Document:

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MAY 31, 2001                                            PAYMENT DUE MAY 31, 2011

                          FORM OF CONVERTIBLE DEBENTURE

WHEREAS:

     A.   CALAIS RESOURCES, INC., a company duly incorporated under the laws of
          the Province of British Columbia, having an office at c/o P.O. Box
          427. Chilliwack, British Columbia V2P 6J7 (the "Company") will be
          indebted to Aardvark Agencies Inc., of #101 - 9482 Williams Street,
          Chilliwack, British Columbia V2P 5G1 (the "Holder") in the amount of
          $747,728.47 (the "Principal Amount") in lawful currency of Canada;

     B.   The Company has agreed to secure its obligations to pay the Principal
          Amount to the Holder by the issue and delivery to the Holder of this
          Debenture; and

     C.   The Company has agreed that the Principal Amount may be converted into
          shares of the Company at the option of the Holder on the terms herein
          contained.

NOW THEREFORE THIS DEBENTURE WITNESSES THAT:

1.0      PROMISE TO PAY

         1.1      For the value received, the Company promises to pay the
                  outstanding amount of the Principal Amount to the order of the
                  Holder on or before May 31, 2011.

         1.2      The Company will pay to the Holder on demand the amount of all
                  expenses including, without limiting the generality of the
                  foregoing, all legal fees and other costs, charges and
                  expenses incurred by the Holder relating to the registration
                  of the Debenture, or in recovering or enforcing payment of the
                  moneys hereby due and owing, all of which together with
                  interest thereon at the rate provided for in this Debenture
                  will be secured hereby, and in default of payment thereof all
                  remedies hereunder and at law and in equity will be
                  exercisable.

2.0      INTEREST

         2.1      No interest will be payable on the Principal Amount.

3.0      SECURITY

         3.1      This Debenture shall be unsecured.

4.0      CONVERSION OF PRINCIPAL AMOUNT INTO SHARES

         4.1      The Holder may at any time prior to May 31, 2011 by notice in
                  writing addressed to the Company at P.O. Box 427, Chilliwack,
                  British Columbia, V2P 6J7 require the Company to allot and
                  issue to the Holder or its designee,
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                  in exchange for and in satisfaction of some or all of the
                  outstanding amount of the Principal Amount of the Debenture
                  owed to the Holder, fully paid common shares of the Company at
                  a price of $1.23 per common share.

         4.2      The Company shall, not later than 10 days from the date of
                  such notice issue to the Holder, in accordance with such
                  notice, so many shares as is properly specified in the said
                  notice, at which time the value of the converted shares shall
                  be deducted from the principal sum due and owing to the Holder
                  under this Debenture.

         4.3      The Company shall be entitled to a release and discharge of
                  this Debenture upon full payment and satisfaction of all
                  obligations hereunder, and upon written request of the Company
                  and payment of all costs, charges and expenses incurred by the
                  Holder in connection with the obligations of such release and
                  discharge. If the Debenture is to be surrendered in partial
                  conversion, the Company should undertake to deliver a new
                  debenture for the unconverted principal amount to the Holder
                  together with the share certificates.

         4.4      In the event of any subdivision or redivision or change of the
                  shares in the capital of the Company at any time and while
                  this Debenture is outstanding into a greater number of such
                  shares, the Company shall deliver, at the time of the exercise
                  thereafter of the right of conversion by the Holder, such
                  additional number of shares as would have resulted from such
                  subdivision, redivision or change if the right of conversion
                  had been exercised prior to the date of such subdivision,
                  redivision or change. In the event of any consolidation or
                  change of the shares in the capital of the Company at any time
                  while this Debenture is outstanding into a lesser number of
                  shares, the number of shares deliverable by the Company on the
                  exercise thereafter of the right of conversion shall be
                  reduced to such number of shares as would have resulted from
                  such consolidation or change if the right of conversion had
                  been exercised prior to the date of such consolidation or
                  change.

5.0      REPRESENTATIONS AND WARRANTIES OF THE COMPANY

         5.1      The Company represents and warrants that this Debenture is
                  issued in accordance with the resolutions of the Directors of
                  the Company, and all other matters and things have been done
                  and performed so as to authorize and make the execution and
                  delivery of this Debenture and the performance of the
                  Company's obligations hereunder, legal, valid and binding;

         5.2      The Company warrants that during the time the debenture is
                  outstanding it will not issue any treasury stock at a price
                  less than Cdn $1.23 unless this debenture has been exercised
                  or paid in full.

6.0      COVENANTS OF THE COMPANY

         6.1      The Company covenants that during the duration of this
                  Debenture it will:
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              (a)    maintain its corporate existence and, subject to all the
                     provisions herein contained, diligently preserve all the
                     rights, powers, privileges and good will owned by it;

              (b)    duly pay all monies secured by this Debenture;

              (c)    at the Holder's request at any time and from time to time
                     execute and deliver such further and other documents and
                     instruments and do all acts and things as the Holder in its
                     absolute discretion required if the conversion right set
                     forth in this Debenture is to be exercised, to enable the
                     conversion to be completed and shares issued to the Holder;

              (d)    notify the Holder promptly of any change in the information
                     contained herein relating to the Company or its business,
                     including without limitation any change of name or address
                     of the Company.

              (e)    Provide the Holder with seven (7) days prior notice of:

                     i.   Its proposal to pay any dividend of any kind upon its
                          common shares or make any distribution to the holders
                          of its common shares;

                     ii.  Its proposal to offer for subscription pro rata to the
                          holders of its common shares any additional shares of
                          stock of any class or other rights;

                     iii. Its proposal of any capital reorganization or
                          classification of its common shares of the merger or
                          amalgamation of the Company with another corporation;
                          or

                     iv.  A voluntary or involuntary dissolution, liquidation or
                          winding-up of the Company;

              (f)    carry on and conduct its business in a proper and
                     business-like manner, including maintenance of proper books
                     of account and records;

              (g)    deliver to the Holder from time to time promptly upon
                     request:

                     i.   all financial statements prepared by or for the
                          Company regarding the Company's business; and

                     ii.  such concerning the Company and the Company's business
                          and affairs as the Holder may reasonably require.

7.0      EVENTS OF DEFAULT

         7.1      The Principal Amount, interest and other monies hereby secured
                  shall become due and payable and the security hereby
                  constituted shall become enforceable upon the happening of any
                  one or more of the following events:

              (a)    if the Company defaults in payment of the outstanding
                     amount of the Principal Amount when the same becomes due
                     and payable;

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              (b)    if, after 10 days, the Company fails to deliver the number
                     of shares specified in the notice referred to in paragraph
                     4.2 above;

              (c)    if the Company becomes insolvent or bankrupt or subject to
                     the provisions of the Bankruptcy and Insolvency Act, or
                     goes into liquidation, either voluntarily or under an order
                     of a court of competent jurisdiction, or makes a general
                     assignment for the benefit of its creditors, or otherwise
                     acknowledge its insolvency;

              (d)    if the Company defaults in observing or performing any
                     other covenant or condition of this Debenture on its part
                     to be observed or performed, and if such default is not
                     cured within a period of 30 days following the giving of
                     notice of default to the Company; or

              (e)    if the Company ceases or threatens to cease to carry on its
                     business, or if the Company commits or threatens to commit
                     any act of bankruptcy.

8.0      NOTICES

         8.1      Any notice given in connection with this Debenture shall be in
                  writing, and shall be sent by prepaid registered mail
                  deposited in a Post Office in Canada addressed to the party
                  entitled to receive the same, delivered to such party or
                  transmitted by telecopy or similar means of recorded
                  electronic communication, as follows:

                  If to Calais Resources Inc.:

                  Calais Resources, Inc.
                  P.O. Box 427
                  Chilliwack, British Columbia
                  V2P 6J7
                  Facsimile:  (604) 792-3676

                  If to the Holder:

                  Aardvark Agencies Inc.
                  #101-9482 Williams Street
                  Chilliwack, British Columbia
                  V2P 5G1

                  The date of receipt of such notice, demand or other
                  communication will be the date of delivery or transmission
                  thereof if delivered or transmitted, or, if given by
                  registered mail as aforesaid, will be deemed conclusively to
                  be the fourth day after the same will have been so mailed
                  except in the case of interruption of postal services for any
                  reason whatever, in which case the date of receipt will be the
                  date on which the notice, demand or other communication is
                  actually received by the addressee.

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         8.2      Either party may at any time and from time to time notify the
                  other party in writing of a change of address and the new
                  address to which notice shall be given to it thereafter until
                  further change.

9.0      WAIVER

         9.1      The Holder may waive any breach by the Company or any
                  provisions contained in this Debenture or any default by the
                  Company in the observance or performance of any covenant or
                  condition required to be observed or performed by the Company
                  under the terms of this Debenture; but no act or omission of
                  the Holder in the premises will extend to or affect any
                  subsequent breach or default or the rights resulting
                  therefrom.

10.0     POWERS OF THE HOLDER

         10.1     The Holder, in addition to any other powers given to it, has
                  the power:

                  (a)      to agree to any modification, compromise, release or
                           waiver of the rights of the Holder against the
                           Company, whether such rights arise under this
                           Debenture or otherwise; and

                  (b)      to accept any other properties or securities in
                           substitution for this Debenture.

11.0     REDEMPTION

         11.1     The Company, not being in default in any payment hereunder or
                  in the observance or performance of any covenant or condition
                  herein contained, and subject to the conversion rights
                  described above, is entitled at any time to redeem this
                  Debenture upon 30 days notice in writing by paying to the
                  Holder a part or all of the full Principal Amount hereof
                  outstanding whereupon the Holder will, at the request and at
                  the expense of the company, upon payment in full, cancel and
                  discharge the charges of this Debenture and execute and
                  deliver to the Company such deeds and other instruments as may
                  be requisite to satisfy the charges hereby constituted.

12.0     MISCELLANEOUS

         12.1     This Debenture is in additional to an not in substitution for
                  any other security now or hereafter held by the Holder.

         12.2     The Holder and its respective legal representatives,
                  successors and assigns will be regarded as exclusively
                  entitled to the benefit of this Debenture, and all persons may
                  act accordingly; but the Company is not bound to recognize any
                  trust or equity affecting the ownership of this Debenture or
                  the moneys hereby secured.

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         12.3     This Debenture shall inure to the benefit of and be binding
                  upon the parties and their respective successors and permitted
                  assigns.

         12.4     Time shall be of the essence of this Debenture.

         12.5     This Debenture is subject to regulatory approval.

13.0     INTERPRETATION

         13.1     This Debenture shall be construed in accordance with the laws
                  of the Province of British Columbia.

         13.2     If a provision of this Debenture is wholly or partially
                  invalid this Debenture shall be interpreted as if the invalid
                  provision had not been a part thereof.

         13.3     The headings of the clauses of this Debenture have been
                  inserted for reference only and do not define, limit, alter or
                  enlarge the meaning of any provision of this Debenture.

IN WITNESS WHEREOF the Company has caused its corporate seal to be hereunto
affixed by the hand of its duly authorized officer this 9th day of October,
2001.

THE CORPORATE SEAL of                              )
CALAIS RESOURCES INC.                       )
Was hereunto affixed in the presence of:    )
                                            )
--------------------------                  )
Authorized Signature                        )
                                                   )
                                            )
                                            )
---------------------------                 )
Authorized Signature                        )
                                                   )

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                              NOTICE OF CONVERSION

TO: CALAIS RESOURCES INC. (THE "COMPANY")

Please treat this as notice pursuant to paragraph 4.1 of the Convertible
Debenture made effective as of the 31st day of May, 2001, that the Holder wishes
to convert $____________ of the Principal Sum into _______________ common shares
of the Company at the applicable conversion rate. The shares, when issued, and
if applicable, the replacement Convertible Debenture for the unconverted
principal amount, should be delivered to the following address:

__________________________
__________________________
__________________________
__________________________

Dated this ___ day of _____, 2___.

SIGNED SEAL AND DELIVERED                   )
By the Holder in the presence of:    )
                                     )
                                     )
                                     )
_________________________________    )
Signature of Witness                 )
                                     )              ____________________________
Name of Witness: _________________   )                   Signature of Holder
                                     )
Address of Witness: _______________  )
___________________________________  )
                                     )
Occupation of Witness:_____________  )<PAGE>

                            PURCHASE OPTION AGREEMENT

                                                               FEBRUARY 28, 2003

         AS OF THIS DATE 2-28-03 Calais Resources Inc., CRI a public corporation
(OTC CAAUF) PO Box 653 Nederland, CO 80466 wishes to enter into a new "Purchase
Option Agreement " POA with Panama Mining Of Golden Cycle, Inc., PMO 1337 West
5th St., Marysville, OH 43040 for the exclusive rights to buy, explore, develop,
and mine the lode hardrock underground deposits and all the surface and placer
and marine deposits located on the Faga de Oro Concessions owned and controlled
by PMO in the State of Veraguas in the Country of Panama. (see Exhibit "A" legal
description). This POA replaces and makes void all previous written and verbal
agreements by and between CRI and PMO dated and signed by CRI and PMO on October
06, 2000 for the hardrock deposits and December 31, 2001 for the placer
deposits.

Listed herein below are the terms and conditions for the new POA between CRI and
PMO for the exclusive rights to CRI to purchase from PMO the FAGA de Oro Panama
Concessions from PMO.

1.       ON or before March 15, 2003 CRI agrees to pay the US cash sum of $5000
to Gary and Brenda Zook 15231 North Del Rey Fountain Hills, AZ 85268 and $5000
to Herbert Hendricks 1337 West 5th Street, Marysville, OH 43040.

2.       The term of this new POA shall be for 10 years for both the lose and
placer deposits and may be renewed if need be on or before March 15, 2013.

3.       The purchase price for the lose and underground deposits shall be $5
million dollars and may be paid to PMO by CRI using the following formula. CRI
will pay to PMO a "net smelter return (NSR)" in the amount of 2% two percent
from the sale and settlement from all gold and or other metals and minerals that
are mined, processed, and sold from the properties by CRI until PMO has received
$5 million dollars in cash $2.5 million to the Zooks and $2.5 million to Herbert
Hendricks. Once these payments are completed the two percent NSR royalty will
terminate. PMO will offer to CRI the right to an "early cash buy out" in the
amount of $2.5 million on or before 18 eighteen months from the date of signing
of this agreement $1.25 million to the Zooks and $1.25 million to Herbert
Hendricks at the end of the early buy out PMO shall retain an ongoing 0.5% one
half percent NSR for the life of production.

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                           PURCHASE OPTION AGREEMENT

4.       Likewise the buy terms for the placer deposits shall be $5 million
dollars to be paid to PMO by CRI by way of 6% six percent of the gross of the
gold (GSR) on all placer mining production from the PMO properties $2.5 million
to the Zooks and $2.5 million to Herbert Hendricks. Once these payments are
completed the six percent GSR shall be terminated and then there shall be a 1
one percent GSR payable to PMO 1/2% to the Zooks and 1/2% to Herbert Hendricks
for the life of placer production from the properties. PMO, the Zooks, and
Herbert Hendricks may elect to receive these GSR payments in either cash, or
gold in hand.

5.       CRI agrees to pay Romulo Tejares within 60 sixty days of the signing of
this POA the past due amount of $8000 dollars owned to him by the Zooks for work
completed by Geomessa for PMO.

6.       CRI agrees to spend a minimum of $250,000 dollars completing a work
program to explore the lode/hardrock deposits located on the PMO properties
during the first year of this POA.

7.       CRI agrees to spend a minimum of $250,000 dollars completing a work
program to explore, develop, and place into production a small pilot placer
operation on the property that will conform to the requirements of the Panama
Government Department of Mineral Resources and to abide by all other laws as may
apply to CRI operations in the Country of Panama and to renew the "production
Permit" on the Barrera Concession.

8.       CRI agrees to transfer 50,000 shares its it publicly traded common
stock OTC CAAUF to the Zooks and 50,000 common shares of CAAUF stock to Herbert
Hendricks within 60 sixty days of the signing of this POA.

9.       CRI agrees to continue to keep all the properties in good and clean
standard during the term of this POA and to keep all the taxes paid on time and
other paper requirements and records up to date and in good business order and
to allow PMO the rights to inspect those records upon written notice to CRI by
PMO.

10.      CRI agrees to retain the placer consulting services of Herbert
Hendricks to oversee the project on behalf of both CRI and PMO. The terms and
conditions of a "separate work agreement" between CRI and Herbert Hendricks
shall be completed in writing between the two parties on or before 45 days of
the signing of this POA.

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                           PURCHASE OPTION AGREEMENT

11.      In the event that CRI should default on any of the terms of this POA as
outlined herein and above and below then PMO shall have the right to notify CRI
in writing of such default and CRI shall then have 30 days to remedy the default
or this POA shall become null and void and PMO shall be entitled to keep any and
all stock, cash, or gold that it has received from CRI previous to the default.
Should any legal problems or laq suites take place against CRI during the term
of this POA then CRI shall hold PMO harmless for any such actions.

12.      CRI shall have the rights to buy to two corporations PMO and Golden
Cycle Of Panama, Inc., GCP for the sum of $25,000 each at anytime within the
first 12 months of this POA or it may elect not to buy either of them and to set
up its own new company in Panama.

13.      This POA may be renewed and or added to as needed and as agreed to by
CRI and PMO and both agree to abide by them.

14.      These then are the basic terms and conditions of the POA by and between
CRI and PMO and both agree to abide by them.

__________________________ Date:____________
Thomas S. Hendricks
President and CEO
Calais Resources Inc., CRI
PO Box 653
Nederland, CO 80466

__________________________ Date:____________
Brenda Zook

__________________________ Date:____________
Gary Zook
Panama Mining Of Golden Cycle Inc., PMO
Golden Cycle of Panama Inc., GCP
15231 North Del Rey
Fountain Hills, AZ 85268

___________________________         Date:_____________
Herbert Hendricks
Sec/Tres. PMO/GCP
1337 West 5th St.
Marysville, OH 43040

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