EXHIBIT 10.3
AMENDED AND RESTATED
ENGAGEMENT AGREEMENT

AGREEMENT effective as of the 1st day of January, 2009 between Capital Gold
Corporation, a Delaware Corporation having an office at 76 Beaver Street, 14th
Floor, New York, NY 10005 (hereinafter referred to as the “Company”), and Scott
Hazlitt (hereinafter referred to as “Hazlitt”).

This agreement (the “Agreement”) amends and restates the engagement agreement by
and between the Company and Hazlitt originally effective on November 1, 2008.

IN CONSIDERATION OF the premises and mutual covenants and conditions herein
contained, the Company and Hazlitt hereby agree as follows:

1.    Engagement.  The Company agrees to engage Hazlitt, and Hazlitt agrees to
serve the Company as the V.P. Mine Development for the Company upon the terms
and conditions hereafter set forth.  The duties of Hazlitt shall be consistent
with his position as V.P. Mine Development, and shall be those duties
customarily performed by an executive of his experience. Hazlitt shall report to
the President of the Company.  During the term of engagement, Hazlitt shall not
directly or indirectly pursue any other business activity without the prior
written consent of the President, with the exception of activity that does not
materially interfere with his duties hereunder and passive personal investments
not in breach of any other term or provision hereof. Hazlitt agrees to travel to
whatever extent is reasonably necessary in the conduct of the Company’s
business, at the Company’s expense and pursuant to the Company’s standard
policies and procedures.

2.    Term.  This Agreement becomes effective as of January 1, 2009 and shall
expire on December 31, 2011 (the Engagement Period”).  Subject to the provisions
of Section 7 herein, the Engagement Period shall automatically renew for
successive one-year periods unless either party provides the other party with
written notice of its intent not to renew at least thirty (30) days prior to the
expiration of the then current Engagement Period.

3.    Compensation And Other Benefits.
 
(a)           Base Fee.  For his services to the Company during the Engagement
Period, the Company shall pay Hazlitt a fee at the annual rate of not less than
One Hundred Fifty Five Thousand Two Hundred and Fifty ($155,250) Dollars (the
“Annual Fee”) payable in equal monthly installments.
 
(b)           Bonus.  Hazlitt shall be eligible for any annual incentive bonus
opportunity offered by the Company to executive officers of the Company as
Hazlitt’s level.  In the event of any conflict between this Agreement and any
incentive bonus plan adopted by the Company for its officers and employees, this
Agreement shall control.  The amount of this bonus, as well as the criteria
necessary to earn a bonus, may be changed at any time by the Company and shall
be within the sole discretion of the Company.  All bonuses paid pursuant to this
Agreement will be

 
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subject to applicable withholdings and deductions, if applicable, and will be
paid no earlier than fifteen (15) days and no later than ninety (90) days after
the Company’s fiscal year end for which the bonus is earned (but in no event
later than the March 15 of the calendar year after the calendar year in which
the bonus is earned).  If Hazlitt’s engagement terminates, voluntarily or by the
Company for Cause, prior to the last day of the fiscal year for which the bonus
applies, Hazlitt acknowledges that he is not entitled to any bonus not yet paid
at the time of the termination because any such unpaid bonus will not be earned,
vested, due, or owing.  Hazlitt hereby expressly forfeits and waives any such
unpaid bonus.  In the event that Hazlitt’s engagement terminates without cause
pursuant to Section 7(b) or by Hazlitt for breach pursuant to Section 7(f) prior
to the last day of the fiscal year for which the bonus applies, Hazlitt will be
entitled to a bonus pro rated for the period from the beginning of that fiscal
year to the date of termination and payable no later than 60 days following
Hazlitt’s termination.  

(c)           As an independent contractor, Hazlitt will not participate in the
Company’s Group Medical program or 401K pension program.

4.    Independent Contractor.  Nothing herein shall be construed to create an
employer-employee relationship between the Company and Hazlitt. Hazlitt is an
independent contractor and not an employee of the Company or any of its
subsidiaries or affiliates. The consideration set forth in Section 3 shall be
the sole consideration due Hazlitt for the services rendered hereunder. It is
understood that the Company will not withhold any amounts for payment of taxes
from the compensation of Hazlitt hereunder.

5.    Services.  Hazlitt agrees to serve the Company faithfully and to the best
of his ability, and to devote substantially all of his business time, labor,
skill, attention and best ability to the performance of his duties hereunder in
a manner which will faithfully and diligently further the business and interests
of the Company.  All services required to be rendered by Hazlitt may be rendered
for the benefit of any of the Company’s affiliates or subsidiaries, but no
liability shall attach to such affiliate or subsidiary for the payment of any
compensation hereunder.

6.    Expenses.  During the period of his engagement, Hazlitt will be reimbursed
for his reasonable and necessary documented expenses incurred by him pursuant to
his engagement hereunder, as they are incurred. ”)

7.    Termination.

(a)           Termination for Cause.  The Company may discharge Hazlitt for: (i)
failure or refusal to perform the services required hereunder; (ii) a material
breach by Hazlitt of any of the terms of this Agreement; or (iii) Hazlitt’s
conviction of a crime that either results in imprisonment or involves
embezzlement, dishonesty, or activities injurious to the Company or its
reputation.  Whether Cause exists under this Agreement shall be determined by
the Company in its reasonable discretion.

(b)           Without Cause.  This Agreement may be terminated by the Company
without Cause at any time, such termination to be effective thirty (30) days
after Hazlitt’s receipt of written notice from the Company.

 
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(c)           Disability.  This Agreement may be terminated by the Company upon
at least thirty (30) days’ written notice if Executive is prevented by illness,
accident or other disability (mental or physical) from performing the essential
functions of the position for one or more periods cumulatively totaling three
(3) months during any consecutive twelve (12) month period.

(d)           Death.  This Agreement shall be automatically terminated in the
event of Executive’s death during the term of employment.

(e)           Resignation.  Hazlitt shall have the right to terminate this
Agreement upon not less than sixty (60) days prior written notice of
termination.

(f)           Material Breach.  This Agreement may be terminated by Hazlitt for
a material breach by the Company of any of the terms of this Agreement, upon
thirty (30) days’ written notice specifying the breach, and failure of the
Company to either (i) cure or diligently commence to cure the breach within the
30-day notice period, or (ii) dispute in good faith the existence of the
material breach.

(g)           Change of Control.  The Agreement can be terminated Upon a Change
of Control as defined in the Agreement Regarding Change In Control (“Change In
Control Agreement”) entered into by and between the Company and Hazlitt
effective as of January 1, 2009 and attached hereto as Exhibit A.  The Change In
Control Agreement, is hereby amended as follows and, as amended, remains in
effect: Sections 2.1 and 6 thereof are amended to exclude the Company’s
termination of Hazlitt due to Hazlitt’s death as a basis for Hazlitt’s
entitlement to Change In Control Benefits . All references to Hazlitt’s salary
are changed to Hazlitt’s Annual Fee.

(h)           Section 409A.

(i)           Anything in this Agreement to the contrary notwithstanding, if on
the date of termination of Hazlitt’s engagement with Company,

(A)           Hazlitt would not have a separation from service within the
meaning of Section 409A(a)(2)(A)(i) (“Separation From Service”) of the Internal
Revenue Code of 1986, as amended (the “Code”), and as a result of such
termination of engagement would receive any payment that, absent the application
of this Section 7(g)(i)(A), would be subject to additional tax imposed pursuant
to Section 409A(a) of the Code, then such payment shall instead be payable on
the date that is the earliest of (1) Hazlitt’s Separation From Service, (2) the
date Hazlitt becomes disabled (within the meaning of Section 409A(a)(2)(C) of
the Code), (3) Hazlitt’s death, or (4) such other date as will not result in
such payment being subject to such additional tax; and if

(B)           Hazlitt is a specified employee within the meaning of Section
409A(a)(2)(B)(i) of the Code and would receive any payment sooner than six
months after Hazlitt’s Separation From Service that, absent the application of
this Section 7(g)(i)(B), would

 
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be subject to additional tax imposed pursuant to Section 409A(a) of the Code as
a result of such status as a specified employee, then such payment shall instead
be payable on the date that is the earliest of (1) six months after Hazlitt’s
Separation From Service, (2) Hazlitt’s death, or (3) such other date as will not
result in such payment being subject to such additional tax.

(ii)           It is the intention of the parties that payments or benefits
payable under this Agreement not be subject to the additional tax imposed
pursuant to Section 409A of the Code.  To the extent such potential payments or
benefits could become subject to such Section, the parties shall cooperate to
amend this Agreement with the goal of giving Hazlitt the economic benefits
described herein in a manner that does not result in such tax being imposed.

(iii)           In the event that a payment or benefit payable under this
Agreement is subject to the additional tax imposed by Section 409A of the Code,
and Hazlitt has not been uncooperative in any attempts of the Company to amend
this Agreement to avoid such additional tax, Company shall (at Hazlitt’s option)
pay directly, or reimburse Hazlitt for such additional tax and any interest and
penalty related thereto (the “409A Amounts”) within 10 days of Hazlitt’s
submission to Company of the taxing authority’s determination of amounts due
(which determination must be submitted by Hazlitt to Company within 30 days of
receipt by Hazlitt), and in the case of Hazlitt’s payment, evidence of such
payment.  At the same time as Company’s payment or reimbursement, Company shall
pay Hazlitt a gross-up amount to cover income, excise, and other applicable
taxes on the 409A Amounts and on the gross-up amount (before this further
gross-up).  For purposes of calculating the gross-up amounts for taxes, Hazlitt
shall be deemed to be taxed at the highest marginal rate under all applicable
local, state, federal, and foreign tax laws for which the payment is made.

8.    Effect of Termination.

(a)           In the event that this Agreement is terminated for "cause"
pursuant to subsection 7(a),  the Company shall pay Hazlitt, at the time of such
termination, only the fees and any reasonable and necessary business expenses
incurred by him in connection with his services (less any applicable
withholdings and deductions), all due and payable to him through the date of the
termination of this Agreement.
 
(b)           In the event that this Agreement is terminated without cause
pursuant to subsection 7(b), subject to Section 7(g)(i) of the Agreement, the
Company shall pay Hazlitt a cash termination payment equal to the greater of
Hazlitt’s Annual Fee in effect upon the date of termination or the balance of
Annual Fees remaining in the then current term of the Agreement, payable in
equal monthly installments beginning in the month following Hazlitt’s
termination. Such termination payments shall cease immediately in the event that
Hazlitt violates any provision of Sections 9 and/or 10 herein.   In addition,
the Company shall pay Hazlitt any reasonable and necessary business expenses
incurred by Hazlitt in connection with his duties, all to the date of
termination and payable in a lump sum, less any applicable holdings and
deductions, as soon as administratively practicable (but in no event later than
60 days) following Hazlitt’s termination.

 
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(c)           In the event that this Agreement is terminated due to disability
pursuant to subsection 7(c), the Company shall pay Hazlitt the same amount as
provided for in subsection 8(a) above, in the same manner as provided for
therein.  In addition, the Company shall pay Hazlitt a cash termination payment
equal to one (1) month of Hazlitt’s Annual Fee in effect upon the date of
termination, payable in a lump sum as soon as administratively practical (but in
no event later than 60 days) following Hazlitt’s termination.

(d)           In the event this Agreement is terminated at his election pursuant
to subsection 7(d) or subsection 7(e), the Company shall pay to Hazlitt, the
same amount as provided for in subsection 8(a) above, in the same manner as
provided for therein.

(d)           In the event this Agreement is terminated for material breach by
Hazlitt pursuant to subsection 7(f), the Company shall pay to Hazlitt
termination payments in an amount equal to cash termination payments calculated
pursuant to Section 8(b).  Subject to  Section 7(h)(i) of the Agreement, such
termination payments shall be paid in equal monthly installments to Hazlitt
beginning in the month following Hazlitt’s termination.  Such termination
payments shall be paid so long as Hazlitt is not in breach of any term of this
Agreement, including, without limitation, Sections 9 and 10 hereof.  In
addition, the Company shall pay to Hazlitt all accrued fees and any reasonable
and necessary business expenses incurred by Hazlitt in connection with his
duties, all to the date of termination and payable in a lump sum, less
applicable holdings and deductions, as soon as administratively practicable (but
in no event later than 60 days) following Hazlitt’s termination.

(e)           In the event of a Termination Upon a Change of Control as defined
in the Change In Control Agreement, the Company’s obligation to Hazlitt shall be
as set forth in the Change In Control Agreement.

9.    Confidentiality.

(a)  The term “Confidential Information” shall include, but not be limited to,
the whole or any portion or phase of (i) any confidential, or proprietary or
trade secret, technical, business, marketing or financial information, whether
pertaining to (1) the Company or its Affiliates, (2) its or their suppliers, or
(3) any third party which the Company or its Affiliates is under an obligation
to keep confidential including, but not limited to, methods, know-how,
techniques, systems, processes, software programs, works of authorship, supplier
lists, projects, plans, and proposals, and (ii) any software programs and
programming prepared for the Company’s benefit whether or not developed, in
whole or in part by Hazlitt.  For purposes of this Agreement, “Confidential
Information” shall include, but shall not be limited to, strategies, analysis,
concepts, ideas, or plans; operating techniques; demographic and trade area
information; prospective site locations know-how; improvements; discoveries,
developments; designs, techniques, procedures; methods; machinery, devices;
drawings; specifications; forecasts; new products; research data, reports, or
records; marketing or business development plans, strategies, analysis, concepts
or ideas; contracts; general financial information about or proprietary to the
Company, including, but not limited to, unpublished financial statements,
budgets, projections, licenses, and costs; pricing; personnel information; and
any and all other trade secrets, trade dress, or proprietary information, and
all concepts or ideas in or reasonably related to the

 
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Company’s business.  All such Confidential Information is extremely valuable and
is intended to be kept secret to the Company; is the sole and exclusive property
of the Company or its Affiliates; and, is subject to the restrictive covenants
set forth herein. The term Confidential Information shall not include any
information generally available to the public or publicly disclosed by the
Company (other than by the act or omission of Hazlitt), information disclosed to
Hazlitt by a third party under no duty of confidentiality to the Company or its
Affiliates, or information required by law or court order to be disclosed by
Hazlitt.

(b)  Hazlitt shall not, without the Company’s prior written approval, use,
disclose, or reveal to any person or entity any of the Company’s Confidential
Information, except as required in the ordinary course of performing duties
hereunder.  Hazlitt shall not use or attempt to use any Confidential Information
in any manner which has the possibility of injuring or causing loss, whether
directly or indirectly, to the Company or any of its Affiliates.

(c)  In the event that Hazlitt’s engagement with the Company is terminated for
any reason whatsoever, he shall return to the Company, promptly upon the
Company’s written request therefore, any documents, photographs, tapes, discs,
memory devices, and other property containing Confidential Information which
were received by him during his engagement, without retaining copies thereof.

10.    Non-Competition; Non-Solicitation; Anti-Raiding;
Non-Disparagement.  Without the prior written approval of the Chief Executive
Officer or the President of the Company, Hazlitt shall not, directly or
indirectly, during his engagement and until the end of one hundred eighty (180)
days after termination of engagement (however such termination occurs,
including, without limitation, termination pursuant to Section 7(a), 7(b), 7(c),
7(d) or 7(e)):

(a)  Engage in a “Competing Business’’ in the “Territory”, as those terms are
defined below, whether as a sole proprietor, partner, corporate officer,
employee, director, shareholder, consultant, agent, independent contractor,
trustee, or in any other manner by which Hazlitt holds any beneficial interest
in a Competing Business, derives any income from any interest in a Competing
Business, or provides any service or assistance to a Competing Business.
“Competing Business” shall mean any business that mines or produces minerals
which is competitive with the business of the Company or any of its Affiliates
(defined below), as conducted or under development at any time during the term
of engagement.  “Affiliates” shall mean any entity controlled by or under common
control with the Company or any joint venture, partnership or other similar
entity to which the Company is a party.  “Territory” shall mean anywhere in the
state of Sonora, Mexico.  The provisions of this Section 10 will not restrict
Hazlitt from owning less than five percent of the outstanding stock of a
publicly-traded corporation engaged in a Competing Business;

(b)  Acquire, lease or otherwise obtain or control any beneficial, direct or
indirect interest in mineral rights, or other rights or lands necessary to
develop, any mineral property in which the Company or any of its Affiliates at
the time of termination as a beneficial interest or is actively seeking to
acquire, or that is within a distance of five (5) kilometers from any point on
the outer perimeter of any such property in which the Company or any of its
affiliates has a beneficial interest or that it is seeking to acquire;

 
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(c)  Conduct any exploration or production activities or otherwise work on or in
respect of any mineral property within a distance of five (5) kilometers from
any point on the outer perimeter of any mineral property in which the Company or
any of its affiliates then has a beneficial interest or is actively seeking to
acquire;

(d)  (i) Contact or solicit, or direct or assist others to contact or solicit,
for the purpose of promoting any person’s or entity’s attempt to compete with
the Company or any of its Affiliates, in any business carried on by the Company
or any of its Affiliates during the period in which Hazlitt was a consultant of
the Company, any suppliers, independent contractors, vendors, or other business
associates of the Company or any of its Affiliates that were existing or
identified prospective suppliers, independent contractors, vendors, or business
associates during such period, or (ii) otherwise interfere in any way in the
relationships between the Company or any of its Affiliates and their suppliers,
independent contractors, vendors, and business associates;

(e)  (i) Solicit, offer engagement to, otherwise attempt to hire, or assist in
the hiring of any employee or officer of the Company or any of its Affiliates;
(ii) encourage, induce, assist or assist others in inducing any such person to
terminate his or her engagement with the Company or any of its Affiliates; or
(iii) in any way interfere with the relationship between the Company or any of
its Affiliates and their employees; or

(f)  Make any public statement or perform or do any other act prejudicial or
injurious to the reputation or goodwill of the Company or any of its Affiliates
or otherwise interfere with the business of the Company or any of its
Affiliates.

11.    Acknowledgments.  Hazlitt acknowledges that the covenants contained in
Sections 9 and 10, including those related to duration, geographic scope, and
the scope of prohibited conduct, are reasonable and necessary to protect the
legitimate interests of the Company.  Hazlitt acknowledges that the covenants
contained in Sections 9 and 10 are designed, intended, and necessary to protect,
and are reasonably related to the protection of, the Company’s trade secrets, to
which he will be exposed and with which he will be entrusted.  Specifically,
without limitation, Hazlitt is entrusted with trade secrets regarding:  the
strategic planning initiatives; business development plans; budgets; financial
information; management training; future business plans; and operational
strategies and procedures.  Hazlitt understands that any breach of Sections 9 or
10 will also constitute a misappropriation of the Company’s proprietary rights,
and may constitute a theft of the Company’s trade secrets under applicable
local, state, and federal statutes, and will result in a claim for injunctive
relief, damages, and/or criminal sanctions and penalties against Hazlitt by the
Company, and possibly others.

12.    Forfeiture of Termination Payments.  If Hazlitt breaches Sections 9 or 10
of this Agreement during the term that termination payments are made pursuant to
Sections 8(b) or 8(d) of this Agreement, Hazlitt shall pay back to the Company
all termination payments received to date.  Nothing contained in this Section 12
shall be construed as prohibiting the Company from pursuing any other remedies
available to it in the event of the breach of Sections 9 or 10, including the
equitable remedies set forth in Section 15.

 
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13.    Forfeiture of Profits Related to Option Exercises.  If Hazlitt breaches
Section 9 or 10 of this Agreement, the Company shall have the right to
repurchase any or all shares of common stock of the Company purchased by Hazlitt
upon the exercise of options within the twelve (12)-month period immediately
preceding the breach at the exercise price of the option (the “Repurchase
Amount”), or if Hazlitt no longer holds such shares of common stock purchased on
exercise of options, Hazlitt shall pay to the Company an amount  (the “Profit
Amount”) equal to the gross profits that Hazlitt received or to be received on
the sale of such shares calculated as the aggregate sale price of such shares of
common stock less the exercise price.  The Company may exercise this right
within 90 days of its discovery of a breach, by a written notice (“Forfeiture
Notice”) to Executive and, as the case may be: (i) if Executive has the shares,
Executive shall immediately deliver them to the Company and, thereafter, the
Company shall pay the Repurchase Amount to Executive within thirty (30) days by
certified or bank check or by wired funds; and (ii) If Executive no longer has
the shares, Executive shall pay the Profit Amount to the Company within thirty
(30) days of the date of the Forfeiture Notice.  If the Executive has
transferred such shares in a transaction which is not a sale (including, for
example, a gift to a family member or entity), the Profit Amount payable by
Executive to the Company shall be an amount equal to the difference between the
value of such shares on the date of the Forfeiture Notice and the exercise
price. Nothing contained in this Section 13 shall be construed as prohibiting
the Company from pursuing any other remedies available to it in the event of the
breach of Sections 9 or 10, including the equitable remedies set forth in
Section 15.

14.    Non-Exclusivity of Rights.  Amounts that are vested benefits or that
Hazlitt is otherwise entitled to receive under any plan, policy or program of,
or contract or agreement with the Company at or subsequent to termination of
engagement (however such termination occurs, including, without limitation,
termination pursuant to Section 7(a), 7(b), 7(c), 7(d) or 7(e)) shall be payable
in accordance with such plan, policy or program of, or any contract or agreement
except as explicitly modified by this Agreement.

15.    Equitable Remedies.  The services to be rendered by Hazlitt and the
Confidential Information entrusted to Hazlitt as a result of his engagement by
the Company are of a unique and special character, and any breach of Sections 9
or 10 will cause the Company immediate and irreparable injury and damage, for
which monetary relief would be inadequate or difficult to quantify.  the Company
will be entitled to, in addition to all other remedies available to it,
injunctive relief and specific performance to prevent a breach and to secure the
enforcement of Sections 9 or 10.  Hazlitt acknowledges that injunctive relief
may be granted immediately upon the commencement of any such action without
notice to Hazlitt and in addition may recover monetary damages.  In the event a
court requires posting of a bond, the parties agree to a maximum $5,000
bond.  Hazlitt further acknowledges that his duties under this Agreement shall
survive termination of his engagement, whether the termination is voluntary or
involuntary, rightful or wrongful, and shall continue until the Company consents
in writing to the release of Hazlitt’s obligations under this Agreement.  The
parties further agree that the provisions of Sections 9 and 10 are separate from
and independent of the remainder of this Agreement and that these provisions are
specifically enforceable by the Company notwithstanding any claim made by
Hazlitt against the Company.

 
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16.    Attorney’s Fees.  In the event Hazlitt breaches, or threatens to breach,
any provision of this Agreement, Hazlitt acknowledges that he shall be solely
and fully responsible for all fees and costs, including without limitation, all
attorney’s fees and costs, incurred by the Company in enforcing this Agreement
if the Company is the prevailing party in any litigation.

17.    Entire Agreement; Amendments. This Agreement (including all exhibits and
the Change In Control Agreement) constitute the entire understanding between the
parties with respect to the subject matter herein and therein, and they
supersede any prior or contemporaneous understandings or agreements.  This
Agreement may be amended, supplemented, or terminated only by a written
instrument duly executed by each of the parties.

18.    Headings. The headings in this Agreement are for convenience of reference
only and shall not affect its interpretation. References to Sections are to
Sections of this Agreement.

19.    Gender; Number.  Words of gender may be read as masculine, feminine, or
neuter, as required by context. Words of number may be read as singular or
plural, as required by context.

20.    Severability. The covenants in this Agreement shall be construed as
independent of one another, and as obligations distinct from one another and any
other contract between Hazlitt and the Company. If any provision of this
Agreement is held illegal, invalid, or unenforceable, such illegality,
invalidity, or unenforceability shall not affect any other provisions hereof. It
is the intention of the parties that in the event any provision is held illegal,
invalid, or unenforceable, that such provision be limited and construed so as to
effect the intent of the parties to the fullest extent permitted by applicable
law. Any claim by Hazlitt against the Company shall not constitute a defense to
enforcement by the Company of this Agreement.

21.    Survival. The provisions of Sections 7, 9, 10, 11, 12, 13, 14, 15, 16,
17, 20, 21, 22, 23, 24, 25 and 26 shall survive the termination of this
Agreement.

22.    Notices.  All notices, demands, waivers, consents, approvals, or other
communications required hereunder shall be in writing and shall be deemed to
have been given if delivered personally, if sent by facsimile with confirmation
of receipt, if sent by certified or registered mail, postage prepaid, return
receipt requested, or if sent by same day or overnight courier service to the
following addresses:

 
(i)
If to the Company, to:

Capital Gold Corporation
76 Beaver Street, 14th Floor
New York, NY 10005
Tel. No.: (212) 344-5158
Fax No..: (212) 344-4537
Attention: President

 
 (ii)
If to Hazlitt, to:

 Scott Hazlitt
 
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Notice of any change in any such address shall also be given in the manner set
forth above. Whenever the giving of notice is required, the giving of such
notice may be waived by the party entitled to receive such notice.

23.    Waiver. The failure of any party to insist upon strict performance of any
of the terms or conditions of this Agreement shall not constitute a waiver of
any of such party’s rights hereunder.

24.    Assignment. Other than as provided below, neither party may assign any
rights or delegate any of obligations hereunder without the prior written
consent of the other party, and such purported assignment or delegation shall be
void; provided that the Company may assign the Agreement to any entity that
purchases the stock or assets of, or merges with, the Company or any
Affiliate.  This Agreement binds, inures to the benefit of, and is enforceable
by the successors and permitted assigns of the parties and does not confer any
rights on any other persons or entities.

25.    Governing Law. This Agreement shall be construed and enforced in
accordance with New York law except for any New York conflict-of-law principle
that might require the application of the laws of another jurisdiction.

26.    Submission to Jurisdiction: Service: Waivers.  With respect to any claim
arising out of this Agreement, each party hereto (a) irrevocably submits, for
itself and its property, to the jurisdiction of the state court located in the
City and County of New York, New York, the federal court located in New York,
New York, and appellate courts therefrom, (b) agrees that the venue for any
suit, action or proceeding arising out of or relating to this Agreement shall be
exclusive to and limited to such courts, and (c) irrevocably waives any
objection it may have at any time to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement brought in any such
court, irrevocably waives any claim that any such suit, action or proceeding
brought in any such court has been brought in an inconvenient forum and further
irrevocably waives the right to object, with respect to such claim, suit, action
or proceeding brought in any such court that such court does not have
jurisdiction over it. Each party irrevocably consents to the service of process
in any suit, action or proceeding in any of the aforesaid courts by the mailing
of copies of process to the other party or parties hereto, by certified or
registered mail at the address specified in Section 22.
 
 
[SIGNATURE PAGE FOLLOWS]
 
 
- 10 -

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IN WITNESS WHEREOF, this Agreement has been signed by the parties hereto
effective as of the date first above written.

CAPITAL GOLD CORPORATION
 
 
By:  /s/ Gifford A. Dieterle

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Gifford Dieterle, President
 
 
/s/ Scott Hazlett

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Scott Hazlitt
 
 
- 11 -

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EXHIBIT A

AGREEMENT REGARDING
CHANGE IN CONTROL

THIS AGREEMENT (“Agreement”), is made and entered into as of the 1st  day of
January, 2009 (the “Effective Date”) by and between Capital Gold Corporation
(the “Company”) and Scott Hazlitt (the “Executive”).

WITNESSETH THAT:

WHEREAS, the Company considers it essential to the best interests of its
stockholders to foster the continuous engagement of key management personnel,
and the Board of Directors of the Company (the “Board”) recognizes that, as is
the case with many publicly held corporations, a change in control might occur
and that such possibility, and the uncertainty and questions which it may raise
among management, may result in the departure or distraction of management
personnel to the detriment of the Company and its stockholders; and

WHEREAS, the Board has determined that appropriate steps should be taken to
reinforce and encourage the continued attention and dedication of members of the
Company’s management, including the Executive, to their engagement without
distraction in the face of potentially disturbing circumstances arising from the
possibility of a change in control of the Company;

NOW, THEREFORE, to induce the Executive to remain engaged by the Company and in
consideration of the premises and mutual covenants set forth herein, IT IS
HEREBY AGREED by and between the parties as follows:

1.           AGREEMENT TERM.  The initial “Agreement Term” shall begin on the
Effective Date and shall continue through December 31, 2011.  As of December 31,
2011, and as of each December 31 thereafter, the Agreement Term shall extend
automatically for a one year period unless the Company gives notice to the
Executive prior to the date of such extension that the Agreement Term will not
be extended.  Notwithstanding the foregoing, if a Change in Control (as defined
in Section 7 below), occurs during the Agreement Term, the Agreement Term shall
continue through and terminate on the first anniversary of the date on which the
Change in Control occurs.

2.           ENTITLEMENT TO CHANGE IN CONTROL BENEFITS.  The Executive shall be
entitled to the Change in Control Benefits described in Section 3 hereof if the
Executive’s engagement by the Company is terminated during the Agreement Term
but after a Change in Control (i) by the Company for any reason other than
Permanent Disability or Cause, (ii) by the Executive for Good Reason or (iii) by
the Executive for any reason during the 30-day period commencing on the first
date which is six months after the date of the Change in Control.  For purposes
of this Agreement:

 

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(a)           A termination of the Executive’s engagement shall be treated as a
termination by reason of “Permanent Disability” only if, due to a mental or
physical disability, the Executive is absent from the performance of services
for the Company for a period of at least twelve consecutive months and fails to
return to the performance of services within 30 days after receipt of a written
demand by the Company to do so.
 
(b)           The term “Cause” shall mean the willful engaging by the Executive
in illegal conduct or gross misconduct which is demonstrably and materially
injurious to the Company.  For purposes of this Agreement, no act, or failure to
act, on the Executive’s part shall be deemed “willful” unless done, or omitted
to be done, by the Executive not in good faith and without reasonable belief
that the Executive’s action or omission was in the best interest of the
Company.  Notwithstanding the foregoing, the Executive shall not be deemed to
have been terminated for Cause unless and until the Company delivers to the
Executive a copy of a resolution duly adopted by the affirmative vote of not
less than three-quarters of the entire membership of the Board at a meeting of
the Board called and held for such purpose (after reasonable notice to the
Executive and an opportunity for the Executive, together with counsel, to be
heard before the Board) finding that, in the good faith opinion of the Board,
the Executive was guilty of conduct set forth above and specifying the
particulars thereof in detail.

(c)           The term “Good Reason” shall mean the occurrence of any of the
following circumstances without the Executive’s express written consent:

(i) a significant adverse change in the nature, scope or status of the
Executive’s position, authorities or services from those in effect immediately
prior to the Change in Control, including, without limitation, if the Executive
was, immediately prior to the Change in Control, an executive officer of a
public company, the Executive ceasing to be an executive officer of a public
company;

(ii) the failure by the Company to pay the Executive any portion of the
Executive’s current compensation, or to pay the Executive any portion of any
installment of deferred compensation under any deferred compensation program of
the Company, within seven days of the date such compensation is due;

(iii) a reduction in the Executive’s annual base compensation (or a material
change in the frequency of payment) as in effect immediately prior to the Change
in Control as the same may be increased from time to time;

(iv)           the failure by the Company to award the Executive an annual bonus
in any year which is at least equal to the annual bonus awarded to the Executive
for the year immediately preceding the year of the Change in Control;

(v)           the failure by the Company to award the Executive equity-based
incentive compensation (such as stock options, shares of restricted stock, or
other equity-based compensation) on a periodic basis consistent with the
Company’s practices with respect to timing, value and terms prior to the Change
in Control;

 
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(vi)           the failure of the Company to award the Executive incentive
compensation of any nature based on attained milestones when such milestones are
attained.

(vii)           the failure of the Company to obtain a satisfactory agreement
from any successor to the Company to assume and agree to perform this Agreement
as contemplated by Section 14.

For purposes of any determination regarding the existence of Good Reason, any
good faith determination by the Executive that Good Reason exists shall be
conclusive.

3.            CHANGE IN CONTROL BENEFITS.  In the event of a termination of
engagement entitling the Executive to benefits in accordance with Section 2, the
Executive shall receive the following:

(a)           The Executive shall be entitled to a lump sum payment in cash no
later than twenty (20) business days after the Executive’s date of termination
equal to the sum of:

(i)           an amount equal to three times the Executive’s base salary in
effect on the date of the Change in Control or, or if greater, as in effect
immediately prior to the date of termination; plus

(ii)           an amount equal to three times the Executive’s bonus award for
the year immediately preceding the year of the Change in Control.

The amount payable under this paragraph (d) shall be inclusive of the amounts,
if any, to which the Executive would otherwise be entitled or by law and shall
be in addition to (and not inclusive of) any amount payable under any written
agreement(s) directly between the Executive and the Company or any of its
subsidiaries.

(b)           All unvested Company options shall immediately become vested, and
any exercise must occur no later than March 15 of the calendar year after the
date of termination.

(c)           The Company shall provide the Executive with and, at the
Executive’s option, directly pay for or reimburse the Executive for outplacement
services and tax and financial counseling suitable to the Executive’s position,
from providers selected by the Executive for services through the end of the
second taxable year of Executive after the taxable year of Executive’s
separation from service (within the meaning of Section 409A(a)(2)(A)(i) of the
Code) with the Company, or, if earlier, the date on which the Executive becomes
employed by another employer.  In the event the Executive has paid for any such
services, the Company shall reimburse the Executive for such payments within 10
days of submission to the Company of a copy of the provider’s invoice for
services and evidence of payment.  Any request for reimbursement for such
expenses shall be submitted no later than 30 days before the end of the third
taxable year of the Executive following the taxable year of the Executive in
which the separation from service occurred.

 
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4.           MITIGATION.  The Executive shall not be required to mitigate the
amount of any payment provided for in this Agreement by seeking other engagement
or otherwise.  The Company shall not be entitled to set off against the amounts
payable to the Executive under this Agreement any amounts owed to the Company by
the Executive, any amounts earned by the Executive in other engagement after the
Executive’s termination of engagement with the Company, or any amounts which
might have been earned by the Executive in other engagement had the Executive
sought such other engagement.

5.           MAKE-WHOLE PAYMENTS.  If any payment or benefit to which the
Executive (or any person on account of the Executive) is entitled, whether under
this Agreement or otherwise, in connection with a Change in Control or the
Executive’s termination of engagement (a “Payment”) constitutes a “parachute
payment” within the meaning of section 280G of the Code, and as a result thereof
the Executive is subject to a tax under section 4999 of the Code, or any
successor thereto, (an “Excise Tax”), the Company shall pay to the Executive an
additional amount (the “Make-Whole Amount”) which is intended to make the
Executive whole for such Excise Tax.  The Make-Whole Amount shall be equal to
(i) the amount of the Excise Tax, plus (ii) the aggregate amount of any
interest, penalties, fines or additions to any tax which are imposed in
connection with the imposition of such Excise Tax, plus (iii) all income, excise
and other applicable taxes imposed on the Executive under the laws of any
Federal, state or local government or taxing authority by reason of the payments
required under clauses (i) and (ii) and this clause (iii).

(a)           For purposes of determining the Make-Whole Amount, the Executive
shall be deemed to be taxed at the highest marginal rate under all applicable
local, state, federal and foreign income tax laws for the year in which the
Make-Whole Amount is paid.  The Make-Whole Amount payable with respect to an
Excise Tax shall be paid by the Company coincident with the Payment with respect
to which such Excise Tax relates.

(b)           All calculations under this Section 5 shall be made initially by
the Company and the Company shall provide prompt written notice thereof to the
Executive to enable the Executive to timely file all applicable tax
returns.  Upon request of the Executive, the Company shall provide the Executive
with sufficient tax and compensation data to enable the Executive or the
Executive’s tax advisor to independently make the calculations described in
subparagraph (a) above and the Company shall, at the Executive’s option, pay the
Executive’s advisor directly or reimburse the Executive for reasonable fees and
expenses incurred for any such verification.  Any payment or reimbursement shall
be made within 10 days of submission of the service provider’s invoice to the
Company, and in the case of reimbursement, evidence of payment.  Executive shall
be submit a copy of the service provider’s invoice for such services to the
Company within 60 days of its receipt by the Executive.

(c)           If the Executive gives written notice to the Company of any
objection to the results of the Company’s calculations within 60 days of the
Executive’s receipt of written notice thereof, the dispute shall be referred for
determination to independent tax counsel selected by the Company and reasonably
acceptable to the Executive (“Tax Counsel”).  The Company shall pay all fees and
expenses of such Tax Counsel.  Pending such determination by Tax Counsel, the
Company shall pay the Executive the Make-Whole Amount as determined by it in
good faith.

 
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The Company shall pay the Executive any additional amount determined by Tax
Counsel to be due under this Section 5 (together with interest thereon at a rate
equal to 120% of the Federal short-term rate determined under section 1274(d) of
the Code) within 10 days after such determination.

(d)           The determination by Tax Counsel shall be conclusive and binding
upon all parties unless the Internal Revenue Service, a court of competent
jurisdiction, or such other duly empowered governmental body or agency (a “Tax
Authority”) determines that the Executive owes a greater or lesser amount of
Excise Tax with respect to any Payment than the amount determined by Tax
Counsel.

(e)           If a Taxing Authority makes a claim against the Executive which,
if successful, would require the Company to make a payment under this Section 5,
the Executive agrees to contest the claim with counsel reasonably satisfactory
to the Company, on request of the Company subject to the following conditions:

(i) The Executive shall notify the Company of any such claim within 10 days of
becoming aware thereof.  In the event that the Company desires the claim to be
contested, it shall promptly (but in no event more than 30 days after the notice
from the Executive or such shorter time as the Taxing Authority may specify for
responding to such claim) request the Executive to contest the claim.  The
Executive shall not make any payment of any tax which is the subject of the
claim before the Executive has given the notice or during the 30-day period
thereafter unless the Executive receives written instructions from the Company
to make such payment together with an advance of funds sufficient to make the
requested payment plus any amounts payable under this Section 5 determined as if
such advance were an Excise Tax, in which case the Executive will act promptly
in accordance with such instructions.

(ii) If the Company so requests, the Executive will contest the claim by either
paying the tax claimed and suing for a refund in the appropriate court or
contesting the claim in the United States Tax Court or other appropriate court,
as directed by the Company; PROVIDED, HOWEVER, that any request by the Company
for the Executive to pay the tax shall be accompanied by an advance from the
Company to the Executive of funds sufficient to make the requested payment plus
any amounts payable under this Section 5 determined as if such advance were an
Excise Tax.  If directed by the Company in writing the Executive will take all
action necessary to compromise or settle the claim, but in no event will the
Executive compromise or settle the claim or cease to contest the claim without
the written consent of the Company; PROVIDED, HOWEVER, that the Executive may
take any such action if the Executive waives in writing the Executive’s right to
a payment under this Section 5 for any amounts payable in connection with such
claim.  The Executive agrees to cooperate in good faith with the Company in
contesting the claim and to comply with any reasonable request from the Company
concerning the contest of the claim, including the pursuit of administrative
remedies, the appropriate forum for any judicial proceedings, and the legal
basis for contesting the claim.  Upon request of the Company, the Executive
shall take appropriate appeals of any judgment or decision that would require
the Company make a payment under this Section 5.  Provided that Executive is in
compliance with the provisions this section, the Company shall be liable for and
indemnify the Executive against any loss in connection with, and all costs and
expenses,

 
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including attorneys’ fees, which may be incurred as a result of, contesting the
claim, and shall provide to the Executive within 30 days after each written
request therefor by the Executive cash advances or reimbursement for all such
costs and expenses actually incurred or reasonably expected to be incurred by
the Executive as a result of contesting the claim.

(f)           Should a Tax Authority finally determine that an additional Excise
Tax is owed, then the Company shall pay an additional Make-Whole Amount to the
Executive in a manner consistent with this Section 5 with respect to any
additional Excise Tax and any assessed interest, fines, or penalties.  If any
Excise Tax as calculated by the Company or Tax Counsel, as the case may be, is
finally determined by a Tax Authority to exceed the amount required to be paid
under applicable law, then the Executive shall repay such excess to the Company
within 30 days of such determination; provided that such repayment shall be
reduced by the amount of any taxes paid by the Executive on such excess which is
not offset by the tax benefit attributable to the repayment.

6.           TERMINATION DURING POTENTIAL CHANGE IN CONTROL.  If a Potential
Change in Control (as defined in Section 8) occurs during the Agreement Term,
and the Company terminates the Executive’s engagement for reasons other than
Permanent Disability or Cause during such Potential Change in Control, the
Executive shall be entitled to receive the benefits that the Executive would
have received under Section 3, such benefits to be calculated based upon the
Executive’s compensation prior to the actual termination of engagement but paid
within 20 business days of the date of such termination.

7.           CHANGE IN CONTROL.  For purposes of this Agreement, a “Change in
Control” shall be deemed to have occurred on the earliest of the following
dates:

(a)           the date any Person is or becomes the Beneficial Owner, directly
or indirectly, of securities of the Company representing 30% or more of the
combined voting power of the Company’s then outstanding securities, excluding
any Person who becomes such a Beneficial Owner in connection with a transaction
described in clause (i) of paragraph (c) below; or

(b)           the date on which the following individuals cease for any reason
to constitute a majority of the number of directors then serving: individuals
who, on the date hereof, constitute the Board and any new director (other than a
director whose initial assumption of office is in connection with an actual or
threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of the Company) whose
appointment or election by the Board or nomination for election by the Company’s
stockholders was approved or recommended by a vote of at least two-thirds (2/3)
of the directors then still in office who either were directors on the date
hereof or whose appointment, election or nomination for election was previously
so approved or recommended; or

(c)           the date on which there is consummated a merger or consolidation
of the Company or any direct or indirect subsidiary of the Company with any
other corporation or other entity, other than (i) a merger or consolidation (A)
immediately following which the individuals who comprise the Board immediately
prior thereto constitute at least a majority of the board of directors of the
Company, the entity surviving such merger or consolidation or, if the Company

 
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or the entity surviving such merger or consolidation is then a subsidiary, the
ultimate parent thereof and (B) which results in the voting securities of the
Company outstanding immediately prior to such merger or consolidation continuing
to represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof), in combination with
the ownership of any trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any subsidiary of the Company, at least
50% of the combined voting power of the securities of the Company or such
surviving entity or any parent thereof outstanding immediately after such merger
or consolidation, or (ii) a merger or consolidation effected to implement a
recapitalization of the Company (or similar transaction) in which no Person is
or becomes the Beneficial Owner, directly or indirectly, of securities of the
Company representing 30% or more of the combined voting power of the Company’s
then outstanding securities; or

(d)           the date on which the stockholders of the Company approve a plan
of complete liquidation or dissolution of the Company or there is consummated an
agreement for the sale or disposition by the Company of all or substantially all
of the Company’s assets, other than a sale or disposition by the Company of all
or substantially all of the Company’s assets to an entity, at least 50% of the
combined voting power of the voting securities of which are owned by
stockholders of the Company, in combination with the ownership of any trustee or
other fiduciary holding securities under an employee benefit plan of the Company
or any subsidiary of the Company, in substantially the same proportions as their
ownership of the Company immediately prior to such sale.

Notwithstanding the foregoing, a “Change in Control” shall not be deemed to have
occurred by virtue of the consummation of any transaction or series of
integrated transactions immediately following which the record holders of the
common stock of the Company immediately prior to such transaction or series of
transactions continue to have substantially the same proportionate ownership in
an entity which owns all or substantially all of the assets of the Company
immediately following such transaction or series of transactions.

For purposes of this Agreement: “Affiliate” shall have the meaning set forth in
Rule 12b-2 promulgated under Section 12 of the Exchange Act; “Beneficial Owner”
shall have the meaning set forth in Rule 13d-3 under the Exchange Act; “Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended from time to
time; and “Person” shall have the meaning given in Section 3(a)(9) of the
Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof, except
that such term shall not include (i) the Company or any of its subsidiaries,
(ii) a trustee or other fiduciary holding securities under an employee benefit
plan of the Company or any of its Affiliates, (iii) an underwriter temporarily
holding securities pursuant to an offering of such securities, or (iv) a
corporation owned, directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership of stock of the Company.

8.           POTENTIAL CHANGE IN CONTROL.  A “Potential Change in Control” shall
exist during any period in which the circumstances described in paragraphs (a),
(b), (c) or (d), below, exist (provided, however, that a Potential Change in
Control shall cease to exist not later than the occurrence of a Change in
Control):

 
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(a)           The Company enters into an agreement, the consummation of which
would result in the occurrence of a Change in Control, provided that a Potential
Change in Control described in this paragraph (a) shall cease to exist upon the
expiration or other termination of all such agreements;

(b)           Any Person (without regard to the exclusions set forth in
subsections (i) through (iv) of such definition) publicly announces an intention
to take or to consider taking actions the consummation of which would constitute
a Change in Control; provided that a Potential Change in Control described in
this paragraph (b) shall cease to exist upon the withdrawal of such intention,
or upon a determination by the Board that there is no reasonable chance that
such actions would be consummated;

(c)           Any Person becomes the Beneficial Owner, directly or indirectly,
of securities of the Company representing 20% or more of either the then
outstanding shares of common stock of the Company or the combined voting power
of the Company’s then outstanding securities; or

(d)           The Board adopts a resolution to the effect that, for purposes of
this Agreement, a Potential Change in Control exists; provided that a Potential
Change in Control described in this paragraph (d) shall cease to exist upon a
determination by the Board that the reasons that gave rise to the resolution
providing for the existence of a Potential Change in Control have expired or no
longer exist.

9.           NONALIENATION.  The interests of the Executive under this Agreement
are not subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment, or garnishment by creditors of the
Executive or the Executive’s beneficiary.

10.           AMENDMENT.  This Agreement may be amended or canceled only by
mutual agreement of the parties in writing without the consent of any other
person.  So long as the Executive lives, no person, other than the parties
hereto, shall have any rights under or interest in this Agreement or the subject
matter hereof.

11.           APPLICABLE LAW.  The provisions of this Agreement shall be
construed in accordance with the laws of the State of New York, without regard
to the conflict of law provisions of any state.

12.           SEVERABILITY.  The invalidity or unenforceability of any provision
of this Agreement will not affect the validity or enforceability of any other
provision of this Agreement, and this Agreement will be construed as if such
invalid or unenforceable provision were omitted (but only to the extent that
such provision cannot be appropriately reformed or modified).

13.           WAIVER OF BREACH.  No waiver by any party hereto of a breach of
any provision of this Agreement by any other party, or of compliance with any
condition or provision of this Agreement to be performed by such other party,
will operate or be construed as a waiver of any subsequent breach by such other
party of any similar or dissimilar provisions and conditions at the same or any
prior or subsequent time.  The failure of any party hereto to take

 
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any action by reason of such breach will not deprive such party of the right to
take action at any time while such breach continues.

14.           SUCCESSORS, ASSUMPTION OF CONTRACT.  This Agreement shall be
binding upon and inure to the benefit of the Company and any successor of the
Company.  The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company to expressly assume and agree to perform
this Agreement in the same manner and to the same extent that the Company would
be required to perform it if no succession had taken place.  This Agreement is
personal to the Executive and may not be assigned by the Executive without the
written consent of the Company.  However, to the extent that rights or benefits
under this Agreement otherwise survive the Executive’s death, the Executive’s
heirs and estate shall succeed to such rights and benefits pursuant to the
Executive’s will or the laws of descent and distribution; provided that the
Executive shall have the right at any time and from time to time, by notice
delivered to the Company, to designate or to change the beneficiary or
beneficiaries with respect to such benefits.

15.           NOTICES.  Notices and all other communications provided for in
this Agreement shall be in writing and shall be delivered personally or sent by
registered or certified mail, return receipt requested, postage prepaid
(provided that international mail shall be sent via overnight or two-day
delivery), or sent by facsimile or prepaid overnight courier to the parties at
the addresses set forth below.  Such notices, demands, claims and other
communications shall be deemed given:

(a)           in the case of delivery by overnight service with guaranteed next
day delivery, the next day or the day designated for delivery;

(b)           in the case of certified or registered U.S.  mail, five days after
deposit in the U.S.  mail; or

(c)           in the case of facsimile, the date upon which the transmitting
party received confirmation of receipt by facsimile, telephone or otherwise;

provided, however, that in no event shall any such communications be deemed to
be given later than the date they are actually received.  Communications that
are to be delivered by the U.S.  mail or by overnight service or two-day
delivery service are to be delivered to the addresses set forth below:

to the Company:

Capital Gold Corporation
76 Beaver Street
14th Floor
New York, NY 10005

 
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with a copy (which shall not constitute notice) to:
 
Chief Financial Officer
Capital Gold Corporation
76 Beaver Street
14th Floor
New York, NY 10005

or to the Executive:

Scott Hazlitt
 
Each party, by written notice furnished to the other party, may modify the
applicable delivery address, except that notice of change of address shall be
effective only upon receipt.

16.           LEGAL AND ENFORCEMENT COSTS.  The provisions of this Section 16
shall apply if it becomes necessary or desirable for the Executive to retain
legal counsel or incur other costs and expenses in connection with enforcing any
and all rights under this Agreement or any other compensation plan maintained by
the Company:

(a)           The Executive shall be entitled to recover from the Company
reasonable attorneys’ fees, costs and expenses incurred in connection with such
enforcement or defense.

(b)           Payments required under this Section 16 shall be made by the
Company to the Executive (or directly to the Executive’s attorney) promptly
following submission to the Company of appropriate documentation evidencing the
incurrence of such attorneys’ fees, costs, and expenses.

(c)           The Executive shall be entitled to select legal counsel; provided,
however, that such right of selection shall not affect the requirement that any
costs and expenses reimbursable under this Section 16 be reasonable.

(d)           The Executive’s rights to payments under this Section 16 shall not
be affected by the final outcome of any dispute with the Company.

17.           SURVIVAL OF AGREEMENT.  Except as otherwise expressly provided in
this Agreement, the rights and obligations of the parties to this Agreement
shall survive the termination of the Executive’s engagement with the Company.

18.           ENTIRE AGREEMENT.  Except as otherwise provided herein, this
Agreement constitutes the entire agreement between the parties concerning the
subject matter hereof and supersedes all prior or contemporaneous agreements,
between the parties relating to the subject matter hereof; provided, however,
that nothing in this Agreement shall be construed to limit any policy or
agreement that is otherwise applicable relating to confidentiality, rights to
inventions,

 
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copyrightable material, business and/or technical information, trade secrets,
solicitation of employees, interference with relationships with other
businesses, competition, and other similar policies or agreement for the
protection of the business and operations of the Company and the subsidiaries.

19.           COUNTERPARTS.  This Agreement may be executed in two or more
counterparts, any one of which shall be deemed the original without reference to
the others.

IN WITNESS THEREOF, the Executive has hereunto set his hand, and the Company has
caused these presents to be executed in its name and on its behalf, and its
corporate seal to be hereunto affixed on this 21st day of January, 2009, all as
of the Effective Date.
 
 
/s/ Scott Hazlitt

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Scott Hazlitt
 
CAPITAL GOLD CORPORATION

By:  /s/ Gifford A. Dieterle

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Gifford A.  Dieterle, President
 
 
ATTEST:
 
/s/ Christopher M. Chipman

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Christopher Chipman, CFO
 
 
 
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