NOTE AND TRUST DEED MODIFICATION AGREEMENT


OF MAY 2009








I.           BACKGROUND:  Effective August 5, 2005, the undersigned Calais Resources, Inc, a British Columbia corporation (“Calais-BC”), and Calais Resources Colorado, Inc, a Nevada corporation (“Calais-CO”) (collectively, the “Calais Companies”) executed a promissory note (the “Note”) in which Calais-BC and Calais-CO promised to pay Duane A. Duffy, Glenn E. Duffy, James Ober, and Luke Garvey (Holders herein) the sum of $807,650.11.  Concurrently, the Calais Companies and the Holders entered into a Security Agreement, pursuant to which the Calais Companies executed a deed of trust encumbering certain real property located in Boulder County, Colorado.  On or about December 15, 2005, the Calais Companies made a principal payment due under the Note in the amount of $166,000.  In March 2007, following a default by the Calais Companies on further payments, the Note was modified and extended to require monthly installment payments of $75,000.00 on the fifteenth (15th) day of each month, beginning April 15, 2007 and continuing until the entire Note balance was paid.  No monthly payments were made by the Calais Companies.  On or about March 31, 2007, the Calais Companies made a further payment of $200,000 on the amount due and payable.  In November 2007, the Calais Companies and the Holders agreed to a further modification of the Note to extend repayment terms through April 1, 2008, pending the expected resolution by the Calais Companies of certain financial issues.  Subsequent to the April Agreement on April 1, 2008 Calais made a payment of $100,000, an additional payment of $50,000 on May 1, 2008, and an additional payment of $25,000 on June 20, 2008.  As of August 1, 2008 the agreed to balance is $816,800.07.  A payment in the amount of $12,500 was made on August 5, 2008.  Subsequent to the new note Agreement of January 2009 – no payments have been made.  A new note agreement was subsequently entered into date May 1, 2009 with the following agreement between the parties.





In the interest of assuring full payment of all principal and interest due under the Note as modified, the Calais Companies and the Holders now agree to revise and amend the terms of the Note further, as follows:





II.           AGREEMENTS OF THE PARTIES:





A.
The balance due under the Note as of May 1, 2009 shall be US$906,770.99 as set forth on attached Exhibit 1.  Commencing May 1, 2009, interest on the unpaid balance shall accrue at a rate of 15.9 percent per annum through the date on which the unpaid balance is paid in full.  The new note settlement date has been set as December 31, 2009 with all payments due at that time.  However, if Calais Resources, Inc. is successful in securing outside funding prior to December 31, 2009, the Company agrees to settle the note balance with the Duffy Group within 10 days of sufficient funding for Calais.















B.
The Calais Companies shall make a note extension payment of $100,000 effective as of May 1, 2009, in the form of Calais shares and full warrants.  The share price will be set at US$ 0.08 per share and the warrant price will be set at US$ 0.12 with an expiration date of January 1, 2020.  The 1,250,000 shares will be issued as per the distribution as shown below.  These shares will be restricted with the normal legend as required under Rule 144.




C.
Calais shall also issue the shares and warrants to the Duffy Group as summarized below.





Name                                      New Shares                                                      New Warrants





Duane Duffy                                          504,683                                               504,683





Glenn Duffy                                          504,683                                               504,683





James Ober                                          120,317                                                120,317





Luke Garvey                                          120,317                                                120,317










D.
All payments to Holders by the Calais Companies, shall be delivered to each Holder directly in accordance with the following allocation:





Duane A. Duffy – 40.3746 %


Glenn E. Duffy  – 40.3746 %


James Ober       --   9.6254 %


Luke Garvey     --   9.6254 %




All modifications of the Note described herein shall also modify the terms of the deed of trust and security agreement referenced herein.  All other terms of the Note and such deed of trust and security agreement shall remain in full force and effect.





Executed on the dates shown below by:














CALAIS RESOURCES, INC.


CALAIS RESOURCES COLORADO, INC.By:  _______________________________


By: __________________________David K. Young


David K. YoungPresident and Chief Executive Officer


President and Chief Executive Officer
 STATE OF COLORADO                  )
 ) ss.
 COUNTY OF ____________         )
 
 On this ____ day of _______________, 2009, before the undersigned officer, personally appeared David K. Young, who acknowledged himself to be the President and Chief Executive Officer of Calais Resources, Inc. and Calais Resources Colorado, Inc., and who, as such, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing on behalf of each such corporation.
  IN WITNESS WHEREOF, I hereunto set my hand and official seal.
 
 My Commission Expires:                                                                           ___________________________________
 Notary Public
  
 
 
 Duane A. Duffy
 
 
 ________________                                                                      ___________________________________
 Date                                                                 Duane A. Duffy
 
 STATE OF COLORADO                  )
 ) ss.
 COUNTY OF ____________         )
 
 The foregoing instrument was acknowledged before me on this _____ day of ________, 2009, by Duane A. Duffy.
 
 My Commission Expires:                                                                           ___________________________________
 Notary Public
  
 
 
 Glenn E. Duffy
 
 
 __________________________________
 Date                                                                       Glenn E. Duffy
 
  STATE OF FLORIDA                       )
 ) ss.
 COUNTY OF ____________         )
 
 The foregoing instrument was acknowledged before me on this _____ day of ________, 2009, by Glenn E. Duffy.
 
 My Commission Expires:                                                                           ___________________________________
 Notary Public
  
 
 
 Luke Garvey
 
 
 __________________________________
 Date:                                                                           Luke Garvey
  
 STATE OF______________          )
 ) ss.
 COUNTY OF ____________         )
 
 The foregoing instrument was acknowledged before me on this _____ day of ________, 2009, by Luke Garvey.
 
 My Commission Expires:                                     ___________________________________
 Notary Public
  
 
 
 James Ober
 
 
 __________________________________
 Date:                                                                           James Ober
 
  STATE OF______________          )
 ) ss.
 COUNTY OF ____________         )
 
 The foregoing instrument was acknowledged before me on this _____ day of ________, 2009, by James Ober.
 
 My Commission Expires:                                   ___________________________________
 Notary Public


Exhibit 1










Calculation of Note Principal as of May 1, 2009














Item
Interest / Day
Days
Amount
New PrincipalPrincipal and interest due as of August 1, 2008:



$816,800.07Payment - $12,500 on August 5, 2008


$12,500.00
804,300.07Per Diem Interest Accruing since August 1, 2008 to Sept 1, 2008 at 15.9% APR
$350.37
31
10,861.36
$815,161.43Per Diem Interest Accruing since Sept 1, 2008 to Dec 31, 2008 at 15.9% APR
$355.10
122
$43,321.92
858,483.35Late Fees for Sept, Oct, Nov, Dec 2008 with interest


$3,241.84
861,725.19Total Amount Due – Dec 31, 2008



$861,725.19Per Diem Interest Accruing from December 31, 2008 to May 1, 2009 at 15.9 % APR
375.38
120
45,045.80
$906,770.99