Calais Resources Inc. (OTC: CAAUF) is pleased
to announce that it has reached an agreement with Calim Private Equity, LLC
of Aspen, Colorado, which represents the mortgage debt against its Caribou
properties near Nederland, Colorado.

Under the agreement, Calim has purchased the $4.5 million USD mortgage,
paying all accrued interest and penalties, and has agreed to terms
extending the mortgage for an additional 12 months. During this 12 month
period, Calim has the right to convert the mortgage amount into convertible
bonds of Calais. The terms of the Broadway Mortgage were reported in the
Company's Quarterly Report on Form 10-QSB for the Quarter ended August 31,
2004. At the time of the December 15, 2005 transaction, Calais was in
default on the mortgage, the terms of which called for the repayment of the
note by August 01, 2005.

Pursuant to the December 15 transaction, Calim shall have the right to
convert the mortgage at anytime into five-year convertible bonds of the
Company in the face amount of $1,000 USD per bond. These bonds will be
secured by a first position against the property of the Company. The bonds
will bear interest at the rate of 12% and be convertible into Units at a
conversion price of $0.20 USD. Each Unit shall consist of one share of the
Company's Common Stock and one two-year share purchase warrant at a strike
price of $0.30 USD per share. Should Calim elect not to convert the
mortgage into bonds, it shall give 60 days notice prior to the due date of
the mortgage, with principal and any accrued interest being due at the end
of the then current 12 month period ending December 15.

Calim has further provided $200,000 USD of working capital to Calais via a
private placement into units of Calais at $0.20 USD per unit, each
consisting of one common share and one two year share purchase warrant at
$0.25 USD. Calim has provided further funding on a note basis and has the
option to convert this note into an additional private placement of $1.5
million USD under the same terms and conditions as the initial private
placement, pending the completion of due diligence by Calim.

Also pursuant to the terms of the December 15 transaction, Calim shall be
issued a five-year broker warrant fee to acquire an additional 2 million
shares of Calais at a purchase price of $0.25 USD per share. Calim is also
entitled to a restructuring fee of 1 million shares of Calais upon
completion of all the transactions summarized above.

The "Company" is also pleased to announce that on December 8, 2005, it
completed a new 10 year extension of its hard rock mining agreement with
Panama Mining of Golden Cycle ("Panama Mining") on the Faja de Oro Project
in the Veragus Province of Panama. These applications were described in the
Company's Quarterly Report Form 10QSB for the period ended August 31, 2004.
In connection with the extension, the Company completed payment of $12,000
USD of past obligations to "Panama Mining" and paid a $25,000 USD renewal
fee. During the 2006 operating season, the Company will be required to
complete $175,000 USD in exploration and property maintenance work. Under
the agreement with Panama Mining the Company must make annual payments on
September 15 of each year in the amount of $25,000 USD and complete a
minimum of $100,000 USD in exploration and property maintenance work for
the 9 year term.

In a related event, the Company purchased the Congo Chief Mine and property
at Caribou on December 16, 2005 for a purchase price of $280,000 USD. The
Congo Chief Mine, Survey number 20305, contains 20.66 patented acres. The
property is located in the northeast portion of the Consolidated Caribou
Mines District and represents the northeast extension on the historic No
Name vein. The Congo Chief Mine property is the last major property of
significant size, which had prevented the Company from achieving total
mining district consolidation at Caribou. The Company completed this
purchase through a note and deed of trust agreement with Calim under
similar terms listed above.

Because of severe financial difficulties brought on by events reported in
the Company's Quarterly Report on From 10-QSB for the period ended August
31, 2004, the Company was left substantially without cash, employees or
legal or audit services for the period beginning the third quarter of the
fiscal year ending May 31, 2005. The Company is currently actively working
with its CPA firm, new legal council and audit firms to bring the Company
back to full reporting compliance as quickly as possible.

About Calais Resources Inc.

Calais Resources Inc. is a junior exploration company which owns or
controls the Consolidated Caribou District Mines project at Caribou,
Colorado, the Nevada Manhattan District properties at Manhattan, Nevada and
the Faja de Oro Project in Panama.

Safe Harbor

The future conduct of the company's business and its response to issues
raised by third parties are dependent upon a number of factors, and there
can be no assurance that the company will be able to conduct its operations
as contemplated. Certain statements contained in this release using the
terms "may," "expects to," "projects," "estimates," "plans," and other
terms denoting future possibilities, are forward-looking statements in
accordance with the Private Securities Litigation Reform Act of 1995. The
accuracy of these statements cannot be guaranteed as they are subject to a
variety of risks that are beyond our ability to predict or control and
which may cause actual results to differ materially from the projections or
estimates contained herein. The risks include, but are not limited to, the
risks described in the above press release; those risks set out in the
company's disclosure documents and its annual, quarterly and current
reports; and the other risks associated with start-up mineral exploration
operations with insufficient liquidity, and no historical profitability.