Document:

jer_exhibit10-1.htm

    

      Exhibit
10.1

       

      

      AGREEMENT (this “Agreement”) dated as
of December 11, 2008, by JER Investors Trust Finance Company GS, LLC (the “Seller”), JER
Investors Trust Inc. (the “Guarantor”) and
Goldman Sachs Mortgage Company (“Buyer”), each a
“Party”, and,
collectively, the “Parties”.

       

      Reference
is made to (i) the Master Repurchase Agreement between Buyer and the Seller,
dated as of September 21, 2006, as amended pursuant to that certain Omnibus
Amendment, dated as of September 28, 2007 (the “Omnibus Amendment”),
as further amended by that certain Waiver and Amendment, dated as of March 27,
2008 (the “Waiver and
Amendment”), and as further amended by that certain Second Omnibus
Amendment, dated as of October 16, 2008 (the “Second Omnibus Amendment”)
(as so amended and as may be further amended, supplemented or modified, and
together with all schedules, annexes and exhibits thereto, and all confirmations
exchanged pursuant to the Transactions entered into in connection therewith, the
“Repurchase
Agreement”) and (ii) the Guaranty by Guarantor in favor of Buyer, dated
as of September 21, 2006, as amended by the Omnibus Amendment, the Waiver and
Amendment and the Second Omnibus Amendment (as so amended and as may be further
amended, supplemented or modified, the “Guaranty”).  All
capitalized terms not otherwise defined herein have the meaning set forth in the
Repurchase Agreement.

       

      NOW,
THEREFORE, in consideration of the foregoing, the Parties have agreed as
follows:

       

      1.  Satisfaction of Margin
Call.  Buyer hereby acknowledges receipt from Seller of payment
in the amount of $2,000,000.00, which payment Buyer accepts in full satisfaction
of the margin call made by Buyer to Seller on December 4, 2008 (the “Margin Call”), in
order to resolve the Margin Deficit in the amount of $2,205,824.33. Buyer hereby
waives any claim that Buyer may have, at law or in equity, to the unpaid balance
of the Margin Call.

       

      2.  Additional
Payment.  On any Business Day (the “Closing Date”) on or
prior to 2:00 p.m. (New York City time) on December 31, 2008 (the “Outside Date”),
Seller shall pay to Buyer $1,500,000.00 (the “Paydown Amount”),
which amount shall be applied to reduce the Repurchase Price under the
Repurchase Agreement. In addition, on the Closing Date, Guarantor shall execute
and deliver to Buyer an unsecured promissory note (the “Note”) in the
principal amount of $500,000.00 in the form attached hereto as Exhibit A to this
Agreement.

       

      3.  Purchase of Purchased
Loans. On the Closing Date
(i) Buyer and Seller agree that the Repurchase Date for all Transactions under
the Repurchase Agreement shall be deemed to occur, (ii) the Repurchase Price
(including accrued and unpaid Price Differential) shall be due and payable by
Seller to Buyer, and, subject to receipt of the Repurchase Price (it being
agreed that accrued and unpaid Price Differential to but excluding the Closing
Date shall be paid by Seller to Buyer by wire transfer in immediately available
funds on the Closing Date and the balance of the Repurchase Price shall be
subject to netting as described below), Buyer shall be obligated to transfer the
Purchased Loans to Seller pursuant to the Repurchase Agreement, (iii) the Seller
shall sell and transfer to Buyer, free and clear of all liens, claims,
encumbrances, obligations, liabilities or any similar interests whatsoever
(other than any liens created under the Repurchase Agreement and the other
Transaction Documents), and Buyer agrees to purchase, the Purchased Loans at a
purchase price equal to the Closeout Purchase Price (as defined below), and (iv)
upon consummation of the transactions described in the foregoing clauses (i),
(ii) and (iii), the Repurchase Agreement, the Guaranty and the other Transaction
Documents shall terminate and

      
        
           

        

        
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      be of no further force or
effect.  The transactions contemplated by clauses (i), (ii) and (iii)
of the prior sentence and the termination of the Repurchase Agreement, the
Guaranty and the other Transaction Documents shall be confirmed by such form of
confirmation or trade ticket as Buyer customarily uses.  The Closeout
Purchase Price due from Buyer to Seller shall be netted against the payment of
the aggregate Repurchase Price payable by Seller to Buyer and the obligation of
Buyer to transfer the Purchased Loans to Seller shall be netted against the
obligation of Seller to transfer the Purchased Loans to Buyer.  The
“Closeout
Purchase Price” means, with
respect to the Transactions, the Repurchase Price for the Transactions
less accrued and unpaid Price Differential
to but excluding the Closing Date.

       

      4.  Representations and
Warranties.  Each of Seller, the Guarantor and Buyer represents
and warrants that (i) this Agreement has been duly authorized, executed and
delivered, (ii) the transactions contemplated hereby have been duly authorized
by all necessary action, do not violate any agreement, document or law or
regulation or require any consent or filing with any person or entity, and (iii)
this Agreement constitutes the legal, valid, and binding obligations of such
Party, enforceable against such Party in accordance with its
terms.   Seller and Guarantor each acknowledge and agree that the
transactions hereunder constitute “reasonably equivalent value” and “fair
consideration” (as such terms are used in connection with any applicable
fraudulent conveyance, fraudulent transfer or other similar laws) and are made
in good faith.

       

      5.  Standstill.  From and after the date hereof to the
earlier to occur of the Closing Date and the Outside Date (the “Standstill
Period”), except as
provided herein, Buyer shall and hereby agrees that (i) any margin call or
maintenance rights of Buyer under the Repurchase Agreement, the Guaranty or
applicable law and (ii) any financial covenants of Seller or Guarantor
under the Repurchase Agreement and the Guaranty, shall, in each case, be
suspended.  Notwithstanding the foregoing, this Agreement and the
Standstill Period shall immediately terminate, and all obligations of the
parties under this Agreement shall immediately terminate upon the occurrence of
any of the following events: (a) breach by the Seller or the Guarantor of its
obligations under this Agreement, (b) the incurrence of additional indebtedness
by the Seller, the Guarantor or any of their respective subsidiaries (except
that (y) Seller and Guarantor shall be permitted to incur ordinary course trade
payables and (z) Guarantor shall be permitted to declare, in December 2008, and
pay, in January 2009, cash dividends in an amount not to exceed Six Million
Dollars ($6,000,000)), (c) Seller or Guarantor shall agree or seek to amend,
restate, supplement or otherwise modify the terms of any documents governing any
indebtedness of Seller, Guarantor or any of their
respective  subsidiaries without offering the same terms and
conditions to Buyer (except that Guarantor shall be permitted to enter into an
amendment of its guaranty of the JPM MRA (as defined below) and a subsidiary of
Guarantor shall be permitted to enter into an amendment to the JPM MRA, in each
case, containing substantially the same terms (and no additional material terms)
provided by Seller to Buyer, and approved by Buyer, prior to the date hereof,
(d) the commencement of any bankruptcy, insolvency, receivership or other
similar proceedings (whether voluntary or involuntary) in respect of the Seller
or the Guarantor, (e) Seller or Guarantor shall make any equity distribution
payments (other than as set forth in clause (b) this Section 5), (f) Seller or
Guarantor shall, directly or indirectly, make any payments in connection with
any “Margin Deficit”, as such term defined in that certain Master Repurchase
Agreement, dated as of September 12, 2008, by and between J.P. Morgan Securities
Inc. and JERIT Finance CO JPM, LLC (the “JPM
MRA”) (excluding a
repayment, in an amount not to exceed Three Million Dollars ($3,000,000), with
respect to the JPM MRA), unless a

      
        
           

        

        
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      proportionate payment of the Repurchase
Price is repaid concurrently with such payment or (g) any Purchased Loan shall
become a Defaulted Loan.

       

      6.  Releases.  The Parties agree that, on the Closing
Date, the termination of the Transactions, the Repurchase Agreement and the
Guaranty pursuant to this Agreement and the sale of the Purchased Loans and
delivery by Seller to Buyer of a duly executed Note in accordance with this
Agreement shall be full and final settlement of all claims whatsoever under the
Repurchase Agreement, the Guaranty and the other Transaction Documents (i) which
may be made by the Seller or the Guarantor against Buyer arising out of, or in
connection with, the Transactions, the Repurchase Agreement, the Guaranty and
the other Transaction Documents and (ii) which may be made by Buyer against the
Seller or the Guarantor arising out of, or in connection with the Transactions,
the Repurchase Agreement, the Guaranty and the other Transaction
Documents.  Upon Buyer’s timely receipt of the Paydown Amount and the
Note on the Closing Date and the consummation of the sale of the Purchased Loans
by Seller to Buyer, each of the Seller and the Guarantor agree to release and
forever discharge Buyer and its present and future subsidiaries, affiliates,
directors, officers, managers and agents, from any and all claims and
liabilities of every nature and description, which then or thereafter exist,
arising out of, or connected or relating to, the Transactions, the Repurchase
Agreement, the Guaranty or the other Transaction Documents, and Buyer agrees to simultaneously
release and forever discharge Seller and the Guarantor and their respective
present and future subsidiaries, affiliates, directors, officers, managers and
agents, from any and all claims and liabilities of every nature and description,
which now or hereafter exist, arising out of, or connected or relating to, the
Transactions, the Repurchase Agreement, the Guaranty or the other Transaction
Documents; provided, however, that nothing in this Agreement or
these releases shall be deemed to release any obligation of
Buyer,  the Seller or the Guarantor, as the case may be, arising under
this Agreement or the transactions contemplated hereunder, including but not
limited to the Guarantor’s obligations under the Note. In connection with the releases granted
herein, each of the Parties hereby waive all rights conferred by the provisions
of California Civil Code Section 1542 and/or any similar state or federal
law.  California Civil Code Section 1542 provides as
follows:

      

      A GENERAL RELEASE DOES NOT EXTEND TO
CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR
AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE
MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.

       

      The Parties understand and acknowledge
the significance and consequence of their waiver of Section 1542 of the
California Civil Code, as well as any other federal or state statute or common
law principle of similar effect, and acknowledge that this waiver is a material
inducement to and consideration for each other Party’s execution of this
Agreement.

      

      7.  Safe Harbor
Rights.  Seller
and the Guarantor acknowledge and agree that (i) this Agreement and the
Repurchase Agreement constitute a “repurchase agreement” within the meaning of
section 101(47) of the United States Bankruptcy Code (the “Code”), and a “securities contract” within
the meaning of section 741(7) of the Code, (ii) the exercise by Buyer of rights
hereunder and as set forth in the Repurchase Agreement are rights described in
and protected by sections 362(b)(6), 362(b)(7), 362(b)(27), 555, 559 and 561 of
the Code, (iii) Buyer is entitled to all

      
        
           

        

        
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      rights and protections applicable to
“repurchase agreements” and “securities contracts” under the Code, including,
without limitation, the rights and protections described in the Code sections
referenced in (ii) of this Section 7, the rights and protections afforded under
sections 546(e), 546(f), 546(j), 548(d)(2)(B), 548(d)(2)(C) of the Code, and the
rights and protections applicable to setoffs or netting described in sections
362(b)(6), 362(b)(7), 555, 559 and 561 of the Code.

      

      8.  No Waiver of Rights or
Remedies.  The Parties agree that other than as expressly set
forth herein, nothing in this Agreement or the performance by the Parties of
their respective obligations hereunder constitutes or shall be deemed to
constitute a waiver of Buyer’s rights, powers or privileges and/or remedies
under the terms of the Repurchase Agreement, the Guaranty, the other Transaction
Documents, the Note or applicable law, all of which are hereby reserved,
including without limitation, (i) any rights or remedies in connection with
any bankruptcy, insolvency, receivership or other similar proceedings (whether
voluntary or involuntary) in respect of the Seller or the Guarantor (to which
this
Agreement shall not apply), and (ii) any rights to set-off, recoup,
net or exercise similar rights whether or not in connection with any bankruptcy,
insolvency, receivership or other similar proceedings (whether voluntary or
involuntary).  In consideration of the suspension of certain rights of
Buyer and certain obligations of Seller and Guarantor under the Repurchase
Agreement, the Guaranty and applicable law pursuant to this Agreement, the
Seller and the Guarantor each agree not to pursue, and expressly waive, any
claims or remedies that may arise under the Repurchase Agreement or the Guaranty
(or otherwise) based on such suspension of certain rights of Buyer and certain
obligations of Seller and Guarantor under the Repurchase Agreement or the
Guaranty and agree that such suspension shall not constitute a waiver or
forbearance (except as otherwise provided herein) of any rights or remedies
Buyer may
have.  This Agreement is not intended to be, and shall not be
deemed or construed to be, a cure, satisfaction, reinstatement, novation, waiver
or release of the Repurchase Agreement, the Guaranty or any other Transaction
Document, the obligations thereunder, or of any prior, existing and/or future
defaults or events of default thereunder, except to the extent expressly set
forth herein and subject to, with respect to Seller and Guarantor, satisfaction
of their obligations set forth herein.  Seller and Guarantor agree
that, except as otherwise expressly set forth herein, the Repurchase Agreement,
the Guaranty and the other Transaction Documents are and shall continue to be in
full force and effect and shall be legal, valid and binding agreements of the
Seller and the Guarantor, as the case may be, enforceable in accordance with
their respective terms.

      

      9.  Miscellaneous.  This
Agreement embodies the entire agreement and understanding of the Parties with
respect to the subject matter of this Agreement, and supersedes all prior or
contemporaneous agreements or understandings, whether written or oral, between
or among the Parties with respect to that subject matter.  This
Agreement may be amended, and the terms hereof may be waived, only by a written
instrument signed by each of the Parties, or, in the case of a waiver, by the
Party waiving compliance.  Any acceptance by Buyer or its affiliates
of performance from, or performance by Buyer or its affiliates to, the Seller
under any agreement, including this agreement, between Buyer or any of its
affiliates and the Seller or any of its affiliates or otherwise (including
without limitation the rollover of, or entry into, any transactions under, or
amendments, supplements or modifications to, any agreement or otherwise), or any
temporary suspension of certain rights that Buyer or any of its affiliates may
have, shall not constitute a waiver or forbearance of any rights or remedies
Buyer or its affiliates may have. 

      
        
           

        

        
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      This
Agreement may be executed in counterparts, each of which shall be deemed an
original, and all of which together shall constitute one and the same
instrument.  This Agreement may be executed and delivered by facsimile
or PDF.  Any facsimile or PDF signatures shall have the same legal
effect as manual signatures.  The Seller and the Guarantor shall not
have any right to transfer or delegate (whether by way of security or otherwise)
this Agreement or any right, title, interest, power, privilege, remedy,
obligation or duty in, to or under this Agreement, in whole or in part, without
the prior written consent of Buyer.  Buyer may transfer or delegate
(whether by way of security or otherwise) this Agreement or any right, title,
interest, power, privilege, remedy, obligation or duty in, to or under this
Agreement, in whole or in part, to an affiliate of Buyer or any entity sponsored
or organized by, or on behalf of or for the benefit of, Buyer without the
consent of the Seller or the Guarantor.

       

      This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York (without reference to its conflicts of laws principles) and
the Parties agree to submit to the non-exclusive jurisdiction of the federal and
state courts in the borough of Manhattan in New York, New York in relation to
any dispute arising out of or in connection with this Agreement.

       

      [SIGNATURES
COMMENCE ON NEXT PAGE]

      
        
           

        

        
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      IN
WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date
first above written.

       

      
        	 
      	
                GOLDMAN
      SACH MORTGAGE COMPANY,

                a
      New York limited partnership

              
	 
      	 
      
	 
      	 
      
	 
      	
                By:

              	
                Goldman
      Sachs Real Estate Funding Corp.,

                its
      general partner

              
	 
      	 
      
	 
      	 
      
	 
      	 
      	
                By:

              	
                /s/
      Mark Buono

              	 
      
	 
      	 
      	 
      	
                Name:

              	 
      Mark
      Buono	 
      
	 
      	 
      	 
      	
                Title:

              	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	
                JER
      INVESTORS TRUST FINANCE COMPANY GS, LLC,

                a
      Delaware limited liability company

              
	 
      	 
      
	 
      	 
      
	 
      	
                By:

              	
                /s/
      Mark S. Weiss

              	 
      
	 
      	 
      	
                Name:

              	
                Mark
      S. Weiss

              	 
      
	 
      	 
      	
                Title:

              	
                President

              	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	
                JER
      INVESTORS TRUST INC.,

                a
      Maryland corporation

              
	 
      	 
      
	 
      	 
      
	 
      	
                By:

              	
                /s/
      Mark S. Weiss

              	 
      
	 
      	 
      	
                Name:

              	
                Mark
      S. Weiss

              	 
      
	 
      	 
      	
                Title:

              	
                President

              	 
      
	 
      	 
      

      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
A

      

      PROMISSORY
NOTE

      JER
Investors Trust Inc.

      

      
        	
                $500,000.00

              	
                New
      York, New York

              
	 
      	
                December
      __, 2008

              
	 
      	 
      

      

      FOR
VALUE RECEIVED, the undersigned JER INVESTORS TRUST INC., a Maryland corporation
(the “Maker”),
promises to pay to GOLDMAN SACHS MORTGAGE COMPANY, a New York limited
partnership, and its successors and registered assigns (the holder of this Note
from time to time, or any portion hereof, is hereinafter referred to as the
“Holder”) or to
such other account pursuant to such other wiring instruction as the Holder may
from time to time designate in writing, the original principal amount of FIVE
HUNDRED THOUSAND AND No/100 DOLLARS ($500,000.00) (the “Principal
Amount”).

       

      The
principal sum evidenced by this note (this “Note”) shall be due
and on February 27, 2009 (the “Maturity Date”). This
Note shall bear no interest from the date hereof to the Maturity Date. From and
after the Maturity Date, if the Principal Amount of this Note is not repaid in
full, default interest shall accrue on the Principal Amount at an annual
interest rate equal to the Prime Rate (as defined below) plus 2.0%, which
interest shall accrue on a daily basis until the Principal Amount and such
accrued default interest is paid in full. “Prime Rate” shall mean the “prime
rate” published in the “Money Rates” section of The Wall Street
Journal.  If The Wall Street
Journal ceases to publish the “prime rate,” then Holder shall select an
equivalent publication that publishes such “prime rate,” and if such “prime
rate” is no longer generally published or is limited, regulated or administered
by a governmental or quasi-governmental body, then Holder shall reasonably
select a comparable interest rate index.

       

      With
respect to the amounts due and payable pursuant to this Note, the Maker waives
demand, presentment and notice.

       

      This
Note may not be assigned in whole or in part by the Maker.  The Holder
shall have the right from time to time at its discretion to assign this Note, in whole or in
part.

       

      The
Holder shall not by any act, delay, omission or otherwise be deemed to have
amended, modified, supplemented, waived, extended, discharged or terminated any
of its rights or remedies, except by an amendment, modification, supplement,
waiver, extension, discharge or termination in writing and signed by the
appropriate parties.  All rights and remedies of the Holder under the
terms of this Note and applicable statutes or rules of law shall be cumulative,
and may be exercised successively or concurrently.  The Maker agrees
that there are no defenses, equities or setoffs with respect to the obligations
set forth herein.

       

      Wherever
possible, each provision of this Note shall be interpreted in such manner as to
be effective and valid under applicable law, but if any provision of this Note
shall be prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Note.

       

      This
Note shall be governed by, and construed in accordance with, the laws of the
State of New York.

       

      ANY
LEGAL SUIT, ACTION OR PROCEEDING AGAINST THE HOLDER OR THE MAKER ARISING OUT OF
OR RELATING TO THIS NOTE SHALL BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN
NEW YORK, NEW YORK.  THE MAKER, AND BY ACCEPTANCE OF THIS NOTE, THE
HOLDER, HEREBY (i) IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING
OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT AND ANY
CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM, AND (ii) IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH
COURT IN ANY SUIT, ACTION OR PROCEEDING.

       

      THE
MAKER AND, BY ACCEPTANCE HEREOF, THE HOLDER, TO THE FULLEST EXTENT THAT EACH MAY
LAWFULLY DO SO, WAIVE TRIAL BY JURY IN ANY ACTION OR PROCEEDING (INCLUDING,
WITHOUT LIMITATION, ANY TORT ACTION), BROUGHT BY EITHER PARTY HERETO WITH
RESPECT TO THIS NOTE.

      

      [Signature
page follows]

      
        
           

        

        
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      IN
WITNESS WHEREOF, the Maker has caused this Note to be executed as of the day and
year first above written.

       

      
        	 
      	
                 
      MAKER:

              
	 
      	 
      
	 
      	
                 JER INVESTORS TRUST
      INC.,

                 a
      Maryland corporation

              
	 
      	 
      
	 
      	 
      
	 
      	
                By:

              	 
      	 
      
	 
      	 
      	
                Name:

              	 
      
	 
      	 
      	
                Title:Filed by Bowne Pure Compliance

Exhibit 10.1

EXECUTIVE EMPLOYMENT AGREEMENT

LEE R. RICE

This EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”) is entered into as of this 10th day of September,
2008, by and between Colorado Goldfields Inc. (“Employer”), and Lee R. Rice (“Executive”).

WHEREAS, Employer is a corporation organized under the laws of the state of Nevada and with its principal places
of business in Lakewood, Colorado;

WHEREAS, Executive is an individual with knowledge and experience that are valuable to Employer;

WHEREAS, Employer desires to employ Executive and Executive desires to accept such employment subject to the terms
and conditions hereinafter set forth.

NOW THEREFORE, and in consideration of the mutual covenants and agreements hereinafter contained, the parties
hereby agree as follows:

1. EMPLOYMENT

Employer hereby employs Executive and Executive hereby accepts employment by Employer, upon all of the terms and
conditions as hereinafter set forth.

2. TERM

The term of this Agreement shall be month-to-month commencing on September 10, 2008. Unless termination is given
in accordance with paragraph 3, this agreement shall automatically renew each month.

3. TERMINATION OF AGREEMENT

This Agreement shall terminate upon the occurrence of any of the following events:

(a) Upon written notice of termination from either party to the other party, which notice may be given at any
time, with or without cause, and shall be effective thirty days (30) days thereafter unless a different effective date
is agreed in writing by the parties;

(b) Upon Executive’s death.

1

 

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Upon the termination of this Agreement, Executive shall be entitled to payment of compensation that is earned but
unpaid for services rendered by Executive as of the date of termination of this Agreement. In addition, Executive
shall be entitled to Separation Pay to the extent expressly set forth in Exhibit A to this Agreement, which pay shall
become due and owing according to the schedule set forth in Exhibit A. However, Executive shall not be entitled to any
compensation for services not yet performed, including services which could have been performed but for the termination
of this Agreement.

At the discretion of Employer, Employer may (a) require that Executive continue to perform his duties during the
period between notice pursuant to Section 3(a) of this Agreement and the resulting termination of this Agreement, or
(b) relieve Executive of his duties during such period (while continuing to provide compensation and benefits in
accordance with this Agreement).

4. DUTIES

Executive is employed by Employer as its Interim Chief Executive Officer and President. The precise nature of
Executive’s duties shall be as defined by the Board of Directors of Employer and may be broadened, curtailed or
otherwise modified by the Board of Directors of Employer from time to time in its sole discretion.

Executive agrees to devote the working time, energy and professional talent as is customarily performed and
required by an Interim Chief Executive Officer and President of a mining company. Notwithstanding the foregoing, (i)
Executive may serve as a director or trustee of another organization upon the prior written consent of the Board of
Directors, and (ii) Employer acknowledges that Executive holds other mining properties which are not part of the Option
Agreement, and that Executive may devote working time to such mining properties so long as Employer’s business is not
adversely affected. The Executive acknowledges that he is a fiduciary of the Employer and he agrees to serve the
Employer in a manner which is consistent with the fiduciary duties owed to the Employer.

During the term of this Agreement, Employer shall nominate Executive for election to the Board of Directors of
Employer as a member of the management slate at each annual meeting of the stockholders, or at each meeting of the
stockholders at which his class, if such class be designated, comes up for election.

5. COMPENSATION

Executive’s compensation under this Agreement shall be as set forth in Exhibit A, which is attached hereto and
incorporated herein. Such compensation shall be paid in accordance with the payroll policies and procedures of
Employer, as they may be modified from time to time at Employer’s sole discretion.

Upon the termination of this Agreement, Executive shall have no further rights to compensation under this
Agreement except for Separation Pay as provided in Exhibit A.

 

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In all cases in which Executive must obtain the consent of Employer or Management, such consent may be granted or
withheld at the sole discretion of Employer or Management as the case may be.

6. INDEMNIFICATION

Subject to the terms and conditions of the Articles of Incorporation and Bylaws of the Employer (in each case, as
in effect from time to time), the Employer agrees to indemnify and hold Executive harmless to the fullest extent
permitted by the laws of the State of Nevada, as in effect at the time of the subject act or omission. Notwithstanding
the foregoing, Employer shall not be required to indemnify Executive if a court or governmental tribunal of competent
jurisdiction finds that the event triggering the indemnification right was caused by, or due to, the willful misconduct
or gross negligence of Employee. In connection therewith, Executive shall be entitled to the protection of any
insurance policies which Employer elects to maintain generally for the benefit of the Employer’s directors and
officers, against all costs, charges and expenses whatsoever incurred or sustained by Executive in connection with any
action, suit or proceeding to which he may be made a party by reason of his being or having been a director, officer or
employee of the Employer. This provision shall survive any termination of Executive’s employment hereunder. To the
extent that Employer has maintained insurance policies generally for the benefit of the Employer’s directors and
officers, Employer shall such insurance coverage, or use commercially reasonable efforts to obtain tail insurance
coverage for Executive, for a period of three years following termination of employment.

7. SEVERABILITY

In the event that any provision of this Agreement is held to be invalid, void or unenforceable (whether due to
unconscionability or otherwise), the remainder of this Agreement shall not be affected thereby, and all other
provisions of this Agreement shall be valid and enforceable to the fullest extent permitted by the law.

 

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8. AGREEMENT NOT ASSIGNABLE

This Agreement shall be binding upon Employer and its successors and upon the heirs, representatives, executors,
and administrators of Executive. This Agreement is not assignable by either party, except that the rights and
obligations of this Agreement shall be assumed by any successor of Employer. For purposes of this Section 8, the term
“successor” shall include any individual or entity which acquires all or substantially all of the assets of Employer by
merger, purchase or otherwise.

9. WAIVER OF BREACH

The waiver by either party of a breach or violation of any provision of this Agreement shall not operate as or be
construed to be a waiver of any subsequent breach hereof.

10. NOTICES 

Any written notice to be given to Executive under the terms of this Agreement shall be addressed to Executive as
follows, unless Management is notified in writing of a change of address: 

Lee R. Rice

10920 West Alameda Ave

Suite 201

Lakewood, CO 80226

Such notice shall be deemed to have been duly given when enclosed and properly sealed in an addressed envelope
registered or certified mail return receipt requested and deposited, postage and registered or certification fee
prepaid, in a post office or branch post office regularly maintained by the United States Postal Service.

11. TITLE AND HEADINGS

Titles and headings to paragraphs in this Agreement are for the purpose of reference only and in no way shall
limit, define or otherwise affect the provisions of this Agreement.

12. GOVERNING LAW

This Agreement, all interpretation and enforcement of this Agreement, and all disputes arising out of this
Agreement shall be governed solely and exclusively by the laws of the State of Colorado, regardless of the forum in
which such interpretation or enforcement of this Agreement occurs or such disputes are resolved, and without regard to
any principles of conflicts of laws.

 

8

 

13. NO RULE OF CONSTRUCTION

The parties acknowledge that each of them has had ample opportunity for their own counsel to participate in
negotiating and drafting this Agreement. Therefore, no rule of construction shall apply to this Agreement which
construes ambiguous or unclear language in favor of or against any party

14. ENTIRE AGREEMENT

(a)          This Agreement, including Exhibit A, represents the entire employment agreement between Employer and
Executive pertaining to the subject matter hereof and supersedes all prior agreements, understandings, negotiations and
discussions, whether oral or written. No supplement, modification or waiver of this Agreement shall be binding unless
executed in writing by Executive and by Employer with the approval of Management.

(b)          This Agreement may be executed in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument.

For COLORADO GOLDFIELDS INC.

/s/ C. Stephen Guyer                

Colorado Goldfields, Inc,

C. Stephen Guyer, Chief Financial Officer

EXECUTIVE:

/s/ Lee R. Rice                         

Lee R. Rice

 

9

 

EXHIBIT A

to

EXECUTIVE EMPLOYMENT AGREEMENT

between

COLORADO GOLDFIELDS INC. (“Employer”) and LEE R. RICE (“Executive”)

dated

September 10, 2008

During the term of the Agreement, Executive’s compensation shall be as follows:

A-1 SALARY

Employer shall pay to Executive a salary of $5,000 per month. Salary payments shall be subject to applicable
withholdings for taxes, to be paid in the manner specified in paragraph 5 of the Agreement. Executive’s salary may be
increased or reduced from time to time at the sole discretion of the Board of Directors, of Employer provided that
Executive’s salary may not be reduced by more than ten percent (10%) below the $5,000 per month figure stated above.
Executive acknowledges that salary and/or expenses may, at the discretion of the Chief Financial Officer, be paid in
stock pursuant to the Company’s 2008 Employee and Director Stock Compensation Plan.

A-2 VACATION

Executive shall be eligible for one (1) day of personal time off per month (“Vacation Time”), which will accrue each
month during the term of the Agreement up to a total of 15 days. Upon termination of this Agreement, Executive shall
be paid for earned but unused Vacation Time based upon the Salary in effect at the time of termination.

A-3 GROUP HEALTH COVERAGE

Executive shall be permitted to participate in such group health insurance plan as Employer may elect to provide for
its other employees, subject to the eligibility and participation requirements of such plan, which plan may be altered
or abolished from time to time at the sole discretion of Employer. However, the level of health insurance coverage for
Executive shall not be reduced below the level in effect upon Executive’s execution of this Agreement, and the cost to
Executive for health insurance coverage shall not be increased above the cost in effect upon Executive’s execution of
this Agreement. Subsequent to the termination or the expiration of the Agreement and at the Executive’s election and
cost, the Company will provide (subject to the eligibility and participation requirements), continued group health
insurance coverage through insurance plans as the Employer may make available for its other employees.

A-4 PENSION/PROFIT-SHARING PARTICIPATION

Executive shall be permitted to participate in such pension or profit-sharing plan as Employer may elect to provide for
its other employees, subject to the eligibility and participation requirements of such plan, which plan may be altered
or abolished from time to time at the sole discretion of Employer.

 

10

 

A-5 AUTOMOBILE ALLOWANCE

Executive shall receive an automobile allowance of $100 per month. However, Executive’s automobile allowance may be
increased or reduced from time to time at the sole discretion of the Board of Directors of Employer, provided that
Executive’s automobile allowance may not be reduced by more than ten percent (10%) below the figure stated above. In
addition, mileage shall be reimbursed at the IRS standard rate.

A-6 OTHER EMPLOYMENT BENEFITS

Executive shall be permitted to participate in such other benefits of employment as Employer may elect to provide for
its other employees, subject to the terms and conditions established by Employer for those benefits, which benefits may
be altered or abolished from time to time at the sole discretion of Employer. Subsequent to the Executives termination
or the expiration of the Agreement and at the Executive’s election and cost the Company will provide (subject to the
eligibility and participation requirements), continued insurance coverage for life, disability, accidental death, and
other specialty coverages through insurance plans as the Employer may make available for its other employees.

A-7 EXPENSE REIMBURSEMENT

Executive shall receive reimbursement from Employer for all reasonable expenses incurred for the benefit of Employer by
Executive in the performance of his duties under the Agreement. Such expenses may include but are not limited to
reasonable out-of-pocket expenses for travel, lodging, meals, entertainment, and professional dues. Employer shall
have the right to establish guidelines for reimbursement of expenses, including but not limited to guidelines regarding
when prior approval for an expense is required and what documentation must be provided in order to obtain
reimbursement.

A-8 SEPARATION PAY

Upon termination of this Agreement, Executive shall be entitled to Separation Pay in accordance with the following
provisions:

(a) Termination by Employer for Convenience: Executive shall receive one month of Base Compensation for
each year of service as an employee or officer of the Employer.

(b) Resignation Within Ninety (90) Days Following Change of Control: Executive shall receive one month of
Base Compensation for each year of service as an employee or officer of Employer. In addition:

(i) Any stock options shall vest immediately;

(ii) all of Executive’s restricted (if any), shares of stock of Employer shall be promptly registered with the
Securities and Exchange Commission if not already freely tradable without restriction; and

 

11

 

(iii) bonuses, if any, remaining unpaid (or unvested) for the period in which the resignation occurs shall be paid
(or vested) immediately, regardless of Executive’s performance status.

(c) Termination upon Expiration of Agreement Without Renewal or Extension: Executive shall receive one
month of Base Compensation for each year of service as an employee or officer of Employer.

(d) Death of Executive: Executive’s estate shall receive one month of salary for each year of service by
Executive as an employee or officer of Employer.

“Base Compensation” shall consist of: (1) salary at the rate in effect at the time of termination; (2) continued
participation in Employer’s group health insurance plan; (3) continued life insurance coverage; (4) access at the
Executive’s expense (subject to the eligibility and participation requirements) continued insurance coverage for
disability, accidental death, and other specialty coverages through insurance plans as the Employer may make available
for its other employees.

“Change of Control” shall mean:

(a) any change in the ownership or control of common stock of Employer which results in more than 30% of the
issued and outstanding common stock of Employer being owned or controlled by a person or entity, or a group of persons
or entities, who did not own or control more than 30% of the issued and outstanding common stock of Employer as of the
date of this Agreement; provided, however, that it shall not be deemed a “Change of Control” under this subsection (a)
if the change in ownership of more than 30% of the issued and outstanding common stock of the Employer is pursuant to a
public or private offering of common stock by the Employer for capital raising purposes, and such offering was approved
by the Board of Directors of the Employer; or

(b) the merger or consolidation of Employer with another entity such that more than 30% of the issued and
outstanding voting stock of the surviving entity is owned or controlled by a person or entity, or a group of persons or
entities, who did not own or control more than 30% of the issued and outstanding common stock of Employer as of the
date of this Agreement.

 

12

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