Document:

Exhibit 10.19

                           Purchase and Sale Agreement
              (With Operating and Marketing Agreement Incorporated)

                                 August 17, 2004

     This Purchase and Sale Agreement  hereinafter  (the  "Agreement")  made and
entered  between  PocketSpec  Technologies  Inc.,  hereinafter  referred  to  as
("PocketSpec") and Color-Spec  Technologies,  Inc.,  hereinafter  referred to as
("Color-Spec").

     WHEREAS,  PocketSpec  desires to separate its operations into two parts and
at the same time enhance its  financial  statement and pay  significant  accrued
operating expense.

     WHEREAS, Color-Spec is a wholly owned subsidiary corporation of PocketSpec,
and will serve  nicely to  restructure  financing  and  business  operations  of
PocketSpec.  The directors have authorized the issuance of 100,000 shares of its
common stock in Color-Spec to PocketSpec.

     WHEREAS,  PocketSpec  and  Color-Spec  have  also  agreed  to  terms  of an
Operating and Marketing  Agreement which is incorporated  into this Agreement as
an  integral  component  to  this  Agreement  which  governs  required  combined
operations  of the  business  affairs for a limited term  expiring  December 31,
2004, except as set forth in section 3. d. ix.

     WHEREAS,  PocketSpec  and  Color-Spec  have entered into this  Agreement to
recite and set down the terms and conditions of the Agreement.

                                    Agreement

     The terms and  conditions  of the purchase  and sale and salient  terms are
described as follows:

<PAGE>

1.   For and in consideration of the Purchase Price described in this Agreement,
     PocketSpec  hereby conveys to Color-Spec  every asset it owns in connection
     with the operation of its color  technology  business,  including by way of
     example, but not limited to the following:

     a.   Inventory  of  assembled  color  sensing  devices  and all  its  other
          component parts; and

     b.   All furniture, fixtures, equipment, computers, software, telephone and
          security systems, supplies; and

     c.   Assignment  of lessee's  interest  in leases for office  space at 3225
          East 2nd Avenue, Denver, Colorado 80206 and the Minolta copy machines;
          and

     d.   All of  PocketSpec's  right,  title  and  interest  in and to  current
          agreements  of a  beneficial  interest,  including  for  example,  its
          agreement with Logicol, S.r.l. ("Logicol") dated May 21, 2004, subject
          to a current  liability  owed to Logicol  for 2nd  Quarter  PocketSpec
          sales of $4,935.00. This liability is included in a list of short term
          liabilities to be paid pursuant to the terms of the Agreement; and

     e.   A  patent  referred  to  the  Colorimeter   Patent,   to  be  formally
          transferred as soon as possible by IP counsel,  subject to maintenance
          fees,  and a pending  patent  approved  and  presently  in the name of
          Color-Spec  referred to as the Wagner Patent which is expected to have
          a patent  number  assigned  to it in the  next 2  months,  subject  to
          expenses and maintenance associated with that patent; and

                                        2
<PAGE>

     f.   All trademarks issued and pending, subject to expenses and maintenance
          associated with the said  trademarks.  Separate  assignments  shall be
          prepared for execution by IP counsel; and

     g.   The non-exclusive use of the business name of PocketSpec  Technologies
          Inc.,  telephone  numbers  and  email  addresses,   which  rights  are
          described in Operating and Marketing Agreement below; and

     h.   All websites,  domain names and graphics material currently maintained
          by Parminder Rai; and

     i.   All  beneficial  interests of  PocketSpec in its core  operations  and
          business.

2.   Purchase  Price.  Color-Spec will pay to PocketSpec the purchase price that
     includes multiple components, described as follows:

     a.   Fixed costs  established  by  settlement  agreements  with  creditors,
          employees,  affiliates  and  vendors  of  PocketSpec  in the amount of
          $1,768,627.14.  There is a list of these people and companies attached
          hereto as Exhibit "A". Payment of this sum is by execution of a series
          of  three-year  8%  interest  promissory  notes,  to be secured by the
          assets  acquired from  PocketSpec.  A list of  promissory  notes to be
          executed in the amount of  $1,908,627.14  is attached as Exhibit  "B".
          Included  in the list in F.  Jeffrey  Krupka  who has agreed to accept
          $140,000.00 as a settlement of future employment benefits,  plus other
          sums  owed to him.  His  promissory  notes  total  $416,825.72,  which
          represents  an excess  payment of  $140,000.00.  The excess  amount of
          $140,000.00  is  agreed  to be  paid  back  by F.  Jeffrey  Krupka  to
          Color-Spec and/or  PocketSpec to settle a list of short-term  accounts
          payable shown as Exhibit "C".

                                        3
<PAGE>

     b.   Variable  and  undetermined  costs  included  in  the  purchase  price
          described as follows:

          i.   The actual  payment to satisfy  the list of  short-term  accounts
               payable in the Exhibit "C"; and

          ii.  The actual  operating  costs of the business  from August 1, 2004
               through  December  31,  2004  which  Color-Spec  agrees to pay in
               accordance with the Operating and Marketing Agreement; and

          iii. The costs owed to settle the Minolta  lease,  which  according to
               Minolta has a payoff of approximately $72,000.00.  Color-Spec may
               negotiate a discount or other settlement of the lease, but in any
               event,  Color-Spec  indemnifies and holds harmless PocketSpec for
               all costs and liabilities thereon; and

          iv.  To the extend  possible these variable and uncertain costs of the
               acquisition will be ascertained by December 31, 2004; and

          v.   Continued  variables detailed in the said Operating and Marketing
               Agreement,  such as the difference  between  operating income and
               operating expenses from August 1, 2004 through December 31, 2004.

3.   PocketSpec and Color-Spec  agree to the terms of an Operating and Marketing
     Agreement as part of the terms and  conditions of this  Agreement,  briefly
     described as follows:

                                        4
<PAGE>

     a.   PocketSpec  has a known name and  established  websites,  credit  card
          accounts  and bank  accounts.  Color-Spec  shall  operate the business
          through PocketSpec  through December 31, 2004 for convenience,  but at
          the expense of Color-Spec; and

     b.   PocketSpec  and Logicol  have an  existing  500,000  shares  option to
          purchase  restricted stock at a price of $.08 per shares dated May 21,
          2004 (the "Logicol  Option"),  which is, expires January 31, 2005. The
          Logicol  Option  was  granted as part of a  Software  Development  and
          Marketing  Agreement  also dated May 21,  2004.  This  option has been
          partially exercised, leaving 438,317 shares detailed below.

          i.   Logicol  and   PocketSpec   by  a  separate   memorandum   (email
               correspondence)  have agreed that Logicol will accept delivery of
               shares  of  stock  in lieu  of1/2of  its 20% fee  entitlement  to
               product and software  sales through  December 31, 2004 which will
               be treated as partial exercise of the Logicol Option. Pursuant to
               memorandum,   Giorgio   Stevanato  is  to  receive  these  shares
               personally,  and he has been  authorized  the  issuance of 61,683
               shares at a value of $4,935.00 for  entitlement  through July 31,
               2004.  PocketSpec  agrees  to set  aside as  needed  or issue the
               438,317 shares of stock in accordance with the memorandum and the
               Logicol  Option.  PocketSpec  shall  retain all  moneys  that are
               received for the exercise of the stock  options,  whether or not,
               credited  to fee  entitlement  owed to Logicol.  The  schedule of
               short-term debts (Exhibit "C") reflects a debt of $4,935.00 which
               will be paid by  Color-Spec,  for the unpaid cash  portion of the
               July 31, 2004 entitlements due Logicol.

                                        5
<PAGE>

     c.   PocketSpec  has  previously  agreed to pay some of its debts  owed for
          proper  services by issuing  stock.  Although the  issuances  shall be
          after  July 31,  2004,  they  shall not be  considered  debts  owed by
          Color-Spec for the purposes of the Operating and Marketing  Agreement.
          Specific issuances applicable to this section:

          i.   186,713  shares of S-8 stock to David  Wagner  for the  credit of
               David Wagner and Associates;

          ii.  60,000 shares of S-8 stock to PocketSpec's press release firm for
               credit to PocketSpec's contract with MacReport.Net, with issuance
               to its consultant, V. William Lucchetti Jr.;

          iii. 40,000  shares of S-8 stock to  Parminder  Rai for  credit to web
               services and his  entitlement  to revenues from Logicol  software
               sales through July 31, 2004;

          iv.  175,000 shares of restricted  stock to Chris Wrigley for invoices
               through 7-31-04.

     d.   Product sales and costs of operation through December 31, 2004:

          i.   During this  period  PocketSpec  shall  continue to make sales of
               products  and  software.  PocketSpec  shall  owe  Color-Spec  the
               proceeds of the sales on December  31,  2004 in  accordance  with
               Settlement of Accounts below; and

                                        6
<PAGE>

          ii.  During  this period  PocketSpec  shall pay as a  convenience  for
               Color-Spec  agreed sums on compensation  agreements in accordance
               with their  terms to Cynthia  Kettl,  Janet  Brophy,  F.  Jeffrey
               Krupka,  Frank Krupka,  Gregg Wagner,  Logicol S.r.l.,  and other
               agreed  service  and  product   vendors.   Color-Spec  shall  owe
               PocketSpec  the  expenses  paid on its  behalf by  PocketSpec  on
               December  31,  2004 in  accordance  with  Settlement  of Accounts
               below; and

          iii. During this period,  or anytime  thereafter,  if the company name
               "PocketSpec   Technologies  Inc."  is  abandoned  by  a  vote  of
               PocketSpec's shareholders, Color-Spec shall be able to change its
               name to PocketSpec Technologies Inc.; and

          iv.  During this  period,  Color-Spec  shall  prepare to take over the
               operations including product sales and servicing of expenses,  as
               well as opening bank accounts,  establishing credit card merchant
               accounts,  payroll  accounts,  IRS and  Colorado  State  employer
               registration, etc.

          v.   During this period and forever thereafter, any written agreements
               to  distribute   products  and  software   require  approval  and
               signatures of Color-Spec.  As part of any  agreement,  Color-Spec
               has permission to authorize the use and marketing of products and
               software with or without the branding name of PocketSpec; and

          vi.  During  this  period,  or so  long  as  PocketSpec  is  the  sole
               shareholder of Color-Spec,  it may investigate the possibility of
               selling  its   ownership   interest  in   Color-Spec  to  others.
               Therefore,  it is  incumbent  on the  directors  and  officers of
               Color-Spec  to not enter into any  financial  obligations  beyond
               December  31,  2004,   except  for  marketing  and   distribution

                                        7
<PAGE>

               agreements  beneficial to Color-Spec and intended to increase its
               sales and its market  value.  These  marketing  and  distribution
               agreements  may be for terms of up to three  years.  Compensation
               agreements may be structured to operate on a month-to-month basis
               thereafter, or at will, but any may be terminated on a thirty-day
               notice with no further  compensation due to engages,  consultants
               or employees; and

          vii. During this period, any  contributions,  gifts,  discounts,  free
               products or services received shall belong to Color-Spec; and

          viii.Settlement of Accounts:  Effective December 31, 2004,  Color-Spec
               and  PocketSpec  shall  complete  an  accounting  for debts  owed
               between the two  companies.  The debts  shall be  adjusted  and a
               promissory  note will be made  payable to the company who is owed
               money  after  the   accounting  is  completed.   Payment  of  the
               promissory  note  shall be a  single  payment  due July 1,  2005,
               together  with  interest  at 6% per annum,  without  penalty  for
               prepayment.

          ix.  Early  Termination:  If for any reason the officers and directors
               of  PocketSpec  should  resign,  Color-Spec  shall  take over all
               operations  effective the date of resignation,  in which case the
               date of December  31, 2004 date set forth above shall be adjusted
               accordingly.

4.   Other terms and conditions:

     a.   PocketSpec shall pay for the following costs:

          i.   The costs of SEC audits after the 3rd Quarter,  meaning the 10KSB
               for fiscal year 2004-2005, and reporting for quarters thereafter;
               and

                                        8
<PAGE>

          ii.  Legal fees and consulting fees pursuant to  acquisitions  that it
               intends to pursue; and

          iii. Sales commissions and consulting fees associated with the sale of
               its ownership interest in Color-Spec; and

          iv.  Costs of income taxes and accounting for  consolidated  financial
               reporting of the  operations  of  Color-Spec  and tax returns for
               periods that PocketSpec is the owner of the stock in Color-Spec.

     b.   Color-Spec  shall pay for all other  costs  related  to the assets and
          technology it has acquired from PocketSpec.

     c.   PocketSpec and Color-Spec agree that no additional  shares of stock in
          Color-Spec  shall be issued  without the approval of the  directors of
          both companies.

     d.   PocketSpec  guarantees delivery of assignments to its patents,  issued
          and  pending as well as all  trademarks,  pending and issued not later
          than  September 16, 2004.  This is critical,  so that  Color-Spec  can
          perfect its  agreement to grant  security  agreement  and interests to
          secure the promissory notes described in the attached Exhibit "B".

     e.   Color-Spec  may  alternatively  satisfy  or  assume  the  indebtedness
          described  in the  attached  Exhibit  "C",  therefore a release by the
          creditor(s)  listed  in  the  list  will  relieve  Color-Spec  of  the
          responsibility for cash payment(s).

                                        9
<PAGE>

PocketSpec Technologies Inc.                 Color-Spec Technologies, Inc.

/s/ Janet Brophy                             /s/ Cynthia Kettl
----------------------------------          ----------------------------------
Janet Brophy, President                     Cynthia Kettl, Secretary/ Treasurer

                                       10

<PAGE>

                                   Exhibit "A"
                                   -----------

Settlement notes                Jeff Krupka                      $140,000.00
Settlement notes                Janet Brophy                     $104,000.00
Settlement notes                Gregg Wagner                     $104,000.00
Settlement notes                Cynthia Kettl                    $104,000.00
Settlement notes                Frank Krupka                      $52,000.00
Settlement notes                Philip Robertson                  $52,000.00
Installment loans               B 7 Brand LLC                    $474,579.63
Installment loans               Gregg Wagner                      $29,104.32
Installment loans               Cynthia Kettl                     $24,017.05
Installment loans               KBP                               $45,926.88
Installment loans               Norm Lakin                        $15,949.22
Installment loans               Wraith Moon House                  $6,351.11
Installment loans               Janet Brophy                      $29,414.76
Expense reimbursements          Janet                             $51,713.88
Expense reimbursements          Jeff's new charges                $54,325.72
Expense reimbursements          Cynthia                           $12,826.47
Expense reimbursements          Frank                             $19,235.86
Short term loans                Asset Realization Inc              $1,632.39
Expense reimbursements          Janet Brophy                       $8,821.82
Expenses reimbursements         Gregg Wagner & Linda                 $629.03
Installment loan                B 7 Brand LLC                     $37,150.00
Installment loan                Cherry Creek Cottage LLC          $77,000.00
Wages through 7-31-04           Cynthia Kettl                     $81,000.00
Wages through 7-31-04           Frank Krupka                      $43,944.00
Wages through 7-31-04           Janet Brophy                     $116,505.00
Wages through 7-31-04           Jeff Krupka                       $82,500.00

                            Totals                             $1,768,627.14

                                       11
<PAGE>

                                   Exhibit "B"
                                   -----------

  Note Number   Beneficiaries                Amount of Note    Payment Amount
  -----------   -------------                --------------    --------------
       1        F. Jeffrey Krupka            $136,825.72        $1,434.00
       2        F. Jeffrey Krupka             $23,000.00          $241.00
       3        F. Jeffrey Krupka             $59,500.00          $623.00
       4        F. Jeffrey Krupka             $50,500.00          $530.00
       5        F. Jeffrey Krupka             $45,000.00          $471.00
       6        F. Jeffrey Krupka             $39,500.00          $414.00
       7        F. Jeffrey Krupka             $34,000.00          $356.00
       8        F. Jeffrey Krupka             $28,500.00          $298.00
       9        Janet Brophy                 $310,455.46        $3,254.00
      10        Frank K. Krupka and
                Jacqueline S. Krupka         $115,179.86        $1,207.00
      11        Cynthia Kettl                $221,843.52        $2,325.00
      12        Gregg Wagner and
                Linda Wagner                 $133,733.35        $1,402.00
      13        B 7 Brand LLC                $411,729.63        $4,315.00
      14        Cherry Creek Cottage LLC      $77,000.00          $807.00
      15        Wraith Moon House LLC          $6,351.11           $67.00
      16        Asset Realization, Inc.        $1,632.39           $17.00
      17        Krupka-Brophy Profit
                Sharing Plan                  $45,926.88          $480.00
      18        Norman Lakin                  $15,949.22          $168.00
      19        Edmond Johnson                $50,000.00          $523.00
      20        Philip Robertson              $50,000.00          $523.00
      21        Philip Robertson              $52,000.00          $545.00
                Total                      $1,908,627.14       $20,000.00

                                       12
<PAGE>

                                   Exhibit "C"
                                   -----------

        Rapport                                             $5,390.00
        Longmont Plastics                                     $800.00
        ADT Security                                           $91.16
        All-American                                        $5,213.46
        American Exhibition Services                          $272.00
        Browning - Ferris Industries                           $45.00
        C2 Media                                            $6,544.15
        City & County of Denver                                $25.00
        Comcast                                               $476.54
        Comprehensive Computing                                $90.00
        Cordovano & Harvey                                    $102.50
        Corporate Stock Transfer                            $1,226.47
        Federal Express                                     $1,817.97
        Freeman Companies                                     $211.00
        Island Sun Times                                    $2,432.00
        Metro Comp                                            $300.00
        Minolta                                             $7,050.45
        Payroll 1                                              $30.00
        PR Newswire                                         $1,965.00
        Rot Nguyen                                            $255.00
        Saelig Co.                                          $1,609.00
        Seko Worldwide                                        $587.49
        Sentry Property Service                               $393.00
        Service By Air                                      $1,436.99
        Sprint                                                 $20.56
        Telecom Elec Supply                                   $482.34
        Treasurer - City & County of Denver                 $3,952.40
        Waste Management                                      $226.59
        Westec Plastics                                    $11,344.19
        Western Die                                         $1,076.00
        Wings Courier                                          $12.00
        Excel Energy                                          $519.00
        American Family Insurance                           $1,088.90
        Cherry Creek Cottage LLC - NNN Charges             $22,532.59
        Cherry Creek Cottage LLC - Rents due               $15,850.00
        Logicol, S.r.l..                                    $4,935.00
        Parminder Rai                                       $2,974.00
        Gregg Wagner                                        $1,450.00
        SEC - Audit allowance                              $12,000.00
        PST - payment of wages to former employees          $5,711.30
        MacReport.Net                                       $2,600.00
        Miscellaneous costs                                $14,860.95

        Total:                                            $140,000.00

                                                       13Exhibit
10.85

 

EMPLOYMENT CONTRACT

 

	
  THE STATE OF TEXAS

  	
  )(

  	
   

  
	
   

  	
  )(

  	
  KNOW ALL MEN BY THESE
  PRESENTS:

  
	
  COUNTY OF MIDLAND

  	
  )(

  	
   

  

 

This Employment
Contract (“Agreement”) is made and entered into by and between CAP ROCK ENERGY
CORPORATION and WILLIAM WEST on this 30th day of December 2003, and the initial
term of this Agreement and all other terms and provisions herein, are effective
beginning as of January 1, 2003 This Agreement modifies, amends and supercedes
the Agreement previously executed by and between the Parties to this Agreement.

 

By this Agreement, Cap
Rock Energy Corporation, referred to in this Agreement as “Company”, acting by
and through its President and Chief Executive Officer, David W. Pruitt, or his
successor, hereinafter referred to as “Pruitt” employs William West, referred
to in this Agreement as “West”, and whose principal place of employment is
Midland, Midland County, Texas, who accepts employment on the following terms
and conditions:

 

ARTICLE 1

 

TERMS
OF EMPLOYMENT

 

By this Agreement, the
Company, acting by and through Pruitt, employs West and West accepts employment
with the Company for an initial term of one (1) year.  Unless a written notice to terminate this Agreement is executed
and properly delivered by either party at least ninety days prior to an
anniversary date of the execution of this Agreement, this Agreement shall
annually and automatically be renewed for an additional term of one (1)
year.  This Agreement may, however, be
terminated earlier, as provided in Article 4, below.

 

ARTICLE 2

 

EMPLOYMENT
COMPENSATION & BENEFITS

 

2.01                        As
compensation for all services rendered under this Agreement, West shall be paid
by Company a salary of $185,000.00 per year, or any greater amount of
compensation including bonuses and deferred compensation authorized by the wage
and salary plan or board policies authorized by the Company, together with an
annual salary adjustment in an amount at least equal to any approved across the
board salary adjustments for all employees.

 

2.02                        West
shall receive fifteen (15) days of vacation (annual leave), available
immediately upon his employment pursuant to this Agreement, and the same sick
leave and all other benefits as are accorded regular full-time employees of the
Company including provisions governing accrual and payment thereof on early
retirement or other methods of employment as set forth in the Company’s
employee policies.

 

1

 

2.03                        Subject
to the above paragraph 2.02, all provisions of the Company’s rules and regulations
relating to annual leave (vacation), sick leave, early retirement, insurance,
savings, deferred compensation, bonuses, pension program contributions,
holiday, stock options as available and appropriate for his responsibility and
experience and other fringe benefits and working conditions as they now exist
or hereafter may be amended, shall apply to West as they would to other
employees of the Company. 
Notwithstanding the foregoing however, West may, at his option, elect to
be covered under or participate in the Company’s employee benefit plans  as though he were hired prior to May 1,
2002,.except that West shall not be entitled to receive health and dental
insurance benefits after his employment with the Company terminates as are
currently available to employees hired prior to May 1, 2002 pursuant to Board
Policy 123.

 

2.04                        Because
West’s duties will from time to time require him to work outside of, and in
addition to, the Company’s established normal workweek, work days and work
hours, West shall be allowed to take compensatory time off.

 

2.05                        Company
will reimburse West for professional dues and continuing education
requirements.

 

2.06                        Company
will pay West’s reasonable expenses to include living expenses while living in
Midland on a temporary basis prior to moving his family between January 1,
2004 and July 31, 2004 or such later date as the Parties agree.  The Company further agrees to pay West’s
moving expenses as follows:

Out of pocket costs of
moving household contents and automobiles (at least two bids submitted), pets
and family members,

In the case where West’s
current home is sold prior to the purchase of a replacement home, temporary
housing and storage if necessary,

In the case where West’s
current home is not sold prior to the purchase of a replacement home, out of
pocket costs equal to the higher of the two homes actual payments (debt service
and escrow) for a period not to exceed six months.

 

ARTICLE 3

 

COVENANT
TO PERFORM

 

3.01                        West
agrees and covenants to perform his work and services diligently and use his
best efforts to faithfully comply with all of the assignments duly made to him
on behalf of the Company by Pruitt.

 

 3.02                     West agrees to execute and honor
and abide by the Company’s “Employee Pledge and Proprietary Rights and Information
Agreement” which all other employees of the Company have executed and agreed
to, a copy of which is attached hereto as Exhibit “A”.

 

2

 

ARTICLE 4

 

TERM
AND TERMINATION

 

4.01                        The
Company shall employ West pursuant to this Agreement for the one (1) year term
beginning with the effective date set forth above, yearly renewable subject to
and following a satisfactory evaluation employee appraisal report on West by
Pruitt for successive one year terms.  However,
if during such employment, West fails or refuses to perform the work and
services assigned to him on behalf of the Company by Pruitt, or should he
become derelict in so performing, or become unable to perform, or otherwise
become in substantial breach of this Agreement all as may be determined by
Pruitt in his sole discretion or otherwise so act as to give the Company cause,
this Agreement shall, at Pruitt’s sole option, cease and terminate and any
of  West’s rights hereunder not already
finally vested shall cease on or at such time as Pruitt shall notify West in
writing.  The term “cause” shall include
the following:

 

1.                                       Knowingly,
willfully and substantially, during the term of this Agreement, neglects the
duties that West is required to perform under the terms of this Agreement.

 

2.                                       Knowingly,
willfully and substantially, during the term of this Agreement, commits clearly
dishonest acts toward the Company with the intent to injure or damage the
Company.

 

3.                                       Insubordination
or failing to follow the directives of the President/CEO in connection normal
assigned job related duties.

 

4.                                       An
unsatisfactory evaluation by Pruitt of West on the annual employee appraisal,

 

4.02                        If
West’s employment terminates for any reason other than as provided for in paragraph
4.01, 4.03, 4.04, 4.05 or 4.06, the Company shall pay West a lump sum cash
settlement equal to the total salary then in effect for one (1) year, plus such
amounts, if any, are at the time of his termination of employment, payable for
accrued but untaken vacation and sick leave, compensatory time, bonuses and
other compensation authorized by the Board of Directors or Pruitt.

 

4.03                        Notwithstanding
paragraphs 4.01 and 4.02, this Agreement and West’s employment hereunder may be
terminated at such time and upon such terms and conditions as the parties may
mutually agree.

 

4.04                        Notwithstanding
the provisions of paragraphs 4.01, 4.02, and 4.03 above, West’s employment
hereunder shall terminate under any of the following conditions:

 

a.                                       Death.             West’s employment
under this Agreement shall terminate automatically upon his death.  In such event, West’s Base Salary shall
continue to be paid to his designated beneficiary for the remaining term of
this Agreement.

 

b.                                      Total
Disability.           The
Company shall have the right to terminate this Agreement if West becomes
Totally Disabled.  For purposes of this
Agreement, “Totally Disabled” means that West is not working and is currently
unable to perform the substantial and material duties of his position hereunder
as a result of sickness, accident or bodily injury for a period of three
months.  Prior to a determination that
West is Totally Disabled, but after West has exhausted all sick leave and
vacation benefits provided by the Company, West shall continue to receive his
Base Salary, offset by any disability benefits he may be eligible to receive,
for the remaining term of this Agreement.

 

3

 

4.05                        Notwithstanding
any other provisions in this Agreement, if (i) West remains employed until the
date that is three (3) months after the date of a Change in Control (the
“Retention Date”), or (ii) West’s employment is terminated after or in
anticipation of a Change in Control (or the execution of a definitive agreement
providing for actions which, if completed, would constitute a Change in
Control) and before the Retention Date (A) by the Company without Good Cause or
(B) by West for Good Reason, then, in addition to any other amounts payable
pursuant to this Agreement, the Company shall pay West a lump sum cash payment
within thirty (30) days of termination equal to six (6) times the sum of West’s
annual Base Salary and the greater of (x) the highest bonus awarded to West in
a prior year or (y) 50% of West’s annual Base Salary.

 

For purposes of this
Agreement “Change in Control” means: (i) a reorganization or merger of the
Company with or into any other company which will result in the Company’s
stockholders immediately prior to such transaction not holding, as a result of
such transaction, at least 50% of the voting power of the surviving or
continuing entity or the entity controlling the surviving or continuing entity;
(ii) a sale of all or substantially all of the assets of the Company to an
entity in which the Company’s stockholders immediately prior to such sale will
not hold following such sale at least 50% of the voting power of such
purchasing entity; (iii) a transaction or series of related transactions which
result in more than 50% of the voting power of the Company being “beneficially
owned” by a single “person” (quoted terms having their respective meanings
under Sections 13(d) and 14(d) under the Securities Exchange Act of 1934, as
amended); (iv) a change in the majority of the Board not approved by at least
two-thirds of the Company’s directors in office prior to such change or (v) the
adoption of any plan of liquidation providing for the distribution of all or
substantially all of the Company’s assets.

 

For purposes of this
Agreement, after a Change in Control, “Good Reason” shall mean the occurrence
of any one of the following circumstances without West’s consent:

 

(1)                                  a
material reduction in West’s salary or benefits excluding the substitution of
substantially equivalent compensation and benefits;

 

(2)                                  a
material diminution of West’s duties, authority or responsibilities as in
effect immediately prior to such diminution;

 

(3)                                  the
relocation of West’s primary work location to a location more than 50 miles
from West’s primary work location as of the date of this Agreement; or

 

(4)                                  the
failure of a successor to assume and perform under this Agreement

 

4.06                        West’s
place of employment pursuant to this Agreement shall be at the corporate
offices in Midland, Texas, unless Pruitt shall direct otherwise.  In that event, at West’s option, he may
refuse to move, terminate this Agreement and receive payment for the remainder
of his contract term as set forth in paragraph 4.02 above.

 

4.07                        In the
event West is eligible to receive a lump sum payment pursuant to this Agreement
and such lump sum payment would cause West to be subject to an excise tax in
excess of normal income taxes on such lump sum, then and in that event, the
lump sum payment shall be increased (grossed up) in an amount sufficient to pay
such excise tax.

 

 

4

 

ARTICLE 5

 

TRADE
SECRETS AND CONFIDENTIAL INFORMATION

 

5.01                        During
the term of West’s employment, the Company will provide West access to, so he
may become familiar with, various trade secrets and other confidential or
proprietary information of the Company, train his in the use of same, and
provide associates a working environment in which he can contribute toward
enhancing same and upgrading his general knowledge.  Trade secrets, proprietary information and confidential information
encompass, without limitation, anything which is owned by the Company and is
regularly used in the operation of the business of the Company to obtain a
competitive advantage over the Company’s competitors who do not know, have
access to, or utilize such information or trade secrets.  Proprietary information further includes,
but is not limited to, records, files, documents, bulletins, publications,
manuals, financial data and information concerning and the identity of
customers, prospects and suppliers. 
Trade secrets further include, but are not limited to, specifications,
software programs, both the source code and the object code, documentation,
flow charts, diagrams, schematics, data, data bases, and business and
production methods and techniques.

 

5.02                        West
acknowledges that such training and the use of the trade secrets and
confidential or proprietary information will enable him to perform his job and
enhance his compensation.  West
recognizes and acknowledges that the trade secrets and other confidential or
proprietary information of the Company are valuable, special and unique and
that the protection thereof is of critical importance to the Company in
maintaining its competitive position. 
West, therefore, covenants and agrees that, except as required by his
employment hereunder or with the express prior written consent of the Company,
he shall not, during the term of his employment by the Company or at anytime
thereafter, either directly or indirectly, make independent use of, publish or
otherwise disclose any of the aforesaid trade secrets or other confidential or
proprietary information of the Company (whether acquired, learned, obtained or
developed by him alone or in conjunction with others) to any person, firm,
corporation, association or other entity for any reason or purpose whatsoever
or allow any other person , firm, corporation, association or other entity to
make use of, publish or disclose any of the aforesaid trade secrets or other
confidential or proprietary information. 
West agrees not to use, steal, or appropriate such items or versions
thereof, whether copies or reconstructed from memory or otherwise, in any
manner.  West further recognizes and
acknowledges that in order to enable Company to perform services for its
customers and engage in Company’s business, information may be furnished to the
Company confidential information and that the goodwill afforded to Company
depends upon, among other things, Company and its employees keeping such
services and information confidential. 
West therefore agrees that he shall keep all such information of the
Company and any of its affiliates and subsidiaries completely and absolutely
confidential.  This agreement not to
disclose confidential information shall survive after the term of West’s employment
pursuant to this Agreement.  Therefore,
West shall be bound by his agreement herein not to disclose confidential
information of the Company and its affiliates or subsidiaries both during his
employment with the Company and after his employment with the Company is
terminated.  A violation by West of this
Article shall be a material violation of this Agreement and will justify
legal and/or equitable relief.  West
recognizes that if he breaches this agreement and discloses confidential
information or trade secrets of the Company or any of its affiliates or
subsidiaries, the Company will suffer substantial, irreparable and continuing
injuries, damages and costs attendant thereto. 
Further, recognizing that money damages may not provide adequate relief,
West agrees that, in the event that he breaches or threatens to breach this
Agreement, the Company shall be entitled to a preliminary or permanent
injunction in order to prevent the continuation of such harm and, as liquidated
damages, West shall forfeit all payments made pursuant to this Agreement from
the date the Agreement was breached and any payments that are or may be due
pursuant to this Agreement, as well as any rights or benefits, including health
insurance benefits.

 

 

5

 

5.03                        West
and the Company acknowledge and agree that the fact that the Parties have
entered into this Agreement and the terms of this Agreement are
confidential.  Neither of the Parties
may therefore disclose the terms of this Agreement to others, except as
necessary with regard to the filing of income taxes and other necessary
documents or as required by law, or pursuant to a subpoena or court order,
unless such disclosure has been approved by the other Party’s written
permission.

 

ARTICLE 6

 

NON-COMPETITION
AGREEMENT

 

West agrees that upon his
termination of employment from the Company, for a period of two (2) years, he
will not engage or participate, directly or indirectly, in competition with the
Company or any of its affiliates or subsidiaries without the prior written
consent of the Company which consent shall not be unreasonably withheld.  This Agreement shall prohibit West from,
among other things, attempts to serve or assist others in serving the Company’s
present or potential customers.  West
further agrees that he will never at any time after executing this Agreement,
assist any person or entity in buying, merging with or acquiring the Company
unless the Company consents in writing.

 

ARTICLE 7

 

PROHIBITIONS

 

7.01                        West shall not, at any time
during or after the term of this Agreement, make derogatory, false, or
misleading oral or written comments to any person or entity regarding the
Company, its management, officers, directors, employees or agents.  West agrees generally to speak favorably of
the Company and his employment with the Company.

 

7.02                        West agrees that neither he,
nor any member of his immediate family, shall run for or serve as a Director of
the Company for a period of five (5) years after West’s employment with the Company
is terminated.

 

7.03                        The
Company and West recognize and agree that the damages to the Company for
violation of Articles 5,6 and 7 may be difficult, if not impossible to
ascertain, and therefore the Parties hereby agree that in the event West
breaches these Articles 5, 6, and 7, the Company shall be entitled to
liquidated damages for such breach which shall be forfeiture and reimbursement
by West of all amounts paid to West from the time of the breach, received by
West from Company pursuant to this Agreement from the time of the breach, or
any amounts which West is entitled to receive pursuant to this Agreement, and
all rights and benefits, including health insurance benefits and stock which
West may be entitled to receive pursuant to this Agreement.

 

 

6

 

ARTICLE 8

 

SUPERSESSION
AND EFFECTIVENESS

 

8.01                        This
Agreement supersedes any other agreement or understanding, written or oral,
between the parties with respect to the matters covered hereunder, and it contains
the entire understanding of the parties and all of the covenants and agreements
between them with respect to West’s employment.

 

8.02                        This
Agreement shall bind and be for the benefit of the parties to the agreement, as
well as their respective successors, heirs and assigns, it being understood,
however that this Agreement may be assigned only with the written consent of
both parties.

 

8.03                        The
existence and effectiveness of this Agreement between the parties hereto does
not preclude or otherwise interfere with employment of West by subsidiary
corporations of Cap Rock Energy Corporation, or by any corporation organized by
the Company’s Board of Directors for the benefit of the Company, or the receipt
of compensation by West from any such corporations.

 

8.04                        This
Agreement shall become binding upon the parties from and as of the date of the
execution.

 

ARTICLE 9

 

GOVERNING
LAW

 

This Agreement has been
executed in the State of Texas and shall be governed by and construed in all
respects in accordance with the laws of the State of Texas.

 

ARTICLE 10

 

ARBITRATION

 

 All disputes, claims and matters in question
arising under, with respect to or out of this Agreement or the relationship
between the parties created by this agreement, whether sounding in contract,
tort or otherwise, which cannot be resolved between the Parties, shall be
resolved by binding arbitration pursuant to the Federal Arbitration Act.  The arbitration shall be administered by the
American Arbitration Association (“AAA”) in Dallas, Texas in accordance with
the Commercial Arbitration Rules of the AAA. 
There shall be three arbitrators. 
Each party shall designate an arbitrator, who need not be neutral,
within 30 days of receiving notification of the filing with the AAA of a demand
for arbitration.  The two arbitrators so
designated shall elect a third arbitrator. 
If either party fails to designate an arbitrator within the time
specified or the two parties’ arbitrators fail to designate a third arbitrator
within 30 days of their appointments, the third arbitrator shall be appointed
by the AAA.  The decision or award of a
majority of the arbitrators shall be final and binding upon the parties.  Any arbitral award may be entered as a
judgment or order in any court of competent jurisdiction.  It is expressly agreed that the arbitrators
shall have no authority to award punitive or exemplary damages, the parties
hereby waiving their right, if any, to recover punitive or exemplary damages,
either in arbitration or in litigation.

 

IN WITNESS
WHEREOF, the parties have executed this Agreement in counterpart on or as of
the 30th day of December, 2003.

 

	
   

  	
  CAP ROCK ENERGY
  CORPORATION

  
	
   

  	
   

  
	
  /s/ Will West

  	
   

  	
  /s/ David W. Pruitt

  	
   

  
	
  Will West

  	
  David W. Pruitt,
  President/CEO

  
				

 

7

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