Filed by Automated Filing Services Inc. (604) 609-0244 - Mantra Venture Group Ltd. - Exhibit 10.4






Mantra Venture Group Ltd. 
207 West Hastings
Street, Suite 1209, Vancouver, BC V6B 1H7 

CONSULTING AGREEMENT 

THIS AGREEMENT (the
"Agreement") effective as of the _1st___ day of September, 2007 (the
“Effective Date”), entered into between Mantra Venture Group Ltd.
(the "Company") and _John Russell_ (the “Consultant”) in
connection with the provision of Consultant’s services to Company. 

WHEREAS:

A.       
     Company is in the business of acquiring and developing
technology for the sustainable production of energy and other resources. 

B.            
Company wishes to engage the services of Consultant as an independent contractor
of Company; and

THIS AGREEMENT WITNESSES THAT in consideration of the
premises and mutual covenants contained in this Agreement and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound hereby, agree as
follows: 

1.            
ENGAGEMENT AS A CONSULTANT 

1.1          
Company hereby engages Consultant as an independent contractor of Company, to
undertake the duties and exercise those powers as requested by Company or its
subsidiaries from time to time, (collectively the “Services”) and
Consultant accepts such engagement on the terms and conditions set forth in this
Agreement. 

2.           
 TERM OF THIS AGREEMENT 

2.1          
The term of this Agreement shall begin as of the Effective Date and shall
continue until terminated pursuant to Sections 13 or 14 herein (the
“Term”). 

3.            
CONSULTANT SERVICES 

3.1          
The Services to be provided by Consultant shall include but shall not be limited
to the following executive consulting services: 

(a) __VP, Technology Evaluation
_______________________________

(b) ___Other duties as
required______________________________


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3.2          
In providing the Services Consultant shall: 

	
  comply with all applicable federal, provincial, local and foreign statutes,
  laws and regulations; 

  
	
  not make any misrepresentation or omit to state any material fact which
  results in a misrepresentation regarding the business of Company; 

  
	
  not disclose, release or publish any information regarding Company without
  the prior written consent of Company; and 

  
	
  subject to section 5 herein, not employ any person in any capacity, or
  contract for the purchase or rental of any service, article or material, nor
  make any commitment, agreement or obligation whereby Company shall be required
  to pay any monies or other consideration without Company's prior written
  consent in each instance. 



4.            
CONSULTANT COMPENSATION 

4.1          
Monthly Rate. As consideration for the provision of the Services, Company
shall compensate Consultant at the gross rate of CDN$2,500.00 per month, payable
on Company’s first pay period following completion of each month during the term
during which Consultant provides the Services (the “Compensation”).
Company’s obligation to pay any applicable Compensation shall be subject to
receipt by Company of Consultant’s invoice regarding same.

4.2          
Shares and Options. As further compensation for the provision of the
Services, Company shall grant Consultant the following securities: 

	 	(a) 	
      options to purchase up to 100,000 common shares in the
      common stock of Company at a price of US$0.25 per share, exercisable
      within two years after the date such option is granted or upon the
      termination of this Agreement, whichever occurs earlier (the
      “Option”), the whole subject to the option agreement between
      Company and Consultant dated concurrently herewith.

	 	 	 
	 	(b) 	
      25,0000 restricted shares in the common stock of the
      Company (the “Shares”), subject to the terms of the subscription agreement
      between Company and the Consultant dated concurrently
  herewith.



5.            
NO REIMBURSEMENT OF EXPENSES 

5.1          
The parties agree that the Compensation hereunder shall be inclusive of any and
all fees or expenses incurred by Consultant on Consultant’s own behalf pursuant
to this Agreement including but not limited to the costs of rendering the
Services. Notwithstanding the foregoing, Company shall reimburse Consultant for
any bona fide expenses incurred by Consultant on behalf of Company in connection
with the provision of the Services provided that Consultant submits to Company
an itemized written account of such expenses and corresponding receipts of
purchase in a form acceptable to Company within 10 days after Consultant incurs
such expenses. However, Company shall have no obligation to reimburse
Executive for any single expense in excess of CDN$500 or CDN $3,000.00 in the
aggregate without the express prior written approval of the Board of Directors.


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6.           
 FIRST PRIORITY SERVICES 

6.1          
Consultant shall at all times faithfully and in a professional manner perform
all of the duties that may be reasonably required of Consultant pursuant to the
terms of this Agreement. Consultant’s services hereunder shall be provided on a
non-exclusive, first priority basis to Company and Consultant shall be
restricted from engaging in other business activities during the Term that may
conflict with the provision of the Services to Company on a first-priority
basis. 

7.            
CONFIDENTIALITY 

7.1          
Consultant shall not disclose to any third party without the prior consent of
Company any financial or business information concerning the business, affairs,
plans and programs of Company its Directors, officers, shareholders, employees,
or consultants (the "Confidential Information"). Consultant shall not be
bound by the foregoing limitation in the event (i) the Confidential Information
is otherwise disseminated and becomes public information or (ii) Consultant is
required to disclose the Confidential Informational pursuant to a subpoena or
other judicial order. As a material inducement to Company entering into this
Agreement, Consultant shall, at Company’s request, execute a confidentiality and
non-disclosure agreement in a form approved by Company. 

8.            
NON-COMPETITION AND NON-SOLICITATION 

8.1          
As a material inducement to Company for entering into this Agreement, Consultant
covenants as follows: 

	 	(a) 	
      during the Term and for a period of 24 months following
      the Term, Consultant shall not, for any reason, directly or indirectly,
      whether as an individual, partner, joint venturer, executive, employee,
      consultant, principal, affiliate, agent, shareholder, officer or director
      of any individual or entity, solicit or accept business with respect to
      products competitive with those of Company from any of Company’s customers
      situate in the Americas.

	 	 	 
	 	(b) 	
      during the Term and for a period of 24 months following
      the Term, Consultant shall not hire or take away or cause to be hired or
      taken away any consultant or employee who was in the employ of Company at
      any time during that period.

	 	 	 
	 	(c) 	
      during the Term and for a period of 24 months following
      the Term, Consultant shall not, for any reason, directly or indirectly,
      whether as an individual, partner or joint venturer, employee, consultant,
      contractor, affiliate, principal, agent, shareholder, officer or director,
      of any person or entity or in any other manner, carry on, be engaged in,
      concerned with, interested in, advise, lend money to, guarantee the debts
      or obligations of, or permit Consultant’s name or likeness to be used or
      employed by any person or entity concerned with, engaged in or having an
      interest in, any business which is the same as, or competitive with, the
      business of Company, including, without limitation, any business relating
      to the alternative energy industry or environmentally sustainable
      technology, within the geographical area of North America. Consultant
      shall, however, be entitled, for investment purposes, to purchase and
      trade shares of a public company which are listed
and



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posted for trading on a recognized
stock exchange the business of which public company is in competition with the
business of Company, so long as Consultant shall not directly or indirectly own
more than 10% of the issued share capital of the public company, or participate
in its management or operation or act in any advisory capacity to such public
company. 

9.            
GRANTS OF RIGHTS AND INSURANCE 

9.1          
Consultant agrees that the results and proceeds of the Services under this
Agreement, although not created in an employment relationship, shall, for the
purpose of copyright only, be deemed a work made in the course of employment
under the Canadian law or a work-made-for-hire under the United States law and
all other comparable international intellectual property laws and conventions.
All intellectual property rights and any other rights (including, without
limitation, all copyright) which Consultant may have in and to any work,
materials, or other results and proceeds of the Services hereunder shall vest
irrevocably and exclusively with Company and are otherwise hereby assigned to
Company as and when created. Consultant hereby waives any moral rights of
authors or similar rights Consultant may have in or to the results and proceeds
of the Consulting Services hereunder.

9.2          
Company shall have the right to apply for and take out, at Company's expense,
life, health, accident, or other insurance covering Consultant, in any amount
Company deems necessary to protect Company's interest hereunder. Consultant
shall not have any right, title or interest in or to such insurance. 

10.          
REPRESENTATIONS AND WARRANTIES 

10.1          Consultant
represents, warrants and covenants to Company as follows:

(a) Consultant is not under any
contractual or other restriction which is inconsistent with the execution of
this Agreement, the performance of the Services hereunder or any other rights of
Company hereunder; 

(b) Consultant is not under any
physical or mental disability that would hinder the performance of his duties
under this Agreement; 

11.          
INDEMNIFICATION 

11.1          Consultant
shall indemnify and hold harmless Company, its partners, financiers parent,
affiliated and related companies, and all of their respective individual
shareholders, directors, officers, employees, licensees and assigns from and
against any claims, actions, losses and expenses (including legal expenses)
occasioned by any breach by Consultant of any representations and warranties
contained in, or by any breach of any other provision of, this Agreement by
Consultant. 

12.          
NO OBLIGATION TO PROCEED.

12.1          Nothing
herein contained shall in any way obligate Company to use the Services hereunder
or to exploit the results and proceeds of the Services hereunder; provided that,
upon the condition that Consultant is not in material default of the terms and
conditions hereof, nothing contained in this section 12.1 shall relieve Company
of its obligation to deliver to Consultant the Compensation. All of the
foregoing shall be subject to the other terms and 

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conditions of this Agreement (including, without limitation,
Company’s right of termination, disability and default). 

13.          
RIGHT OF TERMINATION.

13.1          Company
and Consultant shall each have the right to terminate this Agreement at any time
in its sole discretion by giving not less than 2 weeks written notice to the
other of same. In the event of such termination, Company shall deliver to
Consultant only that portion of the Compensation that has accrued as calculated
on a daily pro-rated basis. Company’s right of termination pursuant to this
section 13.1 shall be in addition to Company’s rights pursuant to below section
14.

14.          
DEFAULT/DISABILITY.

14.1          No
act or omission of Company hereunder shall constitute an event of default or
breach of this Agreement unless Consultant shall first notify Company in writing
setting forth such alleged breach or default and Company shall cure said alleged
breach or default within 10 days after receipt of such notice (or commence said
cure within said ten days if the matter cannot be cured in ten days, and shall
diligently continue to complete said cure). Upon any material breach or default
by Consultant of any of the terms and conditions hereof, or the terms and
conditions of any other agreement between Company and Consultant for the
services of Consultant, Company shall immediately have the right to suspend or
to terminate this Agreement and any other agreement between Company and
Consultant for the services of Consultant.

14.2          Upon
any disability or incapacity of Consultant which prevents Consultant from fully
performing or complying with the terms and conditions hereof, Company shall
immediately have the right to suspend this Agreement. If such disability or
incapacity shall continue for more than 3 consecutive business days or 5
business days in the aggregate, Company shall immediately have the right,
exercisable at any time after such 3 or 5 day period, to continue such
suspension or terminate this Agreement by so notifying Consultant in
writing.

14.3          During
the period of any suspension hereunder or upon any termination hereof,
Consultant shall not be entitled to any further compensation hereunder;
provided, that if such suspension or termination is a result of a disability or
incapacity (and not a default or breach), Consultant shall be entitled to a
portion of the Compensation equal to the fair market value of the Consulting
Services that have been rendered prior to the date of the event giving rise to
such suspension and/or termination, the whole subject to the Discretion of the
Board of Director’s of Company. If Company has the choice to continue a
suspension hereunder or to terminate and Company elects to continue the
suspension, then Company may terminate the Agreement by written notice to
Consultant during the period of any such continued suspension. Nothing contained
hereinabove shall in any manner limit any other remedy which Company may have
against Consultant (including without limitation, the right to offset Company's
damages caused by Consultant's default or breach hereof from and against any
compensation due to Consultant hereunder). Company's failure to suspend and/or
terminate this Agreement during periods when it may do so and/or Company's
payment of the Compensation to Consultant during any period of suspension, shall
not be deemed a waiver of Company's right to later suspend and/or terminate this
Agreement or withhold further compensation due to Consultant. A material breach
of any other agreement between the parties may, at Company's election, be deemed
a material breach of this Agreement. 

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15.          
COMPANY'S REMEDIES.

15.1          The
services to be rendered by Consultant hereunder and the rights and privileges
herein granted to Company are of a special, unique, unusual, extraordinary and
intellectual character which gives them a peculiar value, the loss of which
cannot be reasonably or adequately compensated in damages in an action at law,
it being understood and agreed that a breach by Consultant of any of the
provisions of this Agreement shall cause Company irreparable injury and damages.
Consultant expressly agrees that Company shall be entitled to seek injunctive
and/or other equitable relief to prevent a breach hereof Consultant. Resort to
such equitable relief, however, shall not be construed as a waiver of any other
rights or remedies which Company may have in the premises for damages or
otherwise. 

16.          
CONSULTANT’S REMEDIES.

	16.1 	
      In the event of any breach by Company of this Agreement,
      Consultant shall be limited to its remedies at law for damages, if any,
      and shall not have the right to terminate or rescind this Agreement or to
      in any way enjoin or restrain the operations or activities of
    Company.



17.          
INDEPENDENT CONTRACTORS.

17.1         
Nothing herein shall be construed as creating a partnership, joint venture, or
master-servant relationship between the parties for any purpose whatsoever.
Except as may be expressly provided herein, neither party may be held
responsible for the acts either of omission or commission of the other party,
and neither party is authorized, or has the power, to obligate or bind the other
party by contract, agreement, warranty, representation or otherwise in any
manner. It is expressly understood that the relationship between the parties is
one of independent contractors.

18.          
MISCELLANEOUS PROVISIONS 

	 	(a) 	
      Time. Time is of the essence of this
      Agreement.

	 	 	 
	 	(b) 	
      Presumption. This Agreement or any section
      thereof shall not be construed against any party due to the fact that said
      Agreement or any section thereof was drafted by said party.

	 	 	 
	 	(c) 	
      Titles and Captions. All article, section
      and paragraph titles or captions contained in this Agreement are for
      convenience only and shall not be deemed part of the context nor affect
      the interpretation of this Agreement.

	 	 	 
	 	(d) 	
      Further Action. The parties hereto shall
      execute and deliver all documents, provide all information and take or
      forbear from all such action as may be necessary or appropriate to achieve
      the purposes of this Agreement.

	 	 	 
	 	(e) 	
      Savings Clause. If any provision of this
      Agreement, or the application of such provision to any person or
      circumstance, shall be held invalid, the remainder of this Agreement, or
      the application of such provision to persons or circumstances other than
      those as to which it is held invalid, shall not be affected
  thereby.



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	 	(f) 	
      Assignment. Company may assign this
      Agreement, in whole or in part, at any time to any party, as Company shall
      determine in its sole discretion; provided that, no such assignment shall
      relieve Company of its obligations hereunder unless consented to by
      Consultant in writing. Consultant may not assign this Agreement without
      the prior written consent of Company in its sole discretion.

	 	 	 
	 	(g) 	
      Notices. All notices required or permitted
      to be given under this Agreement shall be given in writing and shall be
      delivered, either personally or by express delivery service, to the party
      to be notified. Notice to each party shall be deemed to have been duly
      given upon delivery, personally or by courier, addressed to the attention
      of the officer at the address set forth heretofore, or to such other
      officer or addresses as either party may designate, upon at least ten days
      written notice, to the other party.

	 	 	 
	 	(h) 	
      Entire agreement. This Agreement contains
      the entire understanding and agreement among the parties. There are no
      other agreements, conditions or representations, oral or written, express
      or implied, with regard thereto. This Agreement may be amended only in
      writing signed by all parties.

	 	 	 
	 	(i) 	
      Waiver. A delay or failure by any party to
      exercise a right under this Agreement, or a partial or single exercise of
      that right, shall not constitute a waiver of that or any other
    right.

	 	 	 
	 	(j) 	
      Counterparts. This Agreement may be
      executed in duplicate counterparts, each of which shall be deemed an
      original, but all of which together shall constitute one and the same
      Agreement. In the event that the document is signed by one party and faxed
      to another the parties agree that a faxed signature shall be binding upon
      the parties to this agreement as though the signature was an
    original.

	 	 	 
	 	(k) 	
      Successors. The provisions of this
      Agreement shall be binding upon all parties, their successors and
      permitted assigns.

	 	 	 
	 	(l) 	
      Counsel. The parties expressly acknowledge
      that each has been advised to seek separate counsel for advice in this
      matter and has been given a reasonable opportunity to do
  so.



IN WITNESS WHEREOF, the parties have duly executed and
delivered this Agreement as of the date first written above. 

	MANTRA VENTURE GROUP LTD. 	 
	 	 
	Per: 	 
	 	 
	/s/ Larry
    Kristof 	 
	Larry Kristof, President 	 
	  	 
	 	 
	CONSULTANT: 	 
	 	 
	/s/ John
Russell	 
	John Russell 	 


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