COFFEE PACIFICA INC




COFFEE PACIFICA INC.


Suite 527, Building 5, 2920 Green Valley Parkway, Henderson,
Nevada, 89014





PRIVATE & CONFIDENTIAL 




April 16, 2007 



Mr. Terry Klassen 

3221 56th
St SW 

Everett, Washington,
98203. 



Dear Mr. Terry Klassen:




RE: MANAGEMENT AGREEMENT 




This letter agreement (the "Agreement") sets forth the
services to be provided by Terry Klassen ("Klassen") to Coffee Pacifica, Inc.
(the "Company") and the terms and conditions under which such services shall be
performed (the "Engagement"). 



1. Engagement. Subject to the terms set forth herein,
the Company hereby engages Klassen and retains Klassen to serve as the Chief
Executive Officer of the Company and Klassen hereby accepts the position of
Chief Executive Officer effective as of April 16, 2007 (the "Effective Date").




2. Duties. Klassen will perform such duties
customarily performed by the Chief Executive Officer and such other duties as
reasonably requested by the Chairman or the Board of Directors of the Company
(the "Board"). These duties will include, but not be limited to, signing SEC
filings and certifications required by the Sarbanes-Oxley Act. It is understood
that Klassen has other business interests and responsibilities but that he does
not anticipate any significant time conflicts. Klassen will not accept any
significant new engagements and will devote the time and attention necessary to
fulfill these duties to the Company. 



3. Term. The term of Klassen's Engagement hereunder is
for thirty six (36) months unless terminated sooner in accordance with the
provisions of Section 4 below. The term of Klassen's Engagement hereunder shall
commence on the Effective Date and shall continue on for thirty six months and
expire on April 1, 2010. 



4. Termination The Company shall have the right to
terminate Klassen's Engagement with the Company at any time with or without
cause and with or without notice. In the event of termination prior to the end
of a calendar month, the Company shall pay Klassen fees for the full month for
the portion of the month that the Engagement was effective. 



5. Compensation. The Company shall make monthly
management fee payment of ten thousand dollars ($10,000) to Klassen or his
private company Vogue International Coffee Products Brokers Inc., in arrears, on
the 25th day of each month. 



6. Bonus and Stock Options 




(a) In further consideration of services to be rendered under
this Agreement, Klassen shall be paid a contract execution bonus of one hundred
thousand dollars ($100,000) upon execution of this Agreement. 



(b) In further consideration of the services to be rendered
under this Agreement, Company hereby grants Klassen a Stock Option. Klassen
shall have an option to purchase up to three hundred thousand (300,000) shares
of Company's Common Stock, prior to January 1, 2010, at an exercise price per
share to be established by the Board (the " Stock Option"). The first one-third
(1/3) of the Stock Option (100,000 shares) shall fully vest on the Effective
Date and the remaining two-thirds (2/3) of the Stock Option (200,000 shares)
shall fully vest on April 2, 2008. The said Stock Option shall be formalized in
two separate Option Agreements between the Company and Klassen in accordance
with the above-noted vesting dates. 



7. Expense Reimbursement. Klassen will be entitled to
reimbursement for reasonable out-of-pocket expenses incurred by Company or paid
by Klassen on behalf of the Company including, but not limited to, use of office
space, reproduction, typing, computer usage, employees, legal counsel (including
legal counsel retained to negotiate and draft this Agreement) and other similar
direct expenses and any and all taxes (other than state, local and federal
income taxes) on any of the foregoing, provided, however, that such
out-of-pocket expenses shall not exceed $1,000 per month without Board approval.
Expenses for ordinary course travel on Company business will not be subject to
the $1,000 monthly limitation. Klassen will be reimbursed within 30 days of
submission of reasonable documentation for such expenses. In no event, will
Klassen be reimbursed later than 30 days following the close of the calendar
year in which such expenses were incurred. 



8. Severance Payment. 



(a) If the Company at its sole discretion terminates the
Engagement anytime without cause, after the Effective Date, Klassen will receive
a severance payment equal to $100,000. Klassen will not receive any severance
payment if terminated by the Company anytime after the Effective Date with
cause. "Cause" shall be defined as any act or series of acts which are illegal,
negligent, constitute willful misconduct, immoral, or otherwise have impact on
the Company and/or its business activities. 



(b) If the Engagement is terminated by Klassen during the
term of this Engagement, Klassen will be required to reimburse the Company
pro-rata the contract execution bonus of one hundred thousand dollars ($100,000)
for the portion of the remaining months of the Engagement. If the Engagement is
terminated by Company during the term of this Engagement anytime without cause
Klassen will not be required to reimburse the Company pro-rata the contract
execution bonus of one hundred thousand dollars ($100,000) for the portion of
the remaining months of the Engagement.



9. Deferred Compensation. Any nonqualified deferred
compensation (within the meaning of Section 409A of the Internal Revenue Code)
payable under this Agreement on account of the completion or termination of the
Engagement shall be delayed to the minimum extent and in the minimum amount
necessary so as to comply with Section 409A and the regulations thereunder;
provided, however, that the bonus set forth in Section 5 shall be paid
immediately if there is a change of control within the meaning of Section 409A
of the Internal Revenue Code regardless of whether there is a termination. 

10. Benefits and Taxes. Klassen shall be entitled to
any benefits paid by the Company to its employees. Klassen shall be solely
responsible for any tax consequences applicable to Klassen by reason of this
Agreement and the services performed hereunder. The Company shall not be
responsible for the payment of any federal, state or local taxes or
contributions imposed under any employment insurance, social security, income
tax or other tax law or regulation with respect to Klassen's performance of
management services hereunder. Klassen agrees to indemnify and hold the Company
harmless for any taxes, interest or penalties imposed upon the Company arising
from or in connection with the Engagement. 



11. Confidential Information, Rights and Duties. 



(a) Klassen specifically agrees that he shall not at any
time, either during or subsequent to the term of the Engagement, in any fashion,
form or manner, either directly or indirectly, unless expressly consented to in
writing by the Company, use, divulge, disclose or communicate to any person or
entity any confidential information of any kind, nature or description
concerning any matters affecting or relating to the business of the Company,
including, but not limited to: the Company's sales and marketing methods,
programs and related data, or other written records used in the Company's
business; the Company's computer processes, programs and codes; the names,
addresses, buying habits or practices of any of its clients or customers;
compensation paid to other employees and independent contractors and other terms
of any employment or contractual relationships; or any other confidential
information of, about or concerning the business of the Company, its manner of
operations, or other data of any kind, nature or description. The parties to
this Agreement hereby stipulate that, as between them, the above information and
items are important, material and confidential trade secrets that affect the
successful conduct of the Company's business and its good will, and that any
breach of any term of this section is a material breach of this Agreement. All
equipment, notebooks, documents, memoranda, reports, files, samples, books,
correspondence, lists or other written and graphic records, and the like,
including tangible or intangible computer programs, records and data, affecting
or relating to the business of the Company, which Klassen might prepare, use,
construct, observe, posses or control, shall be and shall remain the Company's
sole property. 



(b) For purposes of this Agreement, the term "confidential
information" shall not include any information that: (i) has been made public by
the Company (other than by acts of Klassen in violation of this Agreement or
other obligation of confidentiality); (ii) Klassen is legally compelled to
disclose; provided that Klassen notifies the Company of such proposed disclosure
in as far in advance of its disclosure as is practicable and uses his best
efforts to obtain assurances that confidential treatment will be accorded to
such information; or (iii) is otherwise publicly available other than through
disclosure by a party in breach of a confidentiality obligation with respect
thereto. 



(c) Any wrongful interference with the Company's business,
property, confidential information, trade secrets, clients, customers, employees
or independent contractors by Klassen or any of their agents after the term of
the Engagement shall be treated and acknowledged by the parties as a material
breach of this Agreement. 



(d) Klassen's duties under this Section 11 shall survive
termination of the Engagement. Klassen acknowledges that a remedy at law for any
breach or threatened breach by Klassen of the provisions of this Section 11
would be inadequate, and Klassen agrees that the Company shall be entitled to
injunctive relief in case of any such breach or threatened breach. 



12. Indemnification and D&O Insurance. The Company
shall indemnify, forever defend, and hold Klassen free and harmless from any and
all liabilities, assessments, obligations, debts, damages, fees, fines,
penalties, interest, judgments, liens or other claims that may ever be claimed
to exist against Klassen as a result of Klassen's work on behalf of Company
and/or as a result of Klassen executing this Agreement, except to the extent
resulting from Klassen's gross negligence or willful misconduct.





The Company shall enter into an indemnification agreement
with Klassen in the form entered into with each of the Company's officers and
directors. Such indemnification Agreement shall be effective upon the Effective
Date. The Company will furnish Klassen with a copy of its current D&O liability
policy and will agree to consult with Klassen if the Company intends to decrease
the coverage currently provided. 



13. Dispute Resolution In the instance of a dispute between the
Company and Klassen that is incapable of being resolved by them to their mutual
satisfaction, after good faith resolution negotiations, and within thirty (30)
days of the formal notification from Klassen or Company of such dispute, the
complaining Klassen shall have the right to seek such remedies as are available
at law and in equity, as shall the Company. In the event of any breach of this
Agreement, the provisions of this Agreement may be enforceable in a court of
equity by a decree of specific performance. Any equitable remedy shall not be
exclusive and shall be in addition to any other remedy available.



14. General Provisions. 



(a) Notices. Any notices provided hereunder must be in
writing and shall be deemed effective upon the earlier of personal delivery or
duly sent by certified mail, postage prepaid; by an overnight delivery service,
charges prepaid; or by confirmed telecopy, to the Company at its primary office
location and to Klassen at the following address: 3221 56th St SW
Everett Washington, 98203. 



(b) Severability. Whenever possible, each provision of
this Agreement will be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law or
rule in any jurisdiction, such invalidity, illegality or unenforceability will
not affect any other provision or any other jurisdiction, but this Agreement
will be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provisions had never been contained herein or
therein 



(c) Waiver. If either party should waive any breach of
any provision of this Agreement, he or it shall not thereby be deemed to have
waived any preceding or succeeding breach of the same or any other provision of
this Agreement. 



(d) Complete Agreement. This Agreement, the stock
option agreement and the indemnification agreement to be effective upon the
Effective Date constitute the entire agreement between Klassen and the Company
and it is the complete, final, and exclusive embodiment of their agreement and
supersedes any prior agreement written or otherwise between Klassen and the
Company with regard to this subject matter. It is entered into without reliance
on any promise or representation other than those expressly contained herein or
therein, and it cannot be modified or amended except in a writing signed by
Klassen and the Chairman of the Board. This Agreement supersedes the agreement
dated July 1 2006 between Company and Klassen. Upon execution this Agreement the
July 1, 2006 agreement is terminated. 



(e) Headings. The headings of the sections hereof are
inserted for convenience only and shall not be deemed to constitute a part
hereof or thereof nor to affect the meaning thereof. 



(f) Successors and Assigns. This Agreement is intended
to bind and inure to the benefit of and be enforceable by Klassen and the
Company and their respective successors, assigns, heirs, executors and
administrators, except that Klassen may not assign any of their duties hereunder
and may not assign any of their rights hereunder without the written consent of
the Company. 



(g) Attorney Fees. If either party hereto brings any
action to enforce his or its rights hereunder, the prevailing party in any such
action shall be entitled to recover his or its reasonable attorneys' fees and
costs incurred in connection with such action. In no event, will a party
entitled to reimbursement be reimbursed later than thirty days following the
close of the calendar year in which in such action is finally resolved. 



(h) Arbitration. To provide a mechanism for rapid and
economical dispute resolution, Klassen and the Company agree that any and all
disputes, claims, or causes of action, in law or equity, arising from or
relating to this Agreement or its respective enforcement, performance, breach,
or interpretation, will be resolved, to the fullest extent permitted by law, by
final, binding, and confidential arbitration before a single arbitrator held in
Las Vegas, Nevada and conducted by Judicial Arbitration & Mediation Services/Endispute
("JAMS"), under its then-existing Rules and Procedures. The parties shall be
entitled to conduct adequate discovery, and they may obtain all remedies
available to the parties as if the matter had been tried in court. The
arbitrator shall issue a written decision which specifies the findings of fact
and conclusions of law on which the arbitrator's decision is based. Judgment
upon the award rendered by the arbitrator may be entered by any court having
jurisdiction thereof. Unless otherwise required by law, the arbitrator will
award reasonable expenses (including reimbursement of the assigned arbitration
costs) to the prevailing party. Nothing in this Section 12(h) or in this
Agreement is intended to prevent Klassen or the Company from obtaining
injunctive relief in court to prevent irreparable harm pending the conclusion of
any such arbitration. 



(i) Governing Law. All questions concerning the
construction, validity and interpretation of this Agreement will be governed by
the law of the Nevada as applied to contracts made excluding the rules on
conflicts of law. 



(j) Currency. All dollar amounts stated in this
Agreement are in United States dollars. 



If you are in agreement with the terms set forth herein,
please sign and return a copy of this Agreement to me. 



 

Yours truly 



 


/S/ SHAILEN SINGH 


_______________________________ 


COFFEE PACIFICA, INC.



Shailen Singh on Behalf of the Board



 

 

Agreed to and Accepted 


 

 


/S/ TERRY KLASSEN 


___________________________ 

Terry Klassen