MINERAL PROPERTY OPTION AGREEMENT

THIS MINERAL PROPERTY OPTION AGREEMENT

is dated for reference as of the 20th day of October, 2006.

BETWEEN:

WAR EAGLE MINING COMPANY INC.

, a company having an address for delivery and notice located at Suite 420,
475 Howe Street, Vancouver, British Columbia, Canada, V6C 2B3

(hereinafter the "Optionor");

OF THE FIRST PART

AND:

REVELSTOKE INDUSTRIES

, INC., a company having an address for notice and delivery located at 2211
Rimland Drive, Suite 100, Bellingham, Washington, U.S.A., 98226

(hereinafter the "Optionee").

OF THE SECOND PART

WHEREAS:

The Optionor is the registered and beneficial owner of a one hundred percent
(100%) interest in certain mineral licenses, claims, concessions or reservations
(for convenience herein, collectively, the "mineral claims") situated in the
Province of Saskatchewan and better known and described as the Georges Lake
group of mineral claims, as detailed in the more specific description of such
mineral claims attached hereto as Schedule A (and herein called the "Property");
and

The Optionor has agreed to grant an exclusive option to the Optionee to acquire
a seventy percent (70%) interest in and to the Property by incurring certain
exploration Expenditures as detailed herein;

NOW THEREFORE THIS AGREEMENT WITNESSES

that in consideration of the covenants and agreements hereinafter set forth the
parties agree that:

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PART I
DEFINITIONS

1.1                   In this Mineral Property Option Agreement, except as
otherwise expressly provided or as the context otherwise requires,

(a)       "Area of Common Interest" means, subject to Part 16, the area included
within 10 kilometres of the boundaries of the Property, but excluding any third
party mineral claims in existence as of the Effective Date hereof;

(b)       "Effective Date" means the date first above written;

(c)       "Expenditures" means all direct or indirect costs and expenses
incurred by the Optionee in respect of prospecting and exploring the Property
after the date of this Agreement pursuant to §4.2 hereof. The certificate of the
Controller or other financial officer of the Optionee, together with a statement
of Expenditures in reasonable detail shall be prima facie evidence of such
Expenditures;

(d)       "Force Majeure" has the meaning set forth in Part 12;

(e)       "Joint Venture" means the joint venture to be formed between the
Optionor and the Optionee in respect of the Property in the event of and upon
exercise of the Option and which is more particularly described in §4.3 and
Schedule B;

(f)       "Joint Venture Agreement" means the Joint Venture Agreement to be
entered into between the Optionor and the Optionee if the Optionee exercises
this Option as provided for in §4.3 and in the form attached as Schedule B;

(g)       "Option" means the exclusive right herein granted by the Optionor to
the Optionee to permit the Optionee to acquire a seventy percent (70%) undivided
right, title and interest in the Property and thereupon form the Joint Venture
all as provided in Part 4;

(h)       "Option Period" means the period from the date above written on page
one to and including the earliest of

(i)       the date of exercise of the Option,

(ii)     the fifth anniversary of the Effective Date, and

(iii)    the termination hereof pursuant to Part 10;

(i)       "Property" means the seven mineral claims described in Schedule A (the
"Original Property") as they may be augmented pursuant to Part 16 (such
augmenting claims or interests being referred to herein as the "Additional
Property" and included as part of the Property) or reduced under Part 16, and
all mining leases and other mining rights and interests derived from any such
claims, and a reference herein to a mineral claim comprised in the Property
includes any mineral leases or other interests into which such mineral claim may
have been converted and Property includes all Property Rights;

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(j)       "Property Rights" means all licenses, permits, easements,
rights-of-way, surface or water rights and other rights, approvals obtained by
either of the parties either before or after the date of this Agreement and
necessary or desirable for the development of the Property, or for the purpose
of placing the Property into production or continuing production therefrom;

(k)       "Schedule" means the documents attached hereto as follows:

(i)       Schedule A - Mineral Claims Comprising the Property;

(ii)     Schedule B - Joint Venture Agreement; and

(iii)    Schedule C - Third Party Interests; and

(l)       "Third Party Interests" means interests that are held by Bullion Fund
Inc. and Michael Leaderhouse pursuant to an agreement dated December 11, 2005,
attached as Schedule C.

PART 2
REPRESENTATIONS, WARRANTIES AND COVENANTS OF OPTIONOR

2.1                    The Optionor represents and warrants to the Optionee that

(a)       it has been duly incorporated and validly exists as a corporation in
good standing under the laws of the Province of British Columbia and is
authorized to acquire, hold and option mineral claims in the Province of
Saskatchewan, and it is exclusively legally entitled to hold the Property and
all mineral claims comprised therein, and all Property Rights held by it and
will remain so entitled until all interests of the Optionor in the Property
earned by the Optionee have been duly transferred to the Optionee as
contemplated hereby or this Option has terminated,

(b)       it is now, and will also thereafter at the time of legal transfer of
interests in the Property if the Option is exercised, the registered and
beneficial owner of all of the mineral claims comprising the Property free and
clear of all liens, charges and claims of others and no taxes, royalties or
lease payments or like amounts are due in respect of any of the mineral claims,
and to its knowledge and belief; the mineral claims comprised in the Property
have been duly and validly located and recorded pursuant to the applicable
mining laws of Canada, and, except as specified in Schedule A and accepted by
the Optionee, are in good standing in the office of the relevant government
mining office on the date hereof and until the dates set opposite the respective
names thereof in Schedule A,

(c)       there is no adverse claim or challenge against or to the ownership of
or title to any of the mineral claims comprising the Property, nor to the
knowledge of the Optionor is there any basis therefor, and there are no
outstanding agreements or options to acquire or purchase the Property or any
portion thereof, and no person other than the Optionor, pursuant to the
provisions hereof, has any royalty or other interest whatsoever in production
from any of the mineral claims comprising the Property,

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(d)       no third party consent of any kind is required by the Optionor to
enter into this Agreement and grant the Option contemplated hereby,

(e)       on execution hereof, the Optionor shall deliver or cause to be
delivered to the Optionee copies of all available maps and other documents and
data in its possession respecting the Property,

(f)       the Optionor shall assume sole responsibility and liability for any
obligations outstanding as of the date hereof with respect to reclamation of the
Property,

(g)       the execution and delivery of this Agreement and the agreements
contemplated hereby by the Optionor will not violate or result in the breach of
the laws of any jurisdiction applicable or pertaining thereto or of its
constating documents, and

(h)       this Agreement constitutes a legal, valid and binding obligation of
the Optionor under Canadian law.

                         The Optionor acknowledges and confirms that the
Optionee is relying on the foregoing representations and warranties in the
entering into by it of this Agreement.

2.2                    The representations and warranties contained in §2.1 are
provided for the exclusive benefit of the Optionee, and a breach of any one or
more thereof may be waived by the Optionee in whole or in part at any time
without prejudice to its rights in respect of any other breach of the same or
any other representation or warranty; and the representations and warranties
contained in §2.1 will survive the execution hereof and continue throughout the
Option Period and for two years thereafter.

PART 3
REPRESENTATIONS AND WARRANTIES OF OPTIONEE

3.1                    The Optionee represents and warrants to the Optionor that

(a)       it has been duly incorporated and validly exists as a corporation in
good standing under the laws of the State of Nevada and has the corporate power
to hold mining claims and will obtain such necessary registrations as are
necessary to explore and hold legal interests in mining properties in the
Province of Saskatchewan;

(b)       neither the execution and delivery of this Agreement by the Optionee
nor the performance by the Optionee of its obligations hereunder conflicts with
the Optionee's constating documents or any agreement to which it is bound;

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(c)       the execution, delivery and performance by the Optionee of this
Agreement and any other agreement or instrument to be executed and delivered by
it hereunder and the consummation by it of all the transactions contemplated
hereby and thereby have been duly authorised by all necessary corporate action
on the part of the Optionee;

(d)       each of this Agreement and any other agreement or instrument to be
executed and delivered by the Optionee hereunder constitutes a legal, valid and
binding obligation of the Optionee enforceable against it in accordance with its
terms; and

(e)       excepting only as otherwise disclosed herein, the Optionee is not
subject to, or a party to, any charter or by-law restriction, any law, any
claim, any encumbrance or any other restriction of any kind or character which
would prevent consummation of the transaction contemplated by this Agreement or
any other agreement or instrument to be executed and delivered by the Optionee
hereunder.

                         The Optionee acknowledges and confirms that the
Optionor is relying on the foregoing representations and warranties in the
entering into by it of this Agreement.

3.2                    The representations and warranties contained in §3.1 are
provided for the exclusive benefit of the Optionor and a breach of any one or
more thereof may be waived by the Optionor in whole or in part at any time
without prejudice to its rights in respect of any other breach of the same or
any other representation or warranty; and the representations and warranties
contained in §3.1 will survive the execution hereof and continue throughout the
Option Period.

PART 4
GRANT AND EXERCISE OF OPTION

4.1                    The Optionor hereby grants to the Optionee the sole and
exclusive right and option (the "Option") to acquire a seventy percent (70%)
interest in the Property, such 70% interest to be free and clear of all liens,
charges, encumbrances, security interests and adverse claims arising from or
through the Optionor except for the Third Party Interests, and subject to the
laws applicable to the Property.

4.2                    In order to exercise the Option, the Optionee must, by
December 31, 2008, incur or caused to be incurred, Expenditures of not less than
an aggregate of $1,000,000 pursuant to a work program or work programs commenced
and operated by the Optionor.

4.3                    Following the exercise of the Option by the Optionee, the
Optionor and the Optionee will form a Joint Venture for the purpose of carrying
out further development work and production on the Property and will in good
faith, negotiate and execute a Joint Venture Agreement, substantially in the
form of Schedule B, and said agreement shall include, but not be limited to, the
following provisions:

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(a)       the initial participating interests of the parties in the Joint
Venture will be seventy percent (70%) as to the Optionee and thirty percent
(30%) as to the Optionor, which interests shall be at all times subject to the
Third Party Interests;

(b)       the Optionee shall be the initial manager of the Joint Venture and the
Optionee shall remain the manager as long as the Optionee has not less than a
50% participating interest or when the Optionee is being diluted in accordance
with §(d). Property claims shall be registered in the name of the manager on
behalf of the Joint Venture;

(c)       the operations of the Joint Venture will be overseen by a management
committee, with each party to have voting rights on such committee equal to
their participating interest in the Joint Venture. In the event that the parties
interests become equal, the manager will have a casting vote;

(d)       the participating interests of the parties in the Joint Venture will
be subject to dilution for non-contribution to costs in proportion to their
interests, on a straight line basis providing that if any party's participating
interest thereby falls below five percent (5%), it shall be deemed to be
converted into a one percent (1%) after payback net returns royalty as defined
by Schedule C, and, for the purpose of calculating such dilution, on formation
of the Joint Venture, the prior expenditures incurred by the parties shall be
deemed to be for the Optionee, $1,000,000 and for the Optionor, its opening
joint venture capital account balance shall be three-sevenths (3/7) of the
Optionee's calculated amount;

(e)       each party will have 15 days following adoption of work programs to
elect to participate therein and invoices rendered to participating parties in
respect of any work program shall be payable within 20 days;

(f)       each party will grant to the other a 21 day right of first refusal
with respect to any proposed sale of such party's interest in the Joint Venture
to a third party. If a sale is completed the third party must agree to be bound
to the terms of the Joint Venture Agreement; and

(g)       in the event of a dispute in reaching a binding Joint Venture
Agreement the parties shall refer any such dispute to binding arbitration to
have a binding agreement imposed on themselves.

PART 5
VESTING OF INTEREST

5.1                    Upon the Optionee complying with the requirements to
exercise the Option set forth in §4.2, the Optionee may elect within the time
required for such Option, to provide a written notice to the Optionor exercising
the Option.

5.2                    Nothing herein shall be construed as requiring the
Optionee to provide the Optionor with notice of exercise as contemplated by
§5.1.

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5.3                    Upon giving notice to the Optionor of its exercise of the
Option, the Optionee will immediately be vested in and be deemed to legally and
beneficially own a seventy percent (70%) interest in the Property.

PART 6
TITLE TRANSFER

6.1                    Upon the Optionee exercising the Option, then the
Optionor shall execute such documentation as the Optionee may prepare and
reasonably request be executed under the laws of the Province of Saskatchewan to
record to the extent possible, the respective interests of each of the parties
in the Property.

PART 7
Assignment of Option

7.1                    Subject to Part 11, the Optionee may assign all or part
of its obligations under this Mineral Property Option Agreement during the
Option Period to a third party (the "Assignee") with consent of the Optionor,
such consent not to be unreasonably withheld, providing also that the Assignee
agrees to execute an acknowledgement to be bound by the terms hereof insofar as
the Optionor's rights hereunder are concerned.

PART 8
OPTIONEE'S RIGHTS

8.1                    Throughout the Option Period, the directors and officers
of the Optionee and its servants, agents and independent contractors, will have
the sole and exclusive right in respect of the Property to

enter thereon,

have exclusive and quiet possession thereof,

do such prospecting, exploration, development and/or other mining work thereon
and thereunder as the Optionee in its sole discretion may determine advisable,

bring upon and erect upon the Property buildings, plant, machinery and equipment
as the Optionee may deem advisable, and

remove therefrom and dispose of reasonable quantities of ores, mineral and
metals for the purpose of obtaining assays or making other tests.

PART 9
OBLIGATIONS OF Optionee DURING OPTION PERIOD

9.1                    During the Option Period the Optionee will

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(a)       maintain in good standing those mineral claims comprised in the
Property that are in good standing on the date hereof by the payment of fees,
taxes and rentals and the performance of all other actions which may be
necessary under Canadian law in that regard and in order to keep such mineral
claims free and clear of all liens and other charges arising from the Optionee's
activities thereon except those at the time contested in good faith by the
Optionee,

(b)      permit the directors, officers, employees and designated consultants of
the Optionor, at their own risk, access to the Property at all reasonable times
subject always to Part 13, and providing the Optionor agrees to indemnify the
Optionee against and to save the Optionee harmless from all costs, claims,
liabilities and expenses that the Optionee may incur or suffer as a result of
any injury (including injury causing death) to any director, officer, employee
or designated consultant of the Optionor while on the Property,

(c)       while exploration and development is carried out, furnish the
management committee with quarterly progress reports and with a final report
within 90 days following the conclusion of each program which will be deemed to
occur upon the verification of final assays. The final report shall show the
exploration and development performed and the results obtained and shall be
accompanied by a statement of costs and copies of pertinent plans, assay maps,
diamond drill records and other factual engineering data. All information and
data concerning or derived from the exploration and development shall be kept
confidential except as permitted under this Agreement;

(d)       deliver to the Optionor on or before six months after each anniversary
hereof, a report (including up-to-date maps if there are any) describing the
results of work done in the last completed expenditure year, together with
reasonable details of Expenditures made,

(e)       do all work on the Property in a good and workmanlike fashion and in
accordance with all applicable laws, regulations, orders and ordinances of any
governmental authority and

(f)       indemnify and save the Optionor harmless in respect of any and all
costs, claims, liabilities and expenses arising out of the Optionee's activities
on the Property and, without limiting the generality of the foregoing will,
during the currency of this Agreement, cause any of its independent contractors
to carry not less than $1,000,000 in third party liability insurance in respect
of their operations conducted on the Property on behalf of the Optionee, such
insurance to be for the benefit of the Optionee and the Optionor as their
interests appear; provided that neither the Optionee nor its independent
contractors will incur any obligation thereunder in respect of claims arising or
damages suffered after termination of the Option if upon termination of the
Option any workings on or improvements to the Property made by the Optionee are
left in as safe a condition as existed on the date hereof; and

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(g)       obtain such permits or operate through such qualified Canadian
subsidiaries as may be required in to carry on exploration and to acquire and
hold rights to mineral interests under Canadian law.

PART 10
TERMINATION OF OPTION

10.1                  If the Option is terminated otherwise than upon the
exercise thereof pursuant to Part 4, the Optionee will

(a)       leave in good standing for a period of at least one year from the
termination of the Option Period those mineral claims comprised in the Property
that are in good standing on the date hereof and any other mineral claims
comprised in the Property that the Optionee acquires after the date hereof, and

(b)       deliver at no cost to the Optionor within 90 days of such termination
copies of all reports, maps, assay results and other relevant technical data
compiled by or in the possession of the Optionee with respect to the Property
and not theretofore furnished to the Optionor.

10.2                  Notwithstanding termination of the Option, the Optionee
will have the right, within a period of 90 days following the end of the Option
Period, to remove from the Property all buildings, plant, equipment, machinery,
tools, appliances and supplies which have been brought upon the Property by or
on behalf of the Optionee, and any such property not removed within such 90-day
period will thereafter, only if the Optionor elects in writing, become the
property of the Optionor.

PART 11
SURRENDER AND ACQUISITION OF PROPERTY INTERESTS BEFORE TERMINATION OF AGREEMENT

11.1                  The Optionee may during the Option Period, elect to
abandon any one or more of the mineral claims comprised in the Property by
giving notice to the Optionor of such intention.

11.2                  For a period of 30 days after the date of delivery of such
notice the Optionor may elect to have any or all of the mineral claims in
respect of which such notice has been given transferred to it by delivery of a
request therefor to the Optionee, whereupon the Optionee will deliver to the
Optionor a quit claim or provide such other appropriate Deed or assurance in
registrable form transferring such mineral claims to the Optionor if the
Optionor is not then already the registered owner of such mineral claims.

11.3                  Any claims so transferred, if in good standing at the date
hereof or if the Optionee causes the same to be placed in good standing after
the date hereof, will be in good standing under applicable Canadian mining law
for at least six months from the date of transfer. If the Optionor fails to make
request for the transfer of any mineral claims as aforesaid within such 30-day
period, the Optionee may then abandon such mineral claim without further notice
to the Optionor. Upon any such transfer or abandonment the mineral claims so
transferred or abandoned will for all purposes of this Agreement cease to form
part of the Property.

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PART 12
FORCE MAJEURE

12.1                  If the Optionee is at any time either during the Option
Period prevented or delayed in complying with the work Expenditure requirement
provisions of this Agreement in Part 4 by reason of strikes, walk-outs, labour
shortages, power shortages, fuel shortages, fires, wars, acts of God,
governmental regulations restricting normal operations, shipping delays or any
other reason or reasons beyond the control of the Optionee (and for greater
certainty excluding factors related to a lack of funding), the time limited for
the performance by the Optionee of its obligations hereunder will be extended by
a period of time equal in length to the period of each such prevention or delay,
provided however that nothing herein will discharge the Optionee from its
obligation to timely pay the cash under §4.2.

12.2                  The Optionee will within seven days give notice to the
Optionor of each event of force majeure under §12.1 and upon cessation of such
event will furnish the Optionor with notice to that effect together with
particulars of the number of days by which the obligations of the Optionee
hereunder have been extended by virtue of such event of force majeure and all
preceding events of force majeure.

PART 13
CONFIDENTIAL INFORMATION

13.1                  No information furnished by the Optionee to the Optionor
hereunder in respect of the activities carried out on the Property by the
Optionee, will be published by the Optionor without the written consent of the
Optionee, but such consent in respect of the reporting of factual data will not
be unreasonably withheld, and will not be withheld in respect of information
required to be publicly disclosed pursuant to applicable securities or corporate
laws. This provision shall terminate three years after the later of the
termination of this Option and the termination of the Joint Venture Agreement.

PART 14
ARBITRATION

14.1                  All questions or matters in dispute with respect to the
interpretation of this Agreement or the Joint Venture Agreement will, insofar as
lawfully possible, be submitted to arbitration pursuant to the terms hereof
using "final offer" arbitration procedures.

14.2                  It will be a condition precedent to the right of any party
to submit any matter to arbitration pursuant to the provisions hereof, that any
party intending to refer any matter to arbitration will have given not less than
10 days' prior written notice of its intention so to do to the other party
together with particulars of the matter in dispute.

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14.3                  On the expiration of such 10 days, the party who gave such
notice may proceed to commence procedure in furtherance of arbitration as
provided in this Part 14.

14.4                  The party desiring arbitration ("First Party") will
nominate in writing three proposed arbitrators, and will notify the other party
("Second Party") of such nominees, and the other party will, within 10 days
after receiving such notice, either choose one of the three or recommend three
nominees of its own. All nominees of either party must hold accreditation as
either a lawyer, accountant or mining engineer. If the First Party fails to
choose one of the Second Party's nominees then all six names shall be placed
into a hat and one name shall be randomly chosen by the president of the First
Party and that person if he/she is prepared to act shall be the nominee. Except
as specifically otherwise provided in this Part 14 the arbitration herein
provided for will be conducted in accordance with the Commercial Arbitration Act
(British Columbia). The parties shall thereupon each be obligated to proffer to
the Arbitrator within 21 days of his/her appointment a proposed written solution
to the dispute and the arbitrator shall within 10 days of receiving such
proposals choose one of them without altering it except with the consent of both
parties.

14.5                  The expense of the arbitration will be paid as specified
in the award.

14.6                  The parties may agree that the award of the arbitrator
will be final and binding upon each of them.

PART 15
DEFAULT AND TERMINATION

15.1                  If at any time during the Option Period either party fails
to perform any obligation hereunder or any representation or warranty given by
it proves to be untrue, then the other party may terminate this Agreement
(without prejudice to any other rights it may have) providing

(a)       it first gives to the party allegedly in default a notice of default
containing particulars of the obligation which such has not performed, or the
warranty breached,

(b)       the other party does not dispute the default, then if it is reasonably
possible to cure the default without irreparable harm to the non-defaulting
party, the defaulting party does not, within 30 days after delivery of such
notice of default, cure such default by appropriate payment or commence to
correct such default and diligently prosecute the matter until it is corrected,
and

(c)       if the defaulting party fails to comply with the provisions of this
§15.1 the other party may thereafter terminate this Agreement, and the
provisions of Part 10 will then be applicable.

15.2                  The Optionee may at any time terminate this Option by
giving notice of termination to the Optionor and shall thereupon be relieved of
any further obligations in connection herewith but shall remain liable for
obligations which have accrued to the date of notice.

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PART 16
area of COMMON interest

16.1                  If either Party (or permitted assignee hereof)
beneficially acquires any interest in mineral claims or surface rights within
the Area of Common Interest attached hereto as Schedule A they shall, at the
election of the other party (made by it within 20 days of written notice), be
made part of the Property for all purposes and may be referred to as Additional
Property. That is, if acquired by the Optionee, such additional claims shall be
transferred to the Optionor on termination hereof without additional cost and if
acquired by the Optionor shall be optioned to the Optionee as if part of the
Property (and without additional consideration being demanded from the
Optionee).

PART 17
NOTICES

17.1                  Each notice, demand or other communication required or
permitted to be given under this Agreement will be in writing and will be sent
by personal delivery, fax or prepaid registered mail to the addresses of the
parties written on page 1.

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

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

PART 18
GENERAL

18.1                  This Agreement will supersede and replace any other
agreement or arrangement, whether oral or written, heretofore existing between
the parties in respect of the subject matter of this Agreement.

18.2                  No consent or waiver expressed or implied by either party
in respect of any breach or default by the other in the performance of such
other of its obligations hereunder will be deemed or construed to be a consent
to or a waiver of any other breach or default.

18.3                  The parties will promptly execute or cause to be executed
all documents, deeds, conveyances and other instruments of further assurance
which may be reasonably necessary or advisable to carry out fully the intent of
this Agreement or to record wherever appropriate the respective interests from
time to time of the parties in the Property.

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18.4                  This Agreement will enure to the benefit of and be binding
upon the parties and their respective successors and assigns, subject to the
conditions hereof.

18.5                  This Agreement will be construed in accordance with the
laws of the Province of British Columbia and the laws of Canada applicable
therein. This agreement is to be construed as an option only and nothing herein
shall obligate the Optionee to do anything or pay any amount except where
expressly herein provided.

18.6                  All sums of money referred to herein are expressed in
Canadian dollars.

18.7                  The headings appearing in this Agreement are for general
information and reference only and this Agreement will not be construed by
reference to such headings.

18.8                  In interpreting this Agreement and the schedules hereto
attached, where the context so requires, the singular will include the plural,
and the masculine will include the feminine, the neuter, and vice versa.

18.9                  Nothing herein will constitute or be taken to constitute
the parties as partners or create any fiduciary relationship between them.

18.10                No modification, alteration or waiver of the terms herein
contained will be binding unless the same is in writing, dated subsequently
hereto, and fully executed by the parties.

18.11                This Agreement may be executed in counterpart and by
facsimile.

IN WITNESS WHEREOF

this Mineral Property Option Agreement has been executed on behalf of the
Optionor and the Optionee by their duly authorized officers on the 20th day of
October, 2006.

The Optionee:

REVELSTOKE INDUSTRIES, INC.

Per:     ___________________________
            Authorized Signatory

The Optionor:

WAR EAGLE MINING COMPANY INC.

Per:     ___________________________
            Authorized Signatory

__________

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SCHEDULE A

                         This is Schedule A to that certain Mineral Property
Option Agreement between War Eagle Mining Company Inc. and Revelstoke Industries
Inc. dated for reference as of 20th day of October, 2006.

Mineral Claims Comprising The Property

                         The following are the mineral claims comprising the
Property, located on NTS Sheet G3-M-11 and within the Province of Saskatchewan,
approximately 135 kilometers northeast of La Ronge and comprising a total of 979
hectares.

Claim Name

Registered Owner

S-106844

S-106688

S-106689

S-108491

S-108619

S-108618

S-108619

Bullion Fund Inc.*

Bullion Fund Inc.*

Bullion Fund Inc.*

War Eagle Mining Company Inc.

War Eagle Mining Company Inc.

War Eagle Mining Company Inc.

War Eagle Mining Company Inc.

*       Beneficially owned by War Eagle Mining Company Inc. with title currently
held by Bullion Fund Inc.

__________

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SCHEDULE B

                         This is Schedule B to that certain Mineral Property
Option Agreement between War Eagle Mining Company Inc. and Revelstoke Industries
Inc. dated for reference as of 20th day of October, 2006.

 

 

 

 

 

JOINT VENTURE AGREEMENT

 

BETWEEN

 

WAR EAGLE MINING COMPANY INC.

 

AND

 

REVELSTOKE INDUSTRIES, INC.

 

[Date]

 

 

Respecting the Georges Lake Property

 

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TABLE OF CONTENTS

   

Page

1.

DEFINITIONS

1

2.

REPRESENTATIONS AND WARRANTIES; RECORD TITLE; INDEMNITIES

5

 

CAPACITY OF PARTICIPANTS

5

 

DISCLOSURES

5

 

RECORD TITLE

5

 

LOSS OF TITLE

5

 

INDEMNITIES

6

3.

NAME, PURPOSES AND TERM

7

 

GENERAL

7

 

NAME

7

 

PURPOSES

7

 

LIMITATION

8

 

TERM

8

4.

RELATIONSHIP OF THE PARTICIPANTS

8

 

NO PARTNERSHIP

8

 

OTHER BUSINESS OPPORTUNITIES

8

 

TERMINATION OR TRANSFER OF RIGHTS TO PROPERTY

9

 

NO ROYALTY OR OTHER INTERESTS

9

 

NO THIRD PARTY BENEFICIARY RIGHTS

9

5.

CONTRIBUTIONS BY PARTICIPANTS

9

 

INITIAL CONTRIBUTION

9

 

VALUE OF INITIAL CONTRIBUTIONS

9

 

CASH CONTRIBUTIONS

9

6.

PARTICIPATING INTERESTS

10

 

PARTICIPATING INTERESTS

10

 

VOLUNTARY REDUCTION IN PARTICIPATION - DILUTION

10

 

DEFAULT IN MAKING CONTRIBUTIONS

11

 

ELIMINATION OF MINORITY INTEREST

12

 

DOCUMENTATION OF ADJUSTMENTS TO PARTICIPATING INTERESTS

12

 

GRANT OF LIEN OR SECURITY INTEREST

12

 

SUBORDINATION OF INTERESTS

12

7.

MANAGEMENT COMMITTEE

13

 

ORGANIZATION AND COMPOSITION

13

 

DECISIONS

13

 

MEETINGS

13

 

EXPENSE

14

 

RULES

14

 

ACTION WITHOUT MEETING

14

 

MATTERS REQUIRING APPROVAL

15

8.

MANAGER

15

 

APPOINTMENT

15

 

POWERS AND DUTIES OF MANAGER

15

 

STANDARD OF CARE

19

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RESIGNATION; DEEMED OFFER TO RESIGN

19

 

NEW MANAGER

20

 

DELIVERY OF RECORDS

20

 

NO REPLACEMENT FOR MANAGER

20

 

PAYMENTS TO MANAGER

20

 

TRANSACTIONS WITH AFFILIATES

20

 

INDEPENDENT CONTRACTOR

20

9.

PROGRAMS AND BUDGETS

21

 

OPERATIONS PURSUANT TO PROGRAMS AND BUDGETS

21

 

PRESENTATION OF PROGRAMS AND BUDGETS

21

 

ADOPTION OF PROPOSED PROGRAMS AND BUDGETS

21

 

ELECTION TO PARTICIPATE

21

 

BUDGET OVERRUNS; PROGRAM CHANGES

22

 

EMERGENCY EXPENDITURES

22

 

MANDATORY EXPENDITURES

22

 

CASH CALLS

23

 

FAILURE TO MEET CASH CALLS

23

 

AUDITS

23

10.

DISPOSITION OF PRODUCTION

24

 

TAKING IN KIND

24

 

FAILURE OF PARTICIPANT TO TAKE IN KIND

24

 

HEDGING

24

 

VALUE OF MINERAL PRODUCTS

24

 

EXTRA EXPENDITURE

25

 

MANAGER'S AUTHORITY

25

 

PAYMENT OF PROCEEDS

25

 

NON-ARM'S LENGTH TRANSACTION

25

 

RECORDS

25

11.

SUSPENSION AND TERMINATION

26

 

SUSPENSION OF OPERATIONS

26

 

TERMINATION OF OPERATIONS FOLLOWING SUSPENSION

26

 

TERMINATION BY AGREEMENT

26

 

TERMINATION WHERE NO PROGRAM PROPOSED

26

 

DISPOSITION OF ASSETS ON TERMINATION

27

 

RIGHT TO DATA AFTER TERMINATION

27

 

NON-COMPETE COVENANTS

27

 

CONTINUING AUTHORITY

27

 

SURVIVAL OF INGRESS AND EGRESS AFTER TERMINATION

27

12.

ABANDONMENT AND SURRENDER OF PROPERTY

28

13.

SURRENDER OF INTEREST

28

 

SURRENDER OF INTEREST

28

 

RELIEF FROM LIABILITIES

28

 

ACCEPTANCE OF SURRENDER

28

 

EXECUTION OF INSTRUMENTS

29

14.

TRANSFER OF INTEREST

29

 

GENERAL

29

 

LIMITATIONS ON FREE TRANSFERABILITY

29

 

PRE-EMPTIVE RIGHT

30

 

EXCEPTIONS TO PRE-EMPTIVE RIGHT

31

 

ENCUMBRANCES

32

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15.

ACQUISITION WITHIN AREA OF INTEREST

32

 

GENERAL

32

 

NOTICE TO NON-ACQUIRING PARTICIPANT

32

 

OPTION EXERCISE

33

 

OPTION NOT EXERCISED

33

16.

GENERAL PROVISIONS

33

 

NOTICES

33

 

WAIVER

34

 

MODIFICATION

34

 

FORCE MAJEURE

34

 

SURVIVAL OF TERMS AND CONDITIONS

35

 

CONFIDENTIALITY AND PUBLIC STATEMENTS

35

 

ENTIRE AGREEMENT; SUCCESSORS AND ASSIGNS

36

 

DISPUTE RESOLUTION

36

 

FURTHER ASSURANCES

37

 

HEADINGS

37

 

CURRENCY

37

 

SEVERABILITY

37

 

TAXES

37

 

RULE AGAINST PERPETUITIES

38

 

PARTITION

38

 

GOVERNING LAW

38

 

COUNTERPARTS

38

 

Exhibit A - Property

Exhibit B - Area of Interest

Exhibit C - Accounting Procedure

Exhibit D - Net Returns

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JOINT VENTURE AGREEMENT

THIS JOINT VENTURE AGREEMENT

is dated for reference as of u day of u , 200u .

BETWEEN:

WAR EAGLE MINING COMPANY INC.

, a company having an address for delivery and notice located at Suite 420,
475 Howe Street, Vancouver, British Columbia, Canada, V6C 2B3

("War Eagle");

OF THE FIRST PART

AND:

REVELSTOKE INDUSTRIES

, INC., a company having an address for notice and delivery located at 2211
Rimland Drive, Suite 100, Bellingham, Washington, U.S.A., 98226

("Revelstoke").

OF THE SECOND PART

WHEREAS:

War Eagle and Revelstoke own certain Property known as the Georges Lake Property
situated in the Province of Saskatchewan which are described in Exhibit A and
are defined in §1.1(ee) below; and

War Eagle and Revelstoke wish to participate in the further exploration,
evaluation, and if justified, the development and mining of mineral resources
within the Property;

NOW THEREFORE THIS AGREEMENT WITNESSES

that in consideration of the covenants and agreements hereinafter set forth the
parties agree that:

1.                    DEFINITIONS

1.1                  In this Joint Venture Agreement, except as otherwise
expressly provided or as the context otherwise requires,

(a)       "Accounting Procedure" means the procedure set forth in Exhibit C;

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(b)       "Affiliate" of a Participant means an entity or person that Controls,
is Controlled by, or is under common Control with the Participant through direct
or indirect ownership of greater than fifty percent (50%) of equity or voting
interest;

(c)       "Agreement" means this Joint Venture Agreement, including any
amendments and modifications hereof, and all appendices, schedules and exhibits
which are incorporated herein by this reference;

(d)       "Area of Interest" means the area described in Exhibit B;

(e)       "Assets" means the Property, Products, and all other real and personal
property, tangible and intangible, held for the benefit of the Participants
hereunder;

(f)       "Budget" means a detailed estimate of all costs to be incurred by the
Participants with respect to a Program and a schedule of cash advances to be
made;

(g)       "Claims" means the mineral claims described in the agreement to which
this Agreement is Schedule C, and any claims that become part of the Property
pursuant to Article 14 hereof;

(h)       "Continuing Obligations" means obligations or responsibilities that
are reasonably expected to continue or arise after Operations on a particular
area of the Property have ceased or are suspended, including, but not limited
to, Environmental Compliance;

(i)       "Control" used as a verb means, when used with respect to an entity,
the ability, directly or indirectly through one or more intermediaries, to
direct or cause the direction of the management and policies of such entity
through (i) the legal or beneficial ownership of voting securities or membership
interests; (ii) the right to appoint managers, directors or corporate
management; (iii) contract; (iv) operating agreement; (v) voting trust; or
otherwise; and, when used with respect to a person, means the actual or legal
ability to control the actions of another, through family relationship, agency,
contract or otherwise; and "Control" used as a noun means an interest which
gives the holder the ability to exercise any of the foregoing powers;

(j)       "Development" means all preparation (other than Exploration) for the
removal and recovery of Products, including the construction or installation of
leach pads, a mill or any other improvements to be used for the mining,
handling, milling, beneficiation or other processing of Products;

(k)       "Effective Date" means the date set forth in §3.5 of this Agreement;

(l)       "Encumbrance" or "Encumbrances" means mortgages, deeds of trust,
security interests, pledges, liens, net profits interests, royalties or
overriding royalty interests, other payments out of production, or other burdens
of any nature;

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(m)       "Environmental Compliance" means actions performed during or after
Operations to comply with the requirements of all Environmental Laws or
contractual commitments related to reclamation of the Property or other
compliance with Environmental Laws;

(n)       "Environmental Laws" means Laws aimed at reclamation or restoration of
the Property; abatement of pollution; protection of the environment; monitoring
environmental conditions; protection of wildlife, including endangered species;
ensuring public safety from environmental hazards; protection of cultural or
historic resources; management, storage or control of hazardous materials and
substances; releases or threatened releases of pollutants, contaminants,
chemicals or industrial, toxic or hazardous substances into the environment, and
all other Laws relating to the manufacturing, processing, distribution, use,
treatment, storage, disposal, handling or transport of pollutants, contaminants,
chemicals or industrial, toxic or hazardous substances or wastes;

(o)       "Environmental Liabilities" means any and all claims, actions, causes
of action, damages, losses, liabilities, obligations, penalties, judgments,
amounts paid in settlement, assessments, costs, disbursements, or expenses
(including, without limitation, legal fees and costs, experts' fees and costs,
and consultants' fees and costs) of any kind or of any nature whatsoever that
are asserted against either Participant, by any person or entity other than the
other Participant, alleging liability (including, without limitation, liability
for studies, testing or investigatory costs, cleanup costs, response costs,
removal costs, remediation costs, containment costs, restoration costs,
corrective action costs, closure costs, reclamation costs, natural resource
damages, property damages, business losses, personal injuries, penalties or
fines) arising out of, based on or resulting from (i) the presence, release,
threatened release, discharge or emission into the environment of any hazardous
materials or substances existing or arising on, beneath or above the Property
and/or emanating or migrating and/or threatening to emanate or migrate from the
Property to off-site Property; (ii) physical disturbance of the environment
caused by Operations; or (iii) the violation or alleged violation of any
Environmental Laws arising from or relating to Operations;

(p)       "Existing Data" means maps, drill logs and other drilling data, core
tests, pulps, reports, surveys, assays, analyses, production reports,
operations, technical, accounting and financial records, and any other material
or information relating to the Property;

(q)       "Exploration" means activities directed toward ascertaining the
existence, location, quantity, quality, or commercial value of deposits of
Products;

(r)       "Government Fees" means all rentals, holding fees, location fees,
maintenance payments or other payments required by any law, rule or regulation
to be paid to a federal, provincial or territorial government, in order to
locate or maintain any mining leases or surface leases, Claims or other tenures
included in the Property;

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(s)       "Initial Contribution" means that contribution each Participant agrees
to make, or is deemed to have made, pursuant to §5.1;

(t)       "Joint Account" means the account maintained in accordance with the
Accounting Procedure showing the charges and credits accruing to the
Participants;

(u)       "Law" or "Laws" means all Canadian laws (statutory or common), rules,
ordinances, regulations, grants, concessions, franchises, licenses, orders,
directives, judgments, decrees, and other governmental restrictions, including
permits and other similar requirements, whether legislative, municipal,
administrative or judicial in nature, including Environmental Laws, which are
applicable to the Property, Area of Interest, or Operations, regardless of
whether or not in existence or enacted or adopted hereafter; provided, however,
nothing in this definition is intended to make laws applicable to the parties
during periods when the laws are not applicable by their terms or the timing of
their enactment;

(v)       "Management Committee" means the committee established under 7;

(w)       "Manager" means the person or entity appointed under 8 to manage
Operations, or any successor Manager;

(x)       "Mineral Property

Option Agreement" means the agreement between the parties hereto (and/or their
predecessors in title) to which this Joint Venture Agreement is Schedule C;

(y)       "Mining" means the mining, extracting, producing, handling, milling,
or other processing of Products;

(z)       "Net Returns" shall have the meaning specified in Exhibit D;

(aa)     "Operations" means the activities carried out under this Agreement;

(bb)     "Participant" and "Participants" mean the persons or entities that from
time to time have Participating Interests;

(cc)     "Participating Interest" means the percentage interest representing the
ownership interest of a Participant in the Assets, and in all other rights and
obligations arising under this Agreement, as such interest may from time to time
be adjusted hereunder. Participating Interests shall be calculated to three
decimal places and rounded to two (e.g., 1.519% rounded to 1.52%). Decimals of
.005 or more shall be rounded up to .01; decimals of less than .005 shall be
rounded down. The initial Participating Interests of the Participants are set
forth in §6.1(a);

(dd)     "Products" means all metals, ores, concentrates, minerals, and mineral
resources, including materials derived from the foregoing, produced from the
Property under this Agreement;

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(ee)     "Program" means a description in reasonable detail of Operations to be
conducted by the Manager, as described in §9;

(ff)     "Property" means the Property described on Exhibit A; and

(gg)     "Venture" means the contractual relationship of the parties under this
Agreement.

2.                    REPRESENTATIONS AND WARRANTIES; RECORD TITLE; INDEMNITIES

Capacity of Participants

2.1                  Each Participant represents and warrants to the other
Participant as follows:

it is a corporation duly incorporated, qualified to transact business, and in
good standing under the laws of its jurisdiction and in Saskatchewan;

it has the capacity to enter into and perform this Agreement and all
transactions contemplated herein, and all corporate, board of directors and
other actions required to authorize it to enter into and perform this Agreement
have been properly taken; and

it will not breach any other agreement or arrangement by entering into or
performing this Agreement, and this Agreement has been duly executed and
delivered by it and is valid and binding upon it in accordance with its terms.

Disclosures

2.2                  Each of the Participants represents and warrants that it is
not aware of any material facts or circumstances that have not been disclosed in
this Agreement, which should be disclosed to the other Participant in order to
prevent the representations and warranties in this Agreement from being
materially misleading.

Record Title

2.3                  Title to real and personal property included in the Assets
shall be held in the name of the Manager. The Manager shall hold same in trust
for the Participants in accordance with their respective interests from time to
time.

Loss of Title

2.4                  Any failure or loss of title to the Assets, and all costs
of defending title thereto, shall be charged to the Venture.

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Indemnities

2.5       

(a)       Each Participant shall indemnify the other Participant, its directors,
officers, employees, agents and attorneys or Affiliates (collectively
"Indemnified Participant") against any loss, cost, expense, damage or liability
(including legal fees and other expenses) arising out of or based on a breach by
the Participant ("Indemnifying Participant") of any representation, warranty or
covenant contained in this Agreement including, subject to §8.3, a breach of a
participant's duties as Manager pursuant to §8.2.

(b)       In addition to the indemnity provided in §(a), the Manager shall
indemnify the other Participant, its directors, officers, agents and attorneys
or Affiliates (collectively "Indemnified participant") against any third party
related loss, cost, expense, damage or liability (including Environment
Liabilities) (collectively "Loss") incurred or suffered directly by a
Participant arising howsoever out of the Manager's actions or omissions on the
Property. For further certainty, a Participant is not entitled to any
indemnification pursuant to this §(b) in respect of any Loss incurred or
suffered by the Venture.

(c)       If any claim or demand is asserted against an Indemnified Participant
in respect of which such Indemnified Participant may be entitled to
indemnification under this Agreement, written notice of such claim or demand
shall promptly be given to the Indemnifying Participant. The Indemnifying
Participant shall have the right, but not the obligation, by notifying the
Indemnified Participant within thirty (30) days after its receipt of the notice
of the claim or demand, to assume the entire control of (subject to the right of
the Indemnified Participant to participate, at the Indemnified Participant's
expense and with counsel of the Indemnified Participant's choice), the defence,
compromise, or settlement of the matter, including, at the Indemnifying
Participant's expense, employment of counsel of the Indemnified Participant's
choice. Any damages to the Assets or business of the Indemnified Participant
caused by a failure by the Indemnifying Participant to defend, compromise, or
settle a claim or demand in a reasonable and expeditious manner requested by the
Indemnified Participant, after the Indemnifying Participant has given notice
that it will assume control of the defence, compromise, or settlement of the
matter, shall be included in the damages for which the Indemnifying Participant
shall be obligated to indemnify the Indemnified Participant. Any settlement or
compromise of a matter by the Indemnifying Participant shall include a full
release of claims against the Indemnified Participant which has arisen out of
the indemnified claim or demand.

(d)       Notwithstanding §(a), the Manager shall not be indemnified nor held
harmless by any of the parties for any loss, liability, claim, demand, damage,
expense, injury or death (including legal fees) resulting from the negligence or
willful misconduct of the Manager or its officers, employees or agents.

(e)       An act or omission of the Manager or its officers, employees or agents
done or omitted to be done:

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(i)       at the direction, or within the scope of the direction, of the
Management Committee;

(ii)      with the concurrence of the Management Committee; or

(iii)     unilaterally and in good faith by the Manager to protect life or
property;

shall be deemed not to be negligence or willful misconduct.

(f)       The Manager shall not be liable to any other party nor shall any party
be liable to the Manager in contract, tort or otherwise for special or
consequential damages including loss of profits or revenues.

3.                    NAME, PURPOSES AND TERM

General

3.1                  War Eagle and Revelstoke hereby enter into this Agreement
for the purposes hereinafter stated. All of the Participants' rights and
obligations in connection with the Assets, the Area of Interest and all
Operations shall be subject to and governed by this Agreement.

Name

3.2                  The Manager shall conduct the business of this Venture in
the name of the Venture, doing business as the "Georges Lake Venture". If
applicable, the Manager shall accomplish any registration required by
applicable, assumed or fictitious name statutes and similar statutes.

Purposes

3.3                    This Agreement is entered into for the following purposes
and for no others, and shall serve as the exclusive means by which the
Participants, or either of them, accomplish such purposes:

(a)       to conduct Exploration within the Property;

(b)       to acquire additional real property and other interests within the
Area of Interest;

(c)       to evaluate the possible Development and Mining of the Property, and
if justified, to engage in Development and Mining;

(d)       to engage in Operations within the Property;

(e)       to engage in disposition of Products, only to the limited extent
permitted in §10;

(f)       to complete and satisfy all Environmental Compliance obligations and
other Continuing Obligations relating to the Property; and

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(g)       to perform any other operation or activity necessary, appropriate, or
incidental to any of the foregoing.

Limitation

3.4                  Unless the Participants otherwise agree in writing,
Operations shall be limited to the purposes described in §3.3, and nothing in
this Agreement shall be construed to enlarge such purposes.

Term

3.5                  The Effective Date of this Agreement shall be the date
determined according to the Mineral Property Option Agreement. Unless the
Venture is earlier terminated or terminates as provided in this Agreement, the
term of this Agreement is for so long as any of the Property are jointly owned
by the Participants hereto and thereafter until all materials, supplies, and
equipment have been salvaged and disposed of, a final accounting has been made
between the Participants, and any required Environmental Compliance has been
completed and accepted by the appropriate governmental agencies.

4                    RELATIONSHIP OF THE PARTICIPANTS

No Partnership

4.1                  Nothing contained in this Agreement shall be deemed to
constitute either Participant the partner of the other, nor, except as otherwise
herein expressly provided, to constitute either Participant the agent or legal
representative of the other, nor to create any fiduciary relationship between
them. The Participants do not intend to create, and this Agreement shall not be
construed to create, any mining, commercial, tax, or other partnership.

                       Neither Participant shall have any authority to act for
or to assume any obligation or responsibility on behalf of the other
Participant, except as otherwise expressly provided herein. The rights, duties,
obligations and liabilities of the Participants shall be several and not joint
or collective. Each Participant shall be responsible only for its obligations as
herein set out and shall be liable only for its share of the costs and expenses
as provided herein. It is the Participants' intent that their ownership of
Assets and the rights acquired hereunder shall be as tenants in common.

Other Business Opportunities

4.2                  Except as expressly provided in this Agreement, each
Participant shall have the right independently to engage in and receive full
benefits from business activities, whether or not competitive with Operations,
without consulting the other. The doctrines of "corporate opportunity" or
"business opportunity" shall not be applied to any other activity, venture, or
operation of either Participant, and neither Participant shall have any
obligation to the other with respect to any opportunity to acquire any property
outside the Area of Interest at any time, or within the Area of Interest after
the termination of this Agreement, except as provided in §11.8. Unless otherwise
agreed in writing, no Participant shall have any obligation to mill,
beneficiate, or otherwise treat any Participant's share of Products in any
facility owned or controlled by such Participant.

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Termination or Transfer of Rights to Property

4.3                  Except as otherwise provided in this Agreement, neither
Participant shall permit or cause all or any part of its interest in the Assets
or this Agreement to be sold, exchanged, encumbered, surrendered, abandoned,
partitioned, divided, or otherwise terminated, by judicial means or otherwise.
The Participants hereby waive and release all rights of partition, or of sale in
lieu thereof, or other division of Assets, including any such rights provided by
any law.

No Royalty or Other Interests

4.4                  No Participant shall be entitled or permitted to create any
royalty or similar carried interest in all or any part of the Assets.

No Third Party Beneficiary Rights

4.5                  This Agreement shall be construed to benefit the
Participants and their respective successors and assigns only, and shall not be
construed to create third party beneficiary rights in any other party,
governmental agency or organization.

5.                    CONTRIBUTIONS BY PARTICIPANTS

Initial Contribution

5.1                  Each Participant, as its Initial Contribution, hereby
contributes to the Venture all its undivided right, title and interest in and to
the Property, together with all of its respective right, title and interest in
and to any licenses and permits relating to the Property, together with all
maps, data, reports, studies, and documents relating thereto, free and clear of
any Encumbrances.

Value of Initial Contributions

5.2                    The agreed value of the Participants' respective Initial
Contributions shall be as follows:

War Eagle

$[500,000]

Revelstoke

$1,000,000

Cash Contributions

5.3                  The Participants shall contribute funds for adopted
Programs and Budgets in proportion to their respective Participating Interests,
subject to elections permitted by §9.4.

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6.                    PARTICIPATING INTERESTS

Participating Interests

6.1     

(a)       Initial Participating Interest. Subject to §(b) below, the
Participants shall have the following initial Participating Interests in the
Venture:

War Eagle

30%

Revelstoke

70%

(b)       Changes in Participating Interests. A Participant's Participating
Interest shall only be changed as follows:

(i)       upon an election or deemed election by a Participant pursuant to §9.4,
not to contribute or to contribute less to an adopted Program and Budget than
the percentage reflected by its Participating Interest;

(ii)      as provided in §6.4;

(iii)     in the event of default by a Participant in making its agreed upon
contribution to an adopted Program and Budget, followed by an election by the
other Participant to invoke §6.3(b);

(iv)      pursuant to a transfer by a Participant of all or a portion of its
Participating Interest in accordance with 14; or

(v)       upon acquisition by either Participant of part or all of the
Participating Interest of the other Participant, however arising.

Voluntary Reduction in Participation - Dilution

6.2                  A Participant may elect, as provided in §9.4, to limit its
contributions to an adopted Program and Budget (without regard to its vote on
adoption of the Program and Budget) as follows:

to some lesser amount than its respective Participating Interest; or

to not contribute at all.

                       In such event, the non-diluting Participant shall then
have the option to either fully fund the remaining portion of the adopted
Program and Budget; or, within 15 days following the election of the diluting
Participant under §9.4(b), to propose a reduced alternative Program and Budget
to which the Participants shall, within seven days, make a re-election under
§9.4(a) or §9.4(b). If the non-diluting Participant elects to continue with the
initially adopted Program and Budget, the Participating Interest of the
Participant electing either §(a) or §(b) above shall be recalculated at the time
of election by dividing: (i) the sum of (a) the value of that Participant's
Initial Contribution as defined in §5.2, (b) the total of all that Participant's
contributions to previous Programs and Budgets, and (c) the amount the
Participant elects to contribute to the approved Program and Budget, by (ii) the
sum of (a), (b) and (c) above for all Participants; and multiplying the result
by 100. That is:

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(a)+(b)+(c) diluting Participant

x 100 = Recalculated Participating Interest

(a)+(b)+(c) all Participants

                       The Participating Interest of the other Participant shall
thereupon become the difference between one hundred percent (100%) and the
recalculated Participating Interest.

                       As soon as practicable after the necessary information is
available at the end of each period covered by an adopted Program and Budget, a
recalculation of each Participant's Participating Interest shall be made in
accordance with the preceding formula to adjust, as necessary, the
recalculations made at the beginning of such period to reflect actual
contributions made by the Participants during the period. Except as otherwise
provided in this Agreement, a diluting Participant shall retain all of its
rights and obligations under this Agreement, including the right to participate
in future Programs and Budgets at its Recalculated Participating Interest.

Default in Making Contributions

6.3

(a)       If a Participant elects to contribute to an approved Program and
Budget and then defaults in making a contribution or cash call under an approved
Program and Budget, the non-defaulting Participant may, but is not obligated to,
advance the defaulted contribution on behalf of the defaulting Participant and
treat the same, together with any accrued interest, as a demand loan bearing
interest from the date of the advance at the rate provided in §9.9. The failure
to repay said loan upon demand shall be a default.

(b)       The Participants acknowledge that if a Participant defaults in making
a contribution to an approved Program and Budget or a cash call under §9.8, or
in repaying a loan under §(a), as required hereunder, it will be difficult to
measure the damages resulting from such default. The Participants acknowledge
that the damage to the non-defaulting Participant could be significant. In the
event of such default, as reasonable liquidated damages, the non-defaulting
Participant may, with respect to any such default not cured within 30 days after
notice to the defaulting Participant of such default, declare that the
respective Participating Interests of the Participants will be adjusted, in
which event the Participating Interest of the defaulting Participant will be
recalculated first by reducing it by the amount that it would have been reduced
pursuant to §6.2 if such Participant had elected not to contribute the amount by
which it is in default and second by reducing such Participating Interest by the
same amount again. The Participating Interest of the non-defaulting Participant
shall thereupon become the difference between one hundred percent (100%) and the
recalculated Participating Interest of the defaulting Participant.

(c)       If Revelstoke twice elects not to contribute to an approved Program or
Budget, War Eagle at its sole discretion, shall have the right to pay out
Revelstoke for 150% of all its Expenditures and contributions to the Venture,
after which time Revelstoke's Participating Interest shall be forfeited to War
Eagle and Revelstoke's Participating Interest shall be automatically converted
to a one percent (1%) Net Returns Royalty and Revelstoke shall have no further
rights to participate in subsequent Programs.

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Elimination of Minority Interest

6.4                  Upon the reduction of its Participating Interest to five
percent (5%) or less, a Participant shall be deemed to have withdrawn from the
Venture and shall relinquish its entire Participating Interest, free and clear
of any Encumbrances arising by, through or under that Participant. Such
relinquished Participating Interest shall be deemed to have accrued
automatically to the other Participant, and the interest of the Participant
whose Participating Interest dilutes to five percent (5%) or below shall be
converted to a one percent (1%) Net Returns royalty, as defined in Exhibit D to
this Agreement. If a Participant forfeits its Participating Interest any
decision to place the Property into production shall be at the sole discretion
of the other and if the Property is in or is placed into production, such other
party shall have the unfettered right to suspend, curtail or terminate any such
Operation as it in its sole discretion may determine. Except for or as provided
in this §6.4 and §11.9, 14 and §16.6, this Agreement shall thereupon terminate.

Documentation of Adjustments to Participating Interests

6.5                  An adjustment to a Participating Interest need not be
evidenced during the term of this Agreement by the execution and recording of
appropriate instruments, but each Participant's Participating Interest shall be
shown in the books of the Manager. However, either Participant, at any time upon
the request of the other Participant, shall execute and acknowledge instruments
necessary to evidence or effectuate such adjustment in a form sufficient for
recording in the jurisdiction where the Property are located.

Grant of Lien or Security Interest

6.6

(a)       Subject to §6.7, each Participant grants to the other Participant a
lien upon and a security interest in its Participating Interest, including all
of its right, title and interest in the Assets and the Participant's share of
Products, whenever acquired or arising, and the proceeds from and accessions to
the foregoing.

(b)       The liens and security interests granted by §(a) shall secure every
obligation or liability of the Participant granting such lien or security
interest created under this Agreement, including the obligation to repay a loan
granted under §6.3(a). Each Participant hereby agrees to take all action
necessary to perfect such lien and security interests and hereby appoints the
other Participant, its attorney in-fact, to execute, file and record all
financing statements and other documents necessary to perfect or maintain such
lien and security interests.

Subordination of Interests

6.7                  Each Participant shall, from time to time, take all
necessary actions, including execution of appropriate agreements, to pledge and
subordinate its Participating Interests, any liens it may hold which are created
under this Agreement, other than those created pursuant to §6.6 hereof, and any
other right or interest it holds with respect to the Assets (other than any
statutory lien of the Manager) to any secured borrowings for Operations approved
by the Management Committee.

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7.                    MANAGEMENT COMMITTEE

Organization and Composition

7.1                  Upon execution of this Agreement, the Participants shall
establish a Management Committee to determine overall policies, objectives,
procedures, methods and actions under this Agreement. The Management Committee
shall consist of one member appointed by War Eagle and one member appointed by
Revelstoke. Each Participant may appoint an alternate to act in the absence of a
regular member. Any alternate so acting shall be deemed a member. Appointments
shall be made or changed by prior written notice to the other Participant.

Decisions

7.2                  Each Participant, acting through its appointed member,
shall have votes on the Management Committee, in proportion to its Participating
Interest. Unless otherwise provided in this Agreement, the vote of a Participant
with a Participating Interest greater than fifty percent (50%) shall determine
the decisions of the Management Committee. In the event of a tie vote, the
Participant designated as Manager shall have the deciding vote of the Management
Committee.

Meetings

7.3                  The Management Committee shall hold regular meetings at
least annually in Vancouver, British Columbia, or at other mutually agreed
places.

7.4                  The Manager shall give 30 days' notice to the Participants
of such regular meetings (unless such notice is waived by the Participants).
Additionally, any Participant may call a special meeting upon 14 days' notice to
the other Participant (unless such notice is waived by the Participants). In
case of emergency, reasonable notice of a special meeting shall suffice.

7.5                  With respect to a regular or special meeting of the
Management Committee, there shall be a quorum if at least one member
representing each Participant is present; provided, however, that in the event
that, within 30 minutes from the time appointed for a meeting, a quorum does not
exist at any such meeting, any Participant may reschedule the meeting, at a time
at least two days following the originally scheduled meeting but no later than
14 days following the originally scheduled meeting, and, at such rescheduled
meeting, there shall be a quorum if at least one member representing any
Participant having greater than a twenty percent (20%) Participating Interest is
present. If within half an hour from the time appointed for a meeting, a quorum
is not present, the meeting shall, at the election of those representatives who
are present:

(a)     be dissolved; or

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(b)       be adjourned to the same place but on a date and at a time, to be
fixed by the chairperson of the meeting before the adjournment, which shall be
not less than 14 days following the date for which the meeting was called.

                       Notice of the adjourned meeting shall he given to the
representatives of all parties immediately after the adjournment of the meeting.
If at the adjourned meeting a quorum is not present within half an hour from the
time appointed, the representative or representatives present and entitled to
attend and vote at the meeting shall be a quorum, even if only one person is
present.

7.6                  Each notice of a meeting shall include an itemized agenda
prepared by the Manager in the case of a regular meeting, or by the Participant
calling the meeting in the case of a special meeting, but any matter may be
considered with the consent of all Participants.

7.7                  The Manager shall prepare minutes of all meetings and shall
distribute copies of such minutes to the Participants within 30 days after the
meeting. The Participants shall have thirty 30 days after receipt to sign and
return such copies or to provide any written comments on such minutes to the
Manager. If a Participant timely submits written comments on such minutes, the
Management Committee shall seek, for a period not to exceed thirty 30 days, to
agree upon minutes of such meeting acceptable to the Participants. At the end of
such period, failing agreement by the Participants on revised minutes, the
minutes of the meeting shall be the original minutes as prepared by the Manager,
together with the comments on the minutes made by the other Participant. These
documents shall be placed in the minutes book maintained by the Manager.

7.8                  If personnel employed in Operations are required to attend
a Management Committee meeting, reasonable costs incurred in connection with
such attendance shall be a Venture cost. All other costs associated with
Management Committee meetings shall be paid for by the Participants
individually.

Expense

7.9                  Each party shall bear the expenses incurred by its
representatives and alternate representatives in attending meetings of the
Management Committee.

Rules

7.10               The Management Committee may, by agreement of the
representative of all the parties, establish other rules of procedure, not
inconsistent with this agreement, as the Management Committee deems fit.

Action Without Meeting

7.11               In lieu of meetings, the Management Committee may hold
telephone conferences, so long as minutes are prepared in accordance with §7.3.
The Management Committee may also take actions in writing signed by all members.

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Matters Requiring Approval

7.12               Except as otherwise delegated to the Manager in §8.2 the
Management Committee shall have exclusive authority to determine all management
matters related to this Agreement. Management Committee decisions made in
accordance with this agreement shall be binding on all of the parties.

8.                    MANAGER

Appointment

8.1                  The parties hereby appoint Revelstoke as the Manager with
overall management responsibility for Operations and to remain as Manager until
it resigns pursuant to §8.4, or until its Participating Interest falls below
fifty percent (50%). In the event that War Eagle and Revelstoke have equal
participating interests, Revelstoke will act as the Manager.

Powers and Duties of Manager

8.2                  Subject to the terms and provisions of this Agreement, the
Manager shall have the following powers and duties:

(a)       act as the chairperson of meetings of the Management Committee;

(b)       the Manager shall manage, direct, and control Operations, and shall
prepare and present to the Management Committee proposed Programs and Budgets;

(c)       the Manager shall implement the decisions of the Management Committee,
shall make all expenditures necessary to carry out adopted Programs, and shall
promptly advise the Management Committee if it lacks sufficient funds to carry
out its responsibilities under this Agreement;

(d)       the Manager shall use reasonable efforts to: (i) purchase or otherwise
acquire all material, supplies, equipment, water, utility and transportation
services required for Operations, such purchases and acquisitions to be made on
the best terms available, taking into account all of the circumstances; (ii)
obtain such customary warranties and guarantees as are available in connection
with such purchases and acquisitions; and (iii) keep the Assets free and clear
of all Encumbrances, except for those existing at the time of, or created
concurrent with, the acquisition of such Assets, or mechanic's or materialmen's
liens which shall be released or discharged in a diligent manner, or
Encumbrances specifically approved by the Management Committee;

(e)       the Manager shall conduct such title examinations and cure such title
defects relating to the Property as may be advisable in the reasonable judgment
of the Manager;

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(f)       the Manager shall: (i) make or arrange for all payments required by
concessions, leases, licenses, permits, contracts, and other agreements related
to the Assets; (ii) pay all taxes, assessments and like charges on Operations
and Assets except taxes determined or measured by a Participant's sales revenue
or net income. If authorized by the Management Committee, the Manager shall have
the right to contest, in the courts or otherwise, the validity or amount of any
taxes, assessments, or charges if the Manager deems them to be unlawful, unjust,
unequal, or excessive, or to undertake such other steps or proceedings as the
Manager may deem reasonably necessary to secure a cancellation, reduction,
readjustment, or equalization thereof before the Manager shall be required to
pay them, but in no event shall the Manager permit or allow title to the Assets
to be lost as the result of the non-payment of any taxes, assessments, or like
charges; and (iii) do all other acts reasonably necessary to maintain the
Assets;

(g)       the Manager shall: (i) apply for all necessary permits, licenses and
approvals; (ii) comply with the Laws; (iii) notify promptly the Management
Committee of any allegations of substantial violation thereof; and (iv) prepare
and file all reports or notices required for Operations. In the event of any
violation of permits, licenses or approvals, the Manager shall timely cure or
dispose of such violation through performance, payment of fines and penalties,
on both, and the cost thereof shall be charged to the Joint Account;

(h)       the Manager shall notify the other Participant promptly of any
litigation, arbitration, or administrative proceeding commenced against the
Venture. The Manager shall prosecute and defend, but shall not initiate without
consent of the Management Committee, all litigation or administrative
proceedings arising out of Operations. The non-managing Participant shall have
the right to participate, at its own expense, in such litigation or
administrative proceedings. The Management Committee shall approve in advance
any settlement involving payments, commitments or obligations in excess of
$100,000 in cash or value;

(i)       the Manager may dispose of Assets, whether by sale, assignment,
abandonment or other transfer, in the ordinary course of business, except that
Property may be abandoned or surrendered only as provided in 12. However,
without prior authorization from the Management Committee, the Manager shall
not: (i) dispose of Assets in any one transaction having a value in excess of
$100,000; (ii) enter into any sales contracts or commitments for Products,
except as permitted in §10.2; (iii) begin a liquidation of the Venture; or (iv)
dispose of all or a substantial part of the Assets necessary to achieve the
purposes of the Venture;

(j)       the Manager shall have the right to carry out its responsibilities
hereunder through agents, Affiliates or independent contractors;

(k)       the Manager shall keep and maintain all required accounting and
financial records pursuant to the Accounting Procedure and in accordance with
generally accepted accounting procedures;

(l)       the Manager shall select and employ at competitive rates all
supervision and labour necessary or appropriate to all Operations hereunder. All
persons employed hereunder, the number thereof; their hours of labour and their
compensation shall be determined by the Manager, and they shall be employees of
the Manager;

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(m)       the Manager shall keep the Management Committee advised of all
Operations by submitting in writing to the Management Committee: (i) monthly
progress reports within 20 days after the end of each month, which include
statements of expenditures and comparisons of such expenditures to the adopted
Budget; (ii) periodic summaries of data acquired; (iii) copies of reports
concerning Operations; (iv) a detailed final report within 60 days after
completion of each Program and Budget, which shall include comparisons between
actual and budgeted expenditures; and (v) such other reports as the Management
Committee may reasonably request. At all reasonable times, the Manager shall
provide the Management Committee or the representative of any Participant, upon
the request of any member of the Management Committee, access to, and the right
to inspect and copy, all information acquired in Operations, including but not
limited to, maps, drill logs, core tests, reports, surveys, assays, analyses,
production reports, operations, technical, accounting and financial records. In
addition, the Manager shall allow the non-managing Participant, at its sole risk
and expense, and subject to reasonable safety regulations, to inspect the Assets
and Operations at all reasonable times, so long as the inspecting Participant
does not unreasonably interfere with Operations;

(n)       the Manager shall provide insurance for the benefit of the
Participants, in such amounts and of such nature as the Manager deems necessary
to protect the Assets and Operations of the Venture;

(o)       the Manager shall perform or cause to be performed all assessment and
other work, and shall pay all Government Fees required by Law in order to
maintain in good standing all mining leases, surface leases, Claims and other
tenures included within the Property. The Manager shall have the right to
perform the assessment work required hereunder pursuant to a common plan of
exploration on other Property. The Manager shall not be liable on account of any
determination by any court or governmental agency that the work performed by the
Manager does not constitute the required annual assessment work or occupancy for
the purposes of preserving or maintaining ownership of the claims, provided that
the work done is pursuant to an adopted Program and Budget and is performed in
accordance with the Manager's standard of care under §8.3. The Manager shall
timely record and file with the appropriate governmental office any required
affidavits, notices of intent to hold and other documents in proper form
attesting to the payment of Government Fees and the performance of assessment
work, in each case in sufficient detail to reflect compliance with the
applicable requirements. The Manager shall not be liable on account of any
determination by any court or governmental agency that any such document
submitted by the Manager does not comply with applicable requirements, provided
that such document is prepared and recorded or filed in accordance with the
Manager's standard of care under §8.3;

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(p)       if authorized by the Management Committee, the Manager may: (i)
locate, amend or relocate any mining claim, (ii) locate any fractions resulting
from such amendment or relocation, and (iii) apply for patents or mining leases
or other forms of mineral tenure for any such claims;

(q)       the Manager shall prepare an Environmental Compliance plan for all
Operations consistent with the requirements of any applicable Laws or
contractual obligations and shall include in each Program and Budget sufficient
funding to implement the Environmental Compliance plan and to satisfy the
financial assurance requirements of any applicable Law or contractual obligation
pertaining to Environmental Compliance. To the extent practical, the
Environmental Compliance plan shall incorporate concurrent reclamation of
Property disturbed by Operations;

(r)       the funds that are to be deposited into the Environmental Compliance
fund shall be maintained by the Manager in a separate, interest bearing cash
management account, which may include, but is not limited to, money market
investments and money market funds, and/or in longer term investments if
approved by the Management Committee. Such funds shall be used solely for
Environmental Compliance, including the committing of such funds, interests in
property, insurance or bond policies, or other security to satisfy Laws
regarding financial assurance for the reclamation or restoration of the
Property, and for other Environmental Compliance requirements;

(s)       the Manager shall undertake to perform Continuing Obligations when and
as economic and appropriate, whether before or after termination of the
Operations. The Manager shall have the right to delegate performance of
Continuing Obligations to persons having demonstrated skill and experience in
relevant disciplines. As part of each Program and Budget submittal, the manager
shall specify in such Program and Budget the measures to be taken for
performance of Continuing Obligations and the cost of such measures. The Manager
shall keep the other Participant reasonably informed about the Manager's efforts
to discharge Continuing Obligations. Authorized representatives of each
Participant shall have the right from time to time to enter the Property to
inspect work directed toward satisfaction of Continuing Obligations and audit
books, records, and accounts related thereto;

(t)       if Participating Interests are adjusted in accordance with this
Agreement the Manager shall propose from time to time one or more methods for
fairly allocating costs for Continuing Obligations;

(u)       the Manager shall undertake all other activities reasonably necessary
to fulfill the foregoing.

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Standard of Care

8.3                  The Manager shall discharge its duties under §8.2 and
conduct all Operations in a good, workmanlike and efficient manner, in
accordance with sound mining and other applicable industry standards and
practices, and in material compliance with the terms and provisions of
concessions, leases, licenses, permits, contracts and other agreements
pertaining to Assets. The Manager shall not be liable to the non-managing
Participant for any act or omission resulting in damage, loss cost, penalty or
fine to the Venture except to the extent caused by or attributable to the
Manager's wilful misconduct or gross negligence. The Manager shall not be in
default of its duties under this Agreement, if its inability to perform results
from the failure of the non-managing Participant to perform acts or to
contribute amounts required of it by this Agreement.

Resignation; Deemed Offer to Resign

8.4                  The Manager may resign upon 90 day's prior notice to the
Management Committee, in which case the other Participant may elect to become
the new Manager by notice to the Management Committee within 90 days after the
notice of resignation. If any of the following shall occur, the Manager shall be
deemed to have offered to resign, which offer shall be accepted by the other
Participant, if at all, within 90 days following such deemed offer:

(a)       the Participating Interest of the Manager (inclusive of any entity
claiming through the Manager as provided in §14.2(g)) ceases to be the highest
between the Participants, provided; however, that in the event the Manager
transfers its Participating Interest to an Affiliate, such Affiliate shall
automatically become the Manager; or

(b)       the Manager fails to perform a material obligation imposed upon it
under this Agreement, and such failure continues for a period of 60 days after
notice from the other Participant demanding performance; or

(c)       the Manager fails to pay its bills within 90 days after they are due,
unless the Manager contests such bills in good faith; or

(d)       the appointment of a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official is appointed for a substantial part of
the Manager's assets, and such appointment is neither made ineffective nor
discharged within 30 days after the making thereof; or such appointment is
consented to, requested by, or acquiesced in by the Manager; or

(e)       the Manager commences a voluntary case under any applicable
bankruptcy, insolvency or similar law now or hereafter in effect; or consents to
the entry of an order for relief in an involuntary case under any such law or to
the appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or other similar official of any substantial
part of its assets; or makes a general assignment for the benefit of creditors;
or takes corporate or other action in furtherance of any of the foregoing; or

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(f)       entry is made against the Manager of a judgment, decree or order for
relief affecting its ability to serve as Manager, or a substantial part of its
Participating Interest or other assets by a court of competent jurisdiction in
an involuntary case commenced under any applicable bankruptcy, insolvency or
other similar law of any jurisdiction now or hereafter in effect.

                         Under §(d), §(e) or §(f) above, any appointment of a
successor Manager shall be deemed to pre-date the event causing a deemed offer
of resignation.

New Manager

8.5                  The new Manager shall assume all of the rights, duties,
liabilities and status of the previous Manager as provided in this Agreement.
The new Manager shall have no obligation to hire or continue the employment of
any of the employees of the former Manager resulting from this change of
Manager.

Delivery of Records

8.6                  On ceasing to be Manager, the former Manager shall
immediately deliver to the person nominated for that purpose by the Management
Committee, the custody of all the Property, books, records and other property
both real and personal relating to this Agreement.

No Replacement for Manager

8.7                  If the Manager resigns and no other party consents to act
as Manager the Venture shall terminate.

Payments to Manager

8.8                  The Manager shall be compensated for its services and
reimbursed for its costs hereunder in accordance with the Accounting Procedure
set forth in Exhibit C.

Transactions With Affiliates

8.9                  If the Manager engages Affiliates to provide services
hereunder, it shall do so on terms no less favourable than would be the case
with unrelated persons in arm's-length transactions.

Independent Contractor

8.10                The Manager is and shall act as an independent contractor
and not as the agent of the other Participant. The Manager shall maintain
complete control over its employees and all of its subcontractors with respect
to performance of the Operations. Nothing contained in this Agreement or any
subcontract awarded by the Manager shall create any contractual relationship
between any subcontractor and the other Participant. The Manager shall have
complete control over and supervision of Operations and shall direct and
supervise the same so as to ensure their conformity with this Agreement.

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9.                    PROGRAMS AND BUDGETS

Operations Pursuant to Programs and Budgets

9.1                  Operations shall be conducted, expenses shall be incurred,
and Assets shall be acquired only pursuant to Programs and Budgets approved
pursuant to §9.2. Every Program and Budget adopted pursuant to this Agreement
shall provide for accrual of reasonably anticipated Environmental Compliance
expenses for all operations contemplated under the Program and Budget.

Presentation of Programs and Budgets

9.2                  Immediately after the formation of the Venture and
thereafter on February 1st of each year or within 90 days of completion of a
Program, proposed Programs and Budgets shall be prepared by the Manager and
shall be for one calendar year (or in the event that the Manager determines that
appropriate methods of Exploration or Development require a shorter period or a
longer period to accomplish the proposed Program and Budget, the proposed
Program and Budget may be prepared for such shorter or longer period). Each
adopted Program and Budget, regardless of length, shall be reviewed at least
once a year at the annual meeting of the Management Committee. A meeting of the
Management Committee shall be convened to approve each Program and Budget and at
least 40 days prior to such meeting of the Management Committee, a proposed
Program and Budget shall be prepared by the Manager and submitted to the
Participants. Within 20 days of receipt of the proposed Program and Budget, the
Participants may submit written comments to the Manager detailing revisions or
modifications that they would like to have made to the proposed Program and
Budget. If such written comments are received, the Manager, working with the
other Participant, shall seek for a period of time not to exceed 15 days to
develop a revised Program and Budget acceptable to both Participants. The
Manager shall submit any revised proposed Program and Budget to the Participants
at least five days prior to the meeting of the Management Committee to consider
the proposed Program and Budget.

Adoption of Proposed Programs and Budgets

9.3                  At the meeting convened to consider the proposed Program
and Budget, the Management Committee shall consider and vote on the proposed
Program and Budget.

Election to Participate

9.4                  By notice to the Management Committee within 15 days after
the final vote adopting a Program and Budget, a Participant may elect to
contribute to such Program and Budget as follows:

(a)       in proportion to its respective Participating Interest as of the
beginning of the period covered thereby; or

(b)       to some lesser amount than its respective Participating Interest, or
not at all, in which cases its Participating Interest shall be recalculated as
provided in §6.2, and such recalculated Participating Interest shall be
effective the first day of the period covered by the adopted Program and Budget.

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                         If a Participant fails to provide notice to the
Management Committee under this §9.4, the Participant will be deemed to have
elected to contribute to such Program and Budget in proportion to its
Participating Interest at the beginning of the Program period.

Budget Overruns; Program Changes

9.5                  The Manager shall immediately notify the Management
Committee of any material departure from an adopted Program. If the Manager
exceeds the total of an adopted Program by more than ten percent (10%), the
Manager shall immediately give written notice to the Participants contributing
to that Program outlining the nature and extent of the additional costs and
expenses (the "Program Overruns"). If Program Overruns are approved by the
Participants contributing to that Program, then within 30 days after the receipt
of a written request from the Manager, the Participants contributing to that
Program shall provide the Manager with their respective shares of the Program
Overruns. If Program Overruns are not approved by the Participants contributing
to that Program, the Manager shall have the right, but not the obligation, to
pay the Program Overruns, in which case, provided the Program Overruns result
from work undertaken by an independent, third party contractor, the payment
shall be considered to be a contribution to costs by the Manager; alternatively,
the Manager shall have the right to curtail or abandon the Program.

Emergency Expenditures

9.6                  In case of emergency, the Manager may take any action it
deems necessary to protect life, limb or property, to protect the Assets or to
comply with law or government regulation. The Manager may also make reasonable
expenditures on behalf of the Participants for unexpected events that are beyond
its reasonable control. In the case of an emergency or unexpected expenditure,
the Manager shall promptly notify the Participants of the expenditure, and the
Manager shall be reimbursed therefor by the Participants in proportion to their
respective Participating Interests at the time the emergency or unexpected
expenditure is incurred.

Mandatory expenditures

9.7                  Notwithstanding §9.1, if, in any year in which there is no
Program adopted pursuant to this Agreement, circumstances are such that the
Manager must incur costs in order to maintain tenure to the Property, to satisfy
contractual obligations or obligations imposed by law, to prevent waste or to
protect life and property (in this paragraph called the "non-discretionary
costs"), the Manager shall immediately propose a program (in this paragraph
called the "mandatory program") to incur those non-discretionary costs and
provide each party with one copy of it. The mandatory program shall be deemed to
be approved and each of the parties shall be obligated to contribute to the
non-discretionary costs incurred in proportion to their respective Participating
Interest within 30 days of receipt of the Manager's invoice

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Cash Calls

9.8                  On the basis of adopted Programs and Budgets, the Manager
shall submit to each Participant, prior to the last day of each month, a billing
for estimated expenditures and Environmental Compliance fund requirements for
the next month. Within 20 days after receipt of each billing, or a billing made
pursuant to §9.6 or §11.6, each Participant shall advance to the Manager its
proportionate share of the estimated amount. Time is of the essence of payment
of such billings. The Manager shall at all times maintain a cash balance
approximately equal to the rate of disbursement for up to 15 days. After a
decision has been made to begin Development, all funds in excess of immediate
cash requirements shall be invested in interest-bearing accounts for the benefit
of the Joint Account.

Failure to Meet Cash Calls

9.9                  Subject to §6.3(c), if a Participant that fails to meet
cash calls in the amount and at the times specified in §9.8 it shall be in
default, and the amounts of the defaulted cash call shall bear interest from the
date due at an annual rate equal to five percentage points over the prime rate
in effect from time to time for demand, commercial loans quoted by Royal Bank of
Canada at its main branch in Vancouver, British Columbia to its most
credit-worthy customers or the maximum interest rate permitted by law, if less
than this. Such interest shall accrue to the benefit of and be payable to the
non-defaulting Participant, but shall not be deemed as amounts contributed by
the non-defaulting Participant in the event dilution occurs in accordance with
6. The non-defaulting Participant shall have those rights, remedies and
elections specified in §6.3, as well as any other rights and remedies available
to it by law.

Audits

9.10                Upon request of any Participant made within 15 months
following the end of any calendar year (or, if the Management Committee has
adopted an accounting period other than the calendar year, within 24 months
after the end of such period), the Manager shall order an audit of the
accounting and financial records for such calendar year (or other accounting
period). All exceptions to the audit and claims upon the Manager for
discrepancies disclosed by such audit shall be made in writing not later than
three months after receipt of the audit report by the Participant that requested
the audit. A Participant's failure to make such exceptions or claims within the
three month period shall (i) mean that the audit is correct and binding upon the
Participants and (ii) result in a waiver of any right to make claims upon the
Manager for discrepancies disclosed by the audit. The audits shall be conducted
by a national firm of chartered accountants selected by the Manager, unless
otherwise agreed by the Management Committee.

                         In addition each Participant shall have the right to
conduct an independent audit of all books, records and accounts, at the expense
of the requesting Participant, and which audit right will be limited to the
period not more than twenty-four months prior to the date the audit is
conducted. All exceptions to and claims upon the Manager for discrepancies
disclosed by such audit shall be made in writing within three months after
completion or delivery of such audit, or they shall be deemed waived.

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10.                  DISPOSITION OF PRODUCTION

Taking In Kind

10.1                Each Participant shall take in kind or separately dispose of
its share of all Products in accordance with its Participating Interest. Any
extra expenditure incurred in the taking in kind or separate disposition by any
Participant of its proportionate share of Products shall be borne by such
Participant. Nothing in this Agreement shall be construed as providing, directly
or indirectly, for any joint or cooperative marketing or selling of Products or
permitting the processing of Products of anyone other than the Participants at
any processing facilities constructed by the Participants pursuant to this
Agreement. The Manager shall give the Participants notice at least ten days in
advance of the delivery date upon which their respective shares of Products will
be available.

Failure of Participant to Take in Kind

10.2                If a Participant fails to take its share of Products in
kind, the Manager may, but is not obligated, to sell such share on behalf of
that Participant at not less than the prevailing market price in the area for a
period of time not to exceed one year from the date of notice under §10.1.
Subject to the terms of any such contracts of sale then outstanding, during any
period that the Manager is selling a Participant's share of production, the
Participant may elect by notice to the Manager to take in kind. The Manager
shall be entitled to deduct from proceeds of any sale by it for the account of a
Participant reasonable expenses incurred in such a sale.

Hedging

10.3                Neither Participant shall have any obligation to account to
the other Participant for, nor have any interest or right of participation in
any profits or proceeds, nor have any obligation to share in any losses from,
future contracts, forward sales, trading inputs, calls, options or any similar
hedging, price protection or marketing mechanism employed by a Participant with
respect to its proportionate share of any Products produced or to be produced
from the Property.

Value of Mineral Products

10.4                For purposes of determining the value of Mineral Products
taken in kind pursuant to §10.1, each Participant's share of Products shall be
valued at the time of delivery to the Participants at a value equal to that
received by the other party for its share of the Products after deduction of:

(a)       all smelting and other refining costs incurred with an independent
third party smelter or other refining facility;

(b)       all costs of transporting Products, including insurance, from the
Property to the place of delivery designated by the purchaser of the Products;

(c)       a reasonable charge for marketing Products as is consistent with
generally accepted industry marketing practices; and

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(c)       all taxes (other than income taxes). royalties or other charges or
imposts provided for pursuant to any law or legal obligation imposed by any
government if paid by the Participant in connection with the disposition of
Products taken in kind.

Extra Expenditure

10.5                Any extra expenditure incurred by reason of the taking in
kind or separate disposition by a Participant of its proportionate share of
Products shall be borne by that Participant and that Participant shall he
required to construct, operate and maintain, at its own expense, any and all
facilities which may be necessary to receive, store and dispose of its share of
Products, including any costs incurred in respect of security for receiving,
storing or disposing of its share of Products.

Manager's Authority

10.6                If any Participant fails to make the necessary arrangements
to take in kind or separately dispose of its proportionate share of Products,
the Manager as agent may purchase for its own account or sell that share,
subject to the right of the Participant owning the share to revoke at will the
Manager's authority under this paragraph in respect of Products not then
purchased by the Manager or committed for sale to others, and the Manager shall
be entitled to deduct from the sale proceeds all costs of or related to
marketing the Products as is consistent with generally accepted industry
marketing practices including, without limitation, all smelting and other
refining costs incurred with an independent third party smelter or other
refining facility, transportation, storage, security, commissions and discounts,
but all contracts of sale executed by the Manager for a Participants share of
Products shall be only for reasonable periods of time as are consistent with the
minimum needs of the industry under the circumstances and in no event shall any
contract be for a period in excess of one year.

Payment of Proceeds

10.7                Proceeds, if any, from the sale by the Manager of Products
pursuant to §10.6 shall be calculated by the Manager separately for each
Participant at the end of each calendar month and shall be paid monthly within
20 days after the end of each calendar month following payment to the Manager by
each Participant of its respective cost share outstanding as at the end of that
calendar month.

Non-arm's Length Transaction

10.8                If the Manager, any Affiliate of the Manager, or any person
with whom the Manager is not dealing at arm's length is a purchaser of Products
from the Manager, and if the value of the Products is used to determine any
matter arising under this paragraph, the Manager shall be required to receive
competitive prices for all Products so sold.

Records

10.9                The records relating to Products taken in kind or to the
calculation of proceeds from the sale thereof shall be audited annually at the
end of each fiscal year of the Manager and:

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(a)       any adjustments required by the audit shall be made immediately; and

(b)       a copy of the audited statements shall be delivered to each of the
Participants.

10.10              Any of the Participants shall, at reasonable times and on
notice in writing to the Manager, have the right to inspect, audit and copy the
Manager's accounts and records relating to the accounting for Products taken in
kind or to the determination of proceeds from the sale thereof for any calendar
year within twelve months following the end of the calendar year. All accounts
and records shall be deemed to be correct and accurate unless questioned by a
Participant within twelve months following the end of the calendar year to which
the accounts relate. The Participants shall make all reasonable efforts to
conduct audits in a manner which will result in a minimum of inconvenience to
the Manager.

11.                  SUSPENSION AND TERMINATION

Suspension of Operations

11.1                The Manager may, on at least 30 days' notice to all
Participants, recommend that the Management Committee approve that Operations be
suspended. The Manager's recommendation shall include a plan and budget (in this
paragraph called the "Maintenance Plan"), in reasonable detail, of the
activities to be performed to maintain the Assets and Property during the period
of suspension and the costs to be incurred. The Management Committee may, cause
the Manager to suspend Operations in accordance with the Manager's
recommendation, with such changes to the Maintenance Plan as the Management
Committee deems necessary. The Participants shall be committed to contribute
their proportionate share of the costs incurred in connection with the
Maintenance Plan. The Management Committee may cause Operations to be resumed at
any time.

Terminatio

n of Operations Following Suspension

11.2                The Manager may, at any time following a period of at least
90 days during which Operations have been suspended, on at least 30 days' notice
to all Participants, recommend that the Management Committee approve the
permanent termination of Operations. The Manager's recommendation shall include
a plan and budget (in this paragraph called the "Closure Plan"), in reasonable
detail, of the activities to be performed to terminate Operations. The
Management Committee may, by unanimous approval of the representatives of all
Participants, approve the Manager's recommendation, with such changes to the
Closure Plan as the Management Committee deems necessary.

Termination by Agreement

11.3                The Participants may terminate the Venture at any time by
written agreement.

Termination Where No Program Proposed

11.4                The Participants agree that, if neither Participant proposes
a Program and Budget for a period of four consecutive years, then the Venture
shall terminate.

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Disposition of Assets on Termination

11.5                Promptly after termination under §11.3, the Manager shall
take all action necessary to wind up the activities of the Venture, and all
costs and expenses incurred in connection with the termination of the Venture
shall be expenses chargeable to the Venture.

Right to Data After Termination

11.6                After termination of the Venture under §11.3, each
Participant shall be entitled to copies of all information acquired hereunder as
of the date of termination and not previously furnished to it, but a terminating
or withdrawing Participant shall not be entitled to any such copies after any
other termination or withdrawal.

Non-Compete Covenants

11.7                A Participant that is deemed to have withdrawn pursuant to
§6.3 or §6.4, shall not directly or indirectly acquire any interest in property
within the Area of Interest for two years after the effective date of
withdrawal. If the withdrawing Participant, or the Affiliate of a withdrawing
Participant, breaches this §11.7, such Participant or Affiliate shall be
obligated to offer to convey to the non-withdrawing Participant, without cost,
any such property or interest so acquired. Such offer shall be made in writing
and can be accepted by the non-withdrawing Participant at any time within 45
days after it is received by such non-withdrawing Participant.

Continuing Authority

11.8                On termination of the Venture under §11.3 or §11.4 the
Participant which was the Manager prior to such termination or withdrawal (or
the other Participant in the event of a withdrawal by the Manager) shall have
the power and authority to do all things on behalf of both Participants which
are reasonably necessary or convenient to:

(a)       wind-up Operations; and

(b)       complete any transaction and satisfy any obligation, unfinished or
unsatisfied, at the time of such termination or withdrawal, if the transaction
or obligation arises out of Operations prior to such termination or withdrawal.
The Manager shall have the power and authority to grant or receive extensions of
time or change the method of payment of an already existing liability or
obligation, prosecute and defend actions on behalf of both Participants and the
Venture, encumber Assets, and take any other reasonable action in any matter
with respect to which the former Participants continue to have, or appear or are
alleged to have, a common interest or a common liability.

Survival of Ingress and Egress After Termination

11.9                After termination of the Venture, the Participants shall
continue to have rights of ingress and egress to the Property for purposes of
ensuring Environmental Compliance.

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12.                  ABANDONMENT AND SURRENDER OF PROPERTY

12.1                The Management Committee may authorize the Manager to
surrender or abandon some or all of the Property. If the Management Committee
authorizes any such surrender or abandonment over the objection of a
Participant, the Participant that desires to abandon or surrender shall if the
objecting party elects assign to the objecting Participant, by deed, assignment,
or appropriate document, and without cost to the objecting Participant, all of
the surrendering Participant's interest in the property to be abandoned or
surrendered, and the abandoned or surrendered property shall cease to be part of
the Property. Provided, however, the objecting Participant shall assume all
responsibility and liabilities, including but not limited to Environmental
Liabilities, with regard to the surrendered or abandoned property.

13.

                  Surrender of Interest

Surrender of Interest

13.1                A Participant may, at any time on notice, surrender its
entire Participating Interest to the other Participant by giving that party
notice of surrender, which notice shall:

(a)       indicate a date for surrender not more than three months after the
date on which the notice is given; and

(b)       contain an undertaking that the surrendering party will:

(i)       satisfy its proportionate share, based on its then Interest, of all
obligations and liabilities which arose at any time prior to the date of
surrender;

(ii)      pay its proportionate share, based on its then Participating Interest,
of the costs of rehabilitating the mine site and of reclamation as at the date
of surrender; and

(iii)     hold in confidence, for a period of two years from the date of
surrender, all information and data which it acquired pursuant to this
Agreement.

Relief from Liabilities

13.2                On the surrender of its entire Participating Interest and on
delivery of a release in writing, in form acceptable to counsel for the Manager,
releasing the other parties from all claims and demands under this agreement,
the surrendering party shall be relieved of all obligations or liabilities
except for those which arose or accrued or were accruing due on or before the
date of the surrender.

Acceptance of Surrender

13.3                A Participant to whom a notice of surrender has been given
may elect, by notice within 90 days to the party which first gave the notice, to
accept the surrender, or to join in the surrender. If all of the parties join in
the surrender the Venture shall be terminated.

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Execution of Instruments

13.4                The surrendering Participant shall remain obligated to
execute and deliver those instruments as may be necessary to formally effect the
transfer of its Participating Interest to the other Participant.

14.                  TRANSFER OF INTEREST

General

14.1                A Participant shall have the right to transfer to any third
party all or any part of its interest in or to this Agreement, its Participating
Interest, or the Assets solely as provided in this 14. For the purposes of this
14 the word transfer shall mean to convey, sell, assign, grant an option, create
an Encumbrance or in any manner transfer or alienate, but excluding and
excepting alienation done for the purposes of obtaining financing pursuant to
§14.5.

Limitations on Free Transferability

14.2                The transfer right of a Participant in §14.1 shall be
subject to the following terms and conditions:

(a)       no Participant shall transfer any interest in this Agreement or the
Assets (including but not limited to any royalty, profits or other interest in
the Products) except by transfer of part or all of a Participating Interest;

(b)       no transferee of all or part of any Participating Interest shall have
the rights of a Participant unless and until the transferring Participant has
provided to the other Participant notice of the transfer, and the transferee, as
of the effective date of the transfer, has committed in writing to be bound by
this Agreement to the same extent and nature as the transferring Participant;

(c)       no transfer permitted by this 14 shall relieve the transferring
Participant of its share of any liability, whether accruing before or after such
transfer, which arises out of Operations conducted prior to such transfer;

(d)       neither Participant, without the consent of the other, shall make a
transfer that would violate any Law, or result in the cancellation of any
permits, licenses, or other similar authorizations;

(e)       the transferring Participant and the transferee shall bear all tax
consequences of the transfer;

(f)       such transfer shall be subject to a pre-emptive right in the other
Participant as provided in §14.3;

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(g)       in the event of a transfer of less than all of a Participating
Interest, the transferring Participant and its transferee shall act and be
treated as one Participant, and in such event in order for the transfer to be
effective, the transferring Participant and its transferee shall provide written
notice to the non-transferring Participant designating a sole authorized agent
to act on behalf of their collective Participating Interest. Such notice shall
provide that (i) the agent has the sole authority to act on behalf of, and to
bind the transferring Participant and its transferee on all matters pertaining
to this Agreement or the Venture, (ii) the notified Participant may rely on all
decisions of, notices and other communications from, and failures to respond by,
the agent, as if given (or not given) by the transferring Participant and its
transferee; (iii) all decisions of, notices and other communications from, and
failures to respond by, the notified Participant to the agent shall be deemed to
have been given (or not given) to the transferring Participant and its
transferee; and (iv) the agent has the sole authority to receive for and on
behalf of the transferring Participant and its transferee any Net Returns
Royalty payable to the transferring Participant and its transferee. It is
understood and agreed that should a Participant transfer less than all of its
Participating Interest the transferring Participant and the transferee shall
only be entitled to a pro rata portion of the five percent (5%) share of the Net
Returns Royalty.

Pre-emptive Right

14.3                Except as otherwise provided in §14.4, if a Participant
desires to transfer all or any part of its Participating Interest or any Net
Returns royalty, or an Affiliate desires to transfer control of a Participant,
the other Participant shall have a pre-emptive right as provided in this §14.3.

(a)       If either Participant intends to transfer all or any part of its
Participating Interest or any Net Returns royalty, or an Affiliate of either
Participant intends to transfer Control of such Participant, the transferring
Participant or Affiliate ("Transferring Entity") shall promptly notify the other
Participant of its intentions. The notice shall state the price and all other
pertinent terms and conditions of the intended transfer, and shall be
accompanied by a copy of the offer or contract for sale. If the consideration
for the intended transfer is, in whole or in part, other than monetary, the
notice shall describe such consideration and its monetary fair market value. The
other Participant shall have 30 days from the date such notice is delivered to
notify the Transferring Entity whether it elects to acquire the offered interest
at the same price (or its monetary equivalent) and on the same terms and
conditions as set forth in the notice. If it does so elect, the transfer shall
be consummated promptly, but in no event more than 30 days, after notice of such
election is delivered to the Transferring Entity.

(b)       If the other Participant fails to so elect within the period provided
for in §(a), the Transferring Entity shall have 90 days following the expiration
of such period to consummate the transfer to a third party at a price and on
terms no less favourable to the Transferring Entity than those set forth in the
notice required in §(a).

(c)       If the Transferring Entity falls to consummate the transfer to a third
party within the period set forth in §(b), the pre-emptive right of the other
Participant in such offered interest shall be deemed to be revived. Any
subsequent proposal to transfer such interest shall be conducted in accordance
with all of the procedures set forth in this §14.3.

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Exceptions to Pre-emptive Right

14.4                 Section 14.3 shall not apply to:

(a)       the transfer by either Participant of all or any part of its
Participating Interest to an Affiliate provided that such Affiliate remains an
Affiliate of the Participant for a period of not less than three years;

(b)       corporate consolidation or reorganization of either Participant by
which the surviving entity shall possess substantially all of the stock or all
of the property rights and interests, and be subject to substantially all of the
liabilities and obligations of that Participant;

(c)       corporate merger or amalgamation involving either Participant by which
the surviving entity or amalgamated company shall possess all of the stock or
all of the property rights and interests, and be subject to substantially all of
the liabilities and obligations of that Participant; provided, however, that the
value of the merging or amalgamating Participant's interest in the Assets,
evidenced by its Initial Contribution and all subsequent contributions under
approved Programs and Budgets, does not exceed thirty percent (30%) of the Net
Worth of the surviving entity or amalgamated company;

(d)       the transfer of Control of either Participant by an Affiliate to such
Participant or to another Affiliate;

(e)       the creation by any Affiliate of either Participant of an Encumbrance
affecting its Control of such Participant;

(f)       a sale or other commitment or disposition of Products or proceeds from
sale of Products by either Participant upon distribution to it pursuant to 10 of
the Agreement; or

(g)       a transfer by an Affiliate of a Participant (whether an original party
to this Agreement or Participant by virtue of §14.2(b)) of Control of such
Participant to a third party, provided such Participant's interest in the
Assets, as evidenced by its Initial Contribution and all subsequent
contributions under approved Programs and Budgets, does not exceed thirty
percent (30%) of the Net Worth of the transferring Affiliate, or does not exceed
30% of the Net Worth of Transferee.

                        For purposes hereof the term "Net Worth" shall mean the
remainder after total liabilities are deducted from total assets. In the case of
a corporation, Net Worth includes both capital stock and surplus. In the case of
a limited liability company, Net Worth includes member contributions. In the
case of a partnership or sole proprietorship, Net Worth includes the original
investment plus accumulated and reinvested profits.

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Encumbrances

14.5                 Neither War Eagle nor Revelstoke shall pledge, mortgage, or
otherwise create an Encumbrance on its interest in this Agreement or the Assets
except for the purpose of securing project financing relating to the Property,
including its share of funds for Development or Mining costs. The right of a
Participant to grant such Encumbrance shall be subject to the condition that the
holder of the Encumbrance ("Chargee") first enter into a written agreement with
the other Participant, in a form acceptable to that Participant, acting
reasonably, which provides:

(a)       the Chargee shall not enter into possession or institute any
proceedings for foreclosure or partition of the encumbering Participant's
Participating Interest and that such Encumbrance shall be subject to the
provisions of this Agreement;

(b)       the Chargee's remedies under the Encumbrance shall be limited to the
sale of the whole (but only of the whole) of the encumbering Participant's
Participating Interest to the other Participant, or, failing such a sale, at a
public auction to be held at least 45 days after prior notice to the other
Participant, such sale to be subject to the purchaser entering into a written
agreement with the other Participant whereby such purchaser assumes all
obligations of the encumbering Participant under the terms of this Agreement.
The price of any pre-emptive sale to the other Participant shall be the
remaining principal amount of the loan plus accrued interest and related
expenses, and such pre-emptive sale shall occur within 60 days of the Chargee's
notice to the other Participant of its intent to sell the encumbering
Participant's Participating Interest. Failure of a sale to the other Participant
to close by the end of such period, unless failure is caused by the encumbering
Participant or by the Chargee, shall permit the Chargee to sell the encumbering
Participant's Participating Interest at a public sale; and

(c)       the charge shall be subordinate to any then-existing debt, including
project financing previously approved by the Management Committee, encumbering
the transferring Participant's Participating Interest.

14.                 ACQUISITION WITHIN AREA OF INTEREST

General

15.1               Any interest or right to acquire any interest in real
property within the Area of Interest acquired while this Agreement is in effect
by or on behalf of a Participant or any Affiliate shall be subject to the terms
and provisions of this Agreement. This section shall apply to any property
previously abandoned under 12.

Notice to Non-Acquiring Participant

15.2               Within ten days after the acquisition of any interest or the
right to acquire any interest in real property or water rights wholly or
partially within the Area of Interest (except real property acquired by the
Manager pursuant to a Program), the acquiring Participant shall notify the other
Participant of such acquisition by it or its Affiliate. If the acquisition of
any interest pertains to real property or water rights partially within the Area
of Interest, then all property subject to the acquisition shall be subject to
this 15. The acquiring Participant's notice shall describe in detail the
acquisition, the lands and minerals covered thereby, the costs thereof and the
reasons why the acquiring Participant believes that the acquisition is in the
best interests of the Participants under this Agreement. In addition to such
notice, the acquiring Participant shall make any and all information concerning
the acquired interest available for inspection by the other Participant.

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Option Exercise

15.3               If, within 30 days after receiving the acquiring
Participant's notice, the other Participant notifies the acquiring Participant
of its election to accept a proportionate interest in the acquired interest
equal to its Participating Interest, the acquiring Participant shall convey to
the other Participant such a proportionate undivided interest therein, free and
clear of all Encumbrances arising by, through or under the acquiring Participant
or its Affiliate. The acquired interest shall become a part of the Property for
all purposes of this Agreement immediately upon the notice of such other
Participant's election to accept the proportionate interest therein. Such other
Participant shall promptly pay to the acquiring Participant a proportionate
share of the latter's actual out-of-pocket acquisition costs equal to such other
Participant's Participating Interest.

Option Not Exercised

15.4               If the other Participant does not give notice within the 30
day period set forth in §15.3, it shall have no interest in the acquired
interest, and the acquired interest shall not be a part of the Property or be
subject to this Agreement.

16                 GENERAL PROVISIONS

Notices

16.1               All notices, payments and other required communications
("Notices") to the Participants shall be in writing, and shall be given (i) by
personal delivery to the Participant, or (ii) by electronic communication, with
a confirmation sent by registered or certified mail, return receipt requested,
or (iii) by registered or certified mail, return receipt requested.

                        All Notices shall be effective and shall be deemed
delivered (i) if by personal delivery on the date of delivery, (ii) if by
electronic communication on the date of receipt of the electronic communication,
and (iii) if solely by mail on the day delivered as shown on the actual receipt.
A Participant may change its address from time-to-time by Notice to the other
Participant.

(a)       Notice to War Eagle shall be sent to:

War Eagle Mining Company Inc.
Sutie 420, 475 Howe Street, Vancouver, British Columbia, Canada, V6C 2BC

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Attention:       Terrence Schorn, President
Fax:                (604) 606-7980

with a copy to:

u

(b)       Notice to Revelstoke shall be sent to:

Revelstoke Industries, Inc.
2211 Rimland Drive, Suite 100, Bellingham, Washington, U.S.A., 98226

Attention:       Marcus Johnson, President
Fax:                (360) 676-0574

with a copy to:

Lang Michener LLP
Suite 1500, 1055 West Georgia Street, Vancouver, British Columbia, Canada, V6B
4N7

Attention:       Thomas J. Deutsch
Fax:           (604) 893-2769

Waiver

16.2               The failure of a Participant to insist on the strict
performance of any provision of this Agreement or to exercise any right, power
or remedy upon a breach hereof shall not constitute a waiver of any provision of
this Agreement or limit the Participant's right thereafter to enforce any
provision or exercise any right.

Modification

16.3               No modification of this Agreement shall be valid unless made
in writing and duly executed by the Participants.

Force Majeure

16.4               The obligations of a Participant, other than the payment of
money provided hereunder, shall be suspended to the extent and for the period
that performance is prevented or delayed by any cause, whether foreseeable or
unforeseeable, beyond its reasonable control, including, without limitation,
labour disputes (however arising and whether or not employee demands are
reasonable or within the power of the Participant to grant); acts of God; Laws,
or requests of any government or governmental entity; judgments or orders of any
court; inability to obtain on reasonably acceptable terms any public or private
license, permit or other authorization; curtailment or suspension of activities
to remedy or avoid an actual or alleged, present or prospective violation of
Environmental Laws; action or inaction by any governmental entity that delays or
prevents the issuance or granting of any approval or authorization required to
conduct Operations; acts of war or conditions arising out of or attributable to
war, whether declared or undeclared; riot, civil strife, insurrection or
rebellion; fire, explosion, earthquake, storm, flood, sink holes, drought or
other adverse weather condition; delay or failure by suppliers or transporters
of materials, parts, supplies, services or equipment or by contractors' or
subcontractors' shortage of, or inability to obtain, labour, transportation,
materials, machinery, equipment, supplies, utilities or services; accidents;
breakdown of equipment, machinery or facilities; actions by citizen groups,
including but not limited to environmental organizations or native rights
groups; or any other cause whether similar or dissimilar to the foregoing. The
affected Participant shall promptly give notice to the other Participant of the
suspension of performance, stating therein the nature of the suspension, the
reasons therefor, and the expected duration thereof. The affected Participant
shall resume performance as soon as reasonably possible. During the period of
suspension, the obligations of the Participants to advance funds pursuant to
§9.7 shall be reduced to levels consistent with Operations.

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Survival of Terms and Conditions

16.5               The following Sections shall survive the transfer of any
interests in the Assets under this Agreement or the termination of the Venture
to the full extent necessary for their enforcement and the protection of the
Participant in whose favour they run: §2.1, §2.2, §4.2, §6.3, §6.5, §9.9, §11.5,
§11.6, §11.7, §11.8 and §11.9.

Confidentiality and Public Statements

16.6               Except as otherwise provided in this §16.6, the terms and
conditions of this Agreement, and all data, reports, records, and other
information of any kind whatsoever developed or acquired by any Participant in
connection with this Venture shall be treated by the Participants as
confidential (hereinafter called "Confidential Information") and no Participant
shall reveal or otherwise disclose such Confidential Information to third
parties without the prior written consent of the other Participant. Confidential
Information that is available or that becomes available in the public domain,
other than through a breach of this provision by a Participant, shall no longer
be treated as Confidential Information.

                        The foregoing restrictions shall not apply to the
disclosure of Confidential Information to any Affiliate, to any public or
private financing agency or institution, to any contractors or subcontractors
which the Participants may engage and to employees and consultants of the
Participants or to any third party to which a Participant contemplates the
transfer, sale, assignment, Encumbrance or other disposition of all or part of
its Participating Interest pursuant to 14 or with which a Participant or its
Affiliate contemplates a merger, amalgamation or other corporate reorganization;
provided, however, that in any such case only such Confidential Information as
such third party shall have a legitimate business need to know shall be
disclosed and the person or company to whom disclosure is made shall first
undertake in writing to protect the confidential nature of such information at
least to the same extent as the parties are obligated under this §16.6.

                        In the event that a Participant is required to disclose
Confidential Information to any government, any court, or any agency or
department thereof to the extent required by applicable law, rule or regulation,
or in response to a legitimate request for such Confidential Information, the
Participant so required shall immediately notify the other Participants hereto
of such requirement and the terms thereof, and the proposed form and content of
the disclosure prior to such submission. The other Participant shall have the
right to review and comment upon the form and content of the disclosure and to
object to such disclosure to the court, agency, exchange or department
concerned, and to seek confidential treatment of any Confidential Information to
be disclosed on such terms as such Participant shall, in its sole discretion,
determine.

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                        For greater certainty, in the event a party is required
or wishes to issue a press release containing Confidential Information, it shall
provide the other party with a draft of the intended release for review and
comment within one Business Day; the other party shall have the rights to object
and withhold its consent set forth above acting reasonably but if no comment is
provided within such time, the party will be free to issue the press release.

                        The provisions of this §16.6 shall apply during the term
of this Agreement and for a period of three years thereafter and shall continue
to apply to any Participant which forfeits, surrenders, assigns, transfers or
otherwise disposes of its Participating Interest for such three year period.

Entire Agreement; Successors and Assigns

16.7               This Agreement contains the entire understanding of the
Participants and supersedes all prior agreements and understandings, whether
written or oral, between the Participants relating to the subject matter hereof,
with respect to the Assets subject hereto, and any and all other prior
negotiations, representations, offers or understandings between War Eagle and
Revelstoke relating to the Property, whether written or oral. This Agreement and
the obligations and rights created herein shall be binding upon and enure to the
benefit of the respective successors and permitted assigns of the Participants.

Dispute Resolution

16.8               The parties agree that all questions or matters in dispute
with respect to any of the provisions of this agreement shall be submitted to
arbitration on the following basis:

(a)       it is a condition precedent to the right of either party to submit any
matter to arbitration pursuant to the provisions hereof that such party shall
have given not less than 30 days prior written notice of its intention to do so
to the other party together with particulars of the matter in dispute; on the
expiration of such 30 days, the party which gave such notice may proceed to
refer the dispute to arbitration as provided for in sub-paragraph §(b) below;

(b)       the party desiring arbitration shall appoint one arbitrator, and shall
notify the other party of such appointment, and the other party shall, within 15
days after receiving such notice, appoint an arbitrator, and the two arbitrators
so named before proceeding to act, shall, within 15 days of the appointment of
the last appointed arbitrator, unanimously agree on the appointment of a third
arbitrator to act with them and to be the chairman of the arbitration herein
provided for. If the other party shall fail to appoint an arbitrator within 15
days after receiving notice of the appointment of the first arbitrator, or if
the two arbitrators appointed by the parties shall be unable to agree on the
appointment of the chairman, the chairman shall be appointed under the
provisions of the Commercial Arbitration Act (British Columbia). Except as
specifically otherwise provided in this subparagraph (b), the arbitration herein
provided for shall be conducted in accordance with such Act. The chairman shall
fix a time and place in Vancouver, British Columbia for the purpose of hearing
the evidence and representations of the parties, and he shall provide over the
arbitration and determine all questions of procedure not provided for under such
Act or this sub-paragraph. After hearing any evidence and representations that
the parties may submit, the arbitrators shall make and award and reduce the same
to writing, and deliver one copy thereof to each of the parties. The expense of
the arbitration shall be as specified in the award; and

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(c)       the parties agree that the award of a majority of the arbitrators
shall be final and binding upon each of them.

Further Assurances

16.9               Each Participant shall take, from time to time and without
additional consideration, such further actions and execute such additional
instruments as may be reasonably necessary or convenient to implement and carry
out the intent and purpose of this Agreement.

Headings

16.10             The headings to the Sections of this Agreement and the
Exhibits are inserted for convenience only and shall not affect the construction
hereof.

Currency

16.11             All currency amounts herein shall be as between the parties
expressed in Canadian dollars.

Severability

16.12             If any provision of this Agreement is or shall become illegal,
invalid, or unenforceable, in whole or in part, the remaining provisions shall
nevertheless be and remain valid and enforceable and the said remaining
provisions shall be construed as if this Agreement had been executed without the
illegal, invalid, or unenforceable portion.

Taxes

16.13             Each Participant shall be directly responsible for and shall
directly pay all taxes applicable to revenues received by the Participant
through Operations under this Agreement. In particular, each Participant shall
individually file its tax returns with the proper authorities and independently
file claims for and recover any income tax credits. A Participant's decisions
with respect to such tax matters shall not have any binding effect on the course
of actions taken by the other Participant. All costs of Operations incurred
hereunder shall be for the account of the Participant or Participants making or
incurring the same, if more than one then in proportion to their respective
Participating Interests, and each Participant on whose behalf any costs have
been so incurred shall be entitled to claim all tax benefits, write-offs and
deductions with respect thereto.

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Rule Against Perpetuities

16.14             If any provision of this Agreement should violate any rule
against perpetuities or any related rule against interests that last too long or
are not alienable, then any such provision shall terminate 20 years after the
death of the last survivor of all the lineal descendants of His late Majesty
King George V of England, living on the date of execution of this Agreement.

Partition

16.15             Each of the parties waives, during the term of this Agreement,
any right to partition of the Assets or any part thereof and no party shall seek
or be entitled to partition of the Property or other Assets whether by way of
physical partition, judicial sale or otherwise during the term of this
Agreement.

Governing Law

16.17             This Agreement shall be construed and governed by the laws of
British Columbia and the laws of Canada applicable therein and the parties
hereby attorn to the jurisdiction of the Courts of British Columbia in respect
of all matters arising hereunder.

Counterparts

16.18             This Agreement and any other writing delivered pursuant hereto
may be executed in any number of counterparts with the same effect as if all
parties to this Agreement or such other writing had signed the same document and
all counterparts will be construed together and will constitute one in the same
instrument.

IN WITNESS WHEREOF

, the parties hereto have executed this Agreement as of the date first above
written.

WAR EAGLE MINING COMPANY INC.

Per:     ____________________________
            Authorized Signatory

REVELSTOKE INDUSTRIES, INC.

Per:     ____________________________
            Authorized Signatory

__________

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EXHIBIT A

                        This is Exhibit A of Schedule B to that certain Mineral
Property Option Agreement between War Eagle Mining Company Inc. and Revelstoke
Industries Inc. dated for reference as of 20th day of October, 2006.

Mineral Claims Comprising The Property

                        The following are the mineral claims comprising the
Property, located on NTS Sheet G3-M-11 and within the Province of Saskatchewan,
approximately 135 kilometers northeast of La Ronge and comprising a total of 979
hectares.

Claim Name

Registered Owner

S-106844

S-106688

S-106689

S-108491

S-108619

S-108618

S-108619

Bullion Fund Inc.*

Bullion Fund Inc.*

Bullion Fund Inc.*

War Eagle Mining Company Inc.

War Eagle Mining Company Inc.

War Eagle Mining Company Inc.

War Eagle Mining Company Inc.

*       Beneficially owned by War Eagle Mining Company Inc. with title currently
held by Bullion Fund Inc.

__________

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EXHIBIT B

                        This is Exhibit B of Schedule B to that certain Mineral
Property Option Agreement between War Eagle Mining Company Inc. and Revelstoke
Industries Inc. dated for reference as of 20th day of October, 2006.

AREA OF INTEREST

                        Area of Interest means the Property and all lands within
the area included within ten kilometres of the boundaries of the Property (as
detailed in the specific description of the mineral claims attached hereto as
Schedule A).

[Insert map]

__________

 

 

 

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EXHIBIT C

                        This is Exhibit C of Schedule B to that certain Mineral
Property Option Agreement between War Eagle Mining Company Inc. and Revelstoke
Industries Inc. dated for reference as of 20th day of October, 2006.

ACCOUNTING PROCEDURE

                        The financial and accounting procedures to be followed
by the Manager and the Participants under the Agreement are set forth below.
Reference in this Accounting Procedure to Sections are to those located in this
Accounting Procedure unless it is expressly stated that they are references to
the Agreement.

                        The purpose of this Accounting Procedure is to establish
equitable methods for determining charges and credits applicable to operations
under the Agreement. It is the intent of the Participants that none of them
shall lose or profit by reason of their duties and responsibilities as the
Manager. The Participants shall meet and in good faith endeavour to agree upon
changes deemed necessary to correct any unfairness or inequity. In the event of
a conflict between the provisions of this Accounting Procedure and those of the
Agreement, the provisions of the Agreement shall control.

1.

                   GENERAL PROVISIONS

1.1

                 General Accounting Records

                        The Manager shall maintain detailed and comprehensive
accounting records in accordance with this Accounting Procedure, sufficient to
provide a record of revenues and expenditures and periodic statements of
financial position and the results of operations for managerial, tax, regulatory
or other financial reporting purposes. Such records shall be retained for the
duration of the period allowed the Participants for audit or the period
necessary to comply with tax or other regulatory requirements. The records shall
reflect all obligations, advances and credits of the Participants.

1.2

                   Bank Accounts

                        After the decision is made to begin Development, the
Manager shall maintain one or more separate bank accounts for the payment of all
expenses and the deposit of all receipts.

2.

                   CHARGES TO JOINT ACCOUNT

                      Subject to the limitations hereinafter set forth, the
Manager shall charge the Joint Account with the following:

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- 2 -

2.1

                 Rentals and Other Payments

                      Property maintenance costs and other payments, including
Government Fees and any other payments pursuant to the Mineral Property Option
Agreement, necessary to maintain title to the Assets.

2.2

                 Labour and Employee Benefits

Salaries and wages of the Manager's employees directly engaged in Operations,
including salaries or wages of employees who are temporarily assigned to and
directly employed by the Manager.

The Manager's cost of holiday, vacation, sickness and disability benefits, and
other customary allowances applicable to the salaries and wages chargeable under
Sections 2.2(a) and 2.13.

The Manager's actual cost of established plans for employees' group life
insurance, hospitalization, pension, retirement, stock purchase, thrift, bonus
(except production or incentive bonus plans under a union contract based on
actual rates of production, cost savings and other production factors, and
similar non-union bonus plans customary in the industry or necessary to attract
competent employees, which bonus payments shall be considered salaries and wages
under §2.2(a) or 2.13, rather than employees' benefit plans) and other benefit
plans of a like nature applicable to salaries and wages chargeable under §2.2(a)
or 2.13, provided that the plans are limited to the extent feasible to those
customary in the industry.

Cost of assessments imposed by governmental authority which are applicable to
salaries and wages chargeable under Sections 2.2(a) and 2.13, including all
penalties except those resulting from the wilful misconduct or gross negligence
of the Manager.

Those costs in Sections 2.2(b), 2.2(c), 2.2(d) may be charged on a "when and as
paid basis" or by "percentage assessment" on the amount of salaries and wages.
If percentage assessment is used, the rate shall be applied to wages or salaries
excluding overtime and bonuses. Such rate shall be based on the Manager's cost
experience and it shall be periodically adjusted to ensure that the total of
such charges does not exceed the actual cost thereof to the Manager.

2.3

                 Assets

                      Cost of all Assets purchased or furnished.

2.4

                 Transportation

                      Reasonable costs incurred in connection with the
transportation of employees, equipment, material and supplies necessary for
exploration, maintenance and operation of Assets.

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2.5

                 Services

The cost of contract services and utilities procured from outside sources, other
than services described in Sections 2.10 and 2.14. If contract services are
performed by an Affiliate of the Manager, the cost charged to the Joint Account
shall not be greater than that for which comparable services and utilities are
available in the open market.

The costs of using the Manager's exclusively-owned facilities in support of
Venture activities provided that the charges may not exceed those currently
prevailing in the vicinity. Such costs shall include costs of maintenance,
repairs, other operating expenses, insurance, taxes, depreciation and interest
at a rate not to exceed Prime Rate plus three percent (3%) per annum.

2.6

                 Materials, Equipment and Supplies

                      The cost of materials, equipment and supplies (herein
called "Material") purchased from unaffiliated third parties or furnished by
either Participant as provided in Section 3. The Manager shall purchase or
furnish only so much Material as may be required for use in efficient and
economical Operations. The Manager shall also maintain inventory levels of
Materials at reasonable levels to avoid unnecessary accumulation of surplus
stock.

2.7

                 Environmental Compliance Fund

                      Costs of reasonably anticipated Environmental Compliance
which, on a Program basis, shall be determined by the Management Committee and
shall be based on proportionate contributions in an amount sufficient to
establish a fund, which through successive proportionate contributions during
the duration of the Agreement, will pay for ongoing Environmental Compliance
conducted during Operations and which will cover the reasonably anticipated
costs of mine closure, post-Operations Environmental Compliance and other
continuing obligations.

2.8

                 Insurance Premiums

                      Premiums paid or accrued for insurance required for the
protection of the Participants.

2.9

                 Damages and Losses

                      All costs in excess of insurance proceeds necessary to
repair or replace damage or losses to any Assets resulting from any cause other
than the wilful misconduct or gross negligence of the Manager.

2.10

                 Legal Expense

                        All legal costs and expenses incurred in or resulting
from the Operations or necessary to protect or recover the Assets. Routine legal
expenses are included under Section 2.14.

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- 4 -

2.11

               Audit

                      Cost of annual audits under §9.10 of the Joint Venture
Agreement.

2.12

               Taxes

                      All taxes (except income taxes) of every kind and nature
assessed or levied upon or in connection with the Assets, the production of
Products or Operations, which have been paid by the Manager for the benefit of
the Participants. Each Participant is separately responsible for income taxes
which are attributable to its respective Participating Interest.

2.13

               District and Camp Expense (Field Supervision and Camp Expenses)

                      A pro rata portion of (i) the salaries and expenses of the
Manager's superintendent and other employees serving Operations whose time is
not allocated directly to such Operations, and (ii) the costs of maintaining and
operating an office (hereafter, "the Manager's Project Office") and any
necessary suboffice and (iii) all necessary camps, including housing facilities
for employees, used for Operations. The expense of those facilities, less any
revenue therefrom, shall include depreciation or a fair monthly rental in lieu
of depreciation of the investment. Such charges shall be apportioned for all
Property served by the employees and facilities on an equitable basis consistent
with the Manager's general accounting practice and generally accepted accounting
principles.

2.14

               Administrative Charge

                      After the Participants have made their entire Initial
Contributions pursuant to Sections 5.1 and 5.2 of the Joint Venture Agreement,
the Manager shall charge the Joint Account each month a sum as provided below,
which shall be a liquidated amount to reimburse the Manager for its home office
overhead and general and administrative expenses for its conduct of Operations,
which shall be in lieu of any management fee:

with respect to Operations before commencement of Development, the Manager's fee
shall be ten percent (10%) of the Allowable Costs other than funds expended
pursuant to any individual contract for materials or services which exceed in
the aggregate $35,000.00 in any Program year, for which the Manager's fee shall
be two percent (2%);

with respect to operations after the commencement of Development but before
commencement of Mining, Manager's fee shall be five percent (5%) of Allowable
Costs other than funds expended pursuant to any individual contract for
materials or services which exceeds in the aggregate $100,000 in any program
year in which event the fee for such matters shall be two percent (2%);

                      These fee rates are based upon the principle that the
Manager shall not make a profit or loss from this administrative charge but
should be fairly and adequately compensated for the pro rata share of its costs
and expenses. The specific rates provided for in this Section 2.14 shall be
established and may be amended from time to time by mutual agreement among the
Parties hereto if, in practice, the rates are found to be insufficient or
excessive.

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- 5 -

                      Allowable Costs as used in this Section 2.14 shall include
all amounts accrued to the Environmental Compliance fund, and all charges to the
Joint Account except (i) the administrative charge defined herein; (ii)
depreciation, depletion or amortization of tangible or intangible assets; (iii)
amounts expended for acquisition, construction or installation of tangible or
intangible assets after mining operations have commenced; (iv) Property
payments, taxes and assessments; and (v) funds disbursed from the Environmental
Compliance fund.

                      The following representative list of items comprising the
Manager's principal business office expenses are expressly covered by the
administrative charge provided in this Section 2.14:

administrative supervision, which includes services rendered by officers and
directors of the Manager for Operations, except to the extent that such services
represent a direct charge to the Joint Account, as provided for in Section 2.2;

accounting, billing and record keeping in accordance with governmental
regulations and the provisions of the Joint Venture Agreement;

handling of all tax matters, including any protests, except any outside
professional fees which the Management Committee may approve as a direct charge
to the Joint Account;

routine legal services by the Manager's in-house legal staff, and

records and storage space, telephone service and office supplies.

2.15

               Other Expenditures

                      Any reasonable direct expenditure, other than expenditures
which are covered by the foregoing provisions, incurred by the Manager for the
necessary and proper conduct of Operations.

3.

                   BASIS OF CHARGES TO JOINT ACCOUNT

3.1

                 Purchases

                      Material purchased and services procured shall be charged
at prices paid by the Manager after deduction of all discounts actually
received.

3.2

                 Material Furnished by the Manager

                      At its discretion, the Manager may furnish Material from
the Manager's stocks under the following conditions:

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- 6 -

(a)       New Material (Condition "A"): New Material transferred from the
Manager's Property shall be priced f.o.b. the nearest reputable supply store or
railway receiving point, where like Material is available, at current
replacement cost of the same kind of Material (hereafter, "New Price").

(b)       Used Material (Conditions "B" and "C"):

(i)       material in sound and serviceable condition and suitable for reuse
without reconditioning shall be classified as Condition "B" and priced at
seventy-five percent (75%) of New Price.

(ii)       other used Material as defined hereafter shall be classified as
Condition "C" and priced at fifty percent (50%) of New Price:

(A)       used Material which after reconditioning will be further serviceable
for original function as good second-hand Material (Condition "B");

(B)       used Material which is serviceable for original function but not
substantially suitable for reconditioning;

(C)       Material which cannot be classified as Condition "B" or Condition "C"
shall be priced at a value commensurate with its use;

(D)       Material no longer suitable for its original purpose but usable for
some other purpose shall be priced on a basis comparable with items normally
used for such other purpose.

3.3

                 Premium Prices

                      Whenever Material is not readily obtainable at prices
specified in Sections 3.1 and 3.2, the Manager may charge the Joint Account for
the required Material on the basis of the Manager's direct cost and expenses
incurred in procuring such material; provided, however, that prior notice of the
proposed charge is given to the Participants, whereupon any Participant shall
have the right, by notifying the Manager within ten days of the delivery of the
notice from the Manager, to furnish at the usual receiving point all or part of
its share of Material suitable for use and acceptable to the Manager. If a
Participant so furnishes Material in kind, the Manager shall make appropriate
credits to its account.

3.4

                 Warranty of Material Furnished by the Manager or Participants

                      Neither the Manager nor any Participant warrants the
Material furnished beyond any dealer's or manufacturer's warranty.

4.

                   DISPOSAL OF MATERIAL

4.1

                 Disposition Generally

                      The Manager shall have no obligation to purchase a
Participant's interest in Material. The Management Committee shall determine the
disposition of major items of surplus Material, provided the Manager shall have
the right to dispose of normal accumulations of junk and scrap Material either
by transfer to the Participants as provided in §4.2 or by sale. The Manager
shall credit the Participants in proportion to their Participating Interest for
all Material sold hereunder.

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4.2

                 Division in Kind

                      Division of Material in kind between the Participants
shall be in proportion to their respective Participating Interests, and
corresponding credits shall be made to the Joint Account.

4.3

                 Sales

                      Sales of material to third parties shall be credited to
the Joint Account at the net amount received. Any damages or claims by the
Purchaser shall be charged back to the Joint Account if and when paid.

5.

                   INVENTORIES

5.1

                 Periodic Inventories, Notice and Representations

                      At reasonable intervals, inventories shall be taken by the
Manager, which shall include all such Material as is ordinarily considered
controllable by operators of mining Property. The expense of conducting such
periodic inventories shall be charged to the Joint Account.

5.2

                 Reconciliation and Adjustment of Inventories

                      Reconciliation of inventory with charges to the Joint
Account shall be made, and a list of overages and shortages shall be determined
by the Manager. Inventory adjustments shall be made by the Manager to the Joint
Account for overages and shortages, but the Manager shall be held accountable to
the Venture only for shortages due to lack of reasonable diligence.

__________

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EXHIBIT D

                      This is Exhibit D of Schedule B to that certain Mineral
Property Option Agreement between War Eagle Mining Company Inc. and Revelstoke
Industries Inc. dated for reference as of 20th day of October, 2006.

NET RETURNS

                      Pursuant to the Agreement to which this Exhibit is
attached, a party ("Payee") may be entitled to a royalty equal to five percent
(5%) of net returns (the "Net Returns Royalty") payable by the other party
("Payor") as set forth below.

Net Returns Royalty

A.                   "Net Returns Royalty" means the aggregate of:

all revenues from the sale or other disposition of ores, concentrates or
minerals produced from the Property; and

all revenues from the operation, sale or other disposition of any facilities the
cost of which is included in the definition of "Operating Expenses", "Capital
Expenses", or "Exploration Expenses"

less (without duplication) Working Capital, Operating Expenses, Capital Expenses
and Exploration Expenses.

B.                   "Working Capital" means the amount reasonably necessary to
provide for the operation of the mining operation on the Property and for the
operation and maintenance of the Facilities for a period of six months.

C.                   "Operating Expenses" means all costs, expenses,
obligations, liabilities and charges of whatsoever nature or kind incurred or
chargeable directly or indirectly in connection with Commercial Production from
the Property and in connection with the maintenance and operation of the
Facilities, all in accordance with generally accepted accounting principles,
consistently applied, including, without limiting the generality of the
foregoing, all amounts payable in connection with mining, handling, processing,
refining, transporting and marketing of ore, concentrates, metals, minerals and
other products produced from the Property, all amounts payable for the operation
and maintenance of the Facilities including the replacement of items which by
their nature require periodic replacement, all taxes (other than income taxes),
royalties and other imposts and all amounts payable or chargeable in respect of
reasonable overhead and administrative services.

D.                   "Capital Expenses" means all expenses, obligations and
liabilities of whatsoever kind (being of a capital nature in accordance with
generally accepted accounting principles) incurred or chargeable, directly or
indirectly, with respect to the development, acquisition, redevelopment,
modernization and expansion of the Property and the Facilities, including,
without limiting the generality of the foregoing, interest thereon from the time
so incurred or chargeable at a rate per annum from time to time equal to prime
rate established by the Royal Bank of Canada, Main Branch in Vancouver, British
Columbia plus 2 percent per annum, but does not include Operating Expenses nor
Exploration Expenses.

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- 9 -

E.                   "Exploration Expenses" means all costs, expenses,
obligations, liabilities and charges of whatsoever nature or kind incurred or
chargeable, directly or indirectly, in connection with the exploration and
development of the Property including, without limiting the generality of the
foregoing, all costs reasonably attributable, in accordance with generally
accepted accounting principles, to the design, planning, testing, financing,
administration, marketing, engineering, legal, accounting, transportation and
other incidental functions associated with the exploration and mining operation
contemplated by this agreement and with the Facilities, but does not include
Operating Expenses nor Capital Expenses.

F.                   "Facilities" means all plant, equipment, structures, roads,
rail lines, storage and transport facilities, housing and service structures,
real property or interest therein, whether on the Property or not, acquired or
constructed exclusively for the mining operation on the Property contemplated by
this Agreement (all commonly referred to as "infrastructure").

G.                   "Commercial Production" means the operation of the Property
or any portion thereof as a producing mine and the production of mineral
products therefrom (but does not include bulk sampling, pilot plant or test
operations).

Payment

                        Net Returns shall be calculated for each calendar
quarter in which Net Returns are realized, and payment as due hereunder shall be
made within 30 days following the end of each such calendar quarter. Such
payments shall be accompanied by a statement summarizing the computation of Net
Returns and copies of all relevant settlement sheets. Such quarterly payments
are provisional and subject to adjustment within 90 days following the end of
each calendar year. Within ninety days after the end of each calendar year,
Payor shall deliver to Payee an unaudited statement of royalties paid to Payee
during the year and the calculation thereof. All year end statements shall be
deemed true and correct six months after presentation, unless within that period
Payee delivers notice to Payor specifying with particularity the grounds for
each exception. Payee shall be entitled, at Payees's expense, to an annual
independent audit of the statement by a national firm of chartered accountants,
only if Payee delivers a demand for an audit to Payor within four months after
presentation of the related year-end statement.

__________

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SCHEDULE C

                      This is Schedule C to that certain Mineral Property Option
Agreement between War Eagle Mining Company Inc. and Revelstoke Industries Inc.
dated for reference as of 20th day of October, 2006.

THIRD PARTY INTEREST

[Insert]

__________