                of
                whether such customer was generated, in whole or in part, by the
                efforts
                of Employee.

            


    

     

    
      	10.  	
              Representations
                and Warranties.
                Employee makes the following representations and warranties:
                

            


    

     

    
      	a.  	
              Employee
                hereby represents and warrants that he has no agreement in writing
                or oral
                with any person or entity that would preclude him working at
                Company.

            


    

     

    
      	b.  	
              Employee
                hereby represents and warrants that he has not used disclosed/misused
                confidential information belonging to any other person or
                entity.

            


    

     

    
      	11.  	
              Indemnification.
                Employee hereby agrees to indemnify and hold harmless the Company,
                its
                officers, agents, directors, affiliates, subsidiaries, and employees,
                for
                any actions arising from any and all acts or omissions by Employee
                in
                connection with his previous
                employment.

            


    

     

    
      	12.  	
              Reimbursement
                of Expenses.
                Employee shall only expend, and shall only be entitled to reimbursement
                for, appropriately documented reasonable and necessary business expenses
                deemed reimbursable pursuant to written policies of the Company for
                the
                Employee, including the requirement for any pre-approvals provided
                for
                therein. The Company reserves the right to change and/or amend this
                policy
                at any time.

            


    

     

    
      	13.  	
              No
                Interest in Competitors.
                Employee agrees that during the term of this Agreement Employee will
                not
                engage as a director, officer, owner, part-owner (five or more percent
                shareholder), joint venturer, and agent, consultant or otherwise,
                in any
                business competitive with the Company or any of its affiliates or
                subsidiaries. Passive investments are permitted by this
                paragraph.

            


    

     

    
      	14.  	
              Controlling
                Law.
                This Agreement shall be controlled, construed and enforced in accordance
                with the laws of the State of
                Texas.

            


    

     

    
      	15.  	
              Arbitration.
                Any dispute arising out of or relating to this agreement or its breach
                between the Employee and Company shall be resolved by arbitration
                pursuant
                to the rules of the NASD and shall take place in Austin, Texas and
                judgment upon the award entered by the arbitrator(s) may be entered
                in any
                court having jurisdiction thereof. The party prevailing, in addition
                to
                other relief, shall be entitled to an award for reasonable attorney's
                fees
                and related costs. Nothing in this paragraph, however, shall limit
                or
                affect the Company's right to seek from a court injunctive or other
                equitable relief, including but not limited to relief for the unauthorized
                sale, use or disclosure of Confidential Material.
                

            


    

     

    
      
        
        

      

      
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      	16.  	
              No
                Waiver.
                No waiver, express or implied, by Company of a default by Employee
                under
                this Agreement shall constitute a waiver of any subsequent default;
                and,
                following a waiver, express or implied, a demand for strict compliance
                thereafter need not be served on
                Employee.

            


    

     

    
      	17.  	
              Severability.
                If any term, covenant, condition or provision of this Agreement is
                held by
                a court of competent jurisdiction to be invalid, void or unenforceable,
                the remainder of the provisions shall remain in full force and effect
                and
                shall in no way be affected, impaired or
                invalidated.

            


    

     

    
      	18.  	
              Captions.
                Captions of this Agreement are for convenience and reference only,
                and the
                words contained therein shall in know way be held to explain, modify,
                amplify or aid in the interpretation, construction or meaning of
                the
                provisions of this Agreement.

            


    

     

    
      	a.  	
              Number
                and Gender.
                In this Agreement, the neuter includes the feminine and masculine
                and the
                singular number includes the plural, and the word "person" includes
                corporation, partnership, firm, or association wherever the context
                so
                requires.

            


    

     

    
      	b.  	
              Mandatory
                and Permissive.
                "Shall" and "will" and "agrees"' are mandatory; "may" is
                permissive.

            


    

     

    
      	c.  	
              Term
                Includes Extensions.
                All references to the term of this Agreement or the Agreement term
                shall
                include any extensions of such
                term.

            


    

     

    
      	d.  	
              Assignment.
                This Agreement constitutes a personal contract and Employee shall
                not
                transfer or assign this Agreement or any part thereof. Company shall
                reserve the right to assign or transfer this Agreement to it successors
                in
                interest.

            


    

     

    
      	e.  	
              Time
                is of the Essence.
                Time is of the essence of this Agreement, and each covenant and term
                a
                condition hereof.

            


    

     

    
      	20.  	
              Integration.
                This Agreement and all of the attached Schedules contain the entire
                Agreement between the parties and supersedes all prior verbal and
                written
                agreements, understandings, commitments and practices between the
                parties.
                Any amendments to this Agreement shall be made in writing and executed
                by
                both parties.

            


    

     

    
      
        
        

      

      
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    IN
      WITNESS WHEREOF, the Company has caused this Agreement to be executed in its
      corporate name by one of its corporate officers, and the Employee has set
      Employee's hand to this Agreement, as of the day and year written
      below.

     

    Kurt
      E. Morales

    


    /s/
      Kurt E.
      Morales                                             


    By:
      Kurt
      E. Morales

    


    


    Tejas
      Securities Group, Inc.

    


    By:
      /s/ John
      Garber                                             


    


    Name:
      John Garber

    


    Title:
      Chief Financial Officer


    
      
        
        

      

      
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