COLORADO GOLDFIELDS INC.
EXHIBIT 10.1
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<p style=' margin-bottom:0pt; margin-top:12pt;text-align:center;'><B><font SIZE=2>OPTION AGREEMENT</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><B><font SIZE=2>GOLD KING, MAYFLOWER AND MOGUL PROPERTIES</font></B></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:justify;'><B><font SIZE=2>THIS</font></B><font size=2> </font><B><font SIZE=2>AGREEMENT</font></B><font size=2> made the 17th day of June, 2007</font></p>

<p style=' margin-bottom:0pt; margin-top:18pt;text-align:left;'><font SIZE=2>BETWEEN:</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:left;'><b><font size=2>SAN JUAN CORP.</font></b><font size=2>, a company incorporated under the laws of Colorado and having an office at 645 Water Street, Silver Plume, Colorado, U.S.A. 80476 </font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:left;'><font size=2>(&#147;</font><b><font size=2>San Juan&#148;)</font></b></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:left;'><b><font size=2>TODD C. HENNIS, </font></b><font size=2>a private individual, resident at 414 Butte Parkway, Golden, Colorado 80403</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:left;'><font size=2>(&#147;</font><b><font size=2>Hennis</font></b><font size=2>&#148;)</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:left;'><font size=2>(San Juan and Hennis hereinafter referred to collectively as the &#147;</font><b><font size=2>Optionors</font></b><font size=2>&#148;)</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:left;'><font SIZE=2>AND:</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:left;'><b><font size=2>GARPA RESOURCES, INC.</font></b><font size=2>, a company incorporated under the laws of Nevada and having an office at 620-650 West Georgia Street, Vancouver, British Columbia, Canada</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:left;'><font size=2>(&#147;</font><b><font size=2>Optionee</font></b><font size=2>&#148;)</font></p>

<p style=' margin-bottom:0pt; margin-top:18pt;text-align:justify;'><B><font SIZE=2>WHEREAS:</font></B></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font SIZE=2>A.</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>The Optionors are the recorded and beneficial owners of the right, title and interest in and to the properties located in the San Juan County, Colorado, which are more particularly described in Schedule A attached hereto and forming part hereof;</font></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font SIZE=2>B.</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>The parties wish to enter into an agreement granting to Optionee the exclusive right and option to acquire an eighty percent (80%) undivided right, title and interest in and to the Properties (as defined herein) on the terms and conditions set forth in this Agreement.</font></p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt;text-align:justify;'><B><font SIZE=2>NOW THEREFORE THIS AGREEMENT WITNESSES</font></B><font size=2> that, for good and valuable consideration, the receipt and sufficiency of which are acknowledged, the parties agree as follows:</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>1.</b></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>INTERPRETATION</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>1.1</p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>In this Agreement:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>business day</b>&#148; means any day, other than a Saturday, Sunday or any other day on which the principal chartered banks located in the city of Denver, Colorado are not open for business during normal banking hours;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>dollars</b>&#148; means legal currency of the United States of America;</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 2 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(c)</p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Effective Date</b>&#148; means the date that all parties have signed this Agreement;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(d)</p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Environmental Claims</b>&#148; means any and all administrative, regulatory, or judicial actions, suits, demands, claims, liens, notices of non-compliance or violation, investigations, or proceedings relating in any way to any Environmental Law or any permit issued under any Environmental Law, including, without limitation:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(i)</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>any and all claims by government or regulatory authorities for enforcement, clean-up, removal, response, remedial, or other actions or damages under any applicable Environmental Law; and</font></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(ii)</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>any and all claims by any third party seeking damages, contribution, indemnification, cost recovery, compensation, or injunctive or other relief resulting from hazardous materials, including any release of those claims, or arising from alleged injury or threat of injury to human health or safety (arising from environmental matters) or the environment;</font></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(e)</p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Environmental Laws</b>&#148; means all requirements of the common law, civil code, or of environmental, health, or safety statutes of any agency, board, or governmental authority including, but not limited to, those relating to (i) noise, (ii) pollution or protection of the air, surface water, ground water, or land, (iii) solid, gaseous, or liquid waste generation, handling, treatment, storage, disposal, or transportation, (iv) exposure to hazardous or toxic substances, or (v) the closure, decommissioning, dismantling, or abandonment of any facilities, mines, or workings and the reclamation or restoration of lands;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(f)</p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Expenditures</b>&#148; includes all expenditures and costs made or incurred by Optionee or its affiliates or permitted assigns relating directly or indirectly to the Properties, including without limitation all expenditures and costs made or incurred: in doing geophysical, geochemical, land, airborne, environmental and/or geological examinations, assessments, assays, audits and/or surveys; in line cutting, mapping, trenching and staking; in searching for, digging, trucking, sampling, working, developing, mining and/or extracting ores, minerals and metals; in doing diamond and other drilling; all costs related to the Mill including without limitation the purchase, upgrade, modification and operation of the Mill; in construction of access roads and other facilities on or for the benefit of the Properties or any part thereof; in
transporting personnel, supplies, mining, machinery, tools, appliances or equipment in, to or from the Properties or any part thereof; in paying reasonable wages and salaries (including &#147;fringe benefits&#148;) of personnel directly engaged in performing work on or with respect to the Properties; in payment of assessments or contributions under applicable employment legislation relating to workers&#146; compensation, unemployment insurance and other applicable legislation or ordinances relating to such personnel; in supplying food, lodging and other reasonable needs for such personnel; in obtaining and maintaining any insurance; in the management of and accounting for work and providing supervisory, legal, accounting, consulting and other contract or professional services or facilities relating to work performed or to be performed hereunder; in paying any taxes, fees, charges, payments or rentals (including payments made in lieu of assessment work) or otherwise incurred to
transfer the Properties or any part thereof or interest therein pursuant to this Agreement and to keep the Properties or any part thereof in good standing; in acquiring access and surface rights to the Properties and any costs required to be paid relating to the Royalties or any royalties pursuant to section 2.5(a); in carrying out any negotiations and preparing, settling and executing any agreements or other documents relating to environmental or indigenous peoples&#146; claims, requirements or matters relating to the Properties; in carrying </p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:justify;'>&nbsp;</p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 3 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:justify;'>&nbsp;</p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:justify;'>out any requirements or prerequisites in order to obtain and obtaining all necessary or appropriate approvals, permits, consents or permissions relating to the carrying out of work, including, without limitation, environmental permits, approvals or consents; in carrying out reclamation or remediation; in improving, protecting, or perfecting title in the Properties or any part thereof, in carrying out mineral, soil, water, air or other testing; in preparing engineering, geological, or environmental studies and/or reports and test work related thereto; and in preparing one or more feasibility studies including any work or reports preliminary or supplementary thereto;</p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(g)</p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Mill</b>&#148; means the Pride of the West Mill located in Howardsville, Colorado, including any upgrades, modifications, ancillary facilities, buildings, machinery, parts and supplies required to process and otherwise upgrade gold bearing ores and tailings;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(h)</p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Operator</b>&#148; means the operator appointed pursuant to article 5 of this Agreement;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(i)</p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Option</b>&#148; means the option granted by Optionors to Optionee pursuant to section 3.1 of this Agreement;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(j)</p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Program</b>&#148; means any program to carry out work and incur Expenditures on the Properties or any of them and includes, as the context requires:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(i)</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>documents that specify in reasonable detail an outline of any and all research, prospecting, and exploration and development work proposed to be carried out during the Program, the estimated Expenditures to be incurred in carrying out the work, and the area of the Properties on which the work is to be undertaken, and</font></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(ii)</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>the preparation of any feasibility report,</font></p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:justify;'><font size=2>and includes any amendments to a Program which may be proposed by the Operator;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(k)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Properties</b>&#148; means those mining claims described in Schedule A of this Agreement and any other claims that become the subject of this Agreement pursuant to section 14.1 hereof, together with:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(i)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>surface rights to the individual patented mining claim on which the Gold King #7 mine portal, Mogul #1 and #2 portals exist together with any related buildings and fixtures,</font></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(ii)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>any rights granted by third parties and held by the Optionor for access to, on or over the mining claims described in Schedule A to the extent allowed by the underlying third party agreements, and</font></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(iii)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>the Surface Rights Agreement entered into by the Optionor and Optionee, pursuant to section 3.2.</font></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(l)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Royalty</b>&#148; or &#147;<b>Royalties</b>&#148; means the royalty of (i) 3% net smelter return royalty on Gold King, (ii) 2.5% net profits interest on Gold King, (iii) 2% net smelter return royalty on the Mayflower Group, and (iv) 2.5% net profits interest in the Mayflower Group as more particularly described in Schedule B hereto and forming a part hereof; </p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(m)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Royalty Holder</b>&#148; means Recreation Properties, Ltd., 205 West 17<sup>th</sup> Street, Suite E, Tulsa, Oklahoma 74119-4645, the holder of the Royalties;</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 4 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(n)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Shares</b>&#148; means the common stock of Optionee; and</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(o)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>&#147;<b>Underlying Agreements</b>&#148; means the Royalty agreements attached hereto as Schedule&nbsp;B.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>2.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>REPRESENTATIONS AND WARRANTIES</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>2.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionee represents and warrants to Optionors as follows:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionee is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation, and has the requisite corporate power and authority to own or lease all material property that it purports to own or lease and to carry on its business as now being conducted.  Optionee is duly qualified as a foreign corporation, and is in good standing, in each jurisdiction where the character of its properties owned or held under lease or the nature of its activities makes such qualification necessary, except to the extent that the failure to so qualify would not have a material adverse effect on the business or financial condition of Optionee.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionee has heretofore furnished to Purchaser or its counsel a complete and correct copy of its Articles of Incorporation, as amended, and the Bylaws, as amended, of Optionee, as presently in effect.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(c)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>As of May 31, 2007, the authorized capital stock of Optionee consists of 75,000,000 Shares of Common Stock of which 5,575,000 Shares are issued and outstanding.  Except for this Agreement and the foregoing and in the Optionee SEC Documents, there are no options, warrants or other rights, agreements or commitments that do or may obligate Optionee to issue any shares of its capital stock.  The Shares to be issued pursuant to this Agreement, upon issuance on the terms and conditions specified herein, will be duly authorized, validly issued, fully paid and nonassessable, and free of preemptive rights.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(d)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionee has the requisite corporate power and authority to enter into this Agreement and to perform its obligations hereunder. This Agreement has been duly authorized, executed and delivered by Optionee and constitutes a legal, valid and binding obligation of Optionee enforceable against the Optionee in accordance with its terms subject to (i) laws of general application relating to bankruptcy, insolvency and any similar law relating to creditors&#146; rights and (ii) rules of law governing specific performance, injunctive relief and other equitable remedies.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(e)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The execution and delivery of this Agreement and the consummation of the transactions herein and therein contemplated will not conflict with or violate any law, regulation, court order, judgment or decree applicable to Optionee or by which its property is bound or affected, or conflict with or result in any breach of or constitute a default (or any event which without notice or lapse of time or both would become a default) under, or give to others any rights of termination or cancellation of, or result in the creation of any lien or encumbrance on any of the properties or assets of Optionee pursuant to: (a) the Articles of Incorporation or Bylaws of Optionee or (b) any material contract, instrument, permit, license or franchise to which Optionee is a party or by which Optionee or its property is bound or affected. Except for applicable
requirements, if any, of the Securities Exchange Act of 1934 (the &#147;Exchange Act&#148;), state securities laws (&#147;Blue Sky Laws&#148;) and the OTC Bulletin Board, (i) Optionee is not required to submit any notice, report or other filing with any governmental or regulatory authority, domestic or foreign, in connection with the issuance of the Shares contemplated by this Agreement.</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 5 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(f)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionee has made available to Optionors a true and complete copy of each statement, report, registration statement (with the prospectus in the form filed pursuant to Rule 424(b) of the Securities Act of 1933, as amended (the &#147;Securities Act&#148;)), definitive proxy statement, and other filings filed with the SEC by Optionee since its initial filing under the Securities Act (collectively, the &#147;Optionee SEC Documents&#148;).  In addition, Optionee has made available to Optionors all current exhibits to the Optionee SEC Documents filed prior to the date hereof. All documents required to be filed as exhibits to the Optionee SEC Documents have been so filed (and such exhibits are true, correct and complete copies of such documents), and all contracts so filed as exhibits are in full force and effect, except those that have expired in
accordance with their terms or those that have been terminated without default by any party thereto, and neither Optionee nor any other party, is in material default thereunder. As of their respective filing dates, (i) the Optionee SEC Documents complied as to form in all material respects with the requirements of the Exchange Act and the Securities Act, as applicable, and (ii) none of the Optionee SEC Documents contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances in which they were made, not misleading, except to the extent corrected by a subsequently filed Optionee SEC Document.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(g)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>All financial statements filed with the Optionee SEC Documents (the &#147;Optionee Financial Statements&#148;) have been prepared from the books and records of Optionee in accordance with United States generally accepted accounting principles (&#147;GAAP&#148;) consistently applied and maintained throughout the periods indicated (except as may be indicated in the notes thereto) and fairly present in all material respects the financial condition of Optionee at its respective dates and the consolidated results of its operations and cash flows for the periods covered thereby.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(h)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionee is in compliance in all material respects with all laws and regulations applicable to its operations or with respect to which compliance is a condition of engaging in the business thereof, except to the extent that failure to comply would not have a material adverse effect on the business or financial condition of Optionee.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(i)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Except as disclosed in the Optionee SEC Documents or as contemplated by this Agreement, since February 28, 2007, there has not been:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(i)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>any material adverse change in the business, assets, condition (financial or otherwise), operations or prospects of Optionee;</font></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(ii)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>any issuance of capital stock or of rights to acquire capital stock or securities convertible into capital stock, or any agreements relating to such issuance, other than the issuance of Common Stock upon the exercise of stock options under the option plans of Optionee;</font></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(iii)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>any redemption, repurchase or other acquisition of Common Stock of Optionee or any declaration or payment of any dividend or other distribution in cash, stock or property with respect to Common Stock, or any amendment to the Articles of Incorporation or Bylaws or comparable documents of Optionee;</font></p> </td> </tr></table>



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        <td width="96" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(iv)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>any entry into any material commitment or transaction including, without limitation, any borrowing, repayment of indebtedness, capital expenditure or business combination, other than in the ordinary course of business consistent with past practice or as contemplated by this Agreement; or</font></p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


<table border="0" cellspacing=0 cellpadding=0 width="638" style='border-collapse:collapse'>
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        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 6 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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        <td width="96" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(v)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>any pending or, to the knowledge of Optionee, threatened litigation or investigation against Optionee which individually or in the aggregate might result in any material adverse change in the business, assets, condition (financial or otherwise), operations or prospects of Optionee.</font></p> </td> </tr></table>



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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>2.2</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Each of the Optionors represents and warrants to Optionee as follows:</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Each of the Optionors has the requisite corporate power and authority to enter into this Agreement and to perform its obligations hereunder. This Agreement has been duly authorized, executed and delivered by each of the Optionors and constitutes a legal, valid and binding obligation of Optionor enforceable against each of the Optionors in accordance with its terms subject to (i) laws of general application relating to bankruptcy, insolvency and any similar law relating to creditors&#146; rights and (ii) rules of law governing specific performance, injunctive relief and other equitable remedies.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>San Juan is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation, and has the requisite corporate power and authority to own or lease all material property that it purports to own or lease and to carry on its business as now being conducted.  San Juan is duly qualified as a foreign corporation, and is in good standing, in each jurisdiction where the character of its properties owned or held under lease or the nature of its activities makes such qualification necessary, except to the extent that the failure to so qualify would not have a material adverse effect on the business or financial condition of San Juan.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(c)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Neither the execution and delivery of this Agreement nor any of the agreements referred to herein or contemplated hereby, nor the consummation of the transactions hereby contemplated will conflict with, result in the breach of or accelerate the performance required by any agreement to which it is a party.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(d)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>To the best of their knowledge and with the exception of Environmental Laws, each of the Optionors is in compliance in all material respects with all laws and regulations applicable to its operations or with respect to which compliance is a condition of engaging in the business thereof, except to the extent that failure to comply would not have a material adverse effect on the business or financial condition of each of the Optionors.</p> </td> </tr></table>



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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(e)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The mining claims comprised in the Properties have been duly and validly staked and recorded (except as described in Exhibit 2.2(e)), are accurately described in Schedule A, are presently in good standing under the laws of the jurisdiction in which they are located, and are free and clear of all liens, charges, encumbrances, claims, rights, or interest of any person save and except (i) permitted encumbrances including but not limited to utility rights of way, municipal easements, and the like and (ii) the Royalties. </p> </td> </tr></table>



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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(f)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>It has made all taxes, assessment, rentals, levies, or other payments relating to the Properties required to be made to any federal, provincial, or municipal government instrumentality.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(g)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The Optionors are the recorded and beneficial owners of the Properties as described in Schedule A.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(h)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionors have the exclusive right to enter into this Agreement and all necessary authority to dispose of up to an undivided eighty percent (80%) interest in and to the Properties in accordance with the terms of this Agreement.</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


<table border="0" cellspacing=0 cellpadding=0 width="638" style='border-collapse:collapse'>
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        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 7 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(i)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>To the knowledge of the Optionors, no person, firm or corporation has any proprietary or possessory interest in the Properties other than Optionors [except the Royalty Holder as indicated above], and to the knowledge of the Optionors no person is entitled to any royalty or other payment in the nature of rent or royalty on any minerals, ores, metals or concentrates or any other such products removed from the Properties except for the Royalties or as described in Exhibit 2.2(i).</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(j)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>There are no actions, suits, investigations or proceedings before any court, arbitrator, administrative agency or other tribunal or governmental authority, whether current, pending or threatened, which directly or indirectly relate to or affect the Properties or the interests of Optionors therein nor are Optionors aware of any acts that would lead it to suspect that the same might be initiated or threatened except as disclosed in Exhibit 2.2(m)..</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(k)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>There is no adverse claim or challenge against or to the ownership of or title to the Properties, or any portion thereof, nor is there any basis therefore and there are no outstanding agreements or options to purchase or otherwise acquire the Properties or any portion thereof or any interest therein.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(l)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>There are no outstanding agreements or options to purchase or otherwise acquire the Properties or any portion thereof or any interest therein, except this Agreement.</p> </td> </tr></table>



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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(m)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>To the knowledge of the Optionors, after due enquiry, other than as disclosed in Exhibit 2.2(m) there have been no material spills, discharges, leaks, emissions, ejections, escapes, dumping, or other releases of any kind of any toxic or hazardous substances in, on, or under the Properties or the surrounding environment from the time the Optionors acquired ownership of the Properties up to and including the Effective Date; </p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(n)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>To the knowledge of the Optionors, after due enquiry, the conditions on and relating to the Properties respecting all past and current operations are in compliance with all applicable laws, excluding  all Environmental Laws.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(o)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>It has not received from any government authority or any other person any notice of or communication relating to any actual or alleged Environmental Claims, and there are no outstanding governmental actions required to be taken relating to environmental matters respecting the Properties or any operations carried out on the Properties, except for the correspondence attached as Exhibit 2.2(m).</p> </td> </tr></table>



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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(p)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>It has not agreed to nor made any commitments for reclamation, closure or other environmental corrective, clean-up or remediation action with Federal or State government authorities relating directly or indirectly to the Properties.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(q)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionors will upon request, promptly make available to Optionee all information in its possession or control relating to work done on or regarding the Properties that could possibly be considered to be materially significant in indicating whether the Properties might or might not have the potential for economic mineralization.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>2.3</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The representations and warranties hereinbefore set out are conditions on which the parties have relied in entering into this Agreement and will survive the acquisition of any interest in the Properties by Optionee and each party will indemnify and save the other party harmless from all loss, damage, costs, actions and suits arising out of or in connection with any breach of any representation, warranty, covenant, agreement or condition made by the other party and contained in this Agreement.  </p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 8 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>2.4</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The Optionors&#146; total liability to the Optionees pursuant to section 2.3 is limited to the total consideration ( and in the case of shares, the publicly traded value of the shares as at the date the shares were transferred to the Optionors) paid to the Optionors pursuant to sections 3.3, 3.4, 3.5, and 3.6, increased by the value of any additional Optionee shares owned or acquired by the Optionors on or before July 6, 2007, said shares valued as of the date the shares were acquired by the Optionors.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>2.5</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Notwithstanding sections 2.3 and 2.4, in the event the mining claims comprised in the Property are subject to other royalties not referred to or disclosed in this Agreement or the royalty disclosed in Exhibit 2.2(i), any costs required to be paid pursuant to such royalties, including costs to acquire, buy out or otherwise terminate such royalties:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>before the Optionee exercises its option pursuant to section 6.5, will be paid by the Optionees and deemed to be included in and form part of the Expenditures; or</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>after the Optionee exercises its option pursuant to section 6.5, will be paid solely by the Optionor and will not be considered to be joint venture costs. </p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>3.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>OPTION</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>3.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionors hereby irrevocably grants to Optionee the sole and exclusive right and option to acquire up to an undivided eighty percent (80%) right, title and interest in and to the Properties in accordance with the terms of this Agreement, which Option is exercisable by Optionee in stages as set out in sections 3.3, 3.4 and 3.5 hereof.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>3.2</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The Optionors agree they will on or before 5:00 pm Pacific time, June 22, 2007:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>grant all rights reasonably required by the Optionees over all of the surface rights held by the Optionors to the Property listed in Schedule A and any access rights to properties adjacent to the Property, for the purposes of exploring, mining, milling, and storing minerals on or under the Property, or to construct, operate, maintain, demolish and reclaim mine workings and related activities;  and</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><em></em><em>the rights referred to in 3.2 (a) will be granted to all parties to the joint venture agreement for the Property, </em><em></em><em>&nbsp;</em><em></em><em>for $1.00.</em><em></em></p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'><font size=2>If the form of agreements contemplated by this section 3.2 are not mutually satisfactory then this Option Agreement will hereby terminate and the Optionee will be under no further obligation to the Optionors.</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>3.3</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>In order to earn an undivided forty percent (40%) interest in the Properties (the &#147;<b>40% Option</b>&#148;), Optionee will incur Expenditures on the Properties of not less than SIX MILLION DOLLARS ($6,000,000) on the Properties on or before the fifth (5<sup>th</sup>) anniversary of the Effective Date.  Forthwith upon Optionee performing the requirements of Section 3.3, an undivided forty percent (40%) interest in and to the Properties will vest in the Optionee.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>3.4</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>In order to earn an additional undivided twenty percent (20%) interest in the Properties for a total interest of sixty percent (60%) interest in the Properties (the &#147;<b>60% Option</b>&#148;), Optionee will issue Shares and incur additional Expenditures on the Properties, all on the following basis:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>the Optionee will incur additional Expenditures of not less than FOUR MILLION FIVE HUNDRED THOUSAND DOLLARS ($4,500,000) on the Properties on or before the seven and a half (7.5<sup>th</sup>) anniversary of the Effective Date; and</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 9 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>subject to compliance with all applicable securities laws and the execution of a Subscription Agreement and such other documentation as is reasonably required by the Optionee, the Optionee will issue to Optionors five million (5,000,000) Shares (after the Optionee effects a &#147;forward split&#148; of 7.9 to 1 of its Common Stock).</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>Forthwith upon Optionee performing the requirements of paragraphs 3.4(a) and (b), an undivided additional twenty percent (20%) interest in and to the Properties will vest in the Optionee.</p>


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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>3.5</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>In order to earn an additional undivided twenty percent (20%) interest in the Properties for a total interest of eighty percent (80%) interest in the Properties (the &#147;<b>80% Option</b>&#148;), Optionee will issue to Optionors additional Shares and incur additional Expenditures on the Properties, all on the following basis:</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>the Optionee will incur additional Expenditures of not less than FOUR MILLION FIVE HUNDRED THOUSAND DOLLARS ($4,500,000) on the Properties on or before the tenth (10<sup>th</sup>) anniversary of the Effective Date; and</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>subject to compliance with all applicable securities laws and the execution of a Subscription Agreement and such other documentation as is reasonably required by the Optionee, the Optionee will issue to Optionors five million (5,000,000) Shares (after the Optionee effects a &#147;forward split&#148; of 7.9 to 1 of its Common Stock). </p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>Forthwith upon Optionee performing the requirements of paragraphs 3.5(a) and (b), an undivided additional twenty percent (20%) interest in and to the Properties will vest in the Optionee. </p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>3.6</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>In order to keep the Option in good standing, the Optionee will make the following payments to the Optionors, as follows: </p> </td> </tr></table>



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    <tr style='page-break-inside:avoid'>
        <td width="415" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:72pt;text-indent:-36pt;text-align:left;margin-top:12pt;margin-bottom:0pt'>(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;on or before 30 days after the Effective Date, in cash</p>  </td>
        <td width="117" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0in;text-indent:0pt;text-align: right;margin-top:12.0pt;margin-bottom:0in'><font size=2>$50,000</font></p> </td> </tr>
    <tr style='page-break-inside:avoid'>
        <td width="415" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:72pt;text-indent:-36pt;text-align:left;margin-top:12pt;margin-bottom:0pt'>(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;on or before the first anniversary of the Effective Date, in cash</p>  </td>
        <td width="117" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0in;text-indent:0pt;text-align: right;margin-top:12.0pt;margin-bottom:0in'><font size=2>$100,000</font></p> </td> </tr>
    <tr style='page-break-inside:avoid'>
        <td width="415" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:72pt;text-indent:-36pt;text-align:left;margin-top:12pt;margin-bottom:0pt'>(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;on or before the second anniversary of the Effective Date, in cash</p>  </td>
        <td width="117" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0in;text-indent:0pt;text-align: right;margin-top:12.0pt;margin-bottom:0in'><font size=2>$200,000</font></p> </td> </tr>
    <tr style='page-break-inside:avoid'>
        <td width="415" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:72pt;text-indent:-36pt;text-align:left;margin-top:12pt;margin-bottom:0pt'>(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;on or before the third anniversary of the Effective Date, and annually thereafter up to and including the tenth anniversary of the Effective Date in gold contained in gold dore (or equivalent in cash), which payments are only payable if the Optionee has successfully acquired the Mill and the Mill operated during any part of the year in which the payment is due.</p>  </td>
        <td width="117" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0in;text-indent:0pt;text-align: right;margin-top:12.0pt;margin-bottom:0in'><font size=2>100 troy ounces</font></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>4.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>EXPENDITURES</B></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>4.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionors understand and confirm that the Expenditures in excess of the amounts required to be spent within the periods referred to in each of paragraphs 3.3, 3.4(a) and 3.5(a), may be carried over and included in the aggregate amount of Expenditures for the subsequent period. Optionors understand and confirm that Expenditures may be incurred on the Properties by the Optionee or its successors or assigns.</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


<table border="0" cellspacing=0 cellpadding=0 width="638" style='border-collapse:collapse'>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 10 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>4.2</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionee will file assessment reports in a timely manner regarding all eligible Expenditures incurred by Optionee in respect of the Properties.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>4.3</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>As noted in Section 1.1(f), acquisition of Royalties shall be deemed an Expenditure amount, and upon such acquisition, Optionee and/or Optionors agree that such Royalty or Royalties, as the case may be, will be extinguished by making an appropriate legal filing.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>5.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>APPOINTMENT OF OPERATOR</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>5.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionee will be the initial operator on the Properties (the &#147;<b>Operator</b>&#148;) and will be entitled to continue to act as Operator until Optionee may resign as the Operator. Thereafter, Optionors will be entitled to become the Operator. If Optionors decline to be the Operator or resign as the Operator, the parties will appoint a new Operator.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>5.2</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The Operator will be entitled to a fee of ten percent (10%) of all Expenditures made or incurred by it as Operator for management supervision and administrative services, and such fee shall be included as an Expenditure for purposes of meeting the Expenditure requirements set forth in Section 3 of this Agreement. </p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>5.3</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The Operator will have the sole and exclusive right and authority to manage and carry out all Programs on the Properties and to incur the Expenditures required for that purpose. </p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>5.4</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>In carrying out its duties, the Operator will:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>comply with the provisions of all agreements or instruments of title under which the Properties are held, provided the Operator is informed, in writing, of such agreements or instruments of title;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>pay all Expenditures properly incurred promptly as and when due;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(c)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>keep the Properties free of all liens and encumbrances (other than those, if any, in effect on the Effective Date or the creation of which is permitted by this Agreement) arising out of the carrying out of work on the Properties and, in the event of any lien being filed as mentioned, proceed with diligence to contest or discharge it;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(d)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>prosecute claims or, where a defence is available, defend litigation arising out of the carrying out of any work on the Properties on or after the Effective Date, provided that any party may join in the prosecution or defence at its own expense;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(e)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>perform assessment work or make payment in lieu thereof and pay the rentals, taxes, or other payments and do all other things necessary to maintain the Properties in good standing, including without limitation staking and restaking mining claims and applying for licenses, leases, grants, concessions, permits, patents, and other rights to and interests in the Properties;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(f)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>maintain accounts in accordance with principles generally accepted in the mining industry in the United States;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(g)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>perform its duties and obligations in a sound and workmanlike manner, in accordance with sound mining and engineering practices, and in compliance with all applicable federal, provincial, state, territorial, and municipal laws, by-laws, ordinances, rules and regulations, and this Agreement;</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 11 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(h)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>regulate access to the Properties, subject only to the right of designates of the parties authorized in writing to have access to the Properties at all reasonable times at their own risk and expense for the purpose of inspecting work being done on the Properties;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(i)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>employ and engage employees, agents, and independent contractors that it considers necessary or advisable to carry out its duties and obligations and, in this connection, to delegate any of its powers and rights to perform its duties and obligations under this Agreement; </p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(j)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>permit the parties, at their own expense, to inspect, take abstracts from, or audit any or all of the records and accounts related to the Properties and any work done thereon during normal business hours;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(k)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>obtain and maintain, or cause any contractor engaged under this Agreement to obtain and maintain, adequate insurance during any period in which active work is carried out under this Agreement;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(l)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>arrange for and maintain workers&#146; compensation or equivalent coverage for all eligible employees engaged by the Operator in accordance with local statutory requirements; and</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(m)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>transact, undertake, and perform all transactions, contracts, employments, purchases, operations, negotiations with third parties, and any other matters undertaken on behalf of the parties in the Operator&#146;s name.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>5.5</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The Operator may resign as Operator on at least thirty (30) days&#146; notice to all parties.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>5.6</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Within sixty (60) days following the end of each calendar year or, at the Operator&#146;s sole discretion, within sixty (60) days following the completion of any Program on the Properties, the Operator will deliver to the parties a statement showing in reasonable detail the Expenditures incurred during the Program and the aggregate Expenditures incurred to the end of the calendar year or such Program, as the case may be, and the parties to this Agreement will have thirty (30) days from the time of receipt of such statement to question the accuracy thereof in writing, failing which such statement will be deemed to be correct and unimpeachable thereafter.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>5.7</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>If a statement delivered pursuant to section 5.6 is questioned by a party to this Agreement:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>such party will have two (2) months from the time of delivery of the statement to have such audited;</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>the audited results will be final and determinative of the amount of Expenditures incurred for the audited period; provided that, if such audit discloses a deficiency in the amount of Expenditures required to be incurred to maintain the Option in good standing, the party that is the Operator may pay to the non-Operator party the amount of such deficiency within fifteen (15) days following receipt of notice of such audited results, whereupon such amount will be deemed to have been Expenditures incurred during the audited period; and</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(c)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>the costs of the audit will be borne by the party requesting the audit if the Operator&#146;s statement was accurate within five percent (5%) and will be borne by the Operator if such statement was not accurate within five percent (5%).</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


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        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 12 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>6.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>EXERCISE OF OPTION AND FORMATION OF JOINT VENTURE</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>6.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Once the Optionee has incurred and performed the requirements as set out in section 3.3, the Optionee will be deemed to have exercised the 40% Option and to have earned an undivided forty percent (40%) interest in and to the Properties.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>6.2</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Once the Optionee has incurred and performed the requirements as set out in section 3.4, the Optionee will be deemed to have exercised the 60% Option and to have earned an undivided sixty percent (60%) interest in and to the Properties.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>6.3</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Once the Optionee has incurred and performed the requirements as set out in section 3.5, the Optionee will be deemed to have exercised the 80% Option and to have earned an undivided eighty percent (80%) interest in and to the Properties.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>6.4</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The decision to proceed with the 40% Option, the 60% Option or the 80% Option will be made by the independent directors of the Board of Directors of the Optionee.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>6.5</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>In the event that the Optionee: </p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>exercises the 40% Option in accordance with the terms of this Agreement and notifies Optionors in writing that it does not intend to exercise the 60% Option, or</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>exercises the 60% Option in accordance with the terms of this Agreement and notifies the Optionors in writing that it does not intend to exercise the 80% Option, or</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(c)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>exercises the 80% Option in accordance with the terms of this Agreement,</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'><font size=2>then Optionors and Optionee agree to associate on a joint venture basis for the further exploration and development of the Properties and to contribute to all further costs including exploration and development in accordance with their respective interests in the Properties. </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>6.6</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Upon an event specified in section 6.5, the parties further agree to negotiate in good faith and enter into a joint venture agreement, which will include the following terms.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>A deemed initial expenditure by Optionee on the Properties representing its percentage undivided interest in the Properties.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The Optionee shall continue to be the Operator.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(c)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>A management committee (the &#147;<b>Management Committee</b>&#148;) will be formed and will be composed as follows:</p> </td> </tr></table>



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        <td width="96" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(i)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>if Optionee has exercised is 40% Option but not its 60% Option, then Optionee shall have the right to appoint two (2) representatives, and the Optionor shall have the right to appoint two (2) representatives;</font></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(ii)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>if Optionee has exercised its 60% Option, then Optionee shall have the right to appoint four (4) representatives, and the Optionor shall have the right to appoint two (2) representatives; and</font></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(iii)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>if Optionee has exercised its 80% Option, then Optionee shall have the right to appoint six (6) representatives and the Optionor shall have the right to appoint two (2) representatives.</font></p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 13 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(d)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The Management Committee shall make all decisions in respect of exploration, development and mining operations on the Properties, and shall decide every question submitted to it by a vote with each party&#146;s representatives collectively being entitled to cast that number of votes which is equal to its party&#146;s interest percentage in the joint venture. Other than as is expressly set out herein to the contrary, the Management Committee shall make decisions by simple majority. In the event of a tied vote, the chairman shall have a casting vote in addition to the votes to which the chairman is entitled to cast as the representative of a party.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(e)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The representatives of the Optionors shall be the chairman and secretary, respectively, of the Management Committee meeting.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(f)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>A standard formula for dilution of a non-contributing party&#146;s interest. In the event any party&#146;s interest is reduced to five percent (5%) or less, such party shall then be deemed to have assigned and conveyed its interest to the other party, and shall be entitled to receive as its sole remuneration and benefit in consideration of that assignment and conveyance, a one percent (1%) net smelter returns royalty, under a standard definition of net smelter returns.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(g)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>A right of first offer regarding the sale or assignment of a party&#146;s interest in the Property to a non-affiliate.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(h)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>A protocol or set of procedures to avoid conflict of interest and ensure that Todd Hennis&#146; role as an officer and fiduciary of the Optionee does not conflict with his interest and participation as one of the Optionors.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(i)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Ores from the Gold King, Mogul and Mayflower mines will have first priority for   milling at the Mill, and such milling work and services shall be billed at actual direct cost without markup or overhead charge of any kind.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>6.7</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>On formation of a joint venture between the parties, Optionee will be Operator of the Properties.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>6.8</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionors, in addition to, or in lieu of, contributing funds in accordance with their respective interests in the Properties, may elect any one or a combination of the following:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><b>Assignment of Royalties and Income</b>.  Upon written notice to Optionee, Optionors may require Optionee to advance and fund Optionor's share of contribution with respect to Optionor's interests in the Properties, and as sole consideration for such advancement funds, Optionor will assign to Optionee any and all of Optionor's respective interest in future royalties and income received on the Properties until such time as the funds advanced by Optionee have be reimbursed in full, plus interest at 10% per annum on the outstanding balance of any advanced funds.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><b>Application of Rents from Building and Equipment Leasing and/or Rental</b>.  It is envisioned that Optionee may need to use, rent, or lease various supplies, mining related buildings or equipment from Optioners in connection with its Expenditure activities pursuant to this Agreement.  To the extent Optionee uses, rents or leases such supplies, buildings and equipment and they are not already located on or form part of the Properties, Optionee may elect to pay Optionor's share of contribution with respect to Optionor's interests in the Properties by setoff of any amounts due under such lease and/or rental arrangements.</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 14 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>7.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>RIGHT OF ENTRY</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>7.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>During the currency of this Agreement, Optionee and its respective employees, agents and independent contractors, will have the sole and exclusive right and option to:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>enter upon the Properties;</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>have exclusive and quiet possession thereof;</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(c)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>do such prospecting, exploration, development or other mining work thereon and thereunder as Optionee in its sole discretion may consider advisable;</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(d)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>bring and erect upon the Properties such facilities as Optionee may consider advisable; and</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(e)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>remove from the Properties and dispose of, for its own account, ore or mineral products for the purpose of bulk sampling, pilot plant or test operations.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>8.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>ANCILLARY AGREEMENTS</B></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>8.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Upon execution of this Agreement, Optionee shall execute and enter into an employment agreement with Hennis in the form attached hereto as Exhibit 8.1.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:.0001pt'>8.2</p>  </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:.0001pt'><font size=1>&nbsp;</font></p>
<p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>If the Optionee determines to proceed with the preparation and filing with the Securities and Exchange Commission (the &#147;SEC&#148;) of a registration statement (the &#147;Registration Statement&#148;) relating to an offering for its own account or the account of others under the United States Securities Act of 1933, as amended (the &#147;1933 Act&#148;) of any of its common shares, other than on Form S-4 or Form S-8 (each as promulgated under the 1933 Act) or its then equivalents relating to equity securities issuable in connection with stock option or other employee benefit plans, the Optionee shall send to the Optionors written notice of such determination and, if within ten (10) days after receipt of such notice, the Optionors shall so request in writing, the Optionee will cause the registration under the 1933 Act of all unregistered
common shares beneficially owned by the Optionors (the &#147;Registrable Securities&#148;), provided that if at any time after giving written notice of its intention to register any of its common shares and prior to the effective date of the registration statement filed in connection with such registration, the Optionee shall determine for any reason not to register or to delay registration of such common shares, the Optionee may, at its election, give written notice of such determination to the Optionors and, thereupon, (i) in the case of a determination not to register, shall be relieved of its obligation to register the Registrable Securities in connection with such registration, and (ii) in the case of a determination to delay registering, shall be permitted to delay registering the Registrable Securities for the same period as the delay in registering such other common shares.  The Optionee shall include in such registration statement all or any part of the Registrable Securities
provided however that the Optionee shall not be required to register any of the Registrable Shares that are eligible for sale pursuant to Rule 144(k) of the 1933 Act.  Notwithstanding any other provision in this Agreement, if the Optionee receives a comment from the SEC which effectively results in the Optionee having to reduce the number of common shares being registered on such Registration Statement, then the Optionee may, in its sole discretion, reduce on a pro rata basis the number of Registrable Securities to be included in such Registration Statement.</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 15 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionee will file a registration statement, or will amend an existing registration statement, with the SEC with respect to the Registrable Securities if the Optionee receives a written request from the Optionor at any time up to six years after the date of this Agreement, provided that initial request shall be for a minimum of 500,000 Shares.  The Optionee will, as soon as practicable, use its diligent efforts to effect such registration as would permit the sale of all or such portion of such Registrable Securities as are specified in such request.  No additional request may be made within six months of the expiration date of effectiveness of the registration statement relating to the initial registration request.  The Optionee will not be obligated to take any action pursuant to this sub-section (b):</p> </td> </tr></table>



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        <td width="96" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(i)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>after the Optionee has effected three such registrations pursuant to this sub-section (b) and such registrations have been declared or ordered effective;</font></p> </td> </tr></table>



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        <td width="96" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(ii)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>during the period starting with the date 60 days prior to the Optionee&#146;s good faith estimate of the date of filing of, and ending on a date 180 days after the effective date of, a registration for a registered public offering involving an underwriting; provided the Optionee is actively employing in good faith all reasonable efforts to cause such registration statement to become effective; or</font></p> </td> </tr></table>



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        <td width="96" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(iii)</font></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>with respect to Registrable Shares that are eligible for sale pursuant to Rule 144(k) of the 1933 Act.  </font></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>8.3</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>In connection with each Registration Statement described in Section 8.2 hereof, the Optionors will furnish to the Optionee in writing such information and representation letters with respect to itself and the proposed distribution by it as reasonably shall be necessary in order to assure compliance with federal and applicable state securities laws.  The Optionee may require the Optionors to furnish to the Optionee a certified statement as to the number of shares of common stock of the Optionee beneficially owned by the Optionors and the name of the natural person thereof that has voting and dispositive control over the Registrable Securities.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>8.4</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>All fees and expenses incident to the performance of or compliance with the filing of the Registration Statement shall be borne by the Optionee whether or not any Registrable Securities are sold pursuant to the Registration Statement.  The fees and expenses referred to in the foregoing sentence shall include, without limitation, (i) all registration and filing fees (including, without limitation, fees and expenses (A) with respect to filings required to be made with the OTC Bulletin Board or other exchange or quotation service on which the common stock of the Optionee is then listed for trading, and (B) in compliance with applicable state securities or Blue Sky Laws), (ii) printing expenses (including, without limitation, expenses of printing certificates for Registrable Securities and of printing prospectuses if the printing of
prospectuses is reasonably requested by the holders of a majority of the Registrable Securities included in the Registration Statement), (iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of counsel for the Optionee, (v) 1933 Act liability insurance, if the Optionee so desires such insurance, and (vi) fees and expenses of all other persons retained by the Optionee in connection with the filing of the Registration Statement.  In addition, the Optionee shall be responsible for all of its internal expenses incurred in connection with the filing of the Registration Statement (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expense of any annual audit and the fees and expenses incurred in connection with the listing of the Registrable Securities on any securities exchange, if applicable. In no event shall the Optionee be responsible for any broker or similar commissions or, except
to the extent provided for hereunder, any legal fees or other costs of the Optionors.</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 16 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>8.5</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The Optionee shall, notwithstanding any termination of this Agreement, indemnify and hold harmless the Optionors, and if applicable, its officers, directors, agents and employees, and each person who controls the Optionors (within the meaning of Section 15 of the 1933 Act or Section 20 of the United States Securities Exchange Act of 1934 (the &#147;1934 Act&#148;)) and the officers, directors, agents and employees of each such controlling person, to the fullest extent permitted by applicable law, from and against any and all losses, claims, damages, liabilities, costs (including, without limitation, reasonable attorneys&#146; fees) and expenses (collectively, &#147;Losses&#148;), as incurred, arising out of or relating to any untrue or alleged untrue statement of a material fact contained in the Registration Statement, or in any amendment
or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, except to the extent, but only to the extent, that (i) such untrue statements or omissions are based solely upon information regarding the Options furnished in writing to the Optionee by the Optionors expressly for use therein, or to the extent that such information relates to the Optionors or the Optionors&#146; proposed method of distribution of Registrable Securities and was reviewed and expressly approved in writing by the Optionors expressly for use in the Registration Statement, or in any amendment or supplement thereto or (ii) the use by the Optionors of an outdated or defective Registration Statement after the Optionee has notified the Optionors in writing that the Registration Statement is outdated or defective.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>8.6</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The Optionors shall indemnify and hold harmless the Optionee, its directors, officers, agents and employees, each person who controls the Optionee (within the meaning of Section 15 of the 1933 Act and Section 20 of the 1934 Act), and the directors, officers, agents or employees of such controlling persons, to the fullest extent permitted by applicable law, from and against all Losses, as incurred, to the extent arising out of or based solely upon: (x) the Optionors&#146; failure to comply with the prospectus delivery requirements of the 1933 Act or (y) any untrue or alleged untrue statement of a material fact contained in any Registration Statement, or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading (i) to the extent, but only to the extent, that such untrue statement or omission is contained in any information so furnished in writing by the Optionors to the Optionee specifically for inclusion in the Registration Statement or (ii) to the extent that such untrue statements or omissions are based solely upon information regarding the Optionors furnished in writing to the Optionee by the Optionors expressly for use therein, or (iii) to the extent that such information relates to the Optionors or the Optionors&#146; proposed method of distribution of Registrable Securities and was reviewed and expressly approved in writing by the Optionors expressly for use in the Registration Statement or in any amendment or supplement thereto or (z) the use by the Optionors of an outdated or defective Registration Statement after the Optionee has notified the Optionors in writing that the Registration Statement is outdated or  defective.  In
no event shall the liability of the Optionors hereunder be greater in amount than the dollar amount of the net proceeds received by the Optionors upon the sale of the Registrable Securities giving rise to such indemnification obligation.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>8.7</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>If a claim for indemnification hereunder is unavailable to either the Optionee or the Optionors (in each case, an &#147;Indemnified Party or Indemnified Parties&#148;, as applicable) (by reason of public policy or otherwise), then each Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such Losses, in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party and Indemnified Party in connection with the actions, statements or omissions that resulted in such Losses as well as any other relevant equitable considerations.  The relative fault of such Indemnifying Party and Indemnified Party shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged
untrue statement of a </p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>&nbsp;</p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>&nbsp;</p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


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        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 17 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>&nbsp;</p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>material fact or omission or alleged omission of a material fact, has been taken or made by, or relates to information supplied by, such Indemnifying Party or Indemnified Party, and the parties&#146; relative intent, knowledge, access to information and opportunity to correct or prevent such action, statement or omission.  The amount paid or payable by a party as a result of any Losses shall be deemed to include, subject to the limitations set forth in this Agreement, any reasonable attorneys&#146; or other reasonable fees or expenses incurred by such party in connection with any proceeding to the extent such party would have been indemnified for such fees or expenses if the indemnification provided for in this section was available to such party in accordance with its terms. The parties hereto agree that it would not be just and equitable if contribution pursuant to this section were determined by
pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred to in the immediately preceding paragraph.</p>


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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>9.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>TERMINATION</B></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>9.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>In the event of default in the performance of the requirements of article 3, then, subject to the provisions of article 11 of this Agreement, the Option and this Agreement will terminate.</p> </td> </tr></table>



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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>9.2</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Notwithstanding any other provision of this Agreement, Optionee will have the right at any time on or before eighteen (18) months after the Effective Date to terminate the Option and this Agreement by giving ten (10) days written notice to the Optionors. If the Optionee gives such notice of termination, then the Option and this Agreement will terminate, Optionee will, subject to the provisions of section 11.1, have no further rights or interest in the Properties and no further obligations or liabilities to Optionors (including in respect of any cash or dore payments as contemplated in section 3.6 and any Share issuances or Expenditures as contemplated in sections 3.3, 3.4 and 3.5 which have not been made) and Optionors will forthwith return to the Optionee any Shares issued under the terms of this Agreement (except for shares of common
stock which may have been acquired or issued to Mr. Hennis pursuant to his role as an employee with the Optionee) and comply with the terms of section 11.2. </p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>10.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>COVENANTS OF OPTIONORS</B></p> </td> </tr></table>



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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>10.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>During the currency of this Agreement and the Option, Optionors will:</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>do all things required under the Underlying Agreements to maintain the Royalty in good standing and perform and fulfill all its obligations and covenants under the Underlying Agreements;</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>not do any act or thing which would or might in any way adversely affect the rights of Optionee hereunder to earn up to an undivided eighty percent (80%) interest in the Properties; </p> </td> </tr></table>



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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(c)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>promptly make available to Optionee and its representatives all records and files in the possession of Optionors relating to the Properties, and permit Optionee and its representatives at its own expense to take abstracts therefrom and make copies thereof; and</p> </td> </tr></table>



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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(d)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>promptly provide Optionee with any and all notices and correspondence from government agencies in respect of the Properties.</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


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        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 18 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>11.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>OBLIGATIONS OF PARTIES AFTER TERMINATION</B></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>11.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>In the event of the termination of the Option, Optionee will:</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>leave the Properties in good standing for a minimum of six (6) months under all applicable legislation, free and clear of all liens, charges and encumbrances arising from this Agreement or their operations hereunder and in a safe and orderly condition;</p> </td> </tr></table>



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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>deliver to Optionors within sixty (60) days of completion of any Program on the Properties by Optionee a comprehensive report on all work carried out by Optionee on the Properties (limited to factual matter only) together with copies of all maps, drill logs, assay results and other technical data compiled by Optionee with respect to the Properties; and</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(c)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>have the right, and obligation on demand made by Optionors, to remove from the Properties within six (6) months of the effective date of termination all facilities erected, installed or brought upon the Properties by or at the instance of Optionee provided that at the option of Optionors, any or all of facilities not so removed will become the property of Optionors.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>11.2</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>In the event of the termination of the Option, Optionors will:</p> </td> </tr></table>



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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>if termination occurs at any time on or before eighteen (18) months from the Effective Date pursuant to Section 9.2, forthwith return any Shares of the Optionee issued or caused to be transferred to the Optionors pursuant to this Agreement to the Optionee; </p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>cause Hennis and any other directors appointed by Hennis to resign forthwith from the Board of Directors of Optionee. </p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>12.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>TRANSFER OF TITLE</B></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>12.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Upon Optionee earning the 40% Option, the 60% Option or the 80% Option and at the request of Optionee, Optionors will deliver to Optionee a duly executed transfer in registrable form transferring the applicable undivided percentage right, title and interest in and to the Properties in favour of Optionee, which Optionee will be entitled to register against title to the Properties.  Notwithstanding the foregoing, transfer of title, Optionee and Optionors shall be subject to the limitations specified in Note #2 to Schedule A regarding the ban on either party conducting mining operations separate from the joint venture specified in Section 6.5 of this Agreement, provided that any custom milling from the Mill will be excluded from this limitation.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>13.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>REGISTRATION OF AGREEMENT</B></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>13.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Notwithstanding section 12.1 of this Agreement, Optionee or Optionors will have the right at any time to register this Agreement or notice thereof against title to the Properties.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>14.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>AREA OF MUTUAL INTEREST</B></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>14.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>An area of mutual interest located within two miles of the existing exterior boundaries of the Properties is hereby established, (which area is hereinafter called the &#147;<B>AMI</B>&#148;). By signing this Agreement, Optionee and Optionors hereby covenant and agree each with the other that any property interest or mineral rights or Properties that may be acquired by either of them after the Effective Date located wholly or partially within the AMI excluding the Mill, will become a part of the Properties and be subject to this Agreement if: (a) the principal mineralization is gold, </p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>&nbsp;</p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>&nbsp;</p>
<br>
<HR noshade align="center" width="100%" size="2">
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 19 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>&nbsp;</p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>silver, lead or zinc, and (b) the Optionors, acting in good faith, believe that the property or interest has a reasonable potential for economic mineralization. If either Optionee or Optionors acquires an interest as aforesaid, it will notify the other in writing of the extent of the interest acquired. The notified party will have thirty (30) days following receipt by it of the foregoing notification to elect in writing to have the property interest or mineral rights or Properties included within the terms of this Agreement. If the notified party does not so elect in writing within the thirty (30) day period, the acquiring party will be entitled to acquire the property interest or mineral rights or Properties for its own account and such interest will not be part of the Properties and will not be subject to the terms of this Agreement.</p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>14.2</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>An area of potential interest located within 10 miles, but more than two miles, of the existing exterior boundaries of the Properties is hereby established, (which area is hereinafter called the &#147;<B>API</B>&#148;). By signing this Agreement, Optionors hereby covenant and agree that any property interest excluding the Mill or mineral rights that Optionors&#146; may locate or acquire after the Effective Date located wholly or partially within the API will be offered to Optionee if (i) the principal mineralization is gold, silver lead or zinc, and (ii) in the good faith estimate of Optionors&#146;, they believe that the property or interest has a reasonable potential for economic mineralization. If Optionors locate or acquire an interest as aforesaid, it will notify the Optionee in writing regarding the existence and   nature of property
or interest.  Optionee will have thirty (30) days following receipt by it of the foregoing notification to elect in writing to have the property interest or mineral rights included within the terms of this Agreement. If Optionee does not so elect in writing within the thirty (30) day period, Optionor will be entitled to acquire or keep the property interest or mineral rights for its own account and such interest will not be part of the Properties and will not be subject to the terms of this Agreement.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>15.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>DISPOSITION OF PROPERTIES</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>15.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Optionee may, at any time after exercising the Option pursuant to article 6 hereof, sell, transfer or otherwise dispose of all or any portion of its interest in and to the Properties and this Agreement provided that, at any time, Optionee has first obtained the consent in writing of Optionors, such consent not to be unreasonably withheld and further provided that, at any time during the currency of this Agreement, any purchaser, grantee or transferee of any such interest will have first delivered to Optionors its agreement related to this Agreement and to the Properties, containing:</p> </td> </tr></table>



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    <tr >
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>a covenant with Optionors by such transferee to perform all the obligations of Optionee to be performed under this Agreement in respect of the interest to be acquired by it from Optionee, and</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>a provision subjecting any further sale, transfer or other disposition of such interest in the Properties and this Agreement or any portion thereof to the restrictions contained in this section 15.1.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>15.2</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The provisions of section 15.1 of this Agreement will not prevent Optionee from entering into an amalgamation or corporate reorganization, which will have the effect in law of the amalgamated or surviving company possessing all the property, rights and interests and being subject to all the debts, liabilities and obligations of each amalgamating or predecessor company.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>16.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>CONFIDENTIAL NATURE OF INFORMATION</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>16.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The parties agree that all information obtained from the work carried out hereunder and under the operation of this Agreement will be the exclusive property of the parties and will not be used other than for the activities contemplated hereunder except as required by law or by the rules and </p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>&nbsp;</p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>&nbsp;</p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


<table border="0" cellspacing=0 cellpadding=0 width="638" style='border-collapse:collapse'>
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        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 20 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>&nbsp;</p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:0.5in;text-align:justify;'>regulations of any regulatory authority having jurisdiction, or with the written consent of both parties, such consent not to be unreasonably withheld. Notwithstanding the foregoing, it is understood and agreed that a party will not be liable to the other party for the fraudulent or negligent disclosure of information by any of its employees, servants or agents, provided that such party has taken reasonable steps to ensure the preservation of the confidential nature of such information.</p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>17.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>FURTHER ASSURANCES</B></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>17.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The parties hereto agree that they and each of them will execute all documents and do all acts and things within their respective powers to carry out and implement the provisions or intent of this Agreement.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>18.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>NOTICE</B></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>18.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Any notice, direction or other communication required or permitted to be given under this Agreement will be in writing and will be given by personal delivery or by prepaid registered or certified mail or by facsimile or other form of telecommunication, in each case addressed as follows:</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>if to Optionee:</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:left;'><b><font size=2>Garpa Resources, Inc.</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in;text-align:left;'><font size=2>650 Georgia Street West #620</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in;text-align:left;'><font size=2>Vancouver, BC V6B 4N8</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:justify;'><font size=2>Attention: Gary Schellenberg</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:justify;'><font size=2>Fax: c/o 604.687.6314</font></p>


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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>if to Optionors:</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:left;'><b><font size=2>Todd Hennis or San Juan Corp.</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in;text-align:left;'><font size=2>645 Water Street</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in;text-align:left;'><font size=2>PO Drawer I</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1in;text-align:left;'><font size=2>Silver Plume, CO 80476</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt; margin-left:1in;text-align:justify;'><font size=2>Fax: 303.569.0156</font></p>


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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>18.2</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Any notice, direction or other communication aforesaid will, if delivered, be deemed to have been given and received on the day it was delivered, and if mailed, be deemed to have been given and received on the third business day following the day of mailing, except in the event of disruption of the postal services in which event notice will be deemed to be received only when actually received, and if sent by facsimile or other form of telecommunication, will be deemed to have been given or received on the next business day following the date on which it was so sent.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>18.3</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Any party may at any time give to the other notice in writing of any change of address of the party giving such notice and from and after the giving of such notice, the address or addresses therein specified will be deemed to be the address of such party for the purpose of giving notice hereunder.</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


<table border="0" cellspacing=0 cellpadding=0 width="638" style='border-collapse:collapse'>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 21 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>19.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>HEADINGS</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>19.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The headings to the respective sections herein will not be deemed part of this Agreement but will be regarded as having been used for convenience only.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>20.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>DEFAULT</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>20.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>In the event that Optionee is in default of any of its obligations hereunder, Optionors will give notice specifying the nature of the default. If Optionee does not take any reasonable steps to cure such default within thirty (30) days from date of Optionee&#146;s receipt of such notice, this Agreement will terminate and be of no force and effect, except that Optionee will remain responsible for any cash payment that is due to Optionors within the thirty (30) day period following the date of such notice.</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>21.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>PAYMENT</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>21.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>All references to monies hereunder will be in United States funds except where otherwise designated. All payments to be made to any party hereunder will be mailed or delivered to such party at its address for notice purposes as provided herein, or for the account of such party at such bank or banks in the United States as such party may designate from time to time by written notice. Such bank or banks will be deemed the agent of the designating party for the purpose of receiving, collecting and receiving such payment.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>22.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>ENUREMENT</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>22.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>This Agreement will enure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>23.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>TERMS</B></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>23.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The terms and provisions of this Agreement will be interpreted in accordance with the laws of Colorado.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>24.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>FORCE MAJEURE</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>24.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>No party will be liable for its failure to perform any of its obligations under this Agreement due to a cause beyond its control (except those caused by its own lack of funds) including, but not limited to acts of God, fire, flood, explosion, strikes, lockouts or other industrial disturbances, laws, rules and regulations or orders of any duly constituted governmental authority or non-availability of materials, equipment, manpower or transportation (each an &#147;<b>Intervening Event</b>&#148;).</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>24.2</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>All time limits imposed by this Agreement will be extended by a period equivalent to the period of delay resulting from an Intervening Event described in section 24.1.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>24.3</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>A party relying on the provisions of section 24.1 will take all reasonable steps to eliminate an Intervening Event and, if possible, will perform its obligations under this Agreement as far as practical, but nothing herein will require such party to settle or adjust any labour dispute or to question or to test the validity of any law, rule, regulation or order of any duly constituted governmental authority or to complete its obligations under this Agreement if an Intervening Event renders completion impossible.</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 22 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>25.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>ENTIRE AGREEMENT</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>25.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>This Agreement constitutes the entire agreement between the parties and replaces and supersedes all prior agreements, memoranda, correspondence, communications, negotiations and representations, whether verbal or written, express or implied, statutory or otherwise between the parties with respect to the subject matter herein.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>26.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>OPTI</B>O<B>N ONLY</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>26.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>This Agreement provides for an option only and, except for the cash or other payments set out in paragraph&nbsp;3.6(a) hereof, nothing herein contained will be construed as obligating Optionee to do any acts or make any payment hereunder and any act or acts or payment or payments as will be made hereunder will not be construed as obligating Optionee to do any further act or make any further payment.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>26.2</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The decision to proceed with the 40% Option, the 60% Option or the 80% Option will be made by the independent directors of the Board of Directors of the Optionee. </p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>27.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>TIME OF ESSENCE</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>27.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Time will be of the essence in this Agreement.</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>28.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>ENFORCEMENT OF AGREEMENT</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>28.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>The covenants, promises, terms and conditions contained herein will be binding upon the parties jointly and severally and may be enforced by each as against each other inter se.</p> </td> </tr></table>


<p style=' margin-bottom:0pt; margin-top:12pt;text-align:center;'><B><font SIZE=2>THE BALANCE OF THIS PAGE INTENTIONALLY LEFT BLANK</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 23 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:left;'>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b>29.</b></p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><B>COUNTERPARTS</B></p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>29.1</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>This Agreement may be executed in several counterparts, each of which will be deemed to be an original and all of which will together constitute one and the same instrument.</p> </td> </tr></table>


<p style=' margin-bottom:18pt; margin-top:18pt;text-align:justify;'><B><font SIZE=2>IN WITNESS WHEREOF</font></B><font size=2> the parties hereto have executed this Agreement as of the day and year first above written.</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:left;'><B><font SIZE=2>SAN JUAN CORP.</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>Per: /s/ Todd Hennis</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt'><font size=2>Todd Hennis, President</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:24pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:left;'><font size=2>/s/ Todd Hennis</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>Todd Hennis, Individually</font></p>

<p style=' margin-bottom:0pt; margin-top:24pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:24pt;text-align:left;'><b><font size=2>GARPA RESOURCES, INC.</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>Per: /s/ Gary Schellenberg</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0in;margin-bottom:0pt'><font size=2>Gary Schellenberg</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


<p style=' margin-bottom:0pt; margin-top:12pt;text-align:center;'><b><font size=2>Schedule A</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>to Option Agreement</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>Gold King, Mayflower and Mogul Properties</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>made as of the 14th day of June, 2007</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>between</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>San Juan Corp. and Todd C. Hennis, as the Optionors </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>and Garpa Resources, Inc., as the Optionee</font></p>

<p style=' margin-bottom:0pt; margin-top:18pt;text-align:left;'><B><font SIZE=2>GOLD KING UNIT</font></B></p>

<p style=' margin-bottom:6pt; margin-top:12pt;text-align:justify;'><font size=2>Mineral rights only of the following patented lode mining claims:</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:6pt;margin-bottom:6pt'><u><b><font size=2>Name</font></b></u><u></u></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:6pt;margin-bottom:6pt'><U><B><font SIZE=2>U.S.M.S.</font></B></U><u></u></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Alice</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>17371</font></p> </td> </tr>
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        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>A.P. Hill</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>1922</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>American</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>14704</font></p> </td> </tr>
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        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Gold King</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>5689</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Gold King #1</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>14707</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Gold King #2</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>11640</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Gold King #3</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>14709</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Gold King Extension</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>19965</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Gold King Extension #1</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>19965</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Gold King Extension #2</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>19965</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Gold King Extension #3</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>19965</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Gold King Extension #4</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>19965</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Gold King Extension #5</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>19965</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Governor</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>17371</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>I.X.L.</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>1923</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Libbie Bauder</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>14704</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Libbie Bauder Extension</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>17371</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Sampson</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>1618A</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Sampson #2</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>1619A</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Soule</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>14704</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Standard (part)</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>14704</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Sunshine</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>14704</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Waterville</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>14704</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Hoffman</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>5782</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Portland Consolidated</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>13330</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Lizzie Deming</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>2685</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Paul</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>2387A</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
<p style='page-break-before:always'></p>


<table border="0" cellspacing=0 cellpadding=0 width="638" style='border-collapse:collapse'>
    <tr >
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 2 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:6pt; margin-top:12pt;text-align:justify;'><font size=2>Any right, title or interest San Juan Corp. may have in the following unpatented mining claims located in San Juan County, Colorado:</font></p>


<table width="600" border="0" cellspacing=0 cellpadding=0 style='border-collapse:collapse'>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:6pt;margin-bottom:6pt'><u><b><font size=2>Name of lode mining claim</font></b></u><u></u></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:6pt;margin-bottom:6pt'><u><b><font size=2>CMC Number</font></b></u><u></u></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>SJ-1</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>261846</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>SJ-2</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>261847</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>SJ-3</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>261848</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>SJ-4</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>261849</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>SJ-5</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>261850</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>SJ-6</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>261851</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>SJ-7</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>261852</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>SJ-8</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>261853</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>SJ-9</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>261854</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>SJ-10</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>261855</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>SJ-11</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>261856</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:justify;'><font size=2>Any right, title or easement in or to the American Tunnel that San Juan Corp. may have.</font></p>

<p style=' margin-bottom:0pt; margin-top:18pt;text-align:left;'><b><font size=2>MAYFLOWER MINE UNIT (see note #1)</font></b></p>

<p style=' margin-bottom:6pt; margin-top:12pt;text-align:justify;'><font size=2>70% undivided interest in the mineral rights only of the following patented claims:</font></p>


<table width="600" border="0" cellspacing=0 cellpadding=0 style='border-collapse:collapse'>
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        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:6pt;margin-bottom:6pt'><u><b><font size=2>Name</font></b></u><u></u></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:6pt;margin-bottom:6pt'><U><B><font SIZE=2>U.S.M.S.</font></B></U><u></u></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Argentine</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>11380</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>B.S.G.</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>20564</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>C.A.C.</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>20564</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Dives Fraction</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>20059</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Gold Bug</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>14393A</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Gold Bug Millsite</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>14393B</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>G.H.M.</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>20564</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Huntington</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>15351</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>J.R.W.</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>20564</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Kuroki</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>17788</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Mayflower</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>1568</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Mayflower #2</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>16551</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Mountain Quail</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>1157</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>North Star</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>297</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Slide</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>1331</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Terrible</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>272</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Togo</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>17788</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Yellow Jacket</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>311</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:18pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
<br>
<HR noshade align="center" width="100%" size="2">
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<table border="0" cellspacing=0 cellpadding=0 width="638" style='border-collapse:collapse'>
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        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 3 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:18pt;text-align:left;'><B><font SIZE=2>MOGUL MINE UNIT</font></B></p>

<p style=' margin-bottom:6pt; margin-top:12pt;text-align:justify;'><font size=2>Mineral rights only of the following patented claims</font></p>


<table width="600" border="0" cellspacing=0 cellpadding=0 style='border-collapse:collapse'>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:6pt;margin-bottom:6pt'><u><b><font size=2>Name</font></b></u><u></u></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:6pt;margin-bottom:6pt'><U><B><font SIZE=2>U.S.M.S.</font></B></U><u></u></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Theresa Lode</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>15968A</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Young Lode</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>16523</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Cross Cut Lode</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>16523</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Narrow Gauge</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>16523</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>E Pluribus Lode</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>520</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Grand Mogul</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>521</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Caucasus</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>468</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Calumet</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>1203</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>M.E. Harrison (part)</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>469</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Rob the Ranter</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>778</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Side Dish Lode</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>5475</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font SIZE=2>NG</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>466</font></p> </td> </tr>
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        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Winchester</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>467</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Ross</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>491</font></p> </td> </tr>
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        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Mountain Eagle</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>770</font></p> </td> </tr>
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        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Grivitzka</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>2104</font></p> </td> </tr>
    <tr >
        <td width="199" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>Norman</font></p> </td>
        <td width="439" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2pt;margin-bottom:2pt'><font size=2>2105</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:justify;'><font size=2>In addition to the mineral rights of the above mentioned patented mining claims, a nonexclusive surface easement for mining and exploration purposes shall be granted to the joint venture for the period of active mining and exploration. The surface rights to the patented mining claims on which the Gold King #7 portal, Mogul #1 and #2 portals shall be transferred to the joint venture, such claim names to be determined by actual survey in 2007 season, with reciprocal nonexclusive easements (with provision for non-entry during active mining operations) for recreation, surface access and other purposes shall be granted to the current existing owner of each of the three portal sites.</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:justify;'><b><font size=2>Note #1</font></b><font size=2>: Mr. Frederic Gerber of Transgas USA, the holder of the remaining thirty percent (30%) in the Mayflower Mine unit patented claims, has expressed willingness to potentially enter into an agreement to exchange interests in the entirety of the patented claims, in order for both parties to gain one hundred percent (100%) ownership in the acreage represented by their seventy percent (70%) and thirty percent (30%) interests respectively. It is envisioned that such potential exchange would allow San Juan one hundred (100%) ownership in the main Mayflower vein structure. No assurances exists however that such an exchange can or will take place.</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:justify;'><b><font size=2>Note #2</font></b><font size=2>: Neither the earn-in interest of forty percent (40%), sixty percent (60%) and eighty percent (80%) by the public company nor the retained interest by San Juan shall enable or allow either party to conduct mining operations separate of the joint venture agreement. Language reflecting the agreement to waive certain provisions of Colorado statutes regarding the ability to &#147;advertise out&#148; partial owners shall be agreed to.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


<p style=' margin-bottom:0pt; margin-top:12pt;text-align:center;'><b><font size=2>Schedule B</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>to Option Agreement</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>Gold King, Mayflower and Mogul Properties</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>made as of the 14th day of June, 2007</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>between</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>San Juan Corp. and Todd C. Hennis, as the Optionors </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>and Garpa Resources, Inc., as the Optionee</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:center;'><b><font size=2>Royalty Agreements </font></b></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:center;'><font size=2>See attached</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
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        <td width="319" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 2 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:center;'>
<img src="img1.jpg"><br> <font size=2>.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 3 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:center;'>
<img src="img2.gif"><br> </p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>- 4 -</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:center;'>
<img src="img3.jpg"><br> </p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
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<img src="img27.jpg"><br> </p>

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<p style=' margin-bottom:0pt; margin-top:12pt;text-align:center;'><b><font size=2>Exhibit 2.2(e)</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>to Option Agreement</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>Gold King, Mayflower and Mogul Properties</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>made as of the 14th day of June, 2007</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>between</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>San Juan Corp. and Todd C. Hennis, as the Optionors </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>and Garpa Resources, Inc., as the Optionee</font></p>

<p style=' margin-bottom:0pt; margin-top:24pt;text-align:justify;'><font size=2>Due to a potential survey error disclosed after the filing of the unpatented lode mining claims SJ-1 through SJ-11, inclusive, by the surveyor involved in the staking of these claims, certain corrective action work to possibly include amending the location certificates of these claims or re-staking of these claims is to be done as early as practical in the summer season of 2007.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


<p style=' margin-bottom:0pt; margin-top:12pt;text-align:center;'><b><font size=2>Exhibit 2.2(i)</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>to Option Agreement</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>Gold King, Mayflower and Mogul Properties</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>made as of the 14th day of June, 2007</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>between</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>San Juan Corp. and Todd C. Hennis, as the Optionors </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>and Garpa Resources, Inc., as the Optionee</font></p>

<p style=' margin-bottom:0pt; margin-top:24pt;text-align:justify;'><font size=2>Additional royalty interest in the main Gold King unit:  Title work has disclosed the possible existence of a 2% net smelter royalty to the year 2022 believed to be last held of record by Liberty Investment Corp.</font></p>

<p style=' margin-bottom:0pt; margin-top:12pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=1>CW1241589.11</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


<p style=' margin-bottom:0pt; margin-top:12pt;text-align:center;'><b><font size=2>Exhibit 2.2(m)</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>to Option Agreement</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>Gold King, Mayflower and Mogul Properties</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>made as of the 14th day of June, 2007</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>between</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>San Juan Corp. and Todd C. Hennis, as the Optionors </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>and Garpa Resources, Inc., as the Optionee</font></p>

<p style=' margin-bottom:0pt; margin-top:24pt;text-align:justify;'><font size=2>1.</font>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<font size=2>A mine discharge occurs continuously at the Mogul No. 1 level adit.  Periodic, seasonal, or continual discharges occur at the Grand Mogul location and the Mayflower Mine adit.</font></p>


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        <td width="319" valign=top style='padding:24.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>2.</font></p> </td>
        <td width="319" valign=top style='padding:24.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>Substantial acid mine water discharge occurs at Gold King No. 7 level adit.</font></p> </td> </tr>
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        <td width="319" valign=top style='padding:24.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>3.</font></p> </td>
        <td width="319" valign=top style='padding:24.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>See attached correspondence:</font></p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(a)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>from State of Colorado, December 16, 2005,</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(b)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Perkins Coie, December 30, 2005,</p> </td> </tr></table>



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        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(c)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Gold King Mines Corporation, July 28, 2006, (re CDPS Cert. No. COR-040133), and</p> </td> </tr></table>



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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:12pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>  </td>
        <td width="48" valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'>(d)</p> </td>
        <td  valign=top style='padding:12.0pt 0in 0in 0in'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'>Gold King Mines Corporation, July 28, 2006, (re CDPS Cert. No. COR-040050).</p> </td> </tr></table>


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