AGREEMENT EL CAPITAN PRECIOUS METALS, INC. & CLYDE L. SMITH, Ph.D., P.Eng.
AGREEMENT
EL
CAPITAN PRECIOUS METALS, INC. & XXXXX X. XXXXX, Ph.D.,
P.Eng.
This
agreement is made and entered into this 22nd day of August, 2005 between El
Capitan Precious Metals, Inc., with its principal office located at 00000 X.
00xx
xxxxxx,
Xxxxx 000, Xxxxxxxxxx, XX 00000, a mineral exploration company (hereinafter
called “ECPN”) and Xxxxx X. Xxxxx, Ph.D., P.Eng., Consulting Geologist, a sole
proprietor with its principal office located at 000-0000 00xx
Xxxxxx,
Xxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx X0X0X0 (hereinafter called
“Xxxxx”).
WHEREAS,
ECPN has ownership and control over the El Capitan Project located in New
Mexico, and desires to enter into a transaction to sell some, or all of the
project to a third party.
WHEREAS,
Xxxxx has been the consulting geologist overseeing the recent drilling and
assaying of the project.
NOW
THEREFORE, the parties agree that ECPN will provide a success fee to Xxxxx
upon
the completion of a sales transaction involving the El Capitan project under
the
terms and conditions herein.
TERMS
AND CONDITIONS
| 1. |
DUTIES.
Xxxxx will have the following duties to ECPN for the duration of this
agreement:
|
| X. |
Xxxxx
will continue acting as ECPN’s consulting geologist, specifically for
completion of a current report on the El Capitan resource, for directing
an expanded drilling and assay project currently under way at the project,
and for completion of a final report on the El Capitan resource, and
assisting in all due diligence studies conducted by prospective
purchasers.
|
| B. |
Should
Xxxxx decide that the El Capitan project is worthy of presentation
to
Newmont Mining, then Xxxxx will put forth his best efforts to market
the
project to Newmont Mining.
|
| X. |
Xxxxx
will make his services available to ECPN and Xxxxxxx Associates in
assisting to present the project to prospective purchasers other than
Newmont.
|
| D. |
It
is understood that Xxxxx may seek purchasers other than Newmont or
those
from Xxxxxxx Associates.
|
| 2. |
COMPENSATION.
ECPN will compensate Xxxxx for the duties listed above in the following
manner.
|
| X. |
Xxxxx
will continue to receive his separately agreed rate of compensation
for
consulting on the items listed above.
|
| B. |
ECPN
will pay Xxxxx a success fee of $250,000 for the successful sale of
the
project to Newmont Mining or any other company, entity or
individual.
|
| X. |
Xxxxx
will xxxx his going rate of compensation for consulting while assisting
Xxxxxxx Associates to market the project. For a successful sale of
the
project to any company, entity, or individual, ECPN will pay Xxxxx
a
success fee of $250,000.
|
| D. |
It
is understood that should Xxxxx present a purchase proposal to ECPN,
other
than from Newmont or those presented by Xxxxxxx Associates, that Xxxxx
may
negotiate a compensation in addition to the $250,000 from ECPN to be
paid
either by ECPN or the incoming third
party.
|
| 3. |
METHOD
OF PAYMENT.
|
| A. |
The
success payment shall be deemed earned upon the closing of a transaction
of the El Capitan project. The payment for success shall be made in
accordance with the percentage and frequency made to ECPN for their
transaction payment up to a maximum of twelve (12) months, at which
time
the unpaid portion of the success fee shall be due
Xxxxx.
|
| X. |
Xxxxx
normally charges by the day. If while consulting for the expanded drilling
and assay project Xxxxx spends time consulting for the sale of the
project, Xxxxx will assign appropriate portions of that day to each
of the
separate duties.
|
GENERAL
| 1. |
INTERPRETATION
OF AGREEMENT. This Agreements hall be interpreted in accordance with,
and
in performance governed, as applicable by the laws of the State of
Nevada.
|
| 2. |
ARBITRATION.
In the event of a disagreement over any of the provisions or terms
of this
Agreement, all parties agree to seek binding arbitration from a Nevada
State Arbitration Board pursuant to the laws of the State of Nevada.
|
| 3. |
TERM.
The term of this agreement is two years. If, however, an agreement
is
concluded after the initial two years and prior to a total of four
years
from the inception of this agreement with any company, entity or
individual with whom Xxxxx has fulfilled any of the above functions,
then
the terms and conditions of this agreement shall
apply.
|
El
Capitan Precious Metals, Inc.
By: /s/
Xxxxxxx X. Xxxxxxx Date: 8/22/05
Xxxxxxx
X. Xxxxxxx,
President
Xxxxx
X.
Xxxxx, Ph.D., P. Eng (Sole Proprietor)
By: /s/
Xxxxx X. Xxxxx Date: 8/25/05
