EMPLOYMENT CONTRACT AGREEMENT effective as of the 1st day of October 2007.
EMPLOYMENT
CONTRACT
AGREEMENT
effective
as of the 1st day of October 2007.
B
E T W E E N:
J.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
of the
City of Riegelsville in the State of Pennsylvania.
(the
“Executive”)
-
and
-
Colombia
Goldfields Ltd,
a
corporation incorporated under the laws of the State of Delaware
(the
“Company”)
IN
CONSIDERATION
of the
mutual covenants and agreements herein contained and of other good and valuable
consideration, the parties agree with one another as follows:
| 1. |
INTERPRETATION
|
|
1.1
|
Definitions
|
In
this
agreement, unless there is something in the subject matter or context
inconsistent therewith,
“Act”
means
the
Employment
Standards Act of
Ontario as the same may be amended or restated, or any comparable successor
legislation;
“associate”,
“affiliate” and
“subsidiary”
shall
have the respective meanings ascribed to such terms by the Business
Corporations Act (Ontario)
on the date hereof;
“Business”
means
the
business carried on by the Company and its affiliates of the exploration
for
gold, silver and other precious metals;
“Business
Day”
means
any day of the week except Saturday, Sunday or any statutory or civic holiday
observed in Toronto, Ontario;
“Person”
includes
an individual, corporation, partnership, joint venture, trust, unincorporated
organization, the Crown or any agency or instrumentality thereof or any other
entity recognized by law; and
“Related
Person”
In this
agreement, the following Persons shall be deemed to be related to each
other:
| (a) |
a
body corporate and the Person who beneficially owns, directly or
indirectly, voting securities of such body corporate carrying more
than
50% of the voting rights attached to all voting securities of the
body
corporate for the time being outstanding;
|
| (b) |
a
body corporate and any affiliate thereof;
|
| (c) |
a
partnership and any Person who is a partner
thereof;
|
| (d) |
a
trust or estate and any Person who has a substantial beneficial interest
therein or as to which such Person serves as trustee, executor or
in a
similar capacity;
|
| (e) |
Persons
who are spouses of one another; and
|
| (f) |
a
Person and any relative of such Person or any relative of the spouse
of
such Person, where such relative has the same home as such
Person.
|
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1.2
|
Headings
|
The
division of this agreement into paragraphs and subparagraphs and the insertion
of headings are for convenience of reference only and shall not affect the
construction or interpretation of this agreement. The headings in this agreement
are not intended to be full or precise descriptions of the text to which they
refer and shall not be considered part of this agreement. References to a
paragraph or a subparagraph are to the corresponding paragraph or subparagraph
of this agreement
|
1.3
|
Number
and Gender
|
In
this
agreement, words in the singular include the plural and vice-versa and words
in
one gender include all genders.
|
2.
|
EMPLOYMENT
|
The
Company agrees to employ the Executive as its Chief Executive Officer and the
Executive accepts such employment on and subject to the terms of this agreement.
In carrying out his duties and responsibilities as Chief Executive Officer
of
the Company, the Executive shall comply with all lawful instructions as may
from
time to time be given by the Board of Directors of the Company.
|
3.
|
GOODWILL
|
The
Executive shall use his best efforts during the term of this agreement to ensure
the continuity of and to preserve and maintain the goodwill of the Business.
For
a period of one year after the termination of the employment of the Executive
hereunder for any reason, the Executive shall not, directly or indirectly,
take
any action to damage the goodwill of the Business or the relationship of the
Company with its suppliers, consultants or employees.
-2-
|
4.
|
TERM
|
The
term
of this agreement shall commence on October 1, 2007 and shall continue for
a
term of two years unless until terminated in accordance with paragraph 11
hereof. This agreement shall automatically renew on the anniversary date of
the
agreement for a two-year term unless at least 30 days prior to the anniversary
date either party gives written notice to the other Party that this Agreement
is
not to renew.
|
5.
|
DUTIES
|
So
long
as this agreement continues in full force and effect, the Executive shall
perform such tasks and duties in his capacity as Chief Executive Officer of
the
Company as are ordinarily performed by the Chief Executive Officer of a public
company and as may from time to time be determined by the Board of Directors
of
the Company. The Executive shall, in carrying out his obligations under this
agreement, report directly the Board of Directors of the Company.
The
Executive acknowledges that the hours of work involved will vary and be
irregular and are those hours required to meet the objectives of the Company.
The Executive acknowledges that this paragraph constitutes an agreement to
work
such hours where such agreement is required by applicable legislation. The
Executive also acknowledges that he is a senior officer of the Company and
is in
the position of a fiduciary with respect to the Company and all of its property
and assets, whether tangible or intangible.
The
Company acknowledges that the Executive from time to time may have
responsibilities and commitments to other organizations outside the scope of
this agreement. Provided such responsibilities and commitments do not conflict
with the Executive’s responsibilities, commitments, and undertakings contained
in this Agreement, such activities are hereby expressly permitted. In the event
of any conflict or perceived conflict, the Executive agrees to disclose such
conflict to the Company’s Board of Directors and use commercially reasonable
efforts to come to a mutually agreeable resolution.
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6.
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CONFIDENTIAL
INFORMATION
|
The
Executive acknowledges that as Chief Executive Officer of the Company, the
Executive will acquire information about certain matters and things which are
confidential to the Company and which information is the exclusive property
of
the Company. Further, the Executive acknowledges that the Company's business
depends significantly upon the maintenance of trade secrets, data, technical
innovations and other confidential, proprietary information that the Company
has
developed over a long period of time and at great expense. The Executive further
acknowledges that the Company has developed a close and valuable relationship
with many of its consultants and suppliers. In partial consideration for the
Executive's employment hereunder, the Executive covenants and agrees that he
shall not, at any time during the term of his employment by the Company or
thereafter, until such information becomes part of the public domain, reveal,
divulge or make known to any persons or entity (other than the Company and
its
duly authorized employees) or use for his own or any other's benefit, the
Company's list of consultants and suppliers, or its trade secrets, processes
and
materials, formulae, research techniques or accomplishments, or his knowledge
of
any of the business or financial affairs of the Company, or any other
information regarded by the Company as confidential, except in the ordinary
course of business as the Executive may be required to divulge in his capacity
as a senior executive of the Company which during or after his employment
pursuant hereto is made known to the Executive. The Executive acknowledges
that,
without prejudice to any and all other rights of the Company, an injunction
is
the only effective remedy to protect the Company's rights and property as set
out in this paragraph.
-3-
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7.
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VACATION
|
The
Executive shall be entitled to six weeks paid vacation per annum.
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8.
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EXPENSES
|
The
Company shall pay or reimburse the Executive for all travelling and other
out-of-pocket expenses actually and properly incurred by him in connection
with
his duties. The Executive shall obtain the consent of the Compensation Committee
of the Board of Directors of the Company before incurring any expenses of an
extraordinary nature.
|
9.
|
COMPENSATION
|
The
Company shall pay to the Executive and the Executive shall accept as
compensation for all his services and duties hereunder a salary of U.S. $20,000
per month. The Executive’s salary shall be reviewed annually by the Compensation
Committee of the Board of Directors of the Company. The Executive's salary
shall
be payable, net of all statutory withholdings and deductions which the Company
is required to make from time to time, in monthly installments or at such other
times as the Company and the Executive may from time to time agree.
|
10.
|
BENEFITS
|
The
Executive shall be entitled to participate in any plans maintained from time
to
time by the Company for the benefit of Company employees, including, but not
limited to, those pertaining to group life, accident, sickness and medical
insurance and pensions, all within the terms of such plans. Participation by
the
Executive in any of the foregoing plans, programs and benefits is subject to
the
Executive being able to satisfy any pre-conditions of general application to
the
participation of all employees in such plans.
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11.
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TERMINATION
|
The
Executive's employment hereunder may be terminated in each of the circumstances
in subparagraphs 11.1 to 11.6 inclusive:
-4-
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11.1
|
Death
|
The
Executive's employment hereunder shall automatically terminate upon his death
and amounts due and payable to the Executive at that time will be paid to his
estate or as directed by his executor.
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11.2
|
Disability
|
The
Company may terminate the Executive’s employment hereunder if the Executive, by
reason of physical or mental disability, is unable to fulfill his obligations
and duties hereunder on a full time basis (other than by reason of authorized
vacation or leave) for a period in excess of 90 working days in any one-year
period.
|
11.3
|
Cause
|
The
Company may terminate the Executive’s employment hereunder at any time for
cause. For purposes of this agreement “Cause” means and is limited to (i)
willful and continued failure by the Executive to substantially perform the
duties provided herein after a written demand for substantial performance
delivered to the Executive by the Company, which demand identifies with
reasonable specificity the manner in which the Executive has not substantially
performed his duties, and the Executive’s failure to comply with such demand
within a reasonable time; (ii) engaging by the Executive in gross misconduct
or
gross negligence materially injurious to the Company; (iii) the commission
by
the Executive of any act in direct competition with or materially detrimental
to
the best interest of the Company; or (iv) the Executive’s conviction of having
committed a felony.
|
11.4
|
Without
Cause
|
The
Company may terminate the employment of the Executive hereunder at any time
without cause upon 30 days’ prior written notice to the Executive or payment in
lieu thereof. After the effective date of such termination, the Executive shall
be entitled to no further rights or benefits hereunder or in connection with
his
employment by the Company other than as specified in subparagraph 12.2. Subject
to applicable law, the foregoing represents the Company’s maximum termination
and severance obligations. This provision shall remain in full force and effect
unamended notwithstanding any other alterations to the Executive’s terms and
conditions of employment or to this contract, whether fundamental or otherwise,
unless the Executive and the Company otherwise agree in writing.
|
11.5
|
Termination
by the Executive
|
The
Executive may terminate his employment with the Company hereunder on 30 days’
written notice to the Company.
-5-
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11.6
|
Termination
by the Executive Upon Change of
Control
|
Upon
a
“Change in Control”, the Executive shall be entitled to terminate his employment
and, within 30 days, receive a lump sum payment from the Company equal to the
amounts prescribed in subparagraph 12.2 and all previously granted stock options
shall immediately vest. For purpose of this section “Change in Control” shall
have the same meaning as contained in the Company’s Stock Option Agreements and
shall mean:
|
(a)
|
any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities and Exchange Act of 1934, as amended (the "Exchange Act")),
other than a trustee or other fiduciary holding securities of the
Company
under an employee benefit plan of the Company, becomes the "beneficial
owner" (as defined in Rule 1 3d-3 promulgated under the Exchange
Act),
directly or indirectly, of securities of the Company representing
50%
or
more of (A) the outstanding shares of common stock of the Company
or (B)
the combined voting power of the Company's then-outstanding
securities;
|
|
(b)
|
the
Company is party to a merger or consolidation, or series of related
transactions, which results in the voting securities of the Company
outstanding immediately prior thereto failing to continue to represent
(either by remaining outstanding or by being converted into voting
securities of the surviving or another entity) at least fifty (50%)
percent of the combined voting power of the voting securities of
the
Company or such surviving or other entity outstanding immediately
after
such merger or consolidation;
|
|
(c)
|
the
sale or disposition of all or substantially all of the Company's
assets
(or consummation of any transaction; or series of related transactions,
having similar effect);
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(d)
|
there
occurs a change in the composition of the Board of Directors of the
Company within the term of this agreement, as a result of which fewer
than
a majority of the directors are Incumbent
Directors;
|
| (e) |
the
dissolution or liquidation of the Company;
or
|
|
(f)
|
any
transaction or series of related transactions that has the substantial
effect of any one or more of the
foregoing.
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-6-
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12.
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COMPENSATION
ON TERMINATION
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12.1
|
Compensation
on Termination for Cause
|
If
the
Executive's employment shall be terminated for cause, the Company shall pay
the
Executive his salary through the date of termination together with any accrued
vacation pay and the Company shall have no further obligations to the Executive
under this agreement or in connection with his employment by the
Company.
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12.2
|
Compensation
on Termination without
Cause
|
If
the
Executive's employment is terminated by the Company without cause, the Company,
within 30 days of such termination, shall pay to the Executive an amount, to
be
inclusive of all termination and severance amounts payable, as
follows:
| (a) |
12
months’ salary; and
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| (b) |
all
vacation pay owing up to the date of
termination;
|
net
of
all statutory deductions or withholdings which the Company is required to make
from time to time. The Company's obligation to make payments to the Executive
pursuant to this paragraph is conditional upon the Executive fully complying
with all of his covenants and obligations hereunder from and after the date
of
termination of this agreement (with no obligation to mitigate) and shall
continue only so long as the Executive is in full compliance with such covenants
and obligations. Upon termination, any and all stock options previously granted
to Executive shall immediately vest and become exercisable in accordance with
the terms of the Executive’s Employee Stock Option Agreement(s).
| 12.3 |
Compensation
on Termination by the
Executive
|
Subject
to applicable law, the Executive acknowledges that he shall not be entitled
to
any compensation from and after the date that he terminates his employment
with
the Company pursuant to the provisions of subparagraph 11.5, unless the
Executive has terminated the agreement pursuant to the provisions of
subparagraph 11.6.
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13.
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NON
SOLICITATION / NON
COMPEITION
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13.1
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Non
Solicitation
|
During
the term of this agreement and for one year thereafter, the Executive agrees
not
to induce, directly or indirectly, any individual who to the Executive's
knowledge is then employed by, or a consultant to, the Company on a full time
or
substantially full time basis in the Business by the Company or an affiliate
of
the Company to leave the employ of, or engagement with, the Company or such
affiliate, without the Company's prior written consent, and agrees not to suffer
or permit any Related Person to do so.
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13.2
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Non
Competition
|
During
the term of this agreement and for a period of one year thereafter, the
Executive 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 within 30
kilometers of the documented boundaries of the Company’s Marmato Mountain
Project. However, Executive may acquire up to five percent (5%) of any publicly
traded company, even if engaged in competition with the Company.
-7-
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13.3
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Severability
|
If
any
one or more of the covenants provide in this Agreement should be determined
by a
court of competent jurisdiction to be contrary to law, such covenant or
agreement shall be deemed and construed to be severable from the remaining
covenants and agreement herein contained and shall in no way affect the validity
of the remaining provisions of this Agreement.
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14.
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GENERAL
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14.1
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Entire
Agreement
|
This
agreement constitutes the entire agreement between the parties pertaining to
the
employment of the Executive by the Company and supersedes all prior agreements,
negotiations, discussions and understandings, written or oral, between the
parties. There are no representations, warranties, conditions other agreements
or acknowledgments, whether direct or collateral, express or implied, that
form
part of or affect this agreement, or which induced any party to enter into
this
agreement or on which reliance is placed by any party, except as specifically
set forth in this agreement.
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14.2
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Amendment
|
This
agreement may be amended or supplemented only by a written agreement signed
by
each party.
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14.3
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Waiver
of Rights
|
Any
waiver of, or consent to depart from, the requirements of any provision of
this
agreement shall be effective only if it is in writing and signed by the party
giving it, and only in the specific instance and for the specific purpose for
which it has been given. No failure on the part of any party to exercise, and
no
delay in exercising, any right under this agreement shall operate as a waiver
of
such right. No single or partial exercise of any such right shall preclude
any
other or further exercise of such right or the exercise of any other
right.
-8-
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14.4
|
Applicable
Law
|
This
agreement shall be governed by and construed in accordance with the laws in
force in the State of Delaware. Each party irrevocably submits to the
non-exclusive jurisdiction of the courts of Ontario with respect to any matter
arising hereunder or related hereto.
|
14.5
|
Time
|
Time
is
and shall remain of the essence of this agreement and all of its
provisions.
|
14.6
|
Notices
|
Any
notice, demand or other communication (in this paragraph, a "notice") required
or permitted to be given or made hereunder shall be in writing and shall be
sufficiently given or made if:
| (a) |
delivered
in person during normal business hours on a Business Day and
left with a
receptionist or other responsible employee of the relevant party
at the
applicable address set forth
below;
|
| (b) |
sent
by prepaid first class mail;
or
|
| (c) |
sent
by any electronic means of sending messages, including telex or
facsimile
transmission, which produces a paper record ("Electronic Transmission")
during normal business hours on a Business Day charges prepaid
and
confirmed by prepaid first class
mail;
|
in
the
case of a notice to the Executive, addressed to him at:
J.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇,
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇, ▇▇▇▇▇
and
in
the case of a notice to the Company, addressed to it at:
▇
▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Attention:
Chairman of the Board of Directors
Telecopier
No.: ▇▇▇-▇▇▇-▇▇▇▇
Each
notice sent in accordance with this paragraph shall be deemed to have been
received:
| (a) |
on
the day it was delivered;
|
-9-
|
(b)
|
on
the third Business Day after it was mailed (excluding each Business
Day
during which there existed any general interruption of postal services
due
to strike, lockout or other cause);
or
|
|
(c)
|
on
the same day that it was sent by Electronic Transmission or on the
first
Business Day thereafter if the day on which it was sent by Electronic
Transmission was not a Business
Day.
|
The
Executive or the Company may change the address for notice by giving notice
to
each other as provided in this paragraph.
|
14.7
|
Assignment
|
Neither
this agreement nor any rights or obligations hereunder shall be assignable
by
any party without the prior written consent of the other party. Subject thereto,
this agreement shall endure to the benefit of and be binding upon the parties
and their respective heirs, executors, administrators, legal personal
representatives, successors (including any successor by reason of amalgamation
or statutory arrangement of any party) and permitted assigns.
|
14.8
|
Other
|
| (a) |
During
the Term and thereafter while the Executive could have any liability,
the
Executive shall be named as an insured party in any liability insurance
policy (including the director and officer liability policy) which
shall
be maintained by the Company for the directors and/or senior
officers.
|
| (b) |
The
Company shall indemnify the Executive to the fullest extent permitted
by
the laws of the state of Delaware and the province of Ontario on
the date
hereof or as such laws from time to time may be
amended.
|
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14.9
|
Further
Assurances
|
Each
party shall do such acts and shall execute such further documents, conveyances,
deeds, assignments, transfers and the like, and will cause the doing of such
acts and will cause the execution of such further documents as are within its
power as any other party may in writing at any time and from time to time
reasonably request be done and or executed, in order to give full effect to
the
provisions of this agreement.
IN
WITNESS WHEREOF the
parties have duly executed this agreement under seal this 3rd day of October
2007.
|
SIGNED,
SEALED AND DELIVERED
|
)
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|||
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in
the
presence of:
|
)
|
|||
|
)
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||||
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/s/
▇▇▇▇▇ Kopperson
|
)
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/s/
J.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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||
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Witness
|
J.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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-▇▇-
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▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ Ltd.
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||||
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By:
|
/s/
▇▇▇▇▇▇▇▇ ▇▇▇▇, Chair
of the Compensation Committee
|
|||
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On
Behalf of the Board of
Directors
|
-11-