Document:

EX 10.2

    EXHIBIT
      10.2

    

    FORM
      OF REGISTRATION RIGHTS AGREEMENT

    

    This
      Registration Rights Agreement (this “Agreement”)
      is
      made and entered into as of this ___ day of ________ 2006 (the “Effective
      Date”)
      between Foothills Resources, Inc., a Nevada corporation (the “Company”),
      and
      the parties set forth on the signature page and Exhibit
      A
      hereto
      (each, a “Purchaser”
and
      collectively, the “Purchasers”).

     

    RECITALS:

     

    WHEREAS,
      the Company and Brasada California, Inc. have executed a Term Sheet, pursuant
      to
      which they will enter into an Agreement and Plan of Merger and Reorganization,
      pursuant to which a newly organized, wholly-owned subsidiary of the Company
      will
      merge with and into Brasada (the “Merger”),
      with
      Brasada being the surviving entity and a wholly-owned subsidiary of the Company
      as of the consummation of the Merger (the “Merger Effective
      Date”);

     

    WHEREAS,
      as a condition to the consummation of the Merger, and to provide financing
      capital required by Brasada for working capital purposes, the Company is
      offering pursuant to Rule 506 of Regulation D of the Securities Act of 1933,
      as
      amended (the “Securities Act”), to accredited investors in a private placement
      transaction (the “Offering”),
      up to
      10,000,000 units (“Units”)
      consisting of one share of the Company’s common stock, par value $0.001 per
      share (“Common
      Stock”)
      and a
      warrant (the “Investor
      Warrants”)
      to
      purchase 0.75 shares of Common Stock for five years at the exercise price of
      $1.00 per whole share of Common Stock;

     

    WHEREAS,
      to the extent that all 10,000,000 Units are sold, the Company will have the
      option to sell up to an additional 2,000,000 Units in the Offering (the
“Oversubscription
      Units”);
      

     

    WHEREAS,
      prior to the sale of Units in the Offering, the Company intends to offer and
      sell, to accredited investors in a private transaction, debentures of the
      Company (the “Debenture
      Sale”),
      which
      debentures shall bear interest at the rate of nine percent (9%) per annum for
      a
      three-year term, and which are payable in consecutive monthly installments
      of
      principal and interest commencing 120 days from issuance (the “Debentures”),
      and
      which shall convert into such number of Units as to their outstanding principal
      at a conversion price equal to the price per Unit in the Offering, upon the
      simultaneous closing of the Merger and the Offering;

     

    WHEREAS,
      the Offering and Debenture Sale shall terminate on the receipt of acceptable
      subscriptions representing 10,000,000 Units, including the Units into which
      the
      Debentures are convertible, (the “Termination
      Date”),
      or
      such later date as the Company and Brasada shall determine, and will close
      as
      soon as practicable after the Company has received at least subscriptions for
      $2,500,000 in Debentures and 500,000 Units (the “Offering
      Closing Date”);
      and

     

    WHEREAS,
      the Purchasers, in connection with their intent to purchase Units in the
      Offering and Debentures in the Debenture Sale, shall execute and deliver
      Subscription Agreements (the “Subscription
      Agreements”)
      and
      Investor Questionnaires (the “Investor
      Questionnaires”)
      memorializing the Purchasers’ agreement to purchase and the Company’s agreement
      to sell the number of Units and/or Debentures set forth therein at the purchase
      price of $0.70 per Unit or the face value of the Debentures (the “Purchase
      Price”)
      and
      this Agreement, pursuant to which the Company will provide certain registration
      rights related to the shares of Common Stock underlying the Units and the
      Investor Warrants (including such Common Stock and Investor Warrants into which
      the Debentures shall be converted on the Offering Closing Date) on the terms
      set
      forth herein (the Subscription Agreements, Investor Questionnaires and the
      Registration Rights Agreements are collectively referred to as the “Transaction
      Documents”).

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    NOW,
      THEREFORE,
      in
      consideration of the mutual promises, representations, warranties, covenants,
      and conditions set forth herein, the parties mutually agree as follows:

     

    1. Certain
      Definitions.
      As used
      in this Agreement, the following terms shall have the following respective
      meanings:

     

    “Approved
      Market”
means
      the NASD Over-The-Counter Bulletin Board, the NASDAQ National Market, the NASDAQ
      Capital Market, the New York Stock Exchange, Inc. or the American Stock
      Exchange, Inc.

     

    “Blackout
      Period”
means,
      with respect to a registration, a period, in each case commencing on the day
      immediately after the Company notifies the Purchasers that they are required,
      because of the occurrence of an event of the kind described in Section 4(f)
      hereof, to suspend offers and sales of Registrable Securities during which
      the
      Company, in the good faith judgment of its board of directors, determines
      (because of the existence of, or in anticipation of, any acquisition, financing
      activity, or other transaction involving the Company, or the unavailability
      for
      reasons beyond the Company’s control of any required financial statements,
      disclosure of information which is in its best interest not to publicly
      disclose, or any other event or condition of similar significance to the
      Company) that the registration and distribution of the Registrable Securities
      to
      be covered by such registration statement, if any, would be seriously
      detrimental to the Company and its stockholders and ending on the earlier of
      (1)
      the date upon which the material non-public information commencing the Blackout
      Period is disclosed to the public or ceases to be material and (2) such time
      as
      the Company notifies the selling Holders that the Company will no longer delay
      such filing of the Registration Statement, recommence taking steps to make
      such
      Registration Statement effective, or allow sales pursuant to such Registration
      Statement to resume; provided, however,
      that (a)
      the Company shall limit its use of Blackout Periods, in the aggregate, to 30
      Trading Days in any 12-month period and (b) no Blackout Period may commence
      sooner than 60 days after the end of a prior Blackout Period.

     

    “Business
      Day”
means
      any day of the year, other than a Saturday, Sunday, or other day on which the
      Commission is required or authorized to close.

     

    “Closing
      Date”
means
      the Merger Closing Date.

     

    “Commission”
means
      the Securities and Exchange Commission or any other federal agency at the time
      administering the Securities Act.

     

    “Common
      Stock”
means
      the common stock, par value $0.001 per share, of the Company and any and all
      shares of capital stock or other equity securities of: (i) the Company which
      are
      added to or exchanged or substituted for the Common Stock by reason of the
      declaration of any stock dividend or stock split, the issuance of any
      distribution or the reclassification, readjustment, recapitalization or other
      such modification of the capital structure of the Company; and (ii) any other
      corporation, now or hereafter organized under the laws of any state or other
      governmental authority, with which the Company is merged, which results from
      any
      consolidation or reorganization to which the Company is a party, or to which
      is
      sold all or substantially all of the shares or assets of the Company, if
      immediately after such merger, consolidation, reorganization or sale, the
      Company or the stockholders of the Company own equity securities having in
      the
      aggregate more than 50% of the total voting power of such other
      corporation.

     

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

     

    “Exchange
      Act”
means
      the Securities Exchange Act of 1934, as amended, and the rules and regulations
      of the Commission promulgated thereunder.

     

    “Family
      Member”
means
      (a) with respect to any individual, such individual’s spouse, any descendants
      (whether natural or adopted), any trust all of the beneficial interests of
      which
      are owned by any of such individuals or by any of such individuals together
      with
      any organization described in Section 501(c)(3) of the Internal Revenue Code
      of
      1986, as amended, the estate of any such individual, and any corporation,
      association, partnership or limited liability company all of the equity
      interests of which are owned by those above described individuals, trusts or
      organizations and (b) with respect to any trust, the owners of the beneficial
      interests of such trust.

     

    “Holder”
means
      each Purchaser or any of such Purchaser’s respective successors and Permitted
      Assigns who acquire rights in accordance with this Agreement with respect to
      the
      Registrable Securities directly or indirectly from a Purchaser or from any
      Permitted Assignee.

     

    “Investor
      Warrants”
mean
      the warrants issued in relation to the Purchasers purchase of Units in the
      private placement offering.

     

    “Majority
      Holders”
means
      at any time Holders representing a majority of the Registrable
      Securities.

     

    “Permitted
      Assignee”
means
      (a) with respect to a partnership, its partners or former partners in
      accordance with their partnership interests, (b) with respect to a
      corporation, its stockholders in accordance with their interest in the
      corporation, (c) with respect to a limited liability company, its members
      or former members in accordance with their interest in the limited liability
      company, (d) with respect to an individual party, any Family Member of such
      party, (e) an entity that is controlled by, controls, or is under common control
      with a transferor or (f) a party to this Agreement.

     

    “Piggyback
      Registration”
means,
      in any registration of Common Stock as set forth in Section 3(b), the ability
      of
      holders of Common Stock to include Registrable Securities in such registration.
      

     

    “Purchase
      Price”
means
      the Purchase Price per Unit set forth in the Subscription Agreement.

     

    The
      terms
“register,
“
      “registered,
“
and
      “registration”
refer
      to a registration effected by preparing and filing a registration statement
      in
      compliance with the Securities Act, and the declaration or ordering of the
      effectiveness of such registration statement.

     

    “Registrable
      Securities”
means
      the shares of Common Stock issued or issuable to each Purchaser in connection
      with such Purchaser’s purchase of Units or Oversubscription Units pursuant to
      the Subscription Agreements, including the shares of Common Stock issuable
      on
      exercise of the Investor Warrants issued to the Purchasers in connection with
      their purchase of Units but excluding (i) any Registrable Securities that have
      been publicly sold or may be sold immediately without registration under the
      Securities Act either pursuant to Rule 144 of the Securities Act or otherwise;
      (ii) any Registrable Securities sold by a person in a transaction pursuant
      to a
      registration statement filed under the Securities Act or (iii) any Registrable
      Securities that are at the time subject to an effective registration statement
      under the Securities Act. 

     

    “Registration
      Default Date”
means
      the date that is 120 days following the Registration Filing Date. 

     

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

     

    “Registration
      Default Period”
means
      the period following the Registration Default Date during which any Registration
      Event occurs and is continuing.

     

    “Registration
      Event”
means
      the occurrence of any of the following events:

     

    (a) the
      Company fails to file with the Commission the Registration Statement on or
      before the Registration Filing Date (as defined in Section 3(a));

     

    (b) the
      Registration Statement is not declared effective by the Commission on or before
      the Registration Default Date;

     

    (c) after
      the
      SEC Effective Date, sales cannot be made pursuant to the Registration Statement
      for any reason (including without limitation by reason of a stop order, or
      the
      Company’s failure to update the Registration Statement) except as excused
      pursuant to Section 3(a); or

     

    (d) the
      Common Stock generally or the Registrable Securities specifically are not listed
      or included for quotation on an Approved Market, or trading of the Common Stock
      is suspended or halted on the Approved Market, which at the time constitutes
      the
      principal market for the Common Stock, for more than two full, consecutive
      Trading Days; provided, however, a Registration Event shall not be deemed to
      occur if all or substantially all trading in equity securities (including the
      Common Stock) is suspended or halted on the Approved Market for any length
      of
      time.

     

    “Registration
      Filing Date”
means
      the date that is 120 days after the Closing Date.

     

    “Registration
      Statement”
means
      the registration statement that the Company is required to file pursuant to
      this
      Agreement to register the Registrable Securities.

     

    “Rule
      144”
means
      Rule 144 promulgated by the Commission under the Securities Act. 

     

    “Securities
      Act”
means
      the Securities Act of 1933, as amended, or any similar federal statute
      promulgated in replacement thereof, and the rules and regulations of the
      Commission thereunder, all as the same shall be in effect at the
      time.

     

    “SEC
      Effective Date”
means
      the date the Registration Statement is declared effective by the
      Commission.

     

    “Subscription
      Agreement”
means
      the Subscription Agreement dated as of the date hereof between the Company
      and
      the Purchaser setting forth the terms and conditions of the Company’s offer of
      Units and the Purchaser’s purchase of Units.

     

    “Trading
      Day”
means
      any day on which the national securities exchange, the NASDAQ Stock Market,
      the
      NASD Over the Counter Bulletin Board or such other securities market or
      quotation system, which at the time constitutes the principal securities market
      for the Common Stock, is open for general trading of securities.

     

    “Units”
mean
      the units offered by the Company and purchased by the Purchaser pursuant to
      the
      Subscription Agreement which consist of one share of Common Stock and an
      Investor Warrant representing the right of the Purchaser to purchase 0.75 shares
      of Common Stock at the exercise price of $1.00 per share.

     

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

     

    2. Term.
      This
      Agreement shall continue in full force and effect for a period of two years
      from
      the Effective Date, unless terminated sooner hereunder.

     

    3. Registration.

     

    (a) Registration
      on Form SB-2.
      As
      promptly as reasonably practicable after the date hereof, but in any event
      not
      later than the Registration Filing Date, the Company shall file with the
      Commission a registration statement on Form SB-2, or other applicable form,
      relating to the resale by the Holders of all of the Registrable Securities,
      and
      the Company shall use its commercially reasonable best efforts to cause such
      registration statement to be declared effective prior to the Registration
      Default Date; provided, however, that the Company shall not be obligated to
      effect any such registration, qualification, or compliance pursuant to this
      Section, or keep such registration effective pursuant to the terms hereunder:
      (i) in any particular jurisdiction in which the Company would be required to
      qualify to do business as a foreign corporation or as a dealer in securities
      under the securities or blue sky laws of such jurisdiction or to execute a
      general consent to service of process in effecting such registration,
      qualification or compliance, in each case where it has not already done so
      or
      (ii) during any Blackout Period, in which case the Registration Filing Date
      shall be extended to the date immediately following the last day of such
      Blackout Period. 

     

    (b) Piggyback
      Registration.
      If the
      Company shall determine to register for sale for cash any of its Common Stock,
      for its own account or for the account of others (other than the Holders),
      other
      than (i) a registration relating solely to employee benefit plans or securities
      issued or issuable to employees, consultants (to the extent the securities
      owned
      or to be owned by such consultants could be registered on Form S-8) or any
      of
      their Family Members (including a registration on Form S-8) or (ii) a
      registration relating solely to a Commission Rule 145 transaction, a
      registration on Form S-4 in connection with a merger, acquisition, divestiture,
      reorganization, or similar event, the Company shall promptly give to the Holders
      written notice thereof (and in no event shall such notice be given less than
      20
      calendar days prior to the filing of such registration statement), and shall,
      subject to Section 3(c), include as a Piggyback Registration all of the
      Registrable Securities specified in a written request delivered by the Holder
      within 10 calendar days after receipt of such written notice from the Company.
      However, the Company may, without the consent of the Holders, withdraw such
      registration statement prior to its becoming effective if the Company or such
      other stockholders have elected to abandon the proposal to register the
      securities proposed to be registered thereby. 

     

    (c) Underwriting.
      If a
      Piggyback Registration is for a registered public offering involving an
      underwriting, the Company shall so advise the Holders. In such event, the right
      of any Holder to Piggyback Registration shall be conditioned upon such Holder’s
      participation in such underwriting and the inclusion of such Holder’s
      Registrable Securities in the underwriting to the extent provided herein. All
      Holders proposing to include the Registrable Securities they hold through such
      underwriting shall (together with the Company and any other stockholders of
      the
      Company selling their securities through such underwriting) enter into an
      underwriting agreement in customary form with the underwriter selected for
      such
      underwriting by the Company or the selling stockholders, as applicable.
      Notwithstanding any other provision of this Section, if the underwriter or
      the
      Company determines that marketing factors require a limitation of the number
      of
      shares of Common Stock or the amount of other securities to be underwritten,
      the
      underwriter may exclude some or all Registrable Securities from such
      registration and underwriting. The Company shall so advise all Holders (except
      those Holders who failed to timely elect to include their Registrable Securities
      through such underwriting or have indicated to the Company their decision not
      to
      do so), and indicate to each such Holder the number of shares of Registrable
      Securities that may be included in the registration and underwriting, if any.
      The number of shares of Registrable Securities to be included in such
      registration and underwriting shall be allocated among such Holders as follows:
      

     

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

     

    (i) In
      the
      event of a Piggyback Registration that is initiated by the Company, the number
      of shares that may be included in the registration and underwriting shall be
      allocated first to the Company and then, subject to obligations and commitments
      existing as of the date hereof, to all selling stockholders, including the
      Holders, who have requested to sell in the registration on a pro rata basis
      according to the number of shares requested to be included; and

     

    (ii) In
      the
      event of a Piggyback Registration that is initiated by the exercise of demand
      registration rights by a stockholder or stockholders of the Company (other
      than
      the Holders), then the number of shares that may be included in the registration
      and underwriting shall be allocated first to such selling stockholders who
      exercised such demand and then, subject to obligations and commitments existing
      as of the date hereof, to all other selling stockholders, including the Holders,
      who have requested to sell in the registration, on a pro rata basis according
      to
      the number of shares requested to be included.

     

    No
      Registrable Securities excluded from the underwriting by reason of the
      underwriter’s marketing limitation shall be included in such registration. If
      any Holder disapproves of the terms of any such underwriting, such Holder may
      elect to withdraw their Registrable Securities therefrom by delivery of written
      notice to the Company and the underwriter. The Registrable Securities so
      withdrawn from such underwriting shall also be withdrawn from such registration;
      provided, however, that, if by the withdrawal of such Registrable Securities
      a
      greater number of Registrable Securities held by other Holders may be included
      in such registration (up to the maximum of any limitation imposed by the
      underwriters), then the Company shall offer to all Holders who have included
      Registrable Securities in the registration the right to include additional
      Registrable Securities pursuant to the terms and limitations set forth herein
      in
      the same proportion used above in determining the underwriter limitation.

     

    (d) Other
      Registrations.
      Prior
      to the SEC Effective Date, the Company will not, without the prior written
      consent of the Majority Holders, file or request the acceleration of any other
      registration statement filed with the Commission, and during any time subsequent
      to the SEC Effective Date when the Registration Statement for any reason is
      not
      available for use by any Holder for the resale of any Registrable Securities,
      the Company shall not, without the prior written consent of the Majority
      Holders, file any other registration statement or any amendment thereto with
      the
      Commission under the Securities Act or request the acceleration of the
      effectiveness of any other registration statement previously filed with the
      Commission, other than (i) any registration statement on Form S-8 or Form S-4
      and (ii) any registration statement or amendment which the Company is required
      to file or as to which the Company is required to request acceleration pursuant
      to any obligation in effect on the date of execution and delivery of this
      Agreement.

     

    (e) Failure
      to File Registration Statement.
      If a
      Registration Event occurs, then the Company will make payments to each Purchaser
      (a “Qualified
      Purchaser”),
      as
      partial liquidated damages for the minimum amount of damages to the Qualified
      Purchaser by reason thereof, and not as a penalty, at a rate equal to 1% of
      the
      Purchase Price per share of Registrable Securities then held by a Qualified
      Purchaser monthly, for each calendar month of the Registration Default Period
      (pro rated for any period less than 30 days); provided, however, if a
      Registration Event occurs (or is continuing) on a date more than one-year after
      the Qualified Purchaser acquired the Registrable Securities (and thus the
      one-year holding period under Rule 144(d) has elapsed), liquidated damages
      shall
      be paid only with respect to that portion of the Qualified Purchaser’s
      Registrable Securities that cannot then be immediately resold in reliance on
      Rule 144. Each such payment shall be due and payable within five days after
      the
      end of each calendar month of the Registration Default Period until the
      termination of the Registration Default Period and within five days after such
      termination. Such payments shall be in partial compensation to the Qualified
      Purchaser, and shall not constitute the Qualified Purchaser’s exclusive remedy
      for such events. The Registration Default Period shall terminate upon (i) the
      filing of the Registration Statement in the case of clause (a) of the definition
      of Registration Event, (ii) the SEC Effective Date in the case of clause (b)
      of
      the definition of Registration Event, (iii) the ability of the Qualified
      Purchaser to effect sales pursuant to the Registration Statement in the case
      of
      clause (c) of the definition of Registration Event, (iv) the listing or
      inclusion and/or trading of the Common Stock on an Approved Market, as the
      case
      may be, in the case of clause (d) of the definition of Registration Event,
      and
      (v) in the case of the events described in clauses (b) and (c) of the definition
      of Registration Event, the earlier termination of the Registration Default
      Period. The amounts payable as partial liquidated damages pursuant to this
      paragraph shall be payable in lawful money of the United States. Amounts payable
      as partial liquidated damages to each Qualified Purchaser hereunder with respect
      to each share of Registrable Securities shall cease when the Qualified Purchaser
      no longer holds such shares of Registrable Securities or such shares of
      Registrable Securities can be immediately sold by the Qualified Purchaser in
      reliance on Rule 144(k).

     

    
      
         

      

      
        -6-

        
          

        

      

      
         

      

    

     

    4. Registration
      Procedures.
      The
      Company will keep each Holder reasonably advised as to the filing and
      effectiveness of the Registration Statement. At its expense with respect to
      the
      Registration Statement, the Company will:

     

    (a) prepare
      and file with the Commission with respect to the Registrable Securities, a
      registration statement on Form SB-2, or any other form for which the Company
      then qualifies or which counsel for the Company shall deem appropriate and
      which
      form shall be available for the sale of the Registrable Securities in accordance
      with the intended methods of distribution thereof, and use its commercially
      reasonable efforts to cause such registration statement to become and remain
      effective at for a period of two years or for such shorter period ending on
      the
      earlier to occur of (i) the sale of all Registrable Securities and (ii) the
      availability under Rule 144(k) for the Holder to sell the Registrable Securities
      (in either case, the “Effectiveness
      Period”);

     

    (b) if
      a
      registration statement is subject to review by the Commission, promptly respond
      to all comments and diligently pursue resolution of any comments to the
      satisfaction of the Commission;

     

    (c) prepare
      and file with the Commission such amendments and supplements to such
      registration statement and the prospectus used in connection therewith as may
      be
      necessary to keep such registration statement effective during the Effectiveness
      Period;

     

    (d) furnish,
      without charge, to each Holder of Registrable Securities covered by such
      registration statement (i) a reasonable number of copies of such registration
      statement (including any exhibits thereto other than exhibits incorporated
      by
      reference), each amendment and supplement thereto as such Holder may reasonably
      request, (ii) such number of copies of the prospectus included in such
      registration statement (including each preliminary prospectus and any other
      prospectus filed under Rule 424 under the Securities Act) as such Holders may
      reasonably request, in conformity with the requirements of the Securities Act,
      and (iii) such other documents as such Holder may require to consummate the
      disposition of the Registrable Securities owned by such Holder, but only during
      the Effectiveness Period;

     

    (e) use
      its
      commercially reasonable best efforts to register or qualify such registration
      under such other applicable securities or blue sky laws of such jurisdictions
      as
      any Holder of Registrable Securities covered by such registration statement
      reasonably requests and as may be necessary for the marketability of the
      Registrable Securities (such request to be made by the time the applicable
      registration statement is deemed effective by the Commission) and do any and
      all
      other acts and things necessary to enable such Holder to consummate the
      disposition in such jurisdictions of the Registrable Securities owned by such
      Holder; provided, however, that the Company shall not be required to (i) qualify
      generally to do business in any jurisdiction where it would not otherwise be
      required to qualify but for this paragraph, (ii) subject itself to taxation
      in
      any such jurisdiction, or (iii) consent to general service of process in any
      such jurisdiction;

     

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

     

    (f) as
      promptly as practicable after becoming aware of such event, notify each Holder
      of Registrable Securities, the disposition of which requires delivery of a
      prospectus relating thereto under the Securities Act, of the happening of any
      event, which comes to the Company’s attention, that will after the occurrence of
      such event cause the prospectus included in such registration statement, if
      not
      amended or supplemented, to contain an untrue statement of a material fact
      or an
      omission to state a material fact required to be stated therein or necessary
      to
      make the statements therein not misleading and the Company shall promptly
      thereafter prepare and furnish to such Holder a supplement or amendment to
      such
      prospectus (or prepare and file appropriate reports under the Exchange Act)
      so
      that, as thereafter delivered to the purchasers of such Registrable Securities,
      such prospectus shall not contain an untrue statement of a material fact or
      omit
      to state any material fact required to be stated therein or necessary to make
      the statements therein not misleading, unless suspension of the use of such
      prospectus otherwise is authorized herein or in the event of a Blackout Period,
      in which case no supplement or amendment need be furnished (or Exchange Act
      filing made) until the termination of such suspension or Blackout Period;

     

    (g) comply,
      and continue to comply during the Effectiveness Period, in all material respects
      with the Securities Act and the Exchange Act and with all applicable rules
      and
      regulations of the Commission with respect to the disposition of all securities
      covered by such registration statement;

     

    (h) as
      promptly as practicable after becoming aware of such event, notify each Holder
      of Registrable Securities being offered or sold pursuant to the Registration
      Statement of the issuance by the Commission of any stop order or other
      suspension of effectiveness of the Registration Statement;

     

    (i) use
      its
      best efforts to cause all the Registrable Securities covered by the Registration
      Statement to be quoted on the NASD OTC Bulletin Board or such other principal
      securities market on which securities of the same class or series issued by
      the
      Company are then listed or traded; 

     

    (j) provide
      a
      transfer agent and registrar, which may be a single entity, for the shares
      of
      Common Stock at all times;

     

    (k) cooperate
      with the Holders of Registrable Securities being offered pursuant to the
      Registration Statement to issue and deliver, or cause its transfer agent to
      issue and deliver, certificates representing Registrable Securities to be
      offered pursuant to the Registration Statement within a reasonable time after
      the delivery of certificates representing the Registrable Securities to the
      transfer agent or the Company, as applicable, and enable such certificates
      to be
      in such denominations or amounts as the Holders may reasonably request and
      registered in such names as the Holders may request;

     

    (l) during
      the Effectiveness Period, refrain from bidding for or purchasing any Common
      Stock or any right to purchase Common Stock or attempting to induce any person
      to purchase any such security or right if such bid, purchase or attempt would
      in
      any way limit the right of the Holders to sell Registrable Securities by reason
      of the limitations set forth in Regulation M under the Exchange Act;
      and

     

    (m) take
      all
      other reasonable actions necessary to expedite and facilitate the disposition
      by
      the Holders of the Registrable Securities pursuant to the Registration
      Statement.

     

    5. Suspension
      of Offers and Sales.
      Each
      Holder agrees that, upon receipt of any notice from the Company of the happening
      of any event of the kind described in Section 4(f) hereof or of the commencement
      of an Blackout Period, such Holder shall discontinue the disposition of
      Registrable Securities included in the Registration Statement until such
      Holder’s receipt of the copies of the supplemented or amended prospectus
      contemplated by Section 4(f) hereof or notice of the end of the Blackout Period,
      and, if so directed by the Company, such Holder shall deliver to the Company
      (at
      the Company’s expense) all copies (including, without limitation, any and all
      drafts), other than permanent file copies, then in such Holder’s possession, of
      the prospectus covering such Registrable Securities current at the time of
      receipt of such notice.

     

    
      
         

      

      
        -8-

        
          

        

      

      
         

      

    

     

    6. Registration
      Expenses.
      The
      Company shall pay all expenses in connection with any registration obligation
      provided herein, including, without limitation, all registration, filing, stock
      exchange fees, printing expenses, all fees and expenses of complying with
      securities or blue sky laws, and the fees and disbursements of counsel for
      the
      Company and of its independent accountants; provided that, in any underwritten
      registration, each party shall pay for its own underwriting discounts and
      commissions and transfer taxes. Except as provided in this Section and Section
      9, the Company shall not be responsible for the expenses of any attorney or
      other advisor employed by a Holder.

     

    7. Assignment
      of Rights.
      No
      Holder may assign its rights under this Agreement to any party without the
      prior
      written consent of the Company; provided, however, that a Holder may assign
      its
      rights under this Agreement without such consent to a Permitted Assignee as
      long
      as (a) such transfer or assignment is effected in accordance with applicable
      securities laws; (b) such transferee or assignee agrees in writing to become
      subject to the terms of this Agreement; and (c) the Company is given written
      notice by such Holder of such transfer or assignment, stating the name and
      address of the transferee or assignee and identifying the Registrable Securities
      with respect to which such rights are being transferred or
      assigned.

     

    8. Information
      by Holder.
      Holders
      included in any registration shall furnish to the Company such information
      as
      the Company may reasonable request in writing regarding such Holders and the
      distribution proposed by such Holders.

     

    9. Indemnification.

     

    (a) In
      the
      event of the offer and sale of Registrable Securities under the Securities
      Act,
      the Company shall, and hereby does, indemnify and hold harmless, to the fullest
      extent permitted by law, each Holder, its directors, officers, partners, each
      other person who participates as an underwriter in the offering or sale of
      such
      securities, and each other person, if any, who controls or is under common
      control with such Holder or any such underwriter within the meaning of Section
      15 of the Securities Act, against any losses, claims, damages or liabilities,
      joint or several, and expenses to which the Holder or any such director,
      officer, partner or underwriter or controlling person may become subject under
      the Securities Act or otherwise, insofar as such losses, claims, damages,
      liabilities or expenses (or actions or proceedings, whether commenced or
      threatened, in respect thereof) arise out of or are based upon any untrue
      statement of any material fact contained in any registration statement prepared
      and filed by the Company under which shares of Registrable Securities were
      registered under the Securities Act, any preliminary prospectus, final
      prospectus or summary prospectus contained therein, or any amendment or
      supplement thereto, or any omission to state therein a material fact required
      to
      be stated therein or necessary to make the statements therein in light of the
      circumstances in which they were made not misleading, and the Company shall
      reimburse the Holder, and each such director, officer, partner, underwriter
      and
      controlling person for any legal or any other expenses reasonably incurred
      by
      them in connection with investigating, defending or settling any such loss,
      claim, damage, liability, action or proceeding; provided that the Company shall
      not be liable in any such case (i) to the extent that any such loss, claim,
      damage, liability (or action or proceeding in respect thereof) or expense arises
      out of or is based upon an untrue statement in or omission from such
      registration statement, any such preliminary prospectus, final prospectus,
      summary prospectus, amendment or supplement in reliance upon and in conformity
      with written information furnished to the Company through an instrument duly
      executed by or on behalf of such Holder specifically stating that it is for
      use
      in the preparation thereof or (ii) if the person asserting any such loss, claim,
      damage, liability (or action or proceeding in respect thereof) who purchased
      the
      Registrable Securities that are the subject thereof did not receive a copy
      of an
      amended preliminary prospectus or the final prospectus (or the final prospectus
      as amended or supplemented) at or prior to the written confirmation of the
      sale
      of such Registrable Securities to such person because of the failure of such
      Holder or underwriter to so provide such amended preliminary or final prospectus
      and the untrue statement or omission of a material fact made in such preliminary
      prospectus was corrected in the amended preliminary or final prospectus (or
      the
      final prospectus as amended or supplemented). Such indemnity shall remain in
      full force and effect regardless of any investigation made by or on behalf
      of
      the Holders, or any such director, officer, partner, underwriter or controlling
      person and shall survive the transfer of such shares by the Holder.

     

    
      
         

      

      
        -9-

        
          

        

      

      
         

      

    

     

    (b) As
      a
      condition to including Registrable Securities in any registration statement
      filed pursuant to this Agreement, each Holder agrees to be bound by the terms
      of
      this Section 9 and to indemnify and hold harmless, to the fullest extent
      permitted by law, the Company, its directors and officers, and each other
      person, if any, who controls the Company within the meaning of Section 15 of
      the
      Securities Act, against any losses, claims, damages or liabilities, joint or
      several, to which the Company or any such director or officer or controlling
      person may become subject under the Securities Act or otherwise, insofar as
      such
      losses, claims, damages or liabilities (or actions or proceedings, whether
      commenced or threatened, in respect thereof) that arises out of or is based
      upon
      an untrue statement in or omission from such registration statement, any such
      preliminary prospectus, final prospectus, summary prospectus, amendment or
      supplement in reliance upon and in conformity with written information furnished
      to the Holder through an instrument duly executed by or on behalf of the Company
      specifically stating that it is for use in the preparation thereof, and such
      Holder shall reimburse the Company, and each such director, officer, and
      controlling person for any legal or other expenses reasonably incurred by them
      in connection with investigating, defending, or settling and such loss, claim,
      damage, liability, action, or proceeding; provided, however, that such indemnity
      agreement found in this Section 9 shall in no event exceed the gross proceeds
      from the offering received by such Holder. Such indemnity shall remain in full
      force and effect, regardless of any investigation made by or on behalf of the
      Company or any such director, officer or controlling person and shall survive
      the transfer by any Holder of such shares.

     

    (c) Promptly
      after receipt by an indemnified party of notice of the commencement of any
      action or proceeding involving a claim referred to in this Section (including
      any governmental action), such indemnified party shall, if a claim in respect
      thereof is to be made against an indemnifying party, give written notice to
      the
      indemnifying party of the commencement of such action; provided that the failure
      of any indemnified party to give notice as provided herein shall not relieve
      the
      indemnifying party of its obligations under this Section, except to the extent
      that the indemnifying party is actually prejudiced by such failure to give
      notice. In case any such action is brought against an indemnified party, unless
      in the reasonable judgment of counsel to such indemnified party a conflict
      of
      interest between such indemnified and indemnifying parties may exist or the
      indemnified party may have defenses not available to the indemnifying party
      in
      respect of such claim, the indemnifying party shall be entitled to participate
      in and to assume the defense thereof, with counsel reasonably satisfactory
      to
      such indemnified party and, after notice from the indemnifying party to such
      indemnified party of its election so to assume the defense thereof, the
      indemnifying party shall not be liable to such indemnified party for any legal
      or other expenses subsequently incurred by the latter in connection with the
      defense thereof, unless in such indemnified party’s reasonable judgment a
      conflict of interest between such indemnified and indemnifying parties arises
      in
      respect of such claim after the assumption of the defenses thereof or the
      indemnifying party fails to defend such claim in a diligent manner, other than
      reasonable costs of investigation. Neither an indemnified nor an indemnifying
      party shall be liable for any settlement of any action or proceeding effected
      without its consent. No indemnifying party shall, without the consent of the
      indemnified party, consent to entry of any judgment or enter into any
      settlement, which does not include as an unconditional term thereof the giving
      by the claimant or plaintiff to such indemnified party of a release from all
      liability in respect of such claim or litigation. Notwithstanding anything
      to
      the contrary set forth herein, and without limiting any of the rights set forth
      above, in any event any party shall have the right to retain, at its own
      expense, counsel with respect to the defense of a claim.

     

    
      
         

      

      
        -10-

        
          

        

      

      
         

      

    

     

    (d) In
      the
      event that an indemnifying party does or is not permitted to assume the defense
      of an action pursuant to Sections 9(c) or in the case of the expense
      reimbursement obligation set forth in Sections 9(a) and (b), the indemnification
      required by Sections 9(a) and (b) hereof shall be made by periodic payments
      of
      the amount thereof during the course of the investigation or defense, as and
      when bills received or expenses, losses, damages, or liabilities are
      incurred.

     

    (e) If
      the
      indemnification provided for in this Section is held by a court of competent
      jurisdiction to be unavailable to an indemnified party with respect to any
      loss,
      liability, claim, damage or expense referred to herein, the indemnifying party,
      in lieu of indemnifying such indemnified party hereunder, shall (i) contribute
      to the amount paid or payable by such indemnified party as a result of such
      loss, liability, claim, damage or expense as is appropriate to reflect the
      proportionate relative fault of the indemnifying party on the one hand and
      the
      indemnified party on the other (determined by reference to, among other things,
      whether the untrue or alleged untrue statement of a material fact or omission
      relates to information supplied by the indemnifying party or the indemnified
      party and the parties’ relative intent, knowledge, access to information and
      opportunity to correct or prevent such untrue statement or omission), or (ii)
      if
      the allocation provided by clause (i) above is not permitted by applicable
      law
      or provides a lesser sum to the indemnified party than the amount hereinafter
      calculated, not only the proportionate relative fault of the indemnifying party
      and the indemnified party, but also the relative benefits received by the
      indemnifying party on the one hand and the indemnified party on the other,
      as
      well as any other relevant equitable considerations. No indemnified party guilty
      of fraudulent misrepresentation (within the meaning of Section 11(f) of the
      Securities Act) shall be entitled to contribution from any indemnifying party
      who was not guilty of such fraudulent misrepresentation.

     

    (f) Other
      Indemnification.
      Indemnification similar to that specified in this Section (with appropriate
      modifications) shall be given by the Company and each Holder of Registrable
      Securities with respect to any required registration or other qualification
      of
      securities under any federal or state law or regulation or governmental
      authority other than the Securities Act.

     

    10. Rule
      144.
      For
      a period of at least 24 months following the Closing Date,
      the
      Company will use its commercially reasonable best efforts to timely file all
      reports required to be filed by the Company after the date hereof under the
      Securities Act and the Exchange Act and the rules and regulations adopted by
      the
      Commission thereunder, and if the Company is not required to file reports
      pursuant to such sections, it will prepare and furnish to the Purchasers and
      make publicly available in accordance with Rule 144(c) such information as
      is
      required for the Purchasers to sell shares of Common Stock under Rule
      144.

     

    11. Independent
      Nature of Each Purchaser’s Obligations and Rights.
      The
      obligations of each Purchaser under this Agreement are several and not joint
      with the obligations of any other Purchaser, and each Purchaser shall not be
      responsible in any way for the performance of the obligations of any other
      Purchaser under this Agreement. Nothing contained herein and no action taken
      by
      any Purchaser pursuant hereto, shall be deemed to constitute such Purchasers
      as
      a partnership, an association, a joint venture, or any other kind of entity,
      or
      create a presumption that the Purchasers are in any way acting in concert or
      as
      a group with respect to such obligations or the transactions contemplated by
      this Agreement. Each Purchaser shall be entitled to independently protect and
      enforce its rights, including without limitation the rights arising out of
      this
      Agreement, and it shall not be necessary for any other Purchaser to be joined
      as
      an additional party in any proceeding for such purpose.

     

    
      
         

      

      
        -11-

        
          

        

      

      
         

      

    

     

    12. Miscellaneous.

     

    (a) Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of New York and the United States of America, both substantive and
      remedial, without regard to New York conflicts of law principles. Any
      judicial proceeding brought against either of the parties to this agreement
      or
      any dispute arising out of this Agreement or any matter related hereto shall
      be
      brought in the courts of the State of New York, New York County, or in the
      United States District Court for the Southern District of New York and, by
      its
      execution and delivery of this agreement, each party to this Agreement accepts
      the jurisdiction of such courts. The foregoing consent to jurisdiction shall
      not
      be deemed to confer rights on any person other than the parties to this
      Agreement.

     

    (b) Successors
      and Assigns.
      Except
      as otherwise provided herein, the provisions hereof shall inure to the benefit
      of, and be binding upon, the successors, Permitted Assigns, executors and
      administrators of the parties hereto. In the event the Company merges with,
      or
      is otherwise acquired by, a direct or indirect subsidiary of a publicly traded
      company, the Company shall condition the merger or acquisition on the assumption
      by such parent company of the Company’s obligations under this Agreement.

     

    (c) Entire
      Agreement.
      This
      Agreement constitutes the full and entire understanding and agreement between
      the parties with regard to the subjects hereof.

     

    (d) Notices,
      etc.
      All
      notices or other communications which are required or permitted under this
      Agreement shall be in writing and sufficient if delivered by hand, by facsimile
      transmission, by registered or certified mail, postage pre-paid, by electronic
      mail, or by courier or overnight carrier, to the persons at the addresses set
      forth below (or at such other address as may be provided hereunder), and shall
      be deemed to have been delivered as of the date so delivered: 

     

    if
      to the
      Company to:

    

    Foothills
      Resources, Inc.

    P.O.
      Box
      2701 

    Bakersfield,
      California 93303

    Attention:
      Dennis B. Tower, Chief Executive Officer

    Facsimile:
      (541) 595-2484

     

    If
      to the
      Purchasers:  

    

    To
      each
      Purchaser at the address

    set
      forth
      on Exhibit A

    

    or
      at
      such other address as any party shall have furnished to the other parties in
      writing.

     

    (e) Delays
      or Omissions.
      No
      delay or omission to exercise any right, power or remedy accruing to any Holder,
      upon any breach or default of the Company under this Agreement, shall impair
      any
      such right, power or remedy of such Holder nor shall it be construed to be
      a
      waiver of any such breach or default, or an acquiescence therein, or of or
      in
      any similar breach or default thereunder occurring; nor shall any waiver of
      any
      single breach or default be deemed a waiver of any other breach or default
      theretofore or thereafter occurring. Any waiver, permit, consent or approval
      of
      any kind or character on the part of any Holder of any breach or default under
      this Agreement, or any waiver on the part of any Holder of any provisions or
      conditions of this Agreement, must be in writing and shall be effective only
      to
      the extent specifically set forth in such writing. All remedies, either under
      this Agreement, or by law or otherwise afforded to any holder, shall be
      cumulative and not alternative.

     

    
      
         

      

      
        -12-

        
          

        

      

      
         

      

    

     

    (f) Counterparts.
      This
      Agreement may be executed in any number of counterparts, each of which shall
      be
      enforceable against the parties actually executing such counterparts, and all
      of
      which together shall constitute one instrument. In the event that any signature
      is delivered by facsimile transmission, such signature shall create a valid
      and
      binding obligation of the party executing (or on whose behalf such signature
      is
      executed) with the same force and effect as if such facsimile signature page
      were an original thereof.

     

    (g) Severability.
      In the
      case any provision of this Agreement shall be invalid, illegal or unenforceable,
      the validity, legality and enforceability of the remaining provisions shall
      not
      in any way be affected or impaired thereby.

     

    (h) Amendments.
      The
      provisions of this Agreement may be amended at any time and from time to time,
      and particular provisions of this Agreement may be waived, with and only with
      an
      agreement or consent in writing signed by the Company and the Majority Holders.
      The Purchasers acknowledge that by the operation of this Section, the Majority
      Holders may have the right and power to diminish or eliminate all rights of
      the
      Purchasers under this Agreement.

     

    (i) Limitation
      on Subsequent Registration Rights.
      After
      the date of this Agreement, the Company shall not, without the prior written
      consent of the Majority Holders, enter into any agreement with any holder or
      prospective holder of any securities of the Company that would grant such holder
      registration rights senior to those granted to the Holders
      hereunder.

     

    

     

    [SIGNATURE
      PAGES FOLLOW]

     

    
      
         

      

      
        -13-

        
          

        

      

      
         

This
        Registration Rights Agreement is hereby executed as of the date first above
        written.

    

     

    COMPANY:

     

    Foothills
      Resources, Inc.

     

    By: ___________________________

    Name: 
      J.
      Earl
      Terris

    Its:
      President
      and Chief Executive Officer

     

    

     

    

    [SIGNATURE
      PAGE OF PURCHASER FOLLOWS]

     

    
      
         

      

      
        -14-

        
          

        

      

      
         

      

    

     

    This
      Registration Rights Agreement is hereby executed as of the date first above
      written.

    
 

    
      	
              PURCHASER:

            
	 
	      

	 
	   

	
              (Print
                Name)

            
	 
	 
	
              By:

            	    

	 
	
              Name:

            	    

	 
	
              Its:

            	     

	 

    

    

    

    
      
         

      

      
        -15-

        
          

        

      

      
         

      

    

    Exhibit
      A

     

    Purchasers

     

    

    
      	
              Purchaser
                Name

            	 	
              Purchaser
                Address

            	 	
              Number
                of Units and/or Value
                of DebenturesEXHIBIT
      10.3

    

    SPLIT-OFF
      AGREEMENT

    

    SPLIT-OFF
      AGREEMENT,
      dated
      as of this 6th day of April 2006 (this “Agreement”), by and among Foothills
      Resources, Inc., a Nevada corporation (“Seller”), J. Earl Terris (“Purchaser”),
      Foothills Leasco, Inc., a Nevada corporation (“Leasco”), and Brasada California,
      Inc., a Delaware corporation (“Brasada”).

     

    R
      E C I T A L S:

    

    WHEREAS, Seller
      is
      the owner of all of the issued and outstanding capital stock of Leasco. Leasco
      is a newly-formed wholly owned subsidiary of Seller which was organized to
      acquire, and has so acquired, a mineral lease previously granted to Seller.
      Seller has no other businesses or operations;

    

    WHEREAS,
      prior
      to the execution of this Agreement, Seller, Brasada, and a newly-formed
      wholly-owned Delaware subsidiary of Seller, Brasada Acquisition Corp.
      (“Acquisition Corp.”), have entered into an Agreement and Plan of Merger and
      Reorganization (the “Merger Agreement”) pursuant to which Acquisition Corp.
      merged with and into Brasada with Brasada being the surviving entity (the
“Merger”), and the stockholders of Brasada received shares of common stock in
      Seller in exchange for their shares of common stock in Brasada;

    

    WHEREAS,
      the
      execution and delivery of this Agreement was required by Brasada as a condition
      subsequent to its execution of the Merger Agreement. The consummation of the
      purchase and sale transaction contemplated by this Agreement was also a
      condition subsequent to the completion of the Merger pursuant to the Merger
      Agreement. Seller has represented to Brasada in the Merger Agreement that the
      purchase and sale transaction contemplated by this Agreement would be
      consummated as soon as practicable following the consummation of the Merger,
      and
      Brasada relied on such representation in entering into the Merger
      Agreement;

    

    WHEREAS,
      Purchaser desires to purchase the Shares (as defined in Section
      1.1)
      from
      Seller, and to assume, as between Seller and Purchaser, all responsibilities
      for
      any debts, obligations and liabilities of Leasco, on the terms and subject
      to
      the conditions specified in this Agreement; and

    

    WHEREAS,
      Seller
      desires to sell and transfer the Shares to the Purchaser, on the terms and
      subject to the conditions specified in this Agreement;

    

    NOW,
      THEREFORE,
      in
      consideration of the premises and the covenants, promises, and agreements herein
      set forth and for other good and valuable consideration, the receipt and
      sufficiency of which are hereby acknowledged, the parties hereto, intending
      legally to be bound, agree as follows.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    I. PURCHASE
      AND SALE OF STOCK.

     

    1.1 Purchased
      Shares.
      Subject
      to the terms and conditions provided below, Seller shall sell and transfer
      to
      Purchaser and Purchaser shall purchase from Seller, on the Closing Date (as
      defined in Section
      1.3),
      all
      the issued and outstanding shares of capital stock of Leasco (the
“Shares”).

     

    1.2 Purchase
      Price.
      The
      purchase price for the Shares shall be the transfer and delivery by Purchaser
      to
      Seller of 34,106,183 shares of common stock of Seller that Purchaser owns (the
      “Purchase Price Shares”), deliverable as provided in Section
      2.2.

     

    1.3 Closing.
      The
      closing of the transactions contemplated in this Agreement (the “Closing”) shall
      take place as soon as practicable following the execution of this Agreement.
      The
      date on which the Closing occurs shall be referred to herein as the Closing
      Date
      (the “Closing Date”).

     

    II. CLOSING.

     

    2.1 Transfer
      of Shares.
      At the
      Closing, Seller shall deliver to Purchaser a certificate representing the
      Shares, duly endorsed to Purchaser or as directed by Purchaser, which delivery
      shall vest Purchaser with good and marketable title to all of the issued and
      outstanding shares of capital stock of Leasco, free and clear of all liens
      and
      encumbrances.

     

    2.2 Payment
      of Purchase Price.
      At the
      Closing, Purchaser shall deliver to Seller a certificate or certificates
      representing the Purchase Price Shares duly endorsed to Seller, which delivery
      shall vest Seller with good and marketable title to the Purchase Price Shares,
      free and clear of all liens and encumbrances.

     

    2.3 Transfer
      of Records.
      On or
      before the Closing, Seller shall arrange for transfer to Leasco all existing
      corporate books and records in Seller’s possession relating to Leasco and its
      business, including but not limited to all agreements, litigation files, real
      estate files, mineral leases, personnel files and filings with governmental
      agencies; provided,
      however,
      when
      any such documents relate to both Seller and Leasco, only copies of such
      documents need be furnished. On or before the Closing, Purchaser and Leasco
      shall transfer to Seller all existing corporate books and records in the
      possession of Purchaser or Leasco relating to Seller, including but not limited
      to all corporate minute books, stock ledgers, certificates and corporate seals
      of Seller and all agreements, litigation files, real property files, personnel
      files and filings with governmental agencies; provided,
      however,
      when
      any such documents relate to both Seller and Leasco or its business, only copies
      of such documents need be furnished.

     

    III. PURCHASER’S
      REPRESENTATIONS AND WARRANTIES.
      Purchaser represents and warrants to Seller and Brasada that:

     

    3.1 Capacity
      and Enforceability.
      Purchaser has the legal capacity to execute and deliver this Agreement and
      the
      documents to be executed and delivered by Purchaser at the Closing pursuant
      to
      the transactions contemplated hereby. This Agreement and all such documents
      constitute valid and binding agreements of Purchaser, enforceable in accordance
      with their terms.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    3.2 Compliance.
      Neither
      the execution and delivery of this Agreement nor the consummation of the
      transactions contemplated hereby by Purchaser will result in the breach of
      any
      term or provision of, or constitute a default under, or violate any agreement,
      indenture, instrument, order, law or regulation to which Purchaser is a party
      or
      by which Purchaser is bound.

     

    3.3 Purchase
      for Investment.
      Purchaser is financially able to bear the economic risks of acquiring an
      interest in Leasco and the other transactions contemplated hereby, and has
      no
      need for liquidity in this investment. Purchaser has such knowledge and
      experience in financial and business matters in general and with respect to
      businesses of a nature similar to the business of Leasco so as to be capable
      of
      evaluating the merits and risks of, and making an informed business decision
      with regard to, the acquisition of the Shares. Purchaser is acquiring the Shares
      solely for his own account and not with a view to or for resale in connection
      with any distribution or public offering thereof, within the meaning of any
      applicable securities laws and regulations, unless such distribution or offering
      is registered under the Securities Act of 1933, as amended (the “Securities
      Act”), or an exemption from such registration is available. Purchaser has
      (i) received all the information he has deemed necessary to make an
      informed investment decision with respect to the acquisition of the Shares;
      (ii) had an opportunity to make such investigation as he has desired
      pertaining to Leasco and the acquisition of an interest therein and to verify
      the information which is, and has been, made available to him; and
      (iii) had the opportunity to ask questions of Seller concerning Leasco.
      Purchaser acknowledges that Purchaser is an officer and director of Seller
      and
      Leasco and, as such, has actual knowledge of the business, operations and
      financial affairs of Leasco. Purchaser has received no public solicitation
      or
      advertisement with respect to the offer or sale of the Shares. Purchaser
      realizes that the Shares are “restricted securities” as that term is defined in
      Rule 144 promulgated by the Securities and Exchange Commission under the
      Securities Act, the resale of the Shares is restricted by federal and state
      securities laws and, accordingly, the Shares must be held indefinitely unless
      their resale is subsequently registered under the Securities Act or an exemption
      from such registration is available for their resale. Purchaser understands
      that
      any resale of the Shares by him must be registered under the Securities Act
      (and
      any applicable state securities law) or be effected in circumstances that,
      in
      the opinion of counsel for Leasco at the time, create an exemption or otherwise
      do not require registration under the Securities Act (or applicable state
      securities laws). Purchaser acknowledges and consents that certificates now
      or
      hereafter issued for the Shares will bear a legend substantially as
      follows:

     

    THE
      SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR QUALIFIED UNDER
      ANY APPLICABLE STATE SECURITIES LAWS (THE “STATE ACTS”), HAVE BEEN ACQUIRED FOR
      INVESTMENT AND MAY NOT BE SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED
      EXCEPT PURSUANT TO A REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND
      QUALIFICATION UNDER THE STATE ACTS OR EXEMPTIONS FROM SUCH REGISTRATION OR
      QUALIFICATION REQUIREMENTS (INCLUDING, IN THE CASE OF THE SECURITIES ACT, THE
      EXEMPTIONS AFFORDED BY SECTION 4(1) OF THE SECURITIES ACT AND RULE 144
      THEREUNDER). AS A PRECONDITION TO ANY SUCH TRANSFER, THE ISSUER OF THESE
      SECURITIES SHALL BE FURNISHED WITH AN OPINION OF COUNSEL OPINING AS TO THE
      AVAILABILITY OF EXEMPTIONS FROM SUCH REGISTRATION AND QUALIFICATION AND/OR
      SUCH
      OTHER EVIDENCE AS MAY BE SATISFACTORY THERETO THAT ANY SUCH TRANSFER WILL NOT
      VIOLATE THE SECURITIES LAWS.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    Purchaser
      understands that the Shares are being sold to him pursuant to the exemption
      from
      registration contained in Section 4(1) of the Securities Act and that the Seller
      is relying upon the representations made herein as one of the bases for claiming
      the Section 4(1) exemption. 

     

    3.4 Liabilities.
      Following the Closing, Seller will have no liability for any debts, liabilities
      or obligations of Leasco or its business or activities, and there are no
      outstanding guaranties, performance or payment bonds, letters of credit or
      other
      contingent contractual obligations that have been undertaken by Seller directly
      or indirectly in relation to Leasco or its business and that may survive the
      Closing. 

     

    3.5 Title
      to Purchase Price Shares.
      Purchaser is the sole record and beneficial owner of the Purchase Price Shares.
      At Closing, Purchaser will have good and marketable title to the Purchase Price
      Shares, which Purchase Price Shares are, and at the Closing will be, free and
      clear of all options, warrants, pledges, claims, liens, and encumbrances and
      any
      restrictions or limitations prohibiting or restricting transfer to Seller,
      except for restrictions on transfer as contemplated by applicable securities
      laws. 

     

    IV. SELLER’S
      AND LEASCO’S REPRESENTATIONS AND WARRANTIES.
      Seller
      and Leasco, jointly and severally, represent and warrant to Purchaser
      that:

     

    4.1 Organization
      and Good Standing.
      Seller
      is a corporation duly incorporated, validly existing, and in good standing
      under
      the laws of the State of Nevada. Leasco is a corporation duly incorporated,
      validly existing and in good standing under the laws of the State of
      Delaware.

     

    4.2 Authority
      and Enforceability.
      The
      execution and delivery of this Agreement and the documents to be executed and
      delivered at the Closing pursuant to the transactions contemplated hereby,
      and
      performance in accordance with the terms hereof and thereof, have been duly
      authorized by Seller and all such documents constitute the valid and binding
      agreements of Seller enforceable in accordance with their terms.

     

    4.3 Title
      to Shares.
      Seller
      is the sole record and beneficial owner of the Shares. At Closing, Seller will
      have good and marketable title to the Shares, which Shares are, and at the
      Closing will be, free and clear of all options, warrants, pledges, claims,
      liens
      and encumbrances, and any restrictions or limitations prohibiting or restricting
      transfer to Purchaser, except for restrictions on transfer as contemplated
      by
Section
      3.3
      above.
      The Shares constitute all of the issued and outstanding shares of capital stock
      of Leasco.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    4.4 WARN
      Act.
      Leasco
      does not have a sufficient number of employees to make it subject to the Worker
      Adjustment and Retraining Notification Act (“WARN Act”).

     

    4.5 Representations
      in Merger Agreement.
      Leasco
      represents and warrants that all of the representations and warranties by
      Seller, insofar as they relate to Leasco, contained in the Merger Agreement
      are
      true and correct.

     

    V. OBLIGATIONS
      OF PURCHASER PENDING CLOSING.
      Purchaser covenants and agrees that between the date hereof and the
      Closing:

     

    5.1 Not
      Impair Performance.
      Purchaser shall not take any intentional action that would cause the conditions
      upon the obligations of the parties hereto to effect the transactions
      contemplated hereby not to be fulfilled, including, without limitation, taking
      or causing to be taken any action that would cause the representations and
      warranties made by any party herein not to be true, correct and accurate as
      of
      the Closing, or in any way impairing the ability of Seller to satisfy its
      obligations as provided in Article
      VI.

     

    5.2 Assist
      Performance.
      Purchaser shall exercise its reasonable best efforts to cause to be fulfilled
      those conditions precedent to Seller’s obligations to consummate the
      transactions contemplated hereby which are dependent upon actions of Purchaser
      and to make and/or obtain any necessary filings and consents in order to
      consummate the sale transaction contemplated by this Agreement.

     

    VI. OBLIGATIONS
      OF SELLER PENDING CLOSING.
      Seller
      covenants and agrees that between the date hereof and the Closing:

     

    6.1 
      Business as Usual.
      Leasco
      shall operate and Seller shall cause Leasco to operate in accordance with past
      practices and shall use best efforts to preserve its goodwill and the goodwill
      of its employees, customers and others having business dealings with Leasco.
      Without limiting the generality of the foregoing, from the date of this
      Agreement until the Closing Date, Leasco shall (a) make all normal and
      customary repairs to its equipment, assets and facilities, (b) keep in
      force all insurance, (c) preserve in full force and effect all material
      franchises, licenses, contracts and real property interests and comply in all
      material respects with all laws and regulations, (d) collect all accounts
      receivable and pay all trade creditors in the ordinary course of business at
      intervals historically experienced, and (e) preserve and maintain Leasco’s
      assets in their current operating condition and repair, ordinary wear and tear
      excepted. Leasco shall not (i) amend, terminate or surrender any material
      franchise, license, contract or real property interest, or (ii) sell or
      dispose of any of its assets except in the ordinary course of business. Neither
      Leasco nor Purchaser shall take or omit to take any action that results in
      Seller incurring any liability or obligation prior to or in connection with
      the
      Closing.

     

    6.2 Not
      Impair Performance.
      Seller
      shall not take any intentional action that would cause the conditions upon
      the
      obligations of the parties hereto to effect the transactions contemplated hereby
      not to be fulfilled, including, without limitation, taking or causing to be
      taken any action which would cause the representations and warranties made
      by
      any party herein not to be materially true, correct and accurate as of the
      Closing, or in any way impairing the ability of Purchaser to satisfy his
      obligations as provided in Article
      V.

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    6.3 Assist
      Performance.
      Seller
      shall exercise its reasonable best efforts to cause to be fulfilled those
      conditions precedent to Purchaser’s obligations to consum-mate the transactions
      contemplated hereby which are dependent upon the actions of Seller and to work
      with Purchaser to make and/or obtain any necessary filings and consents. Seller
      shall cause Leasco to comply with its obligations under this
      Agreement.

     

    VII. SELLER’S
      AND LEASCO’S CONDITIONS PRECEDENT TO CLOSING.
      The
      obligations of Seller and Leasco to close the transactions contemplated by
      this
      Agreement are subject to the satisfaction at or prior to the Closing of each
      of
      the following conditions precedent (any or all of which may be waived by Seller
      and Brasada in writing):

     

    7.1 Representations
      and Warranties; Performance.
      All
      representations and warranties of Purchaser contained in this Agreement shall
      have been true and correct, in all material respects, when made and shall be
      true and correct, in all material respects, at and as of the Closing, with
      the
      same effect as though such representations and warranties were made at and
      as of
      the Closing. Purchaser shall have performed and complied with all covenants
      and
      agreements and satisfied all conditions, in all material respects, required
      by
      this Agreement to be performed or complied with or satisfied by Purchaser at
      or
      prior to the Closing.

     

    7.2 Additional
      Documents.
      Purchaser shall deliver or cause to be delivered such additional documents
      as
      may be necessary in connection with the consummation of the transactions
      contemplated by this Agreement and the performance of their obligations
      hereunder.

     

    7.3 Release
      by Leasco.
      At the
      Closing, Leasco shall execute and deliver to Seller and Brasada a general
      release which in substance and effect releases Seller and Brasada from any
      and
      all liabilities and obligations that Seller and Brasada may owe to Leasco in
      any
      capacity and from any and all claims that Leasco may have against Seller,
      Brasada, or their respective officers, directors, stockholders, employees and
      agents (other than those arising pursuant to this Agreement or any document
      delivered in connection with this Agreement).

     

    VIII. PURCHASER’S
      CONDITIONS PRECEDENT TO CLOSING.
      The
      obligation of Purchaser to close the transactions contemplated by this Agreement
      is subject to the satisfaction at or prior to the Closing of each of the
      following conditions precedent (any and all of which may be waived by Purchaser
      in writing):

     

    8.1 Representations
      and Warranties; Performance.
      All
      representations and warranties of Seller and Leasco contained in this Agreement
      shall have been true and correct, in all material respects, when made and shall
      be true and correct, in all material respects, at and as of the Closing with
      the
      same effect as though such representations and warranties were made at and
      as of
      the Closing. Seller and Leasco shall have performed and complied with all
      covenants and agreements and satisfied all conditions, in all material respects,
      required by this Agreement to be performed or complied with or satisfied by
      them
      at or prior to the Closing.

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    IX. OTHER
      AGREEMENTS.

     

    9.1 Expenses.
      Each
      party hereto shall bear its expenses separately incurred in connection with
      this
      Agreement and with the performance of its obligations hereunder.

     

    9.2 Confidentiality.
      The
      parties hereto shall not make any public announcements concerning this
      transaction other than in accordance with mutual agreement reached prior to
      any
      such announcement(s) and other than as may be required by applicable law or
      judicial process. If for any reason the transactions contemplated hereby are
      not
      consummated, then Purchaser shall return any information received by Purchaser
      from Seller or Leasco, and Purchaser shall cause all confidential information
      obtained by Purchaser concerning Leasco and its business to be treated as
      such.

     

    9.3 Brokers’
      Fees.
      No
      party to this Agreement has employed the services of a broker and each agrees
      to
      indemnify the other against all claims of any third parties for fees and
      commissions of any brokers claiming a fee or commission related to the
      transactions contemplated hereby.

     

    9.4 Access
      to Information Post-Closing; Cooperation.
      

     

    (a) Following
      the Closing, Purchaser and Leasco shall afford to Seller and its authorized
      accountants, counsel, and other designated representatives reasonable access
      (and including using reasonable efforts to give access to persons or firms
      possessing information) and duplicating rights during normal business hours
      to
      allow records, books, contracts, instruments, computer data and other data
      and
      information (collectively, “Information”) within the possession or control of
      Purchaser or Leasco insofar as such access is reasonably required by Seller.
      Information may be requested under this Section
      9.4(a)
      for,
      without limitation, audit, accounting, claims, litigation and tax purposes,
      as
      well as for purposes of fulfilling disclosure and reporting obligations and
      performing this Agreement and the transactions contemplated hereby. No files,
      books or records of Leasco existing at the Closing Date shall be destroyed
      by
      Purchaser or Leasco after Closing but prior to the expiration of any period
      during which such files, books or records are required to be maintained and
      preserved by applicable law without giving the Seller at least 30 days’ prior
      written notice, during which time Seller shall have the right to examine and
      to
      remove any such files, books and records prior to their
      destruction.

     

    (b) Following
      the Closing, Seller shall afford to Leasco and its authorized accountants,
      counsel and other designated representatives reasonable access (including using
      reasonable efforts to give access to persons or firms possessing information)
      duplicating rights during normal business hours to Information within Seller’s
      possession or control relating to the business of Leasco. Information may be
      requested under this Section
      9.4(b)
      for,
      without limitation, audit, accounting, claims, litigation and tax purposes
      as
      well as for purposes of fulfilling disclosure and reporting obligations and
      for
      performing this Agreement and the transactions contemplated hereby. No files,
      books or records of Leasco existing at the Closing Date shall be destroyed
      by
      Seller after Closing but prior to the expiration of any period during which
      such
      files, books or records are required to be maintained and preserved by
      applicable law without giving the Purchaser at least 30 days prior written
      notice, during which time Purchaser shall have the right to examine and to
      remove any such files, books and records prior to their
      destruction.

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

     

    (c) At
      all
      times following the Closing, Seller, Purchaser and Leasco shall use reasonable
      efforts to make available to the other party on written request, the current
      and
      former officers, directors, employees and agents of Seller or Leasco for any
      of
      the purposes set forth in Section
      9.4(a) or (b)
      above or
      as witnesses to the extent that such persons may be reasonably be required
      in
      connection with any legal, administrative or other proceedings in which Seller
      or Leasco may from time to be involved.

     

    (d) The
      party
      to whom any Information or witnesses are provided under this Section
      9.4
      shall
      reimburse the provider thereof for all out-of-pocket expenses actually and
      reasonably incurred in providing such Information or witnesses.

     

    (e) Seller,
      Purchaser, Leasco and their respective employees and agents shall each hold
      in
      strict confidence all Information concerning the other party in their possession
      or furnished by the other or the other’s representative pursuant to this
      Agreement with the same degree of care as such party utilizes as to such party’s
      own confidential information (except to the extent that such Information is
      (i) in the public domain through no fault of such party or (ii) later
      lawfully acquired from any other source by such party), and each party shall
      not
      release or disclose such Information to any other person, except such party’s
      auditors, attorneys, financial advisors, bankers, other consultants and advisors
      or persons with whom such party has a valid obligation to disclose such
      Information, unless compelled to disclose such Information by judicial or
      administrative process or, as advised by its counsel, by other requirements
      of
      law.

     

    (f) Seller,
      Purchaser and Leasco shall each use their best efforts to forward promptly
      to
      the other party all notices, claims, correspondence and other materials which
      are received and determined to pertain to the other party.

     

    9.5 Guarantees,
      Surety Bonds and Letter of Credit Obligations.
      In the
      event that Seller is obligated for any debts, obligations or liabilities of
      Leasco by virtue of any outstanding guarantee, performance or surety bond or
      letter of credit provided or arranged by Seller on or prior to the Closing
      Date,
      Purchaser and Leasco shall use best efforts to cause to be issued replacements
      of such bonds, letters of credit and guarantees and to obtain any amendments,
      novations, releases and approvals necessary to release and discharge fully
      Seller from any liability thereunder following the Closing. Purchaser and
      Leasco, jointly and severally, shall be responsible for, and shall indemnify,
      hold harmless and defend Seller from and against, any costs or losses incurred
      by Seller arising from such bonds, letters of credits and guarantees and any
      liabilities arising therefrom and shall reimburse Seller for any payments that
      Seller may be required to pay pursuant to enforcement of its obligations
      relating to such bonds, letters of credit and guarantees.

     

    9.6 Filings
      and Consents.
      Purchaser, at its risk, shall determine what, if any, filings and consents
      must
      be made and/or obtained prior to Closing to consummate the purchase and sale
      of
      the Shares. Purchaser shall indemnify the Seller Indemnified Parties (as defined
      in Section
      11.1
      below)
      against any Losses (as defined in Section
      11.1
      below)
      incurred by any Seller Indemnified Parties by virtue of the failure to make
      and/or obtain any such filings or consents. Recognizing that the failure to
      make
      and/or obtain any filings or consents may cause Seller to incur Losses or
      otherwise adversely affect Seller, Purchaser and Leasco confirm that the
      provisions of this Section
      9.6
      will not
      limit Seller’s right to treat such failure as the failure of a condition
      precedent to Seller’s obligation to close pursuant to Article
      VII
      above.

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

     

    9.7 Insurance.
      Purchaser acknowledges that on the Closing Date, effective as of the Closing,
      all insurance coverage and bonds provided by Seller for Leasco, and all
      certificates of insurance evidencing that Leasco maintains any required
      insurance by virtue of insurance provided by Seller, will terminate with respect
      to any insured damages resulting from matters occurring subsequent to Closing.
      

     

    9.8 Agreements
      Regarding Taxes.
      

     

    (a) Tax
      Sharing Agreements.
      Any tax
      sharing agreement between Seller and Leasco is terminated as of the Closing
      Date
      and will have no further effect for any taxable year (whether the current year,
      a future year, or a past year).

     

    (b) Returns
      for Periods Through the Closing Date.
      Seller
      will include the income and loss of Leasco (including any deferred income
      triggered into income by Reg. §1.1502-13 and any excess loss accounts taken into
      income under Reg. §1.1502-19) on Seller’s consolidated federal income tax
      returns for all periods through the Closing Date and pay any federal income
      taxes attributable to such income. Seller and Leasco agree to allocate income,
      gain, loss, deductions and credits between the period up to Closing (the
“Pre-Closing Period”) and the period after Closing (the “Post-Closing Period”)
      based on a closing of the books of Leasco and both Seller and Leasco agree
      not
      to make an election under Reg. §1.1502-76(b)(2)(ii) to ratably allocate the
      year’s items of income, gain, loss, deduction and credit. Seller, Leasco and
      Purchaser agree to report all transactions not in the ordinary course of
      business occurring on the Closing Date after Purchaser’s purchase of the Shares
      on Leasco’s tax returns to the extent permitted by Reg. §1.1502-76(b)(1)(ii)(B).
      Purchaser agrees to indemnify Seller for any additional tax owed by Seller
      (including tax owned by Seller due to this indemnification payment) resulting
      from any transaction engaged in by Leasco during the Pre-Closing Period or
      on
      the Closing Date after Purchaser’s purchase of the Shares. Leasco will furnish
      tax information to Seller for inclusion in Seller’s consolidated federal income
      tax return for the period which includes the Closing Date in accordance with
      Leasco’s past custom and practice.

     

    (c) Audits.
      Seller
      will allow Leasco and its counsel to participate at Leasco’s expense in any
      audits of Seller’s consolidated federal income tax returns to the extent that
      such audit raises issues that relate to and increase the tax liability of
      Leasco. Seller shall have the absolute right, in its sole discretion, to engage
      professionals and direct the representation of Seller in connection with any
      such audit and the resolution thereof, without receiving the consent of
      Purchaser or Leasco or any other party acting on behalf of Purchaser or Leasco,
      provided that Seller will not settle any such audit in a manner which would
      materially adversely affect Leasco after the Closing Date unless such settlement
      would be reasonable in the case of a person that owned Leasco both before and
      after the Closing Date. In the event that after Closing any tax authority
      informs the Purchaser or Leasco of any notice of proposed audit, claim,
      assessment, or other dispute concerning an amount of taxes which pertain to
      the
      Seller, or to Leasco during the period prior to Closing, Purchaser or Leasco
      must promptly notify the Seller of the same within 15 calendar days of the
      date
      of the notice from the tax authority. In the event Purchaser or Leasco does
      not
      notify the Seller within such 15 day period, Purchaser and Leasco, jointly
      and
      severally, will indemnify the Seller for any incremental interest, penalty
      or
      other assessments resulting from the delay in giving notice. To the extent
      of
      any conflict or inconsistency, the provisions of this Section
      9.8
      shall
      control over the provisions of Section
      11.2
      below.

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

    (d) Cooperation
      on Tax Matters.
      Purchaser, Seller and Leasco shall cooperate fully, as and to the extent
      reasonably requested by the other party, in connection with the filing of tax
      returns pursuant to this Section and any audit, litigation or other proceeding
      with respect to taxes. Such cooperation shall include the retention and (upon
      the other party’s request) the provision of records and information which are
      reasonably relevant to any such audit, litigation or other proceeding and making
      employees available on a mutually convenient basis to provide additional
      information and explanation of any material provided hereunder. Leasco shall
      (i) retain all books and records with respect to tax matters pertinent to
      Leasco relating to any taxable period beginning before the Closing Date until
      the expiration of the statute of limitations (and, to the extent notified by
      Seller, any extensions thereof) of the respective taxable periods, and to abide
      by all record retention agreements entered into with any taxing authority,
      and
      (ii) give Seller reasonable written notice prior to transferring,
      destroying or discarding any such books and records and, if the Seller so
      requests, Purchaser agrees to cause Leasco to allow Seller to take possession
      of
      such books and records.

     

    9.9 ERISA.
      Effective as of the Closing Date, Leasco shall terminate its participation
      in,
      and withdraw from, all employee benefit plans sponsored by Seller, and Seller
      and Purchaser shall cooperate fully in such termination and withdrawal. Without
      limitation, Leasco shall be solely responsible for (i) all liabilities
      under those employee benefit plans notwithstanding any status as an employee
      benefit plan sponsored by Seller, and (ii) all liabilities for the payment
      of vacation pay, severance benefits, and similar obligations, including, without
      limitation, amounts which are accrued but unpaid as of the Closing Date with
      respect thereto. Purchaser and Leasco acknowledge that Leasco is solely
      responsible for providing continuation health coverage, as required under the
      Consolidated Omnibus Reconciliation Act of 1985, as amended (“COBRA”), to each
      person, if any, participating in an employee benefit plan subject to COBRA
      with
      respect to such employee benefit plan as of the Closing Date, including, without
      limitation, any person whose employment with Leasco is terminated after the
      Closing Date.

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

     

    X. TERMINATION.
      This
      Agreement may be terminated at, or at any time prior to, the Closing by mutual
      written consent of Seller, Purchaser and Brasada.

     

    If
      this
      Agreement is terminated as provided herein, it shall become wholly void and
      of
      no further force and effect and there shall be no further liability or
      obligation on the part of any party except to pay such expenses as are required
      of such party.

     

    XI. INDEMNIFICATION.

     

    11.1 Indemnification
      by Purchaser.
      Purchaser covenants and agrees to indemnify, defend, protect and hold harmless
      Seller, and its officers, directors, employees, stockholders, agents,
      representatives and affiliates (collectively, together with Seller, the “Seller
      Indemnified Parties”) at all times from and after the date of this Agreement
      from and against all losses, liabilities, damages, claims, actions, suits,
      proceedings, demands, assessments, adjustments, costs and expenses (including
      specifically, but without limitation, reasonable attorneys’ fees and expenses of
      investigation), whether or not involving a third party claim and regardless
      of
      any negligence of any Seller Indemnified Party (collectively, “Losses”),
      incurred by any Seller Indemnified Party as a result of or arising from
      (i) any breach of the representations and warranties of Purchaser set forth
      herein or in certificates delivered in connection herewith, (ii) any breach
      or nonfulfillment of any covenant or agreement (including any other agreement
      of
      Purchaser to indemnify Seller set forth in this Agreement) on the part of
      Purchaser under this Agreement, (iii) any debt, liability or obligation of
      Leasco, (iv) the conduct and operations of the business of Leasco whether
      before or after Closing, (v) claims asserted against Leasco whether before
      or after Closing, or (vi) any federal or state income tax payable by Seller
      and attributable to the transaction contemplated by this Agreement.

     

    11.2 Third
      Party Claims.

     

    (a) Defense.
      If any
      claim or liability (a “Third-Party Claim”) should be asserted against any of the
      Seller Indemnified Parties (the “Indemnitee”) by a third party after the Closing
      for which Purchaser has an indemnification obligation under the terms of
Section
      11.1,
      then
      the Indemnitee shall notify Purchaser and Leasco (the “Indemnitor”) within 20
      days after the Third-Party Claim is asserted by a third party (said notification
      being referred to as a “Claim Notice”) and give the Indemnitor a reasonable
      opportunity to take part in any examination of the books and records of the
      Indemnitee relating to such Third-Party Claim and to assume the defense of
      such
      Third-Party Claim and in connection therewith and to conduct any proceedings
      or
      negotiations relating thereto and necessary or appropriate to defend the
      Indemnitee and/or settle the Claim. The expenses (including reasonable
      attorneys’ fees) of all negotiations, proceedings, contests, lawsuits or
      settlements with respect to any Third-Party Claim shall be borne by the
      Indemnitor. If the Indemnitor agrees to assume the defense of any Third-Party
      Claim in writing within 20 days after the Claim Notice of such Third-Party
      Claim
      has been delivered, through counsel reasonably satisfactory to Indemnitee,
      then
      the Indemnitor shall be entitled to control the conduct of such defense, and
      any
      decision to settle such Third-Party Claim, and shall be responsible for any
      expenses of the Indemnitee in connection with the defense of such Third-Party
      Claim so long as the Indemnitor continues such defense until the final
      resolution of such Third-Party Claim. The Indemnitor shall be responsible for
      paying all settlements made or judgments entered with respect to any Third-Party
      Claim the defense of which has been assumed by the Indemnitor. Except as
      provided on subsection (b) below, both the Indemnitor and the Indemnitee must
      approve any settlement of a Third Party Claim. A failure by the Indemnitee
      to
      timely give the Claim Notice shall not excuse Indemnitor from any
      indemnification liability except only to the extent that the Indemnitor is
      materially and adversely prejudiced by such failure.

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

     

    (b) Failure
      to Defend.
      If the
      Indemnitor shall not agree to assume the defense of any Third-Party Claim in
      writing within 20 days after the Claim Notice of such Third-Party Claim has
      been
      delivered, or shall fail to continue such defense until the final resolution
      of
      such Third-Party Claim, then the Indemnitee may defend against such Third-Party
      Claim in such manner as it may deem appropriate and the Indemnitee may settle
      such Third-Party Claim on such terms as it may deem appropriate. The Indemnitor
      shall promptly reimburse the Indemnitee for the amount of all settlement
      payments and expenses, legal and otherwise, incurred by the Indemnitee in
      connection with the defense or settlement of such Third-Party Claim. If no
      settlement of such Third-Party Claim is made, then the Indemnitor shall satisfy
      any judgment rendered with respect to such Third-Party Claim before the
      Indemnitee is required to do so, and pay all expenses, legal or otherwise,
      incurred by the Indemnitee in the defense against such Third-Party
      Claim.

     

    11.3 Non-Third-Party
      Claims.
      Upon
      discovery of any claim for which Purchaser has an indemnification obligation
      under the terms of Section
      11.3
      which
      does not involve a claim by a third party against the Indemnitee, the Indemnitee
      shall give prompt notice to Purchaser of such claim and, in any case, shall
      give
      Purchaser such notice within 30 days of such discovery. A failure by Indemnitee
      to timely give the foregoing notice to Purchaser shall not excuse Purchaser
      from
      any indemnification liability except to the extent that Purchaser is materially
      and adversely prejudiced by such failure.

     

    11.4 Survival.
      Except
      as otherwise provided in this Section
      11.4,
      all
      representations and warranties made by Purchaser, Leasco and Seller in
      connection with this Agreement shall survive the Closing. Anything in this
      Agreement to the contrary notwithstanding, the liability of all Indemnitors
      under this Article
      XI
      shall
      terminate on the third (3rd)
      anniversary of the Closing Date, except with respect to (a) liability for
      any item as to which, prior to the third (3rd)
      anniversary of the Closing Date, any Indemnitee shall have asserted a Claim
      in
      writing, which Claim shall identify its basis with reasonable specificity,
      in
      which case the liability for such Claim shall continue until it shall have
      been
      finally settled, decided or adjudicated, (b) liability of any party for
      Losses for which such party has an indemnification obligation, incurred as
      a
      result of such party’s breach of any covenant or agreement to be performed by
      such party after the Closing, (c) liability of Purchaser for Losses
      incurred by a Seller Indemnified Party due to breaches of their representations
      and warranties in Article
      III
      of this
      Agreement, and (d) liability of Purchaser for Losses arising out of
      Third-Party Claims for which Purchaser has an indemnification obligation, which
      liability shall survive until the statute of limitation applicable to any third
      party’s right to assert a Third-Party Claim bars assertion of such
      claim.

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

     

    XII. MISCELLANEOUS.

     

    12.1 Notices.
      All
      notices and communications required or permitted hereunder shall be in writing
      and deemed given when received by means of the United States mail, addressed
      to
      the party to be notified, postage prepaid and registered or certified with
      return receipt requested, or personal delivery, or overnight courier, as
      follows:

     

    (a) If
      to
      Seller, addressed to:

     

    Foothills
      Resources, Inc.

    P.O.
      Box
      2701

    Bakersfield,
      CA 93303

    Attn:
      Dennis B. Tower, Chief Executive Officer

    Facsimile:
      (541) 595-2484

    

    With
      a
      copy to (which shall not constitute notice hereunder):

     

    McGuireWoods
      LLP

    1345
      Avenue of the Americas

    New
      York,
      NY 10105

    Attn:
      Louis W. Zehil, Esq.

    Facsimile:
      (212) 548-2175

    

    (b) If
      to
      Purchaser or Leasco, addressed to:

     

    J.
      Earl
      Terris

    9
      Langton
      Close 

    Woking,
      Surrey, England

    Facsimile:
      (011) 566782214

    

    With
      a
      copy to (which shall not constitute notice hereunder):

     

    Gottbetter
      & Partners, LLP

    488
      Madison Avenue, 12th
      Floor

    New
      York,
      New York 10022

    Attention:
      Adam S. Gottbetter, Esq.

    

    (c) If
      to
      Brasada, addressed to:

     

    Brasada
      California, Inc.

    P.O.
      Box
      2701

    Bakersfield,
      CA 93303

    Attn:
      Dennis B. Tower, Chief Executive Officer

    Facsimile:
      (541) 595-2484

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    

    With
      a
      copy to (which shall not constitute notice hereunder):

     

    McGuireWoods
      LLP

    1345
      Avenue of the Americas

    New
      York,
      NY 10105

    Attn:
      Louis W. Zehil, Esq.

    Facsimile:
      (212) 548-2175

    

    or
      to
      such other address as any party hereto shall specify pursuant to this
Section
      12.1
      from
      time to time.

     

    12.2 Exercise
      of Rights and Remedies.
      Except
      as otherwise provided herein, no delay of or omission in the exercise of any
      right, power or remedy accruing to any party as a result of any breach or
      default by any other party under this Agreement shall impair any such right,
      power or remedy, nor shall it be construed as a waiver of or acquiescence in
      any
      such breach or default, or of any similar breach or default occurring later;
      nor
      shall any waiver of any single breach or default be deemed a waiver of any
      other
      breach or default occurring before or after that waiver.

     

    12.3 Time.
      Time is
      of the essence with respect to this Agreement.

     

    12.4 Reformation
      and Severability.
      In case
      any provision of this Agreement shall be invalid, illegal or unenforceable,
      it
      shall, to the extent possible, be modified in such manner as to be valid, legal
      and enforceable but so as to most nearly retain the intent of the parties,
      and
      if such modification is not possible, such provision shall be severed from
      this
      Agreement, and in either case the validity, legality and enforceability of
      the
      remaining provisions of this Agreement shall not in any way be affected or
      impaired thereby.

     

    12.5 Further
      Acts.
      Seller,
      Purchaser and Leasco shall execute any and all documents and perform such other
      acts which may be reasonably necessary to effectuate the purposes of this
      Agreement.

     

    12.6 Entire
      Agreement; Amendments.
      This
      Agreement contains the entire understanding of the parties relating to the
      subject matter contained herein. This Agreement cannot be amended or changed
      except through a written instrument signed by all of the parties hereto,
      including Brasada. No provisions of this Agreement or any rights hereunder
      may
      be waived by any party without the prior written consent of
      Brasada.

     

    12.7 Assignment.
      No
      party may assign his or its rights or obligations hereunder, in whole or in
      part, without the prior written consent of the other parties.

     

    12.8 Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of New York, without giving effect to principles of conflicts or choice
      of
      laws thereof.

     

    12.9 Counterparts.
      This
      Agreement may be executed in one or more counterparts, with the same effect
      as
      if all parties had signed the same document. Each such counterpart shall be
      an
      original, but all such counterparts taken together shall constitute a single
      agreement. In the event that any signature is delivered by facsimile
      transmission, such signature shall create a valid and binding obligation of
      the
      party executing (or on whose behalf such signature is executed) the same with
      the same force and effect as if such facsimile signature page was an original
      thereof.

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

     

    12.10 Section
      Headings and Gender.
      The
      Section headings used herein are inserted for reference purposes only and shall
      not in any way affect the meaning or interpretation of this Agreement. All
      personal pronouns used in this Agreement shall include the other genders,
      whether used in the masculine, feminine or neuter, and the singular shall
      include the plural, and vice
      versa,
      whenever and as often as may be appropriate.

     

    12.11 Specific
      Performance; Remedies.
      Each of
      Seller, Purchaser and Leasco acknowledges and agrees that Brasada would be
      damaged irreparably if any provision of this Agreement is not performed in
      accordance with its specific terms or is otherwise breached. Accordingly, each
      of Seller, Purchaser and Leasco agrees that Brasada will be entitled to seek
      an
      injunction or injunctions to prevent breaches of the provisions of this
      Agreement and to enforce specifically this Agreement and its terms and
      provisions in any action instituted in any court of the United States or any
      state thereof having jurisdiction over the parties and the matter, subject
      to
Section
      12.8,
      in
      addition to any other remedy to which they may be entitled, at law or in equity.
      Except as expressly provided herein, the rights, obligations and remedies
      created by this Agreement are cumulative and in addition to any other rights,
      obligations or remedies otherwise available at law or in equity, and nothing
      herein will be considered an election of remedies.
      

     

    12.12 Submission
      to Jurisdiction; Process Agent; No Jury Trial.

     

    (a) Each
      party to the Agreement hereby submits to the jurisdiction of any state or
      federal court sitting in the County of Los Angeles in the State of California,
      in any action arising out of or relating to this Agreement and agrees that
      all
      claims in respect of the action may be heard and determined in any such court.
      Each party to the Agreement also agrees not to bring any action arising out
      of
      or relating to this Agreement in any other court. Each party to the Agreement
      agrees that a final judgment in any action so brought will be conclusive and
      may
      be enforced by action on the judgment or in any other manner provided at law
      or
      in equity. Each party to the Agreement waives any defense of inconvenient forum
      to the maintenance of any action so brought and waives any bond, surety, or
      other security that might be required of any other Party with respect
      thereto.

     

    (b) EACH
      PARTY TO THE AGREEMENT HEREBY AGREES TO WAIVE HIS OR HER RIGHTS TO JURY TRIAL
      OF
      ANY DISPUTE BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OTHER AGREEMENTS
      RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT OR ANY DEALINGS AMONG THEM
      RELATING TO THE TRANSACTIONS CONTEMPLATED HEREBY. The scope of this waiver
      is
      intended to be all encompassing of any and all actions that may be filed in
      any
      court and that relate to the subject matter of the transactions, including,
      contract claims, tort claims, breach of duty claims, and all other common law
      and statutory claims. Each party to the Agreement hereby acknowledges that
      this
      waiver is a material inducement to enter into a business relationship and that
      they will continue to rely on the waiver in their related future dealings.
      Each
      party to the Agreement further represents and warrants that it has reviewed
      this
      waiver with its legal counsel, and that each knowingly and voluntarily waives
      its jury trial rights following consultation with legal counsel. NOTWITHSTANDING
      ANYTHING TO THE CONTRARY HEREIN, THIS WAIVER IS IRREVOCABLE, MEANING THAT IT
      MAY
      NOT BE MODIFIED ORALLY OR IN WRITING, AND THE WAIVER WILL APPLY TO ANY
      AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR TO
      ANY
      OTHER DOCUMENTS OR AGREEMENTS RELATING HERETO. In the event of commencement
      of
      any action, this Agreement may be filed as a written consent to trial by a
      court.

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

     

    12.13 Construction.
      The
      parties hereto have participated jointly in the negotiation and drafting of
      this
      Agreement. If an ambiguity or question of intent or interpretation arises,
      this
      Agreement will be construed as if drafted jointly by the parties hereto and
      no
      presumption or burden of proof will arise favoring or disfavoring any party
      because of the authorship of any provision of this Agreement. Any reference
      to
      any federal, state, local, or foreign law will be deemed also to refer to law
      as
      amended and all rules and regulations promulgated thereunder, unless the context
      requires otherwise. The words “include,” “includes,” and “including” will be
      deemed to be followed by “without limitation.” The words “this Agreement,”
“herein,” “hereof,” “hereby,” “hereunder,” and words of similar import refer to
      this Agreement as a whole and not to any particular subdivision unless expressly
      so limited. The parties hereto intend that each representation, warranty, and
      covenant contained herein will have independent significance. If any party
      hereto has breached any representation, warranty, or covenant contained herein
      in any respect, the fact that there exists another representation, warranty
      or
      covenant relating to the same subject matter (regardless of the relative levels
      of specificity) which that party has not breached will not detract from or
      mitigate the fact that such party is in breach of the first representation,
      warranty, or covenant.

     

    

    [Signature
      page follows this page.]

     

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF,
      the
      parties hereto have hereunto set their hands as of the day and year first above
      written.

     

    

    FOOTHILLS
      RESOURCES, INC.

     

    By:
       /s/
      J.
      Earl Terris

    
      
        

      

    

    Name: J.
      Earl
      Terris

    Title:  Chief
      Executive Officer

     

    LEASCO,
      INC.

     

    By:  /s/
      J.
      Earl Terris

    
      
        

      

    

    Name: J.
      Earl
      Terris

    Title  Chief
      Executive Officer

     

    PURCHASER

     

    J.
      Earl
      Terris

     

    /s
      J.
      Earl Terris 
      
        

      

    

    J.
      Earl
      Terris

     

    BRASADA
      CALIFORNIA, INC.

     

    By:  
      /s/
      Dennis B. Tower 
      
        

      

    

    Name: Dennis
      B.
      Tower

    Title:  Chief
      Executive Officer

     

    
      
        
        

      

      -17-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00101-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00101-of-00352.parquet"}]]