Document:

exh10-51.htm

 

 

 

 

 

 

 

 

 

 

EXHIBIT 10.51

 

 

 

 

 

 

 

 

  

  

  

EMPLOYMENT AGREEMENT

 

THIS AGREEMENT ("Agreement") effective as of July 5,2006 

 

BETWEEN:

 

Calais Resources Corporation

 

4415 Caribou Road. P.O. Box 653 

Caribou, Nederland, CO 80466-0653

 

(the "Company")

 

-and-

 

David K. Young

 

8839 W. Crestline Dr. 

Littleton, Colorado 80123

 

(the "Executive")

 

RECITALS

 

WHEREAS the Executive is an Officer of the Company and is employed in the Business (as defined below) operated by the Company; and

 

WHEREAS the Company and Executive desire that the agreements and understandings pursuant to which Company has agreed to hire Executive and Executive has agreed to serve be set forth in writing for the benefit of both parties:

 

NOW THEREFORE in consideration of the promises and mutual covenants herein contained, the parties hereto agree as follows:

 

1.           Defined Terms

 

(a)   "Board" means the Board of Directors of the Company;

  

  

  

	
(b)        

	
"Business" means the business presently or hereafter carried on by the Company in the area of mineral resource exploration, development and production;

 

	
(c)        

	
"Disability" means the inability of the Executive as a result of illness or injury to perform his responsibilities as an employee of the Company for a period of 180 consecutive days or 200 days out of 400 days;

 

	
(d)        

	
"Effective Change of Control" means the occurrence, within a single transaction or series of related transactions occurring within the same 12-month period, of a change in the identity of persons who individually or collectively hold rights to elect, or to approve the election of, a majority of the members of the Board, including, without limitation, transactions consisting of one or more sales or other transfers of assets or equity securities, mergers, consolidations, amalgamations, reorganizations, or any similar transactions; and

 

	
(e)        

	
"Stock Option Plan" means the incentive stock option plan of the Company for directors, officers, employees and other service providers of the Company.

 

2.           Employment

 

	
(a)        

	
The Company (directly or through its United States and other subsidiaries) shall employ the Executive, and the Executive shall serve the Company and its subsidiaries as, President and Chief Executive Officer_or in such other capacity or capacities as may be determined by the Board from time to time.

 

	
(b)        

	
The Executive represents that he has the required skills and experience to perform the duties required of him as President and Chief Executive Officer_and agrees to be bound by the terms and conditions of this Agreement.

 

	
(c)        

	
The Executive will be employed by the Company on a full-time basis and will devote himself exclusively to the Business and will not be employed or engaged in any capacity in any other business that is in competition with the Business of the Company, without the prior written approval of the Company.

 

(d)   The Executive acknowledges that in carrying out his duties and responsibilities:

 

	
                                i)

	
the Executive shall comply with all lawful and reasonable instructions as may be given by the Board;

 

	
                                ii)

	
the Executive will perform his duties with the highest level of integrity and in a manner which shall engender the Company's complete confidence in the Executive's relationship with other employees of the Company and with all persons dealt with by the Executive in the course of employment; and

 

 

  

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                                iii)

	
the Executive will perform his duties in a diligent, loyal, productive and efficient manner and use his best efforts to advance the Business and goodwill of the Company.

 

	
(e)       

	
The Executive is employed on a full-time basis for the Company and understands that the hours required to meet the objectives of his employment will vary and be irregular.

 

	
(f)       

	
The location of the Executive's employment under this Agreement shall be in the State of Colorado,

 

3.           Compensation and Benefits

 

As compensation for the services to be rendered by the Executive to the Company, the Company agrees to provide the remuneration and benefits set out in this paragraph 3.

 

(a)          Base Salary and Discretionary Bonus

 

The Executive shall be paid a minimum annual base salary of US$ 175,000. The amount of such salary shall be reviewed annually by the Board. Said salary shall be subject to all deductions required by law or required by company policy and shall be paid bi-monthly, in arrears, by check or deposit, or such other periodic installments as may be from time to time agreed. In addition, the Executive may be entitled to receive a discretionary performance bonus in such amount, if any, as the Board in its sole discretion may determine.

 

(b)          Grant of Stock Options

 

The Executive shall be eligible to receive stock options granted pursuant to the Stock Option Plan, on such terms and conditions as the Board in its discretion may determine.

 

(c)          Automobile Allowance

 

The Executive shall be entitled to receive an automobile allowance to cover normal day-to-day operating (including fuel) and maintenance costs paid by the company.

 

(d)          Health (Medical and Vision), Dental, Long Term Disability and Life Insurance

 

The Executive shall be entitled to receive and participate in health (medical and vision), dental, long-term disability and life insurance programs as are made available by the Company to other executive employees , provided that the Company may modify, suspend, or discontinue any or all of such benefits for its employees generally or for any group thereof, without obligation to replace any such modified, discontinued or suspended benefit with any other benefit or to otherwise compensate the Executive in respect thereof.

  

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(e)           Indemnification and D&O Liability Insurance

 

To assure that Executive will be in a position to perform his duties to the Company without concern over unwarranted liability, the Company shall indemnify and advance reasonable defense expenses to the Executive to the full extent permitted by Colorado. The Company shall also use its best efforts to purchase, at the earliest time practicable, one or more policies of directors and officers liability insurance in an amount adequate to protect Executive against claims made against him for actions taken or not taken in the conduct of his duties to the Company.

 

4.           Vacation

 

The Executive will be entitled to twenty (20) days of vacation during each twelve- (12) month period calculated from January 1, 2006 plus usual statutory and other public holidays, the timing of such vacation to be mutually agreed upon between the Executive and the Company. Vacation entitlement not used in any 12-month period may be carried forward, provided that, if it is not used in the next 12-month period, the Executive shall be paid the cash equivalent of any unused vacation entitlement.

 

5.           Expenses

 

The Executive shall be reimbursed by the Company for business expenses incurred as a result of his work on behalf of the Company. The Company shall reimburse the Executive for such expenses upon presentation of supporting documentation satisfactory to the Company in accordance with the tax principles applicable in the United States for such reimbursement and the Company's established reimbursement policies, as those policies may be modified from time to time in the Company's discretion.

 

Terms of the Agreement and Termination

 

	
(a)      

	
This Agreement shall commence on the date hereof and shall be of indefinite term unless terminated pursuant to the provisions hereof.

 

	
(b)      

	
The Executive may terminate his employment pursuant to this Agreement by giving at least one (1) month's advance notice in writing to the Company. The Company may waive such notice, in whole or in part, and, if it does so, the Executive's entitlement to remuneration and benefits pursuant to this Agreement will cease on the date such notice is waived.

 

	
(c)      

	
The Executive's employment shall terminate upon the death of the Executive, whereupon all stock options granted to the Executive shall immediately vest and shall be exercisable by the Executive's heirs, executors, administrators or personal representatives in accordance with the terms of the Stock Option Plan.

 

  

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(d)      

	
The Executive's employment shall be terminated upon the Disability of the Executive.

 

	
(e)      

	
In the event of an Effective Change of Control, the Executive's employment shall be deemed to have been terminated without cause, and the Company shall be obligated to pay the Executive the severance payments calculated in accordance with subparagraph 6(f) hereof.

 

	
(f)      

	
The Executive's employment may be terminated without cause by majority vote of the Board. In the event that the Executive's employment is so terminated, or is deemed to have been terminated pursuant to subparagraph 6(e) hereof, any stock options granted but not vested shall be immediately vest, and the Company shall pay to the Executive 36 months salary, in compensation for the Executive's loss of employment, together with a payment equal to 50% of any bonus entitlement of the Executive for each year in such 36 month period, plus any other compensation which the Executive is entitled to receive. Health (medical and vision), dental, long term disability and life insurance plan coverage in effect on the last day of employment shall continue, without material change, for a period of 36 months. The Executive shall not have the duty to mitigate damages. For the purpose of calculating payments due to the Executive pursuant to this subparagraph 6(f), all Federal and State taxes and Federal excise taxes (parachute taxes) shall be grossed-up.

 

	
(g)      

	
The Company may terminate the Executive's employment without notice or payment in lieu of such employment, for cause. For the purposes of this Agreement "cause" shall mean (i) the failure to follow written policies or directions of the Board not inconsistent with this Agreement or contrary to applicable law, (ii) neglect of responsibilities after the receipt of written notice setting forth the performance deficiencies and providing 45 days to cure such deficiencies, (iii) acts of dishonesty, fraud, misrepresentation, insubordination, harassment or employment discrimination, and (iv) indictment for a felony.

 

7.           Notices

 

	
(a)      

	
Any notice required or permitted to be given to the Executive shall be sufficiently given if delivered to the Executive personally or mailed by registered mail to the Executive's home address.

 

	
(b)      

	
Any notice required or permitted to be given to the Company shall be sufficiently given if delivered to the Secretary of the Company personally or if mailed by registered mail to the Company's principal office, attention Corporate Secretary.

 

	
(c)      

	
Any notice given by registered mail shall be deemed to have been given forty-eight hours after the time it is posted.

 

  

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8.          Entire Agreement

 

This Agreement terminates, replaces and supersedes all prior agreements, oral or written, between the parties hereto. This Agreement contains the final and entire understanding and agreement between the parties hereto with respect to the subject matter hereof, and they shall not be bound by any terms, conditions, statements, covenants, representations, or warranties, oral or written, with respect to the subject matter hereof not contained in this Agreement.

 

9.          Headings

 

The headings in this Agreement are for convenience of reference only, and under no circumstances should they be construed as being a substantive part of this Agreement nor shall they limit or otherwise affect the meaning hereof.

 

10.          Warranty

 

Each of the parties hereto represents and warrants that there are no restrictions, agreements or limitations on such party's right or ability to enter into and perform the terms of this Agreement.

 

11.          Severability

 

If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable by a court of competent jurisdiction for any reason whatsoever (i) the validity, legality and enforceability of the remaining provisions of this Agreement (including without limitation, all portions of any paragraphs of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby, and (ii) to the fullest extent possible, the provisions of this Agreement (including, without limitation, all portions of any paragraph of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable.

 

12.          Modification

 

Any modification of this Agreement must be in writing and signed by both the Executive on the one hand and by the Company acting through an officer duly authorized to execute such modification on behalf of the Company or such modification shall have no effect and shall be void.

 

13.          Waiver

 

The waiver by either party of any breach or violation of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach or violation. No

 

 

  

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waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

 

14.          Assignment of Rights

 

The rights that accrue to the Company under this Agreement shall pass to its successors or assigns. The rights of the Executive under this Agreement are not assignable or transferable in any manner.

 

15.          Independent Legal Advice

 

The Executive acknowledges that he has read and understands this Agreement, and acknowledges that he has had the opportunity to obtain independent legal advice with respect to it.

 

16.          Time of Essence

 

Time shall be of the essence of this Agreement.

 

17.          Governing Law

 

This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado. Any dispute between the Company and Executive shall be brought exclusively in the State or Federal Courts located in Denver, Colorado. In the event of such dispute, the prevailing party shall be entitled to recover its reasonable attorneys fees and costs.

 

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

 

CALAIS RESOURCES

 

By:         /s/ David R. Russell                         

 

David R. Russell

 

Chairman of the Board

 

 

Executive

 

/s/ David K. Young                              

 

David K. Young

 

 

7exh10-52.htm

 

 

 

 

 

 

 

 

 

 

EXHIBIT 10.52

 

 

 

 

 

  

  

  

SETTLEMENT AND RELEASE AGREEMENT

 

This Settlement and Release Agreement (the "Agreement") is entered into as of March 31, 2005 by and among Calais Resources, Inc., a British Columbia corporation ("Calais"), Thomas S. Hendricks, president and chief executive officer of Calais ("Hendricks") and Matthew C. Witt, former chief financial officer and Secretary of Calais, former officer of various Calais subsidiaries, and a resident of Colorado ("Witt"). Each of the foregoing parties is sometimes referred to as a “Party” and are collectively referred to as the "Parties."

 

Recitals

 

A.          Certain disputes have developed among the Parties arising out of Witt's prior employment by Calais, Witt's separation of employment from Calais, certain options and benefits claimed by Witt and other matters and disagreements among the Parties.

 

B.          Witt and Calais have entered into two separate agreements whereby Calais granted options to Witt to purchase shares of the common stock of Calais (“Shares"), as follows:  (i) the Nonqualified Stock Option Agreement dated August 11, 2003, whereby Calais granted an option to Witt for 500,000 Shares at a price of $5.00 per Share (the "$5 Option”) and (ii) the Non-Qualified Stock Option Agreement dated August 11, 2003, whereby Calais granted an option to Witt for 500,000 Shares at a price of $3.00 per Share (the "$3 Option" and together with the $5 Option, the "Option Agreements"). Witt and Calais discussed the granting of certain additional options in December, 2004, but on the advice of Calais legal counsel, such purported grant has been rescinded and voided and Calais shall undertake a new grant of options for 400,000 Shares pursuant to this Agreement.

 

C.          The Parties wish to enter into this Agreement to amend the Option Agreements, to provide for a new grant of options and a transfer of options and to resolve certain disputes, claims and allegations which they have or might have against each other relating to or arising out of Witt's employment with Calais, Witt's separation of employment from Calais, the options and benefits claimed by Witt, and the transactions, communications and other dealings between the Parties prior to the date of this Agreement.

 

Agreement

 

NOW THEREFORE, in consideration of the execution of this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Witt, Calais and Hendricks agree as follows:

 

1.             Amendment of Option Agreements. Witt and Calais hereby agree that the Option Agreements will each be amended as described in this Agreement.

 

(a)      Amendments to $5 Option. The $5 Option is hereby amended by re-pricing the exercise price from $5.00 per Share to $1.50 per Share, and the defined term "Exercise Price" therein shall be amended to state as follows: ""Exercise Price": $1.50 per share

 

  

  

  

(being greater than the market price on the Date of Grant)". The term of exercise of the options under the $5 Option shall be reduced from August 11, 2013 to August 11, 2008, and the defined term 'Term of the Option" therein shall be amended to state as follows: ""Term of the Option": through August 11, 2008". The amended definitions shall apply throughout the $5 Option. Section 8(a) of the $5 Option is hereby deleted and the following amended Section 8(a) is substituted therefore:

 

"(a)               In the event of a dissolution or liquidation of the Company, or any corporate separation or division, including, but not limited to, split-up, split-off or spin-off, or a merger or consolidation of the Company with another entity, the options will be assumed by the successor entity and will automatically become options to purchase a proportional number of shares or other equity interests in the successor entity. The Company agrees to provide Optionee with the same notice and disclosure materials that the Company provides to holders of its common stock."

 

(b)          Amendments to $3 Option. The $3 Option is hereby amended by re­ pricing the exercise price from $3.00 per Share to $1.50 per Share, and the defined term "Exercise Price" therein shall be amended to state as follows: ""Exercise Price": $1.50 per share (being greater than the market price on the Date of Grant)". The term of exercise of the options under the $3 Option shall be reduced from August 11, 2013 to August 11, 2008, and the defined term "Term of the Option" therein shall be amended to state as follows: '"Term of the Option":  through August 11, 2008". The amended definitions shall apply throughout the $3 Option, Section 8(a) of the $3 Option is hereby deleted and the following amended Section 8(a) is substituted therefore:

 

"(a) In the event of a dissolution or liquidation of the Company, or any corporate separation or division, including, but not limited to, split-up, split-off or spin-off, or a merger or consolidation of the Company with another entity, the options will be assumed by the successor entity and will automatically become options to purchase a proportional number of shares or other equity interests in the successor entity. The Company agrees to provide Optionee with the same notice and disclosure materials that the Company provides to holders of its common stock."

 

(c)          References to Options. Any reference to the $5 Option or the $3 Option in any other agreement, document or instrument shall hereafter be deemed to refer to such agreements as amended hereby, Calais and Witt agree that the $5 Option and the $3 Option each remain in force and effect, as amended by this Agreement.

 

2.             Grant of Options. Witt hereby acknowledges that the purported grant by Calais in December, 2004 of an option to purchase 400,000 Shares has been rescinded and voided by the board of directors of Calais. In consideration of the release and settlement and the other agreements by Witt herein, Calais agrees to grant to Witt an option to purchase 400,000 Shares at an exercise price of $0.35 per Share (the "New Options"). The New Options shall be exercisable through August 11, 2008 and shall not provide for any type of cashless exercise. The New Options shall be subject to the terms and conditions of a Stock Option Agreement with the same terms and conditions as the $3 Option and the $5 Option, as each is amended hereby (except that

 

  

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the exercise price will be $0.35 per share), to be entered into between Calais and Witt within 30 days of the date of this Agreement.

 

3.             Transfer of Options. Hendricks hereby agrees to transfer to Witt, whether by assignment and transfer to Witt or assignment and surrender to Calais for re-issuance, options for 500,000 Shares at a price of $0.50 per Share and with a term of exercise of five years. Such transfer of options from Hendricks to Witt shall occur promptly following the execution and delivery of this Agreement on the same terms and conditions as the $3 Option and the $5 Option, as each is amended hereby (except that the exercise price shall be $0.50 per share). In the event that tax counsel recommends to Hendricks that the 500,000 options be surrendered to Calais by Hendricks, and then re-issued to Witt on the terms provided here for assignment, Witt agrees to such resolution providing that there are no changes to the terms agreed to herein.

 

4.             Payment of Wages and Expenses, Calais hereby agrees to pay to Witt (a) $127,749.94 for all wages, including vacation, paid personal leave, bonus or otherwise, which are due, owing and accrued through Witt's last date of employment which was February 7, 2005, and (b) amounts owed to Witt for any Calais business expenses incurred by Witt as an employee of Calais which are substantiated by written receipts provided to Calais and are expenses of a type and nature reimbursed by Calais, which amounts shall be paid to Witt by not later than the first to occur of (i) September 15, 2005 or (ii) Calais receiving net proceeds from one or more debt financings or equity financings occurring after the date of this Agreement, individually or in the aggregate, of not less than $6,000,000 (excluding the $220,000 to be received by Calais from a third party investor substantially concurrently with Calais' delivery of this Agreement). Payment of the sums described in this Section 4 shall fulfil, satisfy and discharge all obligations of Calais to Witt with respect to, and Witt hereby waives all rights or claims to, any other or additional compensation, salary, bonus, benefits, expenses, reimbursements or other amounts. In the event that the payments described in this Section 4 are not made by Calais by the date specified herein, then Witt's waiver of rights or claims with respect to compensation and the other employment payments and benefits described herein shall become null and void and shall have no further force or effect.

 

5.             General Mutual Release. As a material inducement to the Parties to enter into this Agreement and to re-price the options as described in Section 1 hereof, and to Witt to waive claims he may have against Calais and to Hendricks to transfer certain options to Witt as described in Section 2 hereof; each of the Parties, as a free and voluntary act, for and on behalf of himself, itself, and each of their respective successors, heirs and assigns, hereby completely, unconditionally and forever releases, acquits, discharges and holds harmless the other Parties, and their respective subsidiaries and affiliated entities, their current and former directors, officers, shareholders, employees, agents, representatives, attorneys, successors, heirs and assigns, of and from any and all actions, causes of action, claims, counterclaims, debts, costs, expenses, fees, demands, liabilities, losses and damages of every kind and nature whatsoever, whether known or unknown, including, but not limited to those arising out of Witt's employment with Calais and any claim or demand for liability, salary, wages, bonuses, options or other compensation or under or with respect to any employment-related federal, state or local, law, statute, rule, regulation or ordinance, or which in any manner relate to or arise from any and all

  

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transactions, communications and other dealings between or among the Parties, prior to the date of this Agreement This shall be a full and final mutual release,

 

6.  Covenant Not to Initiate Suit or Arbitration. Each Party covenants that it will not initiate any lawsuit, arbitration or other proceeding or otherwise assert any claims, which have been released under this Agreement

 

7.  No Admission of Liability. Nothing contained herein, and no action taken by Calais or Witt with regard to Witt's employment by Calais, his termination of employment with Calais or the creation or performance of this Agreement shall be construed as an admission of liability as to any legal or other obligation, and no action taken by any Party in effectuating this Agreement may be used in any pending or future litigation or arbitration as an admission of liability by any Party in any respect.

 

8.  Attorneys' Fees. Each Party shall be responsible for its own attorney's fees, costs and expenses incurred in connection with the negotiation and preparation of this Agreement.

 

9.  Agreement Confidential. Except as may required by any regulatory agency having authority over any Party or except pursuant to a subpoena duces tecum or other proper order for production of information in any subsequent judicial proceeding or as required by applicable law to effectuate the purpose and terms of this Agreement each Party agrees to keep the terms and conditions of this Agreement confidential and shall not disclose this Agreement or its terms to any third parties.

 

10.  Non-Disparagement. Each Party agrees not to make any disclosure, issue any statement or otherwise cause to be disclosed any information that is designed, intended or might reasonably be anticipated to disparage, criticize or denigrate any other Party hereto or the business, personnel or employment practices of Calais,

 

11.  Calais Property. Witt represents that he possesses no property of Calais. If Witt subsequently determines that he does have any property of Calais, Witt shall immediately return the property to Calais,

 

12.  No Assignment of Claims. Each of the Parties represents and warrants to the other that it has not heretofore assigned or transferred, or purported to assign or transfer to any person or entity any claims that it might have against any other Party.

 

13.  Agreement Binding. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective successors, heirs and assigns.

 

14.  Complete Agreement; Modification; and Waiver. This Agreement constitutes the entire agreement between the Parties with respect to the subject matter of this Agreement and supersedes all prior and contemporaneous agreements, representations, warranties and understandings of whatever kind or nature, whether oral or in writing, if any, of the Parties with respect to the subject matter of this Agreement. No supplement, modification or amendment of

  

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this Agreement shall be binding unless executed in a writing by the Parties. No waiver of any of the provisions of this Agreement shall be deemed or constitute a waiver of any other provision, whether or not similar, nor shall any waiver constitute a continuing waiver. No waiver shall be binding unless executed in writing by the Party making the waiver.

 

15.             Review; Representation by Counsel; Etc. Each Party acknowledges and represents that:

 

a.          It has received a copy of this Agreement prior to the date hereof and it has fully and carefully read and considered this Agreement in its entirety prior to its execution;

 

b.          It has consulted with its attorneys regarding the legal effect and meaning of this Agreement and all terms and conditions hereof, its attorneys have been involved in the negotiation and preparation of this Agreement, and it is fully aware of the contents of this Agreement and its legal effect;

 

c.          It has had the opportunity to make whatever investigation or inquiry it deems necessary or appropriate in connection with the subject matter of this Agreement;

 

d.          It has not relied on any representation, either express or implied, either by statement or omission, in deciding to enter into this Agreement;

 

e.          It understands that this Agreement has important legal consequences; and

 

f.          It is executing this Agreement voluntarily and free from any undue influence, coercion, duress or fraud of any kind.

 

16.             Execution. This Agreement may be executed in two or more counterparts, all of which shall constitute an original, and all of which together shall constitute one and the same document Execution of this Agreement shall be deemed to have taken place in Denver, Colorado. The Parties shall accept facsimile signatures as original signatures.

 

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year first above written.

 

CALAIS RESOURCES, INC.

 

By:                                                                    

 

Name:                                                              

 

Title:                                                              

 

 

 

/s/ Matthew C. Witt                                      

Matthew C. Witt

 

________________________________

Thomas S. Hendricks

 

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