CONSULTING SERVICES AGREEMENT
Exhibit
10.1
THIS
AGREEMENT
is made
as of the 1st
day of
May, 2008
BETWEEN:
SILVER
RESERVE CORP., a
corporation incorporated under the laws of the State of Delaware
(herein
called the “Corporation”) Party
of
the First Part
-
and
-
XXXXX
CAPITAL LTD., a
corporation incorporated under the laws of the State of Nevada
(herein
called the “Consultant”) Party
of
the Second Part
RECITALS:
|
A.
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The
Corporation wishes to engage the Consultant to assist the Corporation
by
providing administrative and other services as described herein;
and
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B.
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The
Consultant wishes to accept this engagement by the
Corporation.
|
NOW
THEREFORE, in consideration of the mutual covenants and agreements contained
in
this Agreement and other good and valuable consideration, the parties agree
as
follows.
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1.
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DEFINITIONS
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In
this
Agreement the following terms shall have the following meanings:
“Agreement”
means
this Consulting Services Agreement as it may be amended from time to
time;
“Confidential
Information”
means
all confidential or proprietary information (including drilling results, trade
secrets and information about business or asset acquisitions or combinations)
and material facts relating to the business and affairs of the Corporation
that
have not been publicly disclosed;
“Corporation”
includes
affiliates, subsidiaries and associates of the Corporation unless the context
otherwise requires;
“Term”
means
the period commencing May 1, 2008 and terminating in accordance with Section
10
hereof.
| 2. |
REPRESENTATION
AND WARRANTIES
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Each
of
the Corporation and the Consultant hereby covenant, represent and warrant to
each other as follows:
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(a)
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They
have all of the necessary corporate power, authority and capacity
to enter
into this Agreement and the agreements and the other instruments
contemplated herein (if any) and to perform their respective obligations
hereunder and thereunder. The execution and delivery of this Agreement
and
the agreements and other instruments contemplated herein and the
consummation of the transactions contemplated hereunder and thereunder
have or will be duly authorized by all necessary corporate action
required
by each party;
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(b)
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This
Agreement and the agreements and other instruments contemplated herein
(if
any) when executed will constitute valid and binding obligations
of each
of the parties enforceable against each of them as is applicable
in
accordance with the terms hereof and thereof subject, however, to
limitations with respect to enforcement imposed in connection with
laws
affecting the rights of creditors generally including, without limitation,
applicable bankruptcy, insolvency, moratorium, reorganization or
similar
laws and to the extent that equitable remedies such as specific
performance and conjunction are in the discretion of the court from
which
they are sought;
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(c)
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Each
of the parties are duly incorporated and organized, validly existing,
in
good standing and are up to date in all of the filings and registration
required under the laws of the jurisdiction in which they are
incorporated; and
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(d)
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The
entering into and performance of this Agreement and the agreements
and
other instruments contemplated herein (if any) will not violate,
contravene, breach or offend against or result in any default under
any
security agreement, indenture, mortgage, lease, order, undertaking,
licence, permit, agreement, instrument, charter or by-law provision,
resolution of shareholders or directors, statute, regulation, judgement,
decree or law to which the parties hereto are a party or by which
they may
be bound or affected. No licenses, agreements or other instruments
or
documents of the Corporation or any of its subsidiaries (if applicable)
will terminate or require assignment as a result of the entering
into of
this Agreement or the consummation of the transactions contemplated
hereby.
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2
| 3. |
ENGAGEMENT
OF THE CONSULTANT
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The
Corporation hereby engages the Consultant for the Term to perform the following
services:
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(a)
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Employ
and provide secretarial and bookkeeping
personnel;
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(b)
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Provide
receptionist services for telephone calls to the
Corporation;
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(c)
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Advise
the Corporation regarding financial planning, corporate development,
corporate governance and compliance with applicable securities laws
and
regulations;
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(d)
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Prepare
or cause to be prepared all required documentation for the operation
of
the Corporation including, without limitation, corporate minutes,
bookkeeping, administrative agreements and shareholder records and
correspondence not provided by the Corporation’s transfer
agent;
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(e)
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Provide
instruction and oversight to the Corporation's legal counsel and
auditors
in connection with reporting and securities law compliance
generally;
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(f)
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Negotiate
agreements with investor relations consultants, business consultants,
mining and engineering consultants, drilling contractors and other
services providers for the benefit of the Corporation and provide
instruction and oversight to the Corporation's legal counsel in connection
with the
agreements governing such transactions and related
matters;
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(g)
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Provide
instruction and oversight to the Corporation's legal counsel in connection
with private placements of the Corporation’s securities with
investors;
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(h)
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Act
as the agent for communication between the SEC, other regulators
and the
Corporation;
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(i)
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Provide
instruction and oversight to the Corporation's legal counsel in connection
with the registration of the Corporation’s securities with the Securities
and Exchange Commission (the “SEC”) and other regulatory authorities based
upon the Corporation’s decisions on where it will list its securities for
trading;
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(j)
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Insure
that all accounting records are maintained to meet generally accepted
accounting principals and quarterly and annual reports are prepared
and
filed to meet SEC regulatory
requirements;
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(k)
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Manage
shareholder inquiries and issues related to the transfer or assignment
of
shares;
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3
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(l)
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Interact
with the Corporation’s transfer agent to insure smooth operation of the
transfer agent’s functions;
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(m)
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Organize
shareholder meetings when called by the Board of directors, including
engagement of a scrutineer, engagement of appropriate facilities,
preparation of a proxy statement, mailing of the proxy statement
and
solicitation of proxies;
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(n)
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Provide
support for the Corporation’s investor relations, including preparation of
brochures and reports suitable for the level of audience receiving
such
materials;
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(o)
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Oversee
and contract for all printed materials required by the
Corporation;
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(p)
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Prepare
budgets, collect revenue on behalf of the Corporation, if applicable,
and
process payables of the Corporation using access to bank accounts
of the
Corporation as determined by Consultant and the Corporation or using
segregated bank accounts held by
Consultant;
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(q)
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Prepare,
update and maintain the corporate procedures manual of the
Corporation;
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(r)
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Oversee
and implement internal controls and procedures as required by applicable
provisions of the Xxxxxxxx-Xxxxx
Act;
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(s)
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Maintain
board committee minutes for committees of the Corporation’s board,
including the Audit Committee;
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(t)
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Administer
the Corporation’s stock option
plan;
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(u)
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Administer
the exercise of the Corporation’s outstanding warrants and other
convertible securities as they are exercised by their
holders;
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(v)
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Oversee
the issuance of Rule 144 opinion letters by legal counsel, as
applicable;
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(w)
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Provide
personnel to attend board meetings, as requested by the board of
the
Corporation; and
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(x)
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Such
other matters and activities as are required for the operation of
the
Corporation.
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All
activities of the Consultant shall be carried out at the direction of the board
of directors of the Corporation or its officers.
4
| 4. |
COMPENSATION
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(a)
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As
compensation for the services to be provided by the Consultant hereunder,
the Corporation agrees to pay the Consultant $12,500.00 per month
during
the Term.
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(b)
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The
Consultant shall be reimbursed monthly for all expenses incurred
with
respect to the operation of the administration of the Corporation,
including but not limited to office rent, wages, telephones, internet
and
other office operational costs, provided that these expenses are
incurred
in substantial accordance with monthly and annual budgets to be prepared
by the Consultant and approved by the Board of Directors of the
Corporation from time to time.
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(c)
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The
Consultant shall also be reimbursed for the cost of furniture and
equipment for the office provided the ownership of any furniture
and
equipment purchased shall vest with the Corporation, again provided
that
such capital expenditures are incurred in substantial accordance
with
monthly and annual budgets to be prepared by the Consultant and approved
by the Board of Directors of the Corporation from time to
time.
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(d)
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The
Consultant shall provide receipts for all expenses and other items
for
which it is entitled to reimbursement and such other documentation
as may
be reasonably requested by the Corporation’s
auditors.
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(e)
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It
is understood that the Corporation has procedures for the authorization
of
all payments and the issuance of checks and which payments to the
Consultant are subject. The responsibility for carrying out these
procedures shall be that of the Consultant, its officers and
employees.
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| 5. |
TERMS
OF PAYMENT
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Fees
and
expenses of Consultant shall be billed to the Corporation monthly and shall
be
due upon receipt of invoice. Amounts unpaid after 15 days shall bear interest
at
the rate of 1.5% per month.
| 6. |
NATURE
OF RELATIONSHIP
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The
parties acknowledge and agree as follows:
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(a)
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the
relationship of the Consultant to the Corporation is that of independent
contractor;
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(b)
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the
Consultant is not an employees or agent of the Corporation except
where
the Corporation designates that Consultant shall act as its agent;
and
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| (c) |
the
Corporation and the Consultant are not partners or joint
venturers.
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5
| 7. |
NO
USE OF CONFIDENTIAL
INFORMATION
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During
and at all times after the Term, the Consultant will cause its officers,
directors and employees to keep confidential all Confidential Information and
will not use for the benefit of the Consultant its officers, directors and
employees or others (except in connection with the business and affairs of
the
Corporation in the course of providing services hereunder) any Confidential
Information and will not disclose Confidential Information to any person except
in the course of providing services under this Agreement to a person who is
employed by the Corporation or with the Corporation’s prior
consent.
The
foregoing prohibition will not apply to any Confidential Information
if:
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(a)
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the
Confidential Information is available to the public or in the public
domain at the time of disclosure or use;
or
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(b)
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disclosure
is required to be made by operation of law, in which case the Consultants
will notify the Corporation immediately upon learning of that requirement;
or
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(c)
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disclosure
is made with the Corporation’s prior written
approval.
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8.
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CONFLICT
OF INTEREST
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The
Corporation acknowledges that the Consultant will provide from time to time
similar services for other parties which shall not be considered a conflict
of
interest subject to the discharge of the Consultant’s obligations under this
Agreement and in particular those related to confidentiality.
| 9. |
NO
AUTHORITY TO BIND THE
CORPORATION
|
Without
limiting the provisions of Section 3, except where authorized by the
Corporation, the Consultant shall not have authority to bind the Corporation
to
perform any obligations to any third party. The foregoing limitation shall
not
apply where the Consultant is asked to negotiate agreements with third parties
on behalf of the Corporation or address issues raised by regulators on behalf
of
the Corporation. Notwithstanding the foregoing, the Consultant shall not have
authority to execute an agreement on behalf of the Corporation. It is understood
and agreed that only officers of the Corporation shall be authorized to execute
documents on behalf of the Corporation. The parties further agree that the
Consultant may employ an officer of the Corporation as an employee of Consultant
and that such officer of the Corporation, acting in their capacity as an
officer, may execute documents, agreements and filings on behalf of the
Corporation in the normal course.
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| 10. |
TERM
AND TERMINATION
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The
Term
of this Agreement shall be one (1) year and shall automatically renew from
year
to year unless terminated. Either party may terminate this Agreement at anytime
on 60 days prior written notice subject to the provision of Sections 4, 5 and
11
hereof, which Sections shall survive the expiry or termination of this Agreement
and continue in full force and effect.
| 11. |
INDEMNIFICATION
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The
Corporation will indemnify the Consultant and its heirs and legal
representatives against all costs, charges and expenses, including all amounts
paid to settle an action or satisfy a judgement, reasonably incurred by the
Consultant in respect of any civil, criminal or administrative action or
proceeding to which the Consultants is or becomes a party by reason of being
or
having been engaged by the Corporation under this Agreement (a “Claim”), other
than an action (including, without limitation, an action in contract or tort)
by
the Corporation as a result of a breach or alleged breach by the Consultants
of
this Agreement or of any duty owed by the Consultant to the Corporation,
if:
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(a)
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The
Consultant acted honestly and in good faith with a view to the best
interests of the Corporation; and
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(b)
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In
the case of a criminal or administrative action or proceeding that
is
enforced by the monetary penalty, the Consultant had reasonable grounds
for believing that the conduct of the Consultant was
lawful.
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The
Consultant acknowledges that indemnification will be limited to costs, charges
and expenses actually incurred, and will be paid only if the consultant provides
the Corporation with prompt notice of any Claim. The Corporation will have
the
right at its own expense, upon written notice to the Consultant, to assume
control of the negotiation, settlement or defence of any Claim, subject to
the
reasonable oversight of the Consultant. Consultant shall be satisfied with
the
Corporation’s choice of legal counsel in connection with any such negotiation,
settlement or defence. The Consultant will cooperate with the Corporation in
respect of such Claim. If the Corporation does not elect to assume control
of
the negotiation, settlement or defence of a Claim, the Consultant may retain
its
own counsel (at the expense of the Corporation) to defend the Claim and will
keep the Corporation fully advised, including supplying copies of all relevant
documentation promptly as it becomes available. The Consultant or the
Corporation may not settle or compromise any Claim without the prior written
consent of the other party.
| 12. |
NOTICE
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Any
notice or communication to be given or made under this Agreement must be in
writing and addressed as follows:
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| (a) |
if
to the Corporation
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c/o
Xxxx
X. Xxxxxxxxxx, CEO
0000
Xxxxxxxx Xxx, Xxxxx 000X
Xxxx,
Xxxxxx 00000
Phone:
000-000-0000
Fax:
000-000-0000
| (b) |
if
to the Consultant
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Xxxxx
Capital Ltd.
0000
Xxxxxxxx Xxx, Xxxxx 000X
Xxxx,
Xxxxxx 00000
Phone:
000-000-0000
Fax:
000-000-0000
and
will
be deemed to be properly given or made on the earliest of the
following:
| (a) |
actual
delivery;
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| (b) |
48
hours after being sent by commercial courier service;
and
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(c)
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the
day following which any telegram or telecopier message is
sent.
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Notice
of
change of address for the purpose of notice will also be governed by this
section.
| 13. |
ASSIGNMENT
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This
Agreement may not be assigned by any party, without the prior written consent
of
the other parties.
| 14. |
HEADINGS
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The
inclusion of headings in this Agreement is for convenience of reference only
and
is not to affect construction or interpretation.
| 15. |
INVALIDITY
OF PROVISIONS
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Any
provision of this Agreement that is prohibited or unenforceable in any
jurisdiction will, as to that jurisdiction, be ineffective to the extent of
the
prohibition or unenforceability without invalidating the remaining provisions
of
this Agreement, and any prohibition or unenforceability of that provision in
any
other jurisdiction. For any provision severed there will be deemed substituted
a
like provision to accomplish the intent of the parties as closely as possible
to
the provision as drafted, as determined by any court or arbitrator having
jurisdiction over any relevant proceeding, to the extent permitted by the
applicable law.
8
| 16. |
ENTIRE
AGREEMENT
|
This
Agreement constitutes the entire agreement between the parties pertaining to
the
subject matter. There are no warranties, representations or agreements between
the parties in connection with the subject matter except as are specifically
set
out or referred to in this Agreement. No reliance is placed on any
representation, opinion, advice or assertion of fact made by either party or
its
directors, officers or agents to the other party, or its directors, officers
or
agents, except to the extent that the same has been reduced to writing and
included as a term of this Agreement. Accordingly, there is to be no liability,
either in tort or in contract, assessed in relation to any such representation,
opinion, advice or assertion of fact, except to the extent
aforesaid.
| 17. |
WAIVER,
AMENDMENT
|
Except
as
expressly provided in this Agreement, no amendment or waiver of this Agreement
will be binding unless executed in writing by the party to be bound. The failure
of either party at any time to require performance by the other party of any
provisions of this Agreement will in no way affect the right of that party
to
require performance of any other provisions. No waiver of any provision of
this
Agreement will constitute a waiver of any other provision nor will any waiver
of
any breach of any provision of this Agreement be construed as a waiver of any
continuing or succeeding breach of such provision unless otherwise expressly
provided.
| 18. |
CURRENCY
|
All
amounts in this Agreement are stated and will be paid in United States currency
unless otherwise specifically stated.
| 19. |
GOVERNING
LAW
|
This
Agreement is to be governed by and construed in accordance with the laws of
the
Province of Ontario and the laws of Canada applicable therein.
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20.
|
COUNTERPARTS
|
This
Agreement may be executed in multiple counterparts, each of which shall
be deemed
an
original, and all of which together shall constitute one and the same
instrument. Execution and delivery of this Agreement by exchange of facsimile
copies bearing facsimile signature of a party shall constitute a valid and
binding execution and delivery of this Agreement by such party. Such facsimile
copies shall constitute enforceable original documents.
9
IN
WITNESS WHEREOF the Corporation and the Consultants have executed this Agreement
as of the date first written above.
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BY:
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/s/
Xxxx X. Xxxxxxxxxx
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Xxxx
X. Xxxxxxxxxx, CEO
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XXXXX
CAPITAL LTD.
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/s/
Xxxxxxxx Xxxxxx
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X. Xxxxxx, President
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10
