Unassociated Document


    EMPLOYMENT
AGREEMENT

    


    THIS EMPLOYMENT AGREEMENT (the “Agreement”) entered into
effective the 1st day of
September 2010 (the “Effective
Date”), is by and between Desert Hawk Gold Crop., a corporation formed
under the laws of the State of Nevada (the “Employer”), and Robert E.
Jorgensen (the “Employee”).

    


    RECITALS:

    


    WHEREAS, the Employer desires to engage
the services of the Employee as Chief Executive Officer, and the Employee is
willing to render such services to the Employer in consideration of the terms
and conditions agreed to by the parties; and

    


    WHEREAS, the Board of Directors of the
Employer (the “Board”)
has approved the employment of the Employee on the terms and conditions set
forth in this Agreement;

    


    NOW THEREFORE, in consideration of the
mutual covenants and promises contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged by
the parties hereto, the Employer agrees to employ the Employee, and the Employee
agrees to perform services for the Employer as an employee, upon the terms and
conditions set forth herein.

    


    
      	
              1.

            	
              TERM.

            


    

    


    The initial term of this Agreement
shall commence on the Effective Date and shall be for a period of four (4) years
(the “Initial Term”),
unless it is terminated earlier as provided herein.  Beginning on
expiration of the Initial Term, and on each anniversary thereafter, unless it is
terminated earlier as provided herein or unless the Employer delivers written
notice to the Employee of its intention not to extend the Agreement at least
ninety (90) days before the expiration of the Initial Term or any anniversary
date thereafter, the term of this Agreement shall automatically be extended for
unlimited additional one-year terms (the Initial Term and any extension or
extensions are referred to herein as the “Employment
Term”).  The terms of this Agreement shall be binding upon the
parties hereto from the Effective Date throughout the Employment
Term.  The restrictive covenants in Section 4(c) and in Section 9
hereof shall survive the termination of this Agreement.

    


    
      	
              2. 

            	
              TITLE
      AND DUTIES.

            


    


    The Employee shall be employed as the
Chief Executive Officer of the Employer.  The Employee shall perform
such services consistent with his position as might be assigned to him from time
to time by the Board and are consistent with the bylaws of the Employer,
including, but not limited to, service for any subsidiary, partnership, limited
liability company, joint venture, trust or other enterprise or entity controlled
by the Employer.  The Board has appointed the Employee to serve as the
Chief Executive Officer and Employee shall have such responsibilities and
authority as is commensurate with such office and as may be prescribed by the
Board and bylaws of the Employer.  The Board shall have the right to
review and change the duties, responsibilities, and functions of Employee from
time to time as it may deem necessary or appropriate; provided, however, that
such duties, responsibilities, and functions remain consistent with the
Employees status as a senior executive officer of the Employer.  The
Employee shall report directly to Board of Directors.  The Employee
shall also serve as the Chairman of the Board.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    
      	
              3.

            	
              LOCATION.

            


    

    


    The Employee’s place of employment
shall be the offices of the Employer, or at such other location as mutually
agreed between the Employer and the Employee, but in no event outside Spokane
County.  At the request of the Employee, the Employer shall provide a
suitable furnished office, computer, and full-time secretary.

    


    4.           EXTENT
OF SERVICES.

    


    a.           Duty to Perform
Services.

    


    The Employee agrees not to engage in
any material business activities during the term of this Agreement except those
that are for the benefit of the Employer and its subsidiaries, and to devote not
less than 75% of his entire business time, attention, skill, and effort to the
performance of his duties under this Agreement for the Employer and any
corporation controlled by the Employer now or during the term of this
Agreement.  Notwithstanding the foregoing, the Employee may engage in
charitable, professional and civic activities that do not impair the performance
of his duties to the Employer, as the same may be changed from time to
time.  In addition, Employee may serve on the board of directors or
serve as an officer of up to three companies not engaged in business which may
reasonably compete with the business of the Employer, provided that Employee
shall not be required to render any material services with respect to the
operations or affairs of any such company which would exceed 25% of his entire
business time.  Nothing contained herein shall prevent the Employee
from managing his own personal investments and affairs, including, but not
limited to, investing his assets in the securities of publicly traded companies;
provided, however, that the Employee’s activities do not constitute a conflict
of interest, violate securities laws, or otherwise interfere with the
performance of his duties and responsibilities as described
herein.  The Employee agrees to adhere to the Employer’s published
policies and procedures, guidelines, and code of conduct, as each is adopted
from time to time, affecting directors, officers, employees, and agents and
shall use his best efforts to promote the Employer’s interest, reputation,
business and welfare.


    
      
         


      

      
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    b.           Corporate
Opportunities.

    


    The Employee agrees that he will not
take personal advantage of any the Employer business opportunities that arise
during his employment with the Employer and that might be of benefit to the
Employer.  All material facts regarding such opportunities shall be
promptly reported to the Board for consideration by the Employer.

    


    c.           Non-Disparagement.

    


    The Employee agrees that, during the
Employment Term and for one year thereafter, he shall not, in any communications
with the press or other media or any customer, client or supplier of the
Employer, or any of Employer’s affiliates, criticize, ridicule or make any
statement which disparages or is derogatory of the Employer or its affiliates or
any of their respective directors or senior officers.

    


    5.           COMPENSATION
AND BENEFITS.

    


    a.           Base
Salary.

    


    The
Employee’s initial annual base salary shall be $120,000 (the “Initial Base
Salary”).  The base salary shall be payable in equal
installments in accordance with the Employer’s standard payroll
practices.  The Employee’s annual base salary shall be further
reviewed no less frequently than annually for increases in the discretion of the
Compensation Committee and/or Board, taking into account the compensation level
for employees with similar skills and responsibilities at companies comparable
to the Employer, the financial condition of the Employer, and the Employee’s
value to the Employer relative to other members of the executive management of
the Employer; provided, however, that at no time during the term of this
Agreement shall the Employee’s base salary be decreased from the base salary
then in effect except as part of an general program of salary adjustment by the
Employer applicable to all vice presidents and above.

    


    b.           Performance
Compensation.

    


    Employee
will be eligible to receive an annual bonus of a minimum of 10% and a maximum of
100% of the then applicable base salary, less applicable withholding taxes, upon
achievement of annual performance objectives to be determined in good faith by
the Compensation Committee or the Board and the Employee, which objectives for
the first year of this Agreement will be established within thirty (30) days of
the Effective Date.  Objectives for subsequent years will be
determined as set forth herein within thirty (30) days of each anniversary of
this Agreement.  Bonus payments will be paid to the Employee not later
than thirty (30) days following achievement of annual performance objectives,
but in no event later than thirty (30) days following each anniversary of this
Agreement.  At the option of the Employee, such bonus payments may be
paid in cash or in shares of common stock of the Company at the fair market
value on the date the bonus is earned.


    
      
         


      

      
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    c.           Other
Benefits.

    


    During
the Employment Term, Employee will be entitled to participate in the employee
benefit plans currently and hereafter maintained by the Employer of general
applicability to other senior executives of the Employer, including, without
limitation, the Employer’s group medical, dental, vision, disability, life
insurance, flexible-spending account, 401(k) and other plans.  The
Employee shall be entitled to a car allowance of $500 per month which shall be
paid periodically with the Employee’s base salary.

    


    d.           Withholding
Taxes.

    


    The
Employer may make any appropriate arrangements to deduct from all benefits
provided hereunder any taxes reasonably determined to be required to be withheld
by any government or government agency.  The Employee shall bear all
taxes on benefits provided hereunder to the extent that no taxes are withheld,
irrespective of whether withholding is required.

    


    e.           Vacation and Sick
Leave.

    


    Employee will be entitled to paid
vacation of four (4) weeks per year in accordance with the Employer’s vacation
policy, with the timing and duration of specific vacations mutually and
reasonably agreed to by the parties hereto.  Any accrued but unused
vacation time at the expiration of this Agreement shall be payable to the
Employee upon expiration of this Agreement at the then applicable base salary
rate, except as provided in Section 6(c) and (e) hereof.  The Employee
shall be entitled to sick leave in accordance with the sick leave policy adopted
by the Employer from time to time for senior executives.

    


    f.           Reimbursement of
Business Expenses.

    


    The
Employer shall promptly reimburse the Employee for all reasonable travel,
entertainment and other expenses incurred or paid by the Employee in connection
with, or related to, the performance of his duties, responsibilities or services
under this Agreement, upon presentation by the Employee of such supporting
information and documentation as the Employer may reasonably request in
accordance with company policy and the requirements of the Internal Revenue
Code.

    


    6.           TERMINATION
OF EMPLOYMENT.

    


    a.           Termination Due
to Death.

    


    The
Employee’s employment and this Agreement shall terminate immediately upon his
death.  If the Employee’s employment is terminated due to his death,
his estate or his beneficiaries, as the case may be, shall be entitled
to:


    
      
         


      

      
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    (i)           payment
of any unpaid portion of his base salary through the date of such
termination;

    


    (ii)           reimbursement
for any outstanding reasonable business expenses he incurred in performing his
duties hereunder;

    


    (iii)           the
right to elect continuation coverage of insurance benefits to the extent
required by law;

    


    (iv)           full
and immediate vesting of any unexercised stock options or restricted stock
grants;

    


    (v)           
any pension survivor benefits that may become due pursuant to any employee
benefit plan or program of the Employer; and

    


    (vi)           payment
of any accrued but unpaid benefits, and any other rights, as required by the
terms of any employee benefit plan or program of the Employer, this Agreement,
or any other agreement between the Employer and the Employee.

    


    b.           Termination Due
to Disability.

    


    The
Employer may terminate the Employee’s employment at any time if the Employee
becomes disabled, upon written notice by the Employer to the
Employee.  For all purposes under this Agreement, “Disability” shall
mean that the Employee, at the time the notice is given, has been unable to
perform his duties under this Agreement for a period of not less than ninety
(90) days during any 180-day period as a result of the Employee’s incapacity due
to physical or mental illness.  If the Employee’s employment is
terminated due to his disability, he shall be entitled to:

    


    (i)           payment
of any unpaid portion of his base salary through the date of such
termination;

    


    (ii)           reimbursement
for any outstanding reasonable business expenses he has incurred in performing
his duties hereunder;

    


    (iii)           the
right to elect continuation coverage of insurance benefits to the extent
required by law;

    


    (iv)           full
and immediate vesting of any unexercised stock options or restricted stock
grants; and

    


    (v)           payment
of any accrued but unpaid benefits, and any other rights, as required by the
terms of any employee benefit plan or program of the Employer, this Agreement,
or any other agreement between the Employer and the Employee.


    
      
         


      

      
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    As soon
as administratively possible following the Effective Date, the Employer shall
make available to the Employee, and other similarly-situated employees, a
disability benefit plan, paid by the Employer, that provides monthly payments to
Employee equal to at least two thirds (2/3) of the highest monthly base salary
Employee receives pursuant to this Agreement, which payment will continue for as
long as Employee remains disabled.

    


    c.           Termination for
Cause.

    


    The
Employer may terminate the Employee’s employment at any time for Cause, provided
that it gives written notice of termination to the Employee as set forth
below.  If the Employee’s employment is terminated for Cause, as
defined below, he shall be entitled to:

    


    (i)           
payment of any unpaid portion of his base salary through the date of such
termination;

    


    (ii)           reimbursement
for any outstanding reasonable business expenses he incurred in performing his
duties hereunder through the date of such termination; and

    


    (iii)           the
right to elect continuation coverage of insurance benefits to the extent
required by law.

    


    If the
Employee shall be terminated for Cause under this Section 6(c), any of any
accrued but unpaid benefits, including, but not limited to, any performance
compensation under Section 5(b) hereof or any accrued but unused vacation time
under Section 5(e) hereof, and any other rights through the date of termination,
including any severance package benefits, as required by the terms of any
employee benefit plan or program of the Employer, this Agreement, or any other
agreement between the Employer and the Employee, shall be forfeited and the
Employer shall have no obligation to pay such amounts.

    


    For
purposes of this Agreement, a termination for “Cause”
shall mean:  (i) the final conviction of Employee of, or Employee’s
plea of guilty or nolo
contendere to, any felony or a crime involving dishonesty, fraud, or
moral turpitude; (ii) the indictment of Employee for any felony or a crime
involving dishonesty, fraud, or moral turpitude which, in the reasonable
good-faith judgment of the Board, has materially damaged, or could materially
damage, the reputation of the Employer or would materially interfere with the
performance of services by the Employee; (iii) the willful commission of fraud,
nonincidental misappropriation, embezzlement, or other dishonest act by Employee
against the Employer; (iv) Employee’s use of illegal drugs or alcohol on the
Employer’s premises, Employee’s use of illegal drugs or alcohol having an
adverse effect on the performance of the Employee’s duties hereunder, or
Employee’s use of illegal drugs or alcohol which, in the reasonable good-faith
judgment of the Board, has materially damaged, or could materially damage, the
reputation of the Employer; (v) Employee’s willful failure, gross negligence, or
gross misconduct in the performance of his duties to the Employer; (vi)
Employee’s gross malfeasance in the performance of his duties hereunder; (vii)
Employee’s nonfeasance in the performance of his duties hereunder not cured
within ten (10) business days after notice of such nonfeasance; (viii)
Employee’s failure to follow a written order which is both legal and reasonable;
or (ix) Employee’s breach of this Agreement not cured within ten (10) business
days after notice of such breach.


    
      
         


      

      
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    If the
Employer exercises its right to terminate the Employee for Cause, the Employer
shall: (1) give the Employee written notice of termination at least ten (10)
business days before the date of such termination specifying in detail the
conduct constituting such Cause, and (2) deliver to the Employee a copy of a
resolution duly adopted by a majority of the entire membership of the Board,
excluding interested directors, after reasonable notice to the Employee and an
opportunity for the Employee to be heard in person by members of the Board,
finding that the Employee has engaged in such conduct.

    


    
      	
               
      

            	
              d.

            	
              Termination
      Without Cause or Constructive Termination Without
      Cause.

            


    

    


    The
Employer may terminate the Employee’s employment at any time without Cause,
provided that it gives written notice of termination at least ninety (90) days
before the date of such termination.  If the Employee’s employment is
terminated without Cause, or if there is a constructive termination without
Cause, as defined below, the Employee shall be entitled to receive from the
Employer the following:

    


    (i)           payment
of any unpaid portion of his base salary through the date of such
termination;

    


    (ii)           reimbursement
for any outstanding reasonable business expenses he incurred in performing his
duties hereunder;

    


    (iii)           the
right to elect continuation coverage of insurance benefits to the extent
required by law;

    


    (iv)           full
and immediate vesting of any unexercised stock options or restricted stock
grants;

    


    (v)           payment
of any accrued but unpaid benefits, and any other rights, as required by the
terms of any employee benefit plan or program of the Employer, this Agreement,
or any other agreement between the Employer and the Employee;


    
      
         


      

      
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    (vi)           payment
of amounts equal to any premiums for health insurance continuation coverage
under any the Employer health plans that is elected by the Employee or his
beneficiaries pursuant to Section 4980B of the Internal Revenue Code, at a time
or times mutually agreed to by the parties, but only so long as the Employee is
not eligible for coverage under a health plan of another employer (whether or
not he elects to receive coverage under that plan); and

    


    (vii)           subject
to limitations set forth below, a severance benefit in an amount equal to three
(3) times the Initial Base Salary if such termination occurs on or before August
31, 2011, and one and one-half (11⁄2) times the largest annual base salary plus
the largest annual performance compensation pursuant to Section 5(b) hereof
received by Employee under the Agreement if such termination occurs after August
31, 2011, but only if (x) Employee executes an agreement releasing the Employer
from any further liability under this Agreement, (y) the period for revoking
such release has expired, and (z) Employee has not materially breached the
Confidential Information Agreement.

    


    The
Employee shall be deemed to have earned and the Employer shall pay to Employee
75% of the total severance benefit in Section 6(d)(vii) above within thirty (30)
days after all of the applicable conditions are satisfied.  The
remaining 25% of the severance benefit will be deemed earned by Employee, and
the Employer shall pay to Employee such remaining 25% of the severance benefit
within thirty (30) days following the first anniversary of the Employee’s
termination date unless the Employee materially breaches the Confidential
Information Agreement during the one year period following the Employee’s
termination date, in which case such remaining 25% of the severance benefit will
be deemed unearned and will not be paid.  All severance benefits paid
to the Employee shall be paid subject to all legally required payroll deductions
and withholdings for sums owed by the Employer to the Employee.

    


    For
purposes of this Agreement, constructive termination without Cause shall mean a
termination of the Employee at his own initiative following the occurrence,
without the Employee’s prior written consent, of one or more of the following
events not on account of Cause:

    


    
      	
               
      

            	
              (1)

            	
              a
      material reduction in the Employee’s then current base
    salary;

            


    

    


    
      	
               
      

            	
              (2)

            	
              a
      material diminution in the Employee’s authority, duties, or
      responsibilities;

            


    

    


    
      	
               
      

            	
              (3)

            	
              a
      material diminution in the budget over which the Employee retains
      authority;

            


    

    


    
      	
               
      

            	
              (4)

            	
              a
      material change in the geographic location at which the Employee must
      perform the services hereunder;
or

            


    


    
      
         


      

      
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              (5)

            	
              any
      other action or inaction which constitutes a material breach by the
      Employer of this Agreement.

            


    

    


    In the
event the Employee is terminated without Cause or there is a constructive
termination without Cause, the Employee shall provide the Employer with written
notice within ninety (90) days of the event and the Employer shall have thirty
(30) days to cure the default.

    


    e.           Voluntary
Termination.

    


    If the
Employee voluntarily terminates his employment on his own initiative for reasons
other than his death, disability, or constructive termination without Cause, he
shall be entitled to:

    


    (i)           payment
of any unpaid portion of his base salary through the effective date of such
termination;

    


    (ii)          reimbursement
for any outstanding reasonable business expenses he has incurred in performing
his duties hereunder;

    


    (iii)         the
right to elect continuation coverage of insurance benefits to the extent
required by law; and

    


    (iv)        any
of any accrued but unpaid benefits and any other rights through the date of
termination, excluding any severance package benefits or accrued vacation time,
as required by the terms of any employee benefit plan or program of the
Employer, this Agreement, or any other agreement between the Employer and the
Employee.

    


    A
voluntary termination under this paragraph shall be effective upon thirty (30)
days’ prior written notice to the Employer unless the parties mutually agree to
extend the effective date.

    


    7.           MITIGATION
AND OFFSET.

    


    If the
Employee’s employment is terminated during the term of this Agreement pursuant
to the provisions of paragraph 6(d), above, the Employee shall be under no duty
or obligation to seek or accept other employment, and no payment or benefits of
any kind due him under this Agreement shall be reduced, suspended or in any way
offset by any subsequent employment.  The obligation of the Employer
to make the payments provided for in this Agreement shall not be affected by any
circumstance including, by way of example rather than limitation, any set-off,
counterclaim, recoupment, defense, or other right that the Employer may assert,
or due to any other employment or source of income obtained by the
Employee.


    
      
         


      

      
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    8.           ENTITLEMENT
TO OTHER BENEFITS.

    


    Except as
expressly provided herein, this Agreement shall not be construed as limiting in
any way any rights or benefits the Employee, his spouse, dependents or
beneficiaries may have pursuant to any other employee benefits plans or
programs.

    


    
      	
              9.

            	
              CONFIDENTIALITY,
      INVENTIONS, AND CONFLICT OF INTERESTS
POLICY.

            


    

    


    Employee
agrees to abide by the terms of the Confidential Information and Invention
Assignment Agreement attached hereto as Exhibit A (the “Confidential
Information Agreement”) upon commencing employment
hereunder.

    


    
      	
              10.

            	
              CHANGE
      OF CONTROL

            


    

    


    In the
event of merger, consolidation, or similar transaction in which the Employer is
not the survivor, or the sale of all or substantially all of the assets of the
Employer, the Employer shall cause the survivor or the transferee to expressly
assume in writing the liabilities, obligations, and duties of the Employer under
this Agreement and shall provide a copy of such written assumption to the
Employee not less than ten (10) business days prior to the consummation of such
merger, consolidation, or similar transaction, or the sale of all or
substantially all of the assets of the Employer.

    


    11.           ARBITRATION.

    


    Any
dispute or controversy arising under or in connection with this Agreement shall,
if the Employer or the Employee so elects, be settled by arbitration, in
accordance with the Commercial Arbitration Rules procedures of the American
Arbitration Association. Arbitration shall occur before a single arbitrator;
provided, however, that if the parties cannot agree on the selection of such
arbitrator within thirty (30) days after the matter is referred to arbitration,
each party shall select one arbitrator and those arbitrators shall jointly
designate a third arbitrator to comprise a panel of three
arbitrators.  The decision of the arbitrator shall be rendered in
writing, shall be final, and may be entered as a judgment in any court in the
State of Washington.  The Employer and the Employee each irrevocably
consent to the jurisdiction of the federal and state courts located in State of
Washington for this purpose.  The arbitrator shall establish the
extent of discovery permitted and shall be authorized to allocate the reasonable
costs of arbitration between the parties.  Notwithstanding the
foregoing, the Employer, in its sole discretion, may bring an action in any
court of competent jurisdiction to seek injunctive relief in order to avoid
irreparable harm and such other relief as the Employer shall elect to enforce
the Employee’s covenants herein.

    


    
      
        
        

      

      
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              12.

            	
              INDEMNIFICATION.

            


    


    The
Employer agrees that if the Employee is made a party, or is threatened to be
made a party, to any action, suit or proceeding, whether civil, criminal,
administrative, or investigative (a “Proceeding”), by reason of the
fact that he is or was a director, officer or employee or the Employer, or is or
was serving at the request of the Employer as a director, officer, member,
employee or agent of another corporation, partnership, limited liability
company, joint venture, trust or other enterprise, including service with
respect to employee benefit plans, whether or not the basis of such Proceeding
is the Employee’s alleged action in an official capacity while serving as a
director, officer, member, employee or agent, the Employee shall be Indemnified
and held harmless by the Employer to the fullest extent permitted or authorized
by law and by the Employer’s articles of incorporation and bylaws.  To
the extent consistent with the foregoing, this obligation to indemnify the
Employee and hold him harmless shall continue even if he has ceased to be a
director, officer, member, employee or agent of the Employer or other such
entity described above, and shall inure to the benefit of the Employee’s heirs,
executors and administrators.  The Employer shall advance to the
Employee all reasonable costs and expenses incurred by him in connection with a
Proceeding within twenty (20) days after receipt by the Employer of a written
request for such advance.  Such request shall include an undertaking
by the Employee to repay the amount of such advance if it shall ultimately be
determined that the Employee is not entitled to be indemnified against such
costs and expenses.

    


    Neither
the failure of the Employer (including its Board, independent legal counsel or
stockholders) to have made a determination before such Proceeding concerning
payment of amounts claimed by the Employee under the paragraph above that
indemnification of the Employee is proper because he has met the applicable
standards of conduct, nor a determination by the Employer (including its Board,
independent legal counsel or stockholders) that the Employee has not met such
applicable standards of conduct, shall create a presumption that the Employee
has not met the applicable standards of conduct.

    


    Employee
understands and acknowledges that the Employer may be required in the future to
undertake with the Securities and Exchange Commission to submit in certain
circumstances the question of indemnification to a court for a determination of
the Employer’s right under public policy to indemnify Employee and the
obligation to indemnify the Employee hereunder shall be expressly subject to the
outcome of such determination.

    


    13.           GENERAL
PROVISIONS.

    


    a.           Notices.  All
notices required or permitted hereunder shall be in writing and shall be deemed
effective: (1) upon personal delivery; (2) upon deposit with the United States
Postal Service, by registered or certified mail, postage prepaid; or (3) in the
case of delivery by nationally recognized overnight delivery service, when
received, addressed as follows:


    
      
         


      

      
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    If to the
Employer to:

    


    Rick
Havenstrite, President

    Desert
Hawk Gold Corp.

    8921 N.
Indian Trail Road, #288

    Spokane,
WA   99208

    


    With a
copy (which shall not constitute notice) to:

    


    Ronald N. Vance

    Attorney at Law

    1656 Reunion Avenue

    Suite 250

    South Jordan,
UT  84095

    


    If to the
Employee, to:

    2719 W. Strong
Road

    Spokane,
WA  99208

    


    or to
such other address or addresses as either party shall designate to the other in
writing from time to time by like notice.

    


    b.          Legal
Expenses.  Except as provided in Section 11 hereof, if any
legal action or other proceeding is brought for the enforcement of this
Agreement, or because of an alleged dispute, breach, default, or
misrepresentation in connection with any of the provisions of this Agreement,
the successful or prevailing party or parties will be entitled to recover
reasonable attorneys’ fees and other costs incurred in that action or
proceeding, in addition to any other relief to which it or they may be
entitled.

    


    c.           Assignability and
Binding Nature.  No rights or obligations may be assigned or
transferred by the Employer except that such rights or obligations may be
assigned or transferred pursuant to a merger or consolidation in which the
Employer is not the continuing entity, or the sale or liquidation of all or
substantially all of the assets of the Employer, provided that the assignee or
transferee is the successor to all or substantially all of the assets of the
Employer and such assignee or transferee assumes the liabilities, obligations,
and duties of the Employer, as contained in this Agreement, either contractually
or as a matter of law.  Notwithstanding any such assignment, the
Employer shall not be relieved from liability under this
Agreement.  The obligations of the Employee are personal and no rights
or obligations of the Employee under this Agreement may be assigned or
transferred by the Employee other than his right to receive compensation and
benefits, provided such assignment or transfer is otherwise permitted by
law.

    


    d.           Amendment.  This
agreement may be amended or modified only by a written instrument executed by
both the Employer and the Employee.


    
      
         


      

      
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    e.           Exhibits.  Each
of the exhibits referenced in this Agreement is annexed hereto and is
incorporated herein by this reference and expressly made a part
hereof.

    


    f.           Pronouns.  Whenever
the context might require, any pronouns used herein shall include the
corresponding masculine, feminine or neuter forms, and the singular forms of
nouns and pronouns shall include the plural, and vice versa.

    


    g.           Captions.  The
captions appearing herein are for convenience of reference only and in no way
define, limit or affect the scope or substance of any section
hereof.

    


    h.           Time.  All
reference herein to periods of days are to calendar days, unless expressly
provided otherwise.  Any reference herein to business days shall mean
any day other than Saturday, Sunday or other day on which commercial banks in
the State of Washington are authorized or required by law to remain
closed.  Where the time period specified herein would end on a weekend
or holiday, the time period shall be deemed to end on the next business
day.

    


    i.           Entire
Agreement.  This Agreement constitutes the entire agreement
between the Employer and the Employee and supersedes all prior agreements and
understandings, whether written or oral relating to the subject matter
hereof.

    


    j.           Severability.  In
case any provision hereof shall be held by a court or arbitrator with
jurisdiction over the Employer or the Employee to be invalid, illegal, or
otherwise unenforceable, such provision shall be restated to reflect as nearly
as possible the original intentions of the Employer and the Employee in
accordance with applicable law, and the validity, legality, and enforceability
of the remaining provisions shall in not way be affected or impaired
thereby.

    


    k.           Waiver.  No
delays or omission by the Employer or the Employee in exercising any right
hereunder shall operate as a waiver of that or any other right.  A
waiver or consent given by the Employer or the Employee or any one occasion
shall be effective only in that instance and shall not be construed as a bar or
waiver of any right on any other occasion.

    


    l.           Governing
Law.  This Agreement shall be construed, interpreted, and
enforced in accordance with the laws of the State of Washington, without regard
to its conflicts of laws principles.

    


    m.          Jurisdiction;
Service of Process. If neither the Employer or the Employee elects to be
governed by the provisions of Section 11 hereof, the parties to this Agreement,
acting for themselves and for their respective successors and assigns, without
regard to domicile, citizenship or residence, hereby expressly and irrevocably
elect as the sole judicial forum for the adjudication of any matters arising
under or in connection with this Agreement, and consent and subject themselves
to the jurisdiction of, the courts of the State of Washington located in County
of Spokane, and/or the United States District Court for the Eastern District of
Washington, in respect of any matter arising under this
Agreement.


    
      
         


      

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

    


    o.           Full
Knowledge.  By their
signatures, the parties acknowledge that they have carefully read and fully
understand the terms and conditions of this Agreement, that each party has had
the benefit of separate counsel, or has been advised to obtain separate counsel,
and that each party has freely agreed to be bound by the terms and conditions of
this Agreement.  To the extent that a party elects not to consult with
such counsel, the party hereby waives any defense to inadequate representation
by counsel.

    


    p.           Construction.  This
Agreement shall be construed as though all parties had drafted it.

    


    q.           Non-Exclusivity
of Remedies.  The rights and remedies of the parties hereto
shall not be mutually exclusive, and the exercise of one or more of the
provisions of this Agreement shall not preclude the exercise of any other
provision.

    


    r.           Remedies.  In
addition to being entitled to exercise all rights provided herein or granted by
law, including recovery of damages, each of the parties hereto will be entitled
to specific performance.  Each of the parties agrees that monetary
damages may not be adequate compensation for any loss incurred by reason of any
breach of obligations described in the foregoing sentence and hereby agrees to
waive in any action for specific performance of any such obligation the defense
that a remedy at law would be adequate.

    


    [SIGNATURE
PAGE FOLLOWS]


    
      
         


      

      
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    IN
WITNESS WHEREOF, each of the parties hereto has executed this Agreement the
respective day and year set forth below.

    


    
      
        
          
            	
                    EMPLOYER:

                  	 
      	
                    Desert
      Hawk Gold Corp.

                  	 
      
	 
      	 
      	 
      	 
      
	
                    Date:  September
      13, 2010

                  	By:
      	
                    /s/ Rick Havenstrite

                  	 
      
	 
      	 
      	
                    Rick
      Havenstrite, President

                  	 
      
	 
      	 
      	 
      	 
      
	
                    EMPLOYEE:

                  	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
                    Date:  September
      13, 2010

                  	/s/ Robert E. Jorgensen	 
      
	 
      	 
      	
                    Robert E. Jorgensen,
      Individually

                  	 
      


          

        

      

    

     

    
      
         


      

      
        15

        
          

        

      

      
         


      

    


    EXHIBIT
A

    TO

    ROBERT
E. JORGENSEN EMPLOYMENT AGREEMENT

    


    DESERT
HAWK GOLD CORP.

    CONFIDENTIAL
INFORMATION AND

    INVENTION
ASSIGNMENT AGREEMENT

     

    As a
condition of my employment with Desert Hawk Gold Corp., its
subsidiaries, affiliates, successors or assigns (together the “Company”), and in
consideration of my employment with the Company and my receipt of the
compensation now and hereafter paid to me by Company, including, but not limited
to, as provided in the Employment Agreement dated September 1, 2010, between the
Company and Robert E. Jorgensen (the “Employment Agreement”), I
agree to the following:

     

    1.           CONFIDENTIAL INFORMATION.

     

    (a)           Company
Information.  I agree at all times during the term of my
employment and thereafter, to hold in strictest confidence, and not to use,
except for the benefit of the Company, or to disclose to any person, firm or
corporation without written authorization of the Board of Directors of the
Company, any Confidential Information of the Company, except under a
non-disclosure agreement duly authorized and executed by the
Company.  I understand that “Confidential Information”
means any non-public information that relates to the actual or anticipated
business or research and development of the Company, technical data, trade
secrets or know-how, including, but not limited to, research, product plans or
other information regarding Company’s products or services and markets therefor,
customer lists and customers (including, but not limited to, customers of the
Company on whom I called or with whom I became acquainted during the term of my
employment), software, developments, inventions, processes, formulas,
technology, designs, drawings, engineering, hardware configuration information,
marketing, finances or other business information.  I further
understand that Confidential Information does not include any of the foregoing
items which have become publicly known and made generally available through no
wrongful act of mine or of others who were under confidentiality obligations as
to the item or items involved or improvements or new versions
thereof.

     

    (b)           Former Employer
Information.  I agree that I
will not, during my employment with the Company, improperly use or disclose any
proprietary information or trade secrets of any former or concurrent employer or
other person or entity and that I will not bring onto the premises of the
Company any unpublished document or proprietary information belonging to any
such employer, person or entity unless consented to in writing by such employer,
person or entity.

     

    (c)           Third Party
Information.  I recognize that
the Company has received and in the future will receive from third parties their
confidential or proprietary information subject to a duty on the Company’s part
to maintain the confidentiality of such information and to use it only for
certain limited purposes.  I agree to hold all such confidential or
proprietary information in the strictest confidence and not to disclose it to
any person, firm or corporation or to use it except as necessary in carrying out
my work for the Company consistent with the Company’s agreement with such third
party.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    2.           INVENTIONS.

     

    (a)           Inventions
Retained and Licensed.  I have attached
hereto, as Exhibit A-1, a
list describing all inventions, original works of authorship, developments,
improvements, and trade secrets which were made by me prior to my employment
with the Company (collectively referred to as “Prior Inventions”), which
belong to me, which relate to the Company’s proposed business, products or
research and development, and which are not assigned to the Company hereunder;
or, if no such list is attached, I represent that there are no such Prior
Inventions.  If in the course of my employment with the Company, I
incorporate into a Company product, process or service a Prior Invention owned
by me or in which I have an interest, I hereby grant to the Company a
nonexclusive, royalty-free, fully paid-up, irrevocable, perpetual, worldwide
license to make, have made, modify, use and sell such Prior Invention as part of
or in connection with such product, process or service, and to practice any
method related thereto.

     

    (b)           Assignment of
Inventions.  I agree that I
will promptly make full written disclosure to the Company, will hold in trust
for the sole right and benefit of the Company, and hereby assign to the Company,
or its designee, all my right, title, and interest in and to any and all
inventions, original works of authorship, developments, concepts, improvements,
designs, discoveries, ideas, trademarks or trade secrets, whether or not
patentable or registrable under copyright or similar laws, which I may solely or
jointly conceive or develop or reduce to practice, or cause to be conceived or
developed or reduced to practice, during the period of time I am in the employ
of the Company (collectively referred to as “Inventions”), except as
provided in Section 2(F) below.  I further acknowledge that all
original works of authorship which are made by me (solely or jointly with
others) within the scope of and during the period of my employment with the
Company and which are protectible by copyright are “works made for hire,” as
that term is defined in the United States Copyright Act.  I understand
and agree that the decision whether or not to commercialize or market any
invention developed by me solely or jointly with others is within the Company’s
sole discretion and for the Company’s sole benefit and that no royalty will be
due to me as a result of the Company’s efforts to commercialize or market any
such invention.

     

    (c)           Inventions
Assigned to the United States.  I agree to assign
to the United States government all my right, title, and interest in and to any
and all Inventions whenever such full title is required to be in the United
States by a contract between the Company and the United States or any of its
agencies.

     

    (d)           Maintenance of
Records.  I agree to keep
and maintain adequate and current written records of all Inventions made by me
(solely or jointly with others) during the term of my employment with the
Company.  The records will be in the form of notes, sketches,
drawings, and any other format that may be specified by the
Company.  The records will be available to and remain the sole
property of the Company at all times.


    
      
         


      

      
        2

        
          

        

      

      
         


      

    

     

    (e)           Patent and
Copyright Registrations.  I agree to assist
the Company, or its designee, at the Company’s expense, in every proper way to
secure the Company’s rights in the Inventions and any copyrights, patents, mask
work rights or other intellectual property rights relating thereto in any and
all countries, including the disclosure to the Company of all pertinent
information and data with respect thereto, the execution of all applications,
specifications, oaths, assignments and all other instruments which the Company
shall deem necessary in order to apply for and obtain such rights and in order
to assign and convey to the Company, its successors, assigns, and nominees the
sole and exclusive rights, title and interest in and to such Inventions, and any
copyrights, patents, mask work rights or other intellectual property rights
relating thereto.  I further agree that my obligation to execute or
cause to be executed, when it is in my power to do so, any such instrument or
papers shall continue after the termination of this Agreement.  If the
Company is unable because of my mental or physical incapacity or for any other
reason to secure my signature to apply for or to pursue any application for any
United States or foreign patents or copyright registrations covering Inventions
or original works of authorship assigned to the Company as above, then I hereby
irrevocably designate and appoint the Company and its duly authorized officers
and agents as my agent and attorney in fact, to act for and in my behalf and
stead to execute and file any such applications and to do all other lawfully
permitted acts to further the prosecution and issuance of letters patent or
copyright registrations thereon with the same legal force and effect as if
executed by me.

    Exception to
Assignments.  I understand that
the provisions of this Agreement requiring assignment of Inventions to the
Company do not apply to any invention that I developed entirely on my own time
without using the Company’s equipment, supplies, facilities, or trade secret
information, except for those inventions that
either:  (i)  relate at the time of conception or reduction
to practice of the invention to the Company’s business, or actual or
demonstrably anticipated research or development of the Company; or
(ii)  result from any work performed by me for the
Company.

     

    3.           CONFLICTING
EMPLOYMENT.  I agree that, during the
term of my employment with the Company, my obligations regarding conflicting
employment, or potentially conflicting employment, will be governed by the
Employment Agreement.

     

    4.           RETURNING
COMPANY DOCUMENTS.  I agree that, at the time of leaving the
employ of the Company, I will deliver to the Company (and will not keep in my
possession, recreate or deliver to anyone else) any and all devices,
records, data, notes, reports, proposals, lists, correspondence, specifications,
drawings blueprints, sketches, materials, equipment, other documents or
property, or reproductions of any aforementioned items developed by me pursuant
to my employment with the Company or otherwise belonging to the Company, its
successors or assigns, including, without limitation, those records maintained
pursuant to paragraph 2(D).  In
the event of the termination of my employment, I agree to sign and deliver the
“Termination Certification” attached hereto as Exhibit A-2.

     

    5.           NOTIFICATION
OF NEW EMPLOYER.  In the event that I leave the employ of the
Company, or become employed by other employers, I hereby grant consent to
notification by the Company to my other employers about my rights and
obligations under this Agreement.


    
      
         


      

      
        3

        
          

        

      

      
         


      

    

     

    6.           CONFLICT
OF INTEREST GUIDELINES.  I agree to diligently adhere to the
Conflict of Interest Guidelines attached as Exhibit A-3
hereto.

     

    7.           REPRESENTATIONS.  I
agree to execute any proper oath or verify any proper document required to carry
out the terms of this Agreement.  I represent that my performance of
all the terms of this Agreement will not breach any agreement to keep in
confidence proprietary information acquired by me in confidence or in trust
prior to my employment by the Company.  I hereby represent and warrant
that I have not entered into, and I will not enter into, any oral or written
agreement in conflict herewith.

     

    8.           GENERAL
PROVISIONS.  This Agreement shall be subject to the Employment
Agreement, including, but not limited to, the General Provisions of Section 13
thereof, which agreement is incorporated herein by this reference.

     

    
      
        
          
            	
                    Date:  September
      13, 2010

                  	 
      	
                    /s/ Robert E. Jorgensen

                  
	 
      	 
      	
                    Robert
      E. Jorgensen, Employee

                  
	
                    Witness:

                  	 
      	 
      
	 
      	 
      	 
      
	
                    /s/ Paul M. Helgerson

                  	 
      	 
      
	
                    Signature

                  	 
      	 
      
	 	 	 
	
                    Paul M. Helgerson

                  	 
      	 
      
	
                    Name
      (typed or printed)

                  	 
      	 
      


          

        

      

    

     

    
      
         


      

      
        4

        
          

        

      

      
         


      

    

     

    Exhibit A-1

     

    LIST
OF PRIOR INVENTIONS

    AND
ORIGINAL WORKS OF AUTHORSHIP

    


    
      	
              
                 

                Title

              

            	 	
              
                 

                Date

              

            	 	
              
                Identifying
      Number or Brief

                Description

              

            
	 
      	 	 
      	 	 
      
	 
      	 	 
      	 	 
      


    

     

    ___  No
inventions or improvements

    ___  Additional
Sheets Attached

     

    
      
        	
                Signature
      of Employee:

              	 
      	
                /s/ Robert E. Jorgensen

              	 
      
	 
      	 
      	
                Robert
      E. Jorgensen

              	 
      


      

    

     

    Date:  September
13, 2010


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    Exhibit A-2

     

    DESERT
HAWK GOLD CORP.

     

    TERMINATION
CERTIFICATION

    This is
to certify that I do not have in my possession, nor have I failed to return, any
devices, records, data, notes, reports, proposals, lists, correspondence,
specifications, drawings, blueprints, sketches, materials, equipment, other
documents or property, or reproductions of any aforementioned items belonging to
Desert Hawk Gold Corp.,
its subsidiaries, affiliates, successors or assigns (together, the “Company”).

    I further
certify that I have complied with all the terms of the Company’s Employment,
Confidential Information and Invention Assignment Agreement signed by me,
including the reporting of any inventions and original works of authorship (as
defined therein), conceived or made by me (solely or jointly with others)
covered by that agreement.

    I further
agree that, in compliance with the Employment, Confidential Information and
Invention Assignment Agreement, I will preserve as confidential all trade
secrets, confidential knowledge, data or other proprietary information relating
to products, processes, know-how, designs, formulas, developmental or
experimental work, computer programs, data bases, other original works of
authorship, customer lists, business plans, financial information or other
subject matter pertaining to any business of the Company or any of its
employees, clients, consultants or licensees.

     

    Date:                                                                

     

    
      
        
          	 
      	 
      
	 
      	
                  Robert
      E. Jorgensen

                


        

      

    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    Exhibit A-3

     

    DESERT
HAWK GOLD CORP.

     

    CONFLICT
OF INTEREST GUIDELINES

    It is the
policy of Desert Hawk Gold
Corp. to conduct its affairs in strict compliance with the letter and
spirit of the law and to adhere to the highest principles of business
ethics.  Accordingly, all officers, employees and independent
contractors must avoid activities which are in conflict, or give the appearance
of being in conflict, with these principles and with the interests of the
Company.  The following are potentially compromising situations which
must be avoided.  Any exceptions must be reported to the CEO or to the
Board of Directors and written approval for continuation must be
obtained.

    1.           Revealing
confidential information to outsiders or misusing confidential
information.  Unauthorized divulging of information is a violation of
this policy whether or not for personal gain and whether or not harm to the
Company is intended.

    2.           Accepting
or offering substantial gifts, excessive entertainment, favors or payments which
may be deemed to constitute undue influence or otherwise be improper or
embarrassing to the Company.

    3.           Initiating
or approving personnel actions affecting reward or punishment of employees or
applicants where there is a family relationship or is or appears to be a
personal or social involvement.

    4.           Initiating
or approving any form of personal or social harassment of
employees.

    5.           Investing
or holding outside directorship in suppliers or customers, including financial
speculations, where such investment or directorship might influence in any
manner a decision or course of action of the Company.

    6.           Borrowing
from or lending to employees, customers or suppliers.

    7.           Acquiring
real estate, mining or other property of interest to the Company.

    8.           Improperly
using or disclosing to the Company any proprietary information or trade secrets
of any former or concurrent employer or other person or entity with whom
obligations of confidentiality exist.

    9.           Unlawfully
discussing prices, costs, customers, sales or markets with competing companies
or their employees.

    10.           Making
any unlawful agreement with distributors with respect to prices.

    11.           Improperly
using or authorizing the use of any inventions which are the subject of patent
claims of any other person or entity.

    12.           Knowingly
permitting the Company to enter into a contract, agreement, or transaction with
another corporation, firm or association in which one or more of the directors
or officers of the Company are directors or officers or are financially
interested in the other entity.

    13.           Making
or authorizing a payment to a foreign office, a foreign political party or party
office, or any candidate for a foreign political office for the purpose of
obtaining or retaining business for or with, or directing business to, the
Company with the intent to induce the recipient to misuse his official position
to direct business wrongfully to the Company or any other
person.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

    


    14.           Knowingly
permitting the Company to make loans or extend credit to its directors or
executive officers.

    Each
officer, employee and independent contractor must take every necessary action to
ensure compliance with these guidelines and to bring problem areas to the
attention of higher management for review.  Violations of this
conflict of interest policy may result in discharge.


    
      
         


      

      
        2