Unassociated Document


    EMPLOYMENT
      CONTRACT

     

    AGREEMENT
      effective
      as of the 15th day of October 2007.

    


    


    B
      E T W E E N:

    


    T.
      W. Lough,
      of the
      City of Toronto in the Province of Ontario.

    


    (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,

    


    “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:

            


    

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    
      	(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.

            


    

     

     

    
      	
              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 President and the Executive
      accepts such employment on and subject to the terms of this agreement. In
      carrying out his duties and responsibilities as President of the Company, the
      Executive shall comply with all lawful instructions as may from time to time
      be
      given by the Chief Executive Officer 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 15, 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 President of the Company as
      are
      ordinarily performed by the President 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
      Chief Executive Officer 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.

    


    
      	
              6.

            	 	
              CONFIDENTIAL
                INFORMATION

            


    

    


    The
      Executive acknowledges that as President 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

        
          

        

      

      
        
        

      

    

    

      


      
        	
                7.

              	 	
                VACATION

              


      

    

    


    The
      Executive shall be entitled to six weeks paid vacation per annum. 

    
      


      
        	
                8.

              	 	
                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 CDN $15,000
      per month. The Executive’s salary shall be reviewed annually by the Chief
      Executive Officer 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.

    


    
      	
              11.

            	 	
              TERMINATION

            


    

    


    The
      Executive’s employment hereunder may be terminated in each of the circumstances
      in subparagraphs 11.1 to 11.6 inclusive:

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    
 

    
      	
              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.

     

    
      	
              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

        
          

        

      

      
        
        

      

    

     

    
      
        
          	
                  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);

            


    

    


    
      	 	
              (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.

            


    

    


    12.  COMPENSATION
      ON TERMINATION

    


    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    
      	
              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.

    


    
      	
              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


    (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.

    


    
      	
              13.

            	 	
              NON
                SOLICITATION / NON
                COMPETITON

            


    

    


    
      	13.1                       	
              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.

    


    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    


    
      	13.2                       	
              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.

    


    13.3                        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.

    


    14.                         
      GENERAL

    


    
      	
              14.1

            	 	
              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.

    


    14.2                       
      Amendment

    


    This
      agreement may be amended or supplemented only by a written agreement signed
      by
      each party.

    


    
      	
              14.3

            	 	
              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

        
          

        

      

      
        
        

      

    

    


    
      	
              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:

    


    T.
      W.
      Lough

    3505
      - 44
      Charles St., W.

    Toronto,
      ON M4Y 1R8  

     

    and
      in
      the case of a notice to the Company, addressed to it at:

    


    Colombia
      Goldfields Ltd.

    8
      King
      Street East, Suite 208

    Toronto,
      Ontario, M5C 1B5

    


    Attention:
      Chief Executive Officer

    Telecopier
      No.: 416-381-0883

    


    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.

            


    

     

    
      	
              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 12th day of November
      2007.

    


    SIGNED,
      SEALED AND DELIVERED       )

    in
      the
      presence
      of:                           
)

                                                                            ) 

                       
      /s/ N.
      Becerra                 
           )            /s/
      T. W.
      Lough            


    Witness                                                                
      T.
      W. Lough

    


    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    Colombia
      Goldfields Ltd.

     

     

    


    By:        
      /s/ J. R.
      Martin            


     
      J. R. Martin

    


    
      
        
        

      

      
        11