CONSULTING SERVICES AGREEMENT
THIS
CONSULTING AGREEMENT (the “Agreement”), is made and entered into as of this 1st
day of August 2006, by and among Colombia Goldfields Ltd., a Nevada corporation
(the “Company”) and J. Xxxxxxx Xxxxxx (hereinafter referred to as “Consultant”).
The Company and Consultant are sometimes collectively referred to as “Parties”
or individually as a “Party”.
R
E C I T A L S
WHEREAS,
the Company is engaged in exploration for and development of, minerals and
mining properties, respectively, primarily in Colombia; and
WHEREAS,
Consultant has significant experience with the operation, administration and
financing of the Company; and
WHEREAS,
the Company desires to utilize Consultant’s business expertise and Consultant
desires to provide services to the Company.
NOW,
THEREFORE, in consideration of the mutual promises and agreements set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby expressly acknowledged, the Parties agree as
follows:
A
G R E E M E N T
ARTICLE
I
DEFINITIONS
1.1 Effective
Date.
The
Effective Date of this Agreement shall be May 1, 2006.
ARTICLE
II
APPOINTMENT
2.1 Appointment.
The
Company hereby engages Consultant to furnish the services described in Article
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of this Agreement, and Consultant hereby accepts such engagement. The Consultant
agrees to use his best efforts to perform his duties, responsibilities, and
obligations set forth in this Agreement.
2.2 Status
of the Parties.
It is
expressly understood and agreed that in the performance of services under this
Agreement, Consultant shall, at all times, be an independent contractor with
respect to the Company, and not an employee of the Company. Further, it is
expressly understood and agreed by the Parties that nothing contained in this
Agreement is intended to create a joint venture, partnership, association or
other affiliation or like relationship between the Parties. In no event shall
either Party be liable for the debts or obligations of the other Party.
Consultant understands that he will not be treated as an employee for U.S.
Federal
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tax
purposes and that Consultant shall be responsible
for all taxes, Social Security and FICA payments and withholding (if
applicable). Consultant shall not be entitled or eligible to receive xxxxxxx’x
compensation insurance, disability or unemployment insurance
benefits.
ARTICLE
III
CONDITIONS
AND TERMS OF AGREEMENT
Consultant
shall perform only those functions set forth in this Agreement or otherwise
delegated by the Company, and shall be solely responsible for determining the
manner in which the services are rendered. The Company shall provide Consultant
with access to the Company's premises and its consultants and employees to
enable Consultant to perform his services hereunder.
ARTICLE
IV
OBLIGATIONS
OF CONSULTANT
Consultant
shall devote his best efforts, skill and sufficient time and attention to carry
out his responsibilities under this Agreement. Consultant shall be engaged
as
the Company's Chief Executive Officer and shall report to the Board of Directors
of the Company (the "Board of Directors"). Consultant shall act in substantial
accordance with all reasonable instructions and directives of the Board of
Directors and provide management and operational services to the Company as
requested by the Board of Directors. Consultant shall comply with all written
policies and procedures of the Company that are furnished to him and which
are
applicable to Company employees in general, in connection with the performance
of services hereunder.
ARTICLE
V
PAYMENT
5.1 Consideration.
In
consideration of the services provided by Consultant pursuant to this Agreement,
the Company shall pay to Consultant USD $10,000 per month commencing on the
Effective Date.
5.2 Reasonableness
of Payments.
The
amounts paid to Consultant hereunder have been determined by the Parties in
good
faith and through arms-length negotiation and are intended to be based on fair
market value for the services rendered by the Consultant.
ARTICLE
VI
BUSINESS
EXPENSES; ADDITIONAL BENEFITS
5.1 Reimbursement
of Expenses.
The
Company shall reimburse Consultant for business expenses reasonably incurred
in
the performance of his services pursuant to this Agreement, including, without
limitation, travel and entertainment. Requests for reimbursement must be in
writing and accompanied by appropriate documentation
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5.2 Stock
Option Plan.
In
consideration of the execution by Consultant of this Agreement and for services
rendered hereunder, Consultant shall be eligible for grants of stock options
pursuant to the Company's
2005 Stock Option Plan in
such
amounts as may from time to time be determined by the Board of Directors (or
the
Stock Option/Compensation Committee), in its sole discretion.
5.3 Additional
Benefits.
Consultant shall be eligible to receive bonuses in such amounts and at such
times as may be determined by the Board of Directors, in its sole discretion,
and shall be included as a participant in any group health and dental insurance
obtained by the Company.
ARTICLE
VII
TERM
AND TERMINATION OF AGREEMENT
7.1 Term.
Subject
to Section 6.2, the term of this Agreement shall be for a period of two (2)
year(s) from the Effective Date. Subject to Section 6.2, this Agreement shall
automatically renew for a two (2) year period, unless at least 60 days prior
to
the renewal period either Party gives written notice to the other Party as
provided in Section 9.2 hereof that this Agreement is not to renew.
7.2 Termination:
This
Agreement may be terminated as follows:
7.2.1 Termination
by Mutual Consent.
This
Agreement may be terminated at any time by mutual consent in
writing.
7.2.2 Termination
by Company for Cause.
The
Company shall have the right to immediately terminate this Agreement upon the
happening of any of the following:
(a) (i)
Consultant’s conviction of a felony; or (ii) Consultant becomes disabled so as
to be unable to perform the duties required by this Agreement for a period
of
ninety (90) days in any twelve month period; or
(b) the
willful failure to substantially perform reasonably assigned duties in
accordance with Article III which after written notice that describes the
non-performance or other failure ("Deficiency") remains uncured after seven
(7)
days unless such Deficiency is incapable of being cured within such seven day
period and Consultant is diligently pursuing a cure.
7.2.3 Termination
by Company Without Cause.
If the
Company terminates this Agreement without cause, Consultant shall be entitled
to
receive a lump sum payment from the Company, within five (5) days after such
termination, equal to twelve (12) months of fees and any and all stock options
granted to Consultant shall immediately vest and become exercisable in
accordance with their terms.
7.3 Force
Majeure.
The
inability of any Party to commence or complete its obligations hereunder by
the
dates required resulting from delays caused by strikes, walk-outs, insurrection,
fires, floods, hurricane, freight embargoes, epidemics, quarantine restrictions,
any
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law,
act, order, proclamation, decree, regulation,
ordinance or any other acts of any governmental or judicial authority, acts
of
God, acts of terrorists, war, emergencies, equipment failures, shortages or
unavailability of materials, unavailability of necessary utilities or other
similar causes beyond the Party’s reasonable control which shall have been
timely communicated to the other Party, shall extend the period for the
performance of the obligations for the period equal to the period(s) of any
such
delays(s); provided that such Party shall continue to perform to the extent
feasible in view of such force majeure event.
ARTICLE
VIII
COVENANTS
8.1 Confidentiality.
Consultant shall (a) not disclose or reveal any confidential information (as
herein defined) to any person other than those who are actively and directly
participating in the services rendered by Consultant under this Agreement and
(b) not use any confidential information regarding the Company for any purposes
other than in connection with the services to be rendered by Consultant
hereunder, and (c) take all steps as are normally used by Consultant in
protecting confidential information to assure adherence to the terms of this
Agreement. In the event that Consultant is requested pursuant to, or required
by, applicable law or regulation or by legal process to disclose any
confidential information regarding the Company, Consultant agrees that it will
provide the Company with prompt notice of such request(s) to enable the Company
to seek an appropriate protective order and/or waive compliance by Consultant
with the provisions of this Section. "Confidential Information" means all
information about the Company, in any form, however and whenever acquired,
that
is not generally known to business competitors or the general public, and which
is treated as confidential by the Company, including, without limitation:
studies and tests, geological information, title information, contracts, vendor
or supplier lists, procedures, improvements, modifications, enhancements,
concepts and ideas, business plans and proposals, business methods, technical
plans and proposals, research and development, know-how, budgets and
projections, market studies, competitive analyses, accounts receivable or
payable, billing methods and other non-public financial information, information
regarding the skills and compensation of employees, technical memoranda,
reports, designs and specifications, product and user manuals, software (whether
or not reduced to writing and whether or not protectable by patent or copyright
registration), in both object code and source code, engineering, hardware
configuration information, data and documents now existing or later acquired,
regardless of whether any of such information, data or documents qualify as
"trade secrets" under applicable Federal or state law. Notwithstanding the
foregoing, “confidential information” does not include information which is
generally known in the trade or industry, or which is not gained as a result
of
a breach of a duty to maintain the secrecy of the Company's confidential
information. The phrase “generally known” shall mean readily accessible to the
public in a written publication.
8.2 Non-Competition.
Consultant expressly covenants and agrees that during the term of this Agreement
and for a period of one (1) year after termination of this Agreement, Consultant
shall not directly or indirectly, either as a principal, agent, employee,
employer, stockholder, co-partner or in any other individual or representative
capacity whatsoever, engage in the Company's business anywhere in the Republic
of Colombia. However, Consultant may
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acquire
up to five percent (5%) of any publicly
traded company, even if engaged in competition with the Company.
8.3 Non-Solicitation
of Employees.
Consultant agrees that during the term of this Agreement and for a period of
one
(1) year after termination of this Agreement, Consultant shall, (i) not solicit,
entice, persuade, or induce any employee or consultant of the Company or any
of
its subsidiaries to leave the employ of such entity, and (ii) refrain from
recruiting or hiring, or attempting to recruit or hire, directly or by assisting
others, any individual who is employed by, or engaged as a consultant by the
Company or any of its subsidiaries at the time of the attempted recruiting
or
hiring.
8.4 Work
Product.
Consultant shall disclose promptly to the Company any and all significant
conceptions and ideas for inventions, improvements and valuable discoveries,
whether patentable or not, that are conceived or made by the Consultant, solely
or jointly with another, during the term of this Agreement and that are directly
related to the business or activities of Company and that Consultant conceives
as a result of the Consultant's independent contractor relationship with the
Company. Consultant hereby assigns and agrees to assign all the Consultant's
interests therein to the Company or its nominee. Consultant agrees that all
such
inventions, improvements and valuable discoveries that the Consultant develops
or conceives and/or documents during the term of this Agreement shall be deemed
works made-for-hire for the Company within the meaning of the copyright laws
of
the United States or any similar or analogous law or statute of any other
jurisdiction and, accordingly, the Company shall be the sole and exclusive
owner
for all purposes for the distribution, exhibition, advertising and exploitation
of such materials or any part of them in all media and by all means now known
or
that may hereafter be devised, throughout the universe in perpetuity.
ARTICLE
IX
MISCELLANEOUS
9.1 Indemnification.
To
the
fullest extent permitted by law, the Company shall promptly indemnify Consultant
for all amounts (including, without limitation, judgments, fines, settlement
payments, losses, damages, costs and expenses (including reasonable attorneys’
fees)) incurred or paid by Consultant in connection with any action, proceeding,
suit or investigation arising out of or relating to the performance by
Consultant of his services pursuant to this Agreement. This indemnification
shall also apply to Consultant's prior activities as an officer and director
of
the Company. The Company shall use its best efforts to include Consultant as
an
insured under any insurance policy covering its officers, directors and
employees.
9.2 Notice.
Any
notice, request or demand given pursuant to this Agreement shall be in writing
and either hand delivered, or sent by certified or registered U.S. mail, return
receipt requested. Notice shall be deemed given upon receipt and delivered
to
the respective addresses set out below, or to such other address as a Party
shall specify in the manner required by this Section, as follows:
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If
to COMPANY:
Xxxxx
000, 0 Xxxx Xxxxxx Xxxx
Xxxxxxx,
Xxxxxxx, Xxxxxx X0X 0X0
Attn:
Xx.
Xxxxx Xxxxxxxx
If
to CONSULTANT:
J.
Xxxxxxx Xxxxxx
Xxxxx
000, 0 Xxxx Xxxxxx Xxxx
Xxxxxxx,
Xxxxxxx, Xxxxxx X0X 0X0
9.3 Assignment.
Consultant may only assign any of its rights under this Agreement to an entity
controlled by Consultant. The Agreement may not be assigned by the Company
without Consultant's prior written consent.
9.4 Governing
Law/Prevailing Party.
This
Agreement shall be construed in accordance with and governed for all purposes
by
the laws of the State of Nevada. The prevailing party in any suit brought
hereunder shall be entitled to reimbursement for legal fees and costs incurred
in connection with such suit (and appeal).
9.5 Entire
Agreement.
This
Agreement contains the entire agreement of the Parties and supersedes all prior
agreements, contracts and understandings, whether written or otherwise, between
the Parties relating to the subject matter hereof and may not be modified except
by an amendment signed by the Parties.
9.6 Severability.
If any
provision of this Agreement shall be determined by a court of competent
jurisdiction to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions of this Agreement shall remain in full
force and effect and shall in no way be affected, impaired or invalidated.
If
any provisions shall be determined by a court of competent jurisdiction to
be
unenforceable because excessively broad or vague as to duration, activity or
subject, it shall be construed by limiting, reducing or defining it, so as
to be
enforceable.
9.7 Waiver.
Neither
the failure nor delay on the part of either Party to exercise any right, remedy,
power or privilege under this Agreement shall operate as a waiver hereof. No
waiver shall be effective unless it is in writing and is signed by the Party
asserted to have granted such waiver.
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IN
WITNESS WHEREOF, the Parties have executed this Agreement as of the 1st day
of
August, 2006.
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By:
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/s/ Xxxxx Xxxxxxxx
Xxxxx Xxxxxxxx - Chairman
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CONSULTANT
/s/
Xxxxxxx Xxxxxx
J.
Xxxxxxx
Xxxxxx
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