Exhibit 4.6

MR. NOTARY,

Kindly  issue  in your  registry  of  public  deeds  one  evidencing  the  EARLY
TERMINATION  OF THE AGREEMENT OF  ASSIGNMENT  THROUGH  EXPLORATION  AND PURCHASE
OPTION OF MINING RIGHTS entered into by and between  COMPANIA DE  EXPLORACIONES,
DESARROLLO E INVERSIONES MINERAS S.A.C., with Single Taxpayer's Registration No.
20101283586,  registered in Entry 1 of Card No. 10003 of the Book of Contractual
Corporations and Other Legal Entities of the Public Registry of Mines, domiciled
for  purposes  hereof at Luis N. Saenz No.  447-449,  Jesus  Maria,  Lima,  duly
represented by its General Manager, Mr. Jean Marie Georgel Paris,  identified by
Foreign Resident's Card No. N-74128, and its Chairman of the Board of Directors,
Mr. Alberto  Benavides de la Quintana,  identified by Voter's  Registration Card
No.  07784578,  as per power of  attorney  granted  in the  Board of  Directors'
Meeting held on May 21, 2001,  which  minutes you,  Mr.  Notary,  should  kindly
insert herein as a certified copy,  hereinafter referred to as CEDIMIN, as party
to the first part, and COMPANIA MINERA  MANHATTAN  S.A., with Single  Taxpayer's
Registration  No.  20251828980,  registered  in Entry 1 of Card No. 40091 of the
Book of Contractual Corporations and Other Legal Entities of the Public Registry
of Mines,  domiciled  at  Salamanca  150, San Isidro,  duly  represented  by its
Director,  Mr. Juan Carlos  Escudero  Velando,  identified by National  Identity
Document No.  08273043,  as per power of attorney  granted by the  Shareholders'
Meeting on May 4, 2001,  which you, Mr.  Notary,  should kindly  insert  herein,
hereinafter  referred to as  MANHATTAN,  as party to the other  part,  under the
following terms and conditions:

CEDIMIN and MANHATTAN shall be jointly referred to as THE PARTIES.

Based on THE  PARTIES'  good  faith,  the terms and  conditions  hereof  are the
following:

BACKGROUND
----------

I.   By means of a public deed dated December 27, 1997 and granted before Notary
     Dr.  Gustavo  Correa  Miller,  THE PARTIES  entered  into an  Agreement  of
     Assignment  through  Exploration  and  Purchase  Option of  Mining  Rights,
     whereby  CEDIMIN  assigned  to  MANHATTAN  its rights to exploit its mining
     rights  called  "El Papayo 1 ", "El Papayo  2",  "Locuto 1 ",  "Locuto  2",
     "Locuto  3",  "Vega  Hoyaga  Honda"  and  "Vega La Rita" and  granted  it a
     purchase  option  with  respect  to 51 of its rights and shares in the said
     mining rights.

II.  On the date of execution of this preliminary deed, THE PARTIES declare that
     they have signed the preliminary deed of Early Termination of the Agreement
     of  Assignment  trough  Exploration  and Purchase  Option of Mining  Rights
     referred to in the above paragraph.

CLAUSE ONE: MINING RIGHTS
----------- -------------

1.1  CEDIMIN declares that it is the holder of the following Mining Concessions,
     hereinafter  the MINING  RIGHTS,  located in the District of Tambo  Grande,
     Province and Department of Piura and registered with the Public Registry of
     Mines - Regional Registration Office of Trujillo.


<PAGE>


                                     - 2 -


Registration with the Public Registry of Mines - BOOK OF MINING RIGHTS

--------------------------------------------------------------------------
|NAME                |    NUMBER       |      HECTARES    |      CARD    |
|--------------------|-----------------|------------------|--------------|
|EL PAPAYO 1         |     2249        |        1000      |      5475    |
|--------------------|-----------------|------------------|--------------|
|EL PAPAYO 2         |     2250        |        400       |      5435    |
|--------------------|-----------------|------------------|--------------|
|LOCUT01             |     2329        |        700       |      7138    |
|--------------------|-----------------|------------------|--------------|
|LOCUTO 2            |     2330        |        500       |      6043    |
|--------------------|-----------------|------------------|--------------|
|LOCUTO 3            |     2331        |        400       |      5355    |
|--------------------|-----------------|------------------|--------------|
|VEGA HOYAGA HONGA   |     2341        |        100       |      5427    |
|--------------------|-----------------|------------------|--------------|
|VEGA LA RITA 1      |     2322        |        100       |      5411    |
--------------------------------------------------------------------------

1.2  Regarding the MINING RIGHTS listed in 1.1, CEDIMIN  represents and warrants
     that:

     1.2.1     It is the only holder of the MINING RIGHTS,  the payment of their
               standing  fees until year 2000  inclusive  having been made,  and
               there are no burdens, liens or judicial or extrajudicial measures
               of any  nature  whatsoever  on them  that  prevent  CEDIMIN  from
               carrying out the exploration and exploitation activities.

     1.2.2     During  the whole  term  hereof,  it will keep each of the MINING
               RIGHTS in good standing and free from liens.

     1.2.3     In case it acquires any title whatsoever on new mining properties
               to cover areas  adjacent to the MINING RIGHTS and then decides to
               transfer  them,  it will  grant  the  first  preemptive  right of
               purchase  to  the  company  to  be  incorporated,  provided  that
               MANHATTAN  exercises  the  OPTION  hereinafter  conferred  in its
               favor.

     1.2.4     In case it  acquires,  under any title  whatsoever,  the  surface
               areas  covered by the MINING  RIGHTS or adjacent to them and then
               decides to  transfer  them,  it will  grant the first  preemptive
               right of  purchase to the  company to be  incorporated,  provided
               that MANHATTAN exercises the OPTION hereinafter  conferred in its
               favor.

     1.2.5     It has not entered into any agreement  contrary to this agreement
               with any third party.

     1.2.6     There is no outstanding precautionary measure, whether pending or
               already executed, judicial,  administrative or tax proceeding, or
               claim  affecting  or  that  may  affect  MANHATTAN  so  that  the
               execution  and/or  performance  hereof is  prevented or hindered.
               Likewise,  it represents that it is not aware of the existence of
               any circumstance  that may cause that those proceedings are filed
               or that it is intended to file them.

     1.2.7     On  the  date  hereof,   there  are  no  pending   administrative
               requirements  related to security,  hygiene and/or  environmental
               protection provisions, such as fines, indemnities, compensations,
               construction  or capital  investment,  with respect to the MINING
               RIGHTS or the surface lands where they are located.


<PAGE>


                                     - 3 -


     1.2.8     It has delivered to MANHATTAN  reports,  studies,  maps and other
               data in its possession related to the MINING RIGHTS.

     1.2.9     In case it is  determined  that one or more of the MINING  RIGHTS
               subject  matter hereof are  superimposed,  whether in whole or in
               part, with MINING RIGHTS of third parties, and that new companies
               are  created  as  holders of new  MINING  RIGHTS  comprising  the
               superimposed  areas, it commits itself to vote its  corresponding
               interests  or  shares in those new  companies  and to make  every
               necessary  effort  and/or  action for the new  companies to enter
               into  assignment  and/or OPTION  agreements  with  MANHATTAN with
               respect to its mining rights.

               In the event it is a partial  superimposition and CEDIMIN obtains
               new MINING RIGHTS and/or the area of the present MINING RIGHTS is
               reduced,  it will be understood that this agreement comprises the
               new MINING RIGHTS and/or  continues being applied with respect to
               those which areas will be reduced.

1.3  If MANHATTAN  acquires,  under any title whatsoever,  new mining properties
     covering  areas adjacent to the MINING RIGHTS or surface lands covering the
     surface areas of the MINING RIGHTS or their adjacent areas and then decides
     to transfer them, it hereby binds itself to grant a first  preemptive right
     of purchase  to the company to be  incorporated,  provided  that  MANHATTAN
     exercises the OPTION right hereinafter conferred upon it.

1.4  For  purposes  of  paragraphs  1.2.3 and 1.2.4 of points  1.2 and 1.3,  THE
     PARTIES define the area  comprised in the following UTM  coordinates as the
     area adjacent to the MINING RIGHTS,  hereinafter referred to as the AREA OF
     INTEREST:

     56 600 E                                                      94 38000 N
     56 600 E                                                      94 50000 N
     57 700 E                                                      94 50000 N
     57 700 E                                                      94 38000 N

CLAUSE TWO: ASSIGNMENT THROUGH EXPLORATION OF THE MINING RIGHTS
----------- ---------------------------------------------------

2.1  ASSIGNMENT:  Pursuant  to the  provisions  set forth in article  166 of the
     Single Revised Text of the General Mining Law, approved by means of Supreme
     Decree No.  014-92-EM,  hereinafter the Mining Law,  CEDIMIN hereby assigns
     MANHATTAN,  and MANHATTAN accepts,  its rights to explore the MINING RIGHTS
     mentioned in clause one, hereinafter referred to as the ASSIGNMENT.

     THE PARTIES agree that the  consideration  for the  ASSIGNMENT  will be the
     investment  of  US$4'950,000  to be made by  MANHATTAN,  subject  to annual
     exploration  programs  for  amounts  not  less  than  US$100,000,   without
     prejudice to the total  investment  committed.  THE PARTIES  agree that for
     purposes  of  determining  the


<PAGE>


                                     - 4 -


     investment amount of US$4'950,000, the investment already made by MANHATTAN
     in the  MINING  RIGHTS by virtue of the  Agreement  of  Assignment  through
     Exploration  and Purchase Option of Mining Rights referred to in point I of
     the Background hereof shall be taken into consideration. Thus, for purposes
     of determining  compliance with the investment amount of US$4'950,000,  the
     investment made by MANHATTAN  during the term hereof referred to in point I
     of the  Background  hereof  will be added to the  investment  to be made by
     MANHATTAN during the term of this Agreement.

2.2  ASSIGNMENT  TERM:  THE PARTIES have  mutually  agreed that the term of this
     ASSIGNMENT  will begin on the DATE OF COMING INTO EFFECT  hereof and finish
     on January 15, 2004.

     This term is compulsory for CEDIMIN, but not for MANHATTAN, which, by means
     of a notarial letter  addressed to CEDIMIN,  may, at any moment and with no
     reason, terminate the ASSIGNMENT, in which case THE PARTIES must enter into
     the corresponding  termination agreement of assignment for its registration
     with the Public Registry of Mines.

2.3  SCOPE OF THE AGREEMENT

     2.3.1     By means of the  ASSIGNMENT,  MANHATTAN  takes full possession of
               the  MINING  RIGHTS  subject  matter  thereof   pursuant  to  the
               provisions  set  forth in  article  166 of the  MINING  LAW,  and
               substitutes  CEDIMIN in all its rights and  obligations  to carry
               out the exploration  activities.  However, this substitution does
               not  include  the  defense of the titles  over the MINING  RIGHTS
               assigned  or the surface  areas  where such  rights are  located,
               which defense must be carried out by CEDIMIN without prejudice to
               the  collaboration  required by MANHATTAN  to such effect,  which
               collaboration it hereby commits itself to offer.

               It is  expressly  established  that CEDIMIN will not abide by the
               action  nor  abandon  it,  without  the  express   acceptance  by
               MANHATTAN.

               Regarding  the granting of titles over the MINING RIGHTS and over
               the surface  lands  comprised  in the Area of  Interest,  CEDIMIN
               commits  itself  before  MANHATTAN to keep it informed  about any
               act, whether administrative and/or judicial.

     2.3.2     The  ASSIGNMENT  includes  the ponds,  clearance,  camps,  roads,
               facilities and everything  forming part of and/or being accessory
               to the MINING RIGHTS subject matter of the ASSIGNMENT, whether in
               fact or by law.

     2.3.3     During the term of the  ASSIGNMENT,  MANHATTAN is  authorized  to
               freely make, on its own risk and account,  the technical  studies
               and works of prospecting and/or exploration in the MINING RIGHTS'
               area, on the surface and/or inside the mine, and to take samples,
               make analysis,  etc.,  without  prejudice to performing them in a
               rational  way,  according  to the  opinion  and  judgment  of its


<PAGE>


                                     - 5 -


               technical  personnel and always complying with the provisions set
               forth in such  regard in the MINING  LAW and its mining  welfare,
               mining security and environmental  regulations.  Likewise,  it is
               hereby  authorized  to  construct  every  kind  of  building  and
               facility and install machinery and/or equipment therein.

     2.3.4     MANHATTAN is hereby authorized to freely dispose of the ore to be
               extracted as a result of the  exploration  works,  provided  that
               said disposal is not a purchase-sale.  In order to sell said ore,
               it will require an authorization in writing from CEDIMIN.

     2.3.5     MANHATTAN  commits  itself to comply,  with respect to the MINING
               RIGHTS   subject  to  the   ASSIGNMENT,   with  the   obligations
               established  in title  six,  chapters  I and V of the  MINING LAW
               about exploration  investments,  annual payments of standing fees
               or penalties,  if the case may be, core records  and/or  drilling
               samples,  presentation  of sworn  returns  and other  obligations
               established by Law,  particularly about the use of surface lands.
               A  reason   for  the   automatic   TERMINATION   hereof   is  the
               non-compliance  with any of these  obligations  resulting  in the
               termination of the MINING RIGHTS. Any default subject matter of a
               sanction will be assumed by MANHATTAN.

     2.3.6     During the term of this  ASSIGNMENT,  CEDIMIN  may, at any moment
               and  prior  notice  through  a  letter  or fax  sent at  least 10
               calendar  days in  advance,  inspect  the MINING  RIGHTS  subject
               matter of the ASSIGNMENT, being empowered to make this inspection
               with its own personnel or through authorized representatives, but
               without interfering in any manner whatsoever with the exploration
               works and other activities carried out by MANHATTAN.

               MANHATTAN  will provide the  designated  inspector or  inspectors
               everything  required  to make his or their  task  easier.  In its
               visit, the inspectors will be accompanied by the person in charge
               of conducting the mining works.

               Likewise,   CEDIMIN  will  be  entitled  to  be   delivered   any
               information and documentation  requested to it in relation to the
               performance of the explorations.

     2.3.7     Any  facility,  building,  machinery,  equipment or material that
               MANHATTAN  installs  on its  own  account  will  be  kept  as its
               property and upon termination of the ASSIGNMENT,  notwithstanding
               the reason  therefor,  it may remove them within a six-month term
               as from the date of termination of the ASSIGNMENT. However, it is
               established  that MANHATTAN may not remove anything  forming part
               of the MINING  RIGHTS  and/or  any  supporting  material,  if its
               removal may cause landslides,  which will benefit CEDIMIN with no
               payment whatsoever to MANHATTAN.

     2.3.8     MANHATTAN will exercise is rights and comply with its obligations
               hereunder,  with its own personnel;  however,  to such effect, it
               will be free to hire third parties, including CEDIMIN.


<PAGE>


                                     - 6 -


     2.3.9     MANHATTAN  may,  at any  moment  and by means of a letter  or fax
               addressed to CEDIMIN,  terminate the  ASSIGNMENT  with respect to
               one, more or all MINING RIGHTS,  without  prejudice,  in case the
               termination is partial,  to continue with the ASSIGNMENT  subject
               to the terms and conditions agreed hereunder,  with no alteration
               whatsoever.

CLAUSE THREE: OPTION
------------- ------

3.1  OPTION:  Pursuant to the  provisions set forth in article 165 of the MINING
     LAW, CEDIMIN grants MANHATTAN,  and the latter accepts,  a PURCHASE OPTION,
     hereinafter the OPTION,  on 51 % of its rights and shares in any and all of
     the MINING  RIGHTS  referred to in clause one.,  including its integral and
     accessory parts.

3.2  OPTION  TERM:  THE  PARTIES  have  agreed that the term of this OPTION will
     commence on the DATE OF COMING  INTO  EFFECT  hereof and end on January 15,
     2004.

3.3  EXERCISE OF THE OPTION
     ----------------------

     3.3.1     MANHATTAN  may  exercise  the  OPTION at any  moment  during  its
               effective  term, on the last day of the OPTION term,  until 11.55
               pm.,  Lima  time,  provided  that it has  invested  the amount of
               US$4'950,000  indicated in point 2.1,  unless the works performed
               show  that with a lower  investment,  to the sole  discretion  of
               MANHATTAN,  there are enough  reserves  for the  company to be in
               charge of the  exploitation  to continue with the studies  and/or
               works.  Pursuant to point 2.1,  for purposes of  determining  the
               investment of US$4'950,000,  the amount of the investment made by
               MANHATTAN  during the term  hereof  referred to in point I of the
               Background hereof will be taken into consideration.  The exercise
               of the  option  and the  incorporation  of the  company  does not
               release  MANHATTAN  from  making  the  pending  investment  until
               completing  the sum of  US$4'950,000,  which is  regulated  under
               Annex I forming an integral  part hereof.  However,  it is hereby
               established  that every expense  required to incorporate  the new
               company forms part of the aforementioned amount of US$4'950,000.

     3.3.2     The  OPTION  will be  exercised  by  means of a  notarial  letter
               addressed to CEDIMIN,  accompanied  by a cashier's  check for the
               total price of the purchase-sale of the MINING RIGHTS.

     3.3.3     The total  price  equivalent  to 51 % of the rights and shares in
               the MINING RIGHTS subject matter of the OPTION is mutually agreed
               by THE PARTIES at US$50,000.00,  which will be divided into equal
               parts among all MINING RIGHTS covered by the purchase-sale.

               THE PARTIES  expressly  establish  that CEDIMIN will use the full
               price to carry out the exploration  works required or, if this is
               not the case, to cover the expenses and/or  investments under the
               company's responsibility, to the extent


<PAGE>


                                     - 7 -


               possible. To such effect, CEDIMIN will deliver the price received
               to the company,  once it has been  incorporated,  pursuant to the
               provisions set forth in paragraph 3.3.4 below.

      3.3.4    Once the  notarial  letter  informing  about the  exercise of the
               OPTION has been received by CEDIMIN,  THE PARTIES,  within a term
               not to exceed 30 calendar  days  counted from the date of receipt
               of said letter,  must sign the  preliminary  deed and public deed
               corresponding  to the  incorporation  and  corporate  bylaws of a
               closed corporation,  which, in case it is actually  incorporated,
               will be called MINERA PAPAYO S.A.C. This closed  corporation will
               substitute the legal entity that would have to be incorporated if
               this were not the case and pursuant to the  provisions  set forth
               in article 184 of the MINING LAW.

               CEDIMIN  will have a 49%  interest In MINERA  PAPAYO  S.A.C.  and
               MANHATTAN, a 51 % interest.

      3.3.5    MINERA  PAPAYO  S.A.C.   will  have  an  initial   capital  stock
               equivalent  in nuevos  soles to the total price of  purchase-sale
               agreed  under  paragraph  3.3.3.,  plus  a sum  in  nuevos  soles
               equivalent to US$10,000.00,  which THE PARTIES will pay according
               to their  corresponding  interest  percentages  in said  company,
               pursuant to paragraph  3.3.4. The MINING RIGHTS will form part of
               the   equity  of  MINERA   PAPAYO   S.A.C.,   once  it  has  been
               incorporated.

      3.3.6    ANNEX 1 forms an integral part hereof and contains the guidelines
               for the  incorporation  and  corporate  bylaws of  MINERA  PAPAYO
               S.A.C. as well as the rights and obligations of its  shareholders
               with  respect to the  corporation  and those of the  shareholders
               with respect to each other.

3.4  TERMINATION OF THE OPTION
     -------------------------

     At any moment  and by means of a  notarial  letter  addressed  to  CEDIMIN,
     MANHATTAN  may  terminate  the  OPTION,  which  would  imply the  automatic
     termination of the ASSIGNMENT.

     Once the agreement has been terminated,  MANHATTAN will only be responsible
     for  completing the  exploration  works subject matter of the annual budget
     being applied,  upon receipt of the  aforementioned  notarial  letter,  and
     delivering  to  CEDIMIN  the  information  obtained  as  a  result  of  the
     exploration,  including plans, analyses, samples, etc. Likewise,  MANHATTAN
     will  also be  responsible  for  filing  with the  mining  authorities  the
     statements  and  other  writs  required  by Law,  in  compliance  with  the
     provisions  set  forth  in  paragraph   2.3.5,   and  must  also  sign  the
     corresponding  termination  agreement of this ASSIGNMENT and OPTION for its
     registration   with  the  Public  Registry  of  Mines.   The  notarial  and
     registration expenses will be borne by MANHATTAN.


<PAGE>


                                     - 8 -


CLAUSE FOUR: CONDITIONS OF THE ASSIGNMENT AND OPTION
------------ ---------------------------------------

4.1  As a condition for the  execution of the  ASSIGNMENT  and OPTION  contained
     herein,  MANHATTAN will invest in the  exploration of the MINING RIGHTS the
     sum of  US$4'950,000  established  under  point  2.1  including  the  other
     expenses stipulated in paragraph 3.3.1. For purposes of determining the sum
     of US$4'950,000,  the provisions contained in the second paragraph of point
     2.1 of clause two shall apply.

4.2  According  to  the  terms   contained  in  point  2.1,  the  investment  of
     US$4'950,00  will be made  subject to the annual  exploration  programs for
     amounts not less,  in any year,  than  US$100,000.00,  duly approved by the
     TECHNICAL COMMITTEE described in clause five below.

4.3  As a condition for the execution of the  ASSIGNMENT  and OPTION,  MANHATTAN
     must pay to  CEDIMIN  as  OPTION  RIGHT  the  amount  of  US$300,000.  This
     obligation  will be met through  annual  payments of US$50,000  each, to be
     made subsequently  every contractual year, except for the case indicated in
     paragraph  3.3.1. In such a case,  MANHATTAN must pay to CEDIMIN,  together
     with the  purchase-sale  price and in the same form  indicated in paragraph
     3.3.2, the amount pending for the OPTION RIGHT. It is expressly established
     that  these  payments  will be  final,  notwithstanding  whether  MANHATTAN
     exercises its OPTION right or not.

     It  is  also  expressly  established  that  pursuant  to  the  stipulations
     contained in point 3.4, MANHATTAN will not be obliged to pay for the OPTION
     RIGHT, since, if the case may be, it releases the OPTION.

     THE PARTIES agree that for purposes of determining the sum of US$300,000 to
     be paid by MANHATTAN  pursuant to this point 4.3, the annual  payments made
     by  MANHATTAN  for  the  OPTION  RIGHT  during  the  effective  term of the
     agreement  referred  to in point I of the  Background  will be  taken  into
     consideration.  To such  effect,  the annual  payments for the OPTION RIGHT
     already made by  MANHATTAN  will be added to the payments to be made by the
     latter for this same reason during the effective term hereof.

4.4  As a condition for the execution of the ASSIGNMENT and OPTION, CEDIMIN will
     not  transfer,  assign  or  encumber  the  MINING  RIGHTS in favor of third
     parties,  it  being  expressly  agreed  that if due to  legal  or  economic
     reasons, it is essential, appropriate or necessary to act in this way, with
     the  approval in writing of MANHATTAN  with  respect to the MINING  RIGHTS,
     whether in whole or in part,  and/or their integral and/or accessory parts,
     the possible  acquirer or beneficiary of the  encumbrances  must previously
     accept this agreement, in whole and in writing,  without altering its terms
     and conditions, and without said acceptance,  those agreements will have no
     effect.

     Pursuant to the provisions contained in the foregoing  paragraph,  prior to
     any transfer,  ASSIGNMENT or  encumbrance,  CEDIMIN will inform  thereof to
     MANHATTAN  in


<PAGE>


                                     - 9 -


     writing,  stating  the reasons  and the name of the  potential  acquirer or
     beneficiary, and act in this way, once MANHATTAN has given its consent.

4.5  MANHATTAN  should enter the  investments  in the account  books and records
     under its  responsibility  pursuant to the  generally  accepted  accounting
     principles  of the mining  activity,  in accordance  with the  requirements
     contained in the Peruvian laws. To such effect,  THE PARTIES agree that the
     investments under MANHATTAN's responsibility,  notwithstanding whether they
     are entered in the account  books and  records in local  currency,  will be
     calculated  in US dollars.  For that purpose,  the buying  exchange rate in
     force on the date of each investment will be applied.

CLAUSE FIVE: TECHNICAL COMMITTEE
------------ -------------------

5.1  THE PARTIES do hereby create a TECHNICAL  COMMITTEE by mutual  agreement to
     be in charge of  defining  the policy to be followed  during the  effective
     term hereof,  to which THE PARTIES will submit  themselves.  Likewise,  the
     TECHNICAL   COMMITTEE  will  be   responsible   for  approving  the  annual
     exploration  programs and their corresponding  budgets and any other aspect
     related to the performance hereof until its full compliance.

     THE PARTIES are duly  represented  in the TECHNICAL  COMMITTEE by three (3)
     representatives  each, who will elect, on an annual basis, the President of
     the TECHNICAL COMMITTEE among them. The President may be reelected and will
     be  elected  among   MANHATTAN's   representatives   before  the  TECHNICAL
     COMMITTEE.

5.2  The TECHNICAL  COMMITTEE will hold compulsory meetings once a year in March
     and in any other time deemed necessary to the President's  discretion.  The
     TECHNICAL  COMMITTEE  will adopt its  resolutions by majority vote. To such
     effect,  each  representative or member of the TECHNICAL  COMMITTEE will be
     entitled to vote. In case of tie, the President of the TECHNICAL  COMMITTEE
     will have a casting vote.

     The President of the  TECHNICAL  COMMITTEE  will call an annual  meeting by
     means of a letter or via fax, and with acknowledgment of receipt, addressed
     to CEDIMIN and MANHATTAN,  10 calendar days in advance. For purposes of any
     other meeting, the same procedure will be followed, but 20 calendar days in
     advance.  The notice will indicate the date, place and time of the meeting,
     whether  it is held in the city of Lima or  abroad,  and the  matters to be
     dealt with. For purposes of the annual  notices,  the project of the annual
     exploration program for the next year and the corresponding  budget,  which
     will be prepared by MANHATTAN, will be sent.

     Without prejudice to the provisions  contained in the foregoing  paragraph,
     any of THE  PARTIES  may, at any moment,  request the  President  to call a
     meeting of the TECHNICAL  COMMITTEE,  which will call the meeting  within 3
     calendar days


<PAGE>


                                     - 10 -


     following the date of receipt of the request  received in this regard.  The
     notice will be sent 20 calendar days in advance.

     The meetings of the TECHNICAL  COMMITTEE will rather be held in the city of
     the Lima.

5.3  The results of the implementation of the annual  exploration  programs will
     be  submitted by  MANHATTAN,  since it is in charge of  implementing  them,
     before the TECHNICAL  COMMITTEE so that the latter  approves them and makes
     any comment and/or observation on them.

5.4  For purposes of the meetings of the TECHNICAL COMMITTEE,  at least four (4)
     of its  members  must be present,  notwithstanding  whether the meeting has
     been called for the first or second  time,  provided  that two (2) of those
     members represent MANHATTAN and the other two (2), CEDIMIN.

     10 calendar days must elapse from the first call to the second call and, if
     the case may be, the date for the second  call,  if the case may be, may be
     indicated when the meeting is called for the first time.

     The meetings of the TECHNICAL  COMMITTEE and the  resolutions to be adopted
     will be  contained  in  minutes  that  will be  signed at least by 2 of the
     members present in each meeting. The minutes will be kept in loose sheets.

CLAUSE SIX: MINERA PAPAYO SOCIEDAD  ANONIMA CERRADA IN CASE MANHATTAN  EXERCISES
----------- --------------------------------------------------------------------
THE OPTION
----------

THE PARTIES do hereby agree that once MINERA PAPAYO S.A.C. has been incorporated
and provided that MANHATTAN  exercises the OPTION  conferred to it, they will be
subject to the general  guidelines agreed by them for that company in a separate
document, which forms an integral part hereof as Annex I.

CLAUSE SEVEN: REPRESENTATIONS AND/OR WARRANTIES OF MANHATTAN
------------- ----------------------------------------------

MANHATTAN hereby represents and/or warrants that:

7.1  It is a company duly  incorporated  and  existing  pursuant to the Peruvian
     laws and likewise,  it is duly qualified to own MINING RIGHTS and carry out
     on them all mining activities regulated by the MINING LAW.

7.2  It has economic  capacity to make the investments and payments agreed under
     the ASSIGNMENT and OPTION.

7.3  It has no  pending  proceeding  and is free from  dissolution,  liquidation
     and/or bankruptcy proceedings.


<PAGE>


                                     - 11 -


7.4  It has  obtained  all  authorizations  required to execute and perform this
     agreement and to assume the obligations agreed hereunder.

7.5  It knows the legal  provisions in force about mining safety and hygiene and
     environment  and commits itself to apply and honor them so as not to breach
     them upon the performance of the works to be carried out in its capacity as
     ASSIGNEE.

CLAUSE EIGHT: ASSIGNMENT OR TRANSFER OF CONTRACTUAL POSITION
------------- ----------------------------------------------

It is hereby agreed that THE PARTIES may transfer  their rights  hereunder to an
affiliate,  subsidiary  and/or, if the case may be, its parent company,  with no
authorization  whatsoever  and whether in whole or in part. In such a case,  the
acquirer will be subject to all terms and conditions of this agreement. For this
purpose, the following terms shall have the meanings indicated below:

AFFILIATE: A company in which 50% or more of its shares or interests entitled to
vote are directly or indirectly owned by the person or persons,  which, in turn,
are the owners of 50% or more of the shares or interests entitled to vote of the
party intending to transfer.

SUBISIDIARY:  A  company,  in which  at least  50% of its  shares  or  interests
entitled to vote are directly or indirectly owned by the company that intends to
transfer its interests hereunder.

PARENT COMPANY: A company that is the direct or indirect owner of 50% or more of
the shares or interests entitled to vote of the part intending to transfer.

CLAUSE NINE: CONFIDENTIALITY
------------ ---------------

THE PARTIES do hereby commit  themselves to treat any information  they may have
access to in relation to the  exploration  activities as well as the results and
processes they use in the strictest confidence.  However,  MANHATTAN may use the
information it has for purposes of complying with the obligations  regarding the
statements made before the authorities and the public pursuant to law.

Confidential  information  shall mean every information about the MINING RIGHTS,
including,  but not limited to,  geological,  geochemical and geophysical  data,
maps, geologic maps, estimates,  analyses,  cores, reports and any other written
or oral information, in the possession or control of THE PARTIES.

CLAUSE TEN: FORCE MAJEURE EVENTS
----------- --------------------

It is expressly  agreed that if as a  consequence  of a cause beyond the will of
THE PARTIES, duly evidenced,  a force majeure event or an act of God, any of THE
PARTIES is prevented from complying with the obligations  assumed hereunder,  it
must  immediately  inform  thereof  to the  other  PARTY by means of a  notarial
letter.

In such a case, the compliance  with any of the  obligations  assumed by it that
have been affected will be suspended  until the force majeure event,  act of God
or reason beyond the will of THE


<PAGE>


                                     - 12 -


PARTIES, duly evidenced, disappears, and the corresponding terms and obligations
of the other PARTY will be extended.

If 30  calendar  days elapse from the date of  occurrence  of the force  majeure
event, act of God or reason beyond the will of THE PARTIES, duly evidenced,  and
the affected party has not  recommenced  compliance  with its  obligations,  THE
PARTIES will hold a meeting to determine by mutual  agreement and in writing the
steps to be followed.

The only consequences of the force majeure events, acts of God or reasons beyond
the will of THE PARTIES,  duly  evidenced,  will be those expressly set forth in
this clause.

CLAUSE ELEVEN: CONFLICT SETTLEMENT
-------------- -------------------

Pursuant to the  provisions  set forth in Law No.  26572,  THE PARTIES do hereby
agree that the conflicts between them with respect of the interpretation  and/or
application  hereof  that  cannot be  settled  by means of a direct  negotiation
within a term of 15  calendar  days  counted  from the  date of  receipt  of the
written notice informing of the existence of the subject matter of the conflict,
will be  settled  by  means of an  arbitration  by law to be  carried  out by an
Arbitration Court composed of one or three arbitrators, which will be subject to
the laws and rules of the International  Chamber of Commerce and will be held in
the city of New York,  pursuant to the said  regulations.  The arbitrators  must
have a widely known experience in the mining industry,  whether they are lawyers
or any other  professionals.  The  arbitration  languages  will be  Spanish  and
English.

The arbitration  award will be final and unappealable and THE PARTIES  expressly
waive  to  submit  any  conflict   before  the   judicial   instances  of  their
jurisdictions or any Peruvian or foreign entity.

CLAUSE TWELEVE: DOMICILES OF THE PARTIES AND NOTICES
--------------- ------------------------------------

THE  PARTIES  have  stated  that  their  domiciles  are those  appearing  in the
introduction hereof.

In addition, they have declared that their fax numbers are the following:

MANHATTAN                 440-8861
CEDIMIN                   463-3377

It will be considered that the communications or notices sent to those domiciles
at their fax  numbers  have been sent,  unless  their  change is informed to the
other party by means of a notarial  letter or fax sent at least 15 calendar days
in advance.

CLAUSE THIRTEEN: APPLICABLE LAW
---------------- --------------

The laws of the Republic of Peru will apply to this Agreement.


<PAGE>


                                     - 13 -


CLAUSE FOURTEEN: COMING INTO EFFECT
---------------- ------------------

This  agreement  will  come  into  effect  on the date  THE  PARTIES  sign  this
preliminary deed without  prejudice to its conversion into a public deed and its
registration  in the  registration  entries of the MINING  RIGHTS in the Book of
MINING RIGHTS of the Public Registry of Mines.

CLAUSE FIFTEEN: TAXES
--------------- -----

It is certified  that the execution  hereof is not subject to the payment of any
tax whatsoever and that if in the future, any type of tax is imposed upon it, it
will be  borne  by THE  PARTIES  in  proportion  to  those  corresponding  to it
hereunder when the taxable matter arises, unless that, by virtue of the law, the
tax must be necessarily paid by any of them.

CLAUSE SIXTEEN: EXPENSES
--------------- --------

The notarial  expenses  resulting from the conversion of this  preliminary  deed
into a public deed and its  registration  with the Public Registry of Mines will
be fully borne by  MANHATTAN  and will be  calculated  in its  equivalent  in US
dollars against the investment to be made by MANHATTAN hereunder.

CLAUSE SEVENTEEN: POWERS
----------------- ------

THE PARTIES declare that their representatives, Messrs. Jean Marie Georgel Paris
and  Alberto  Benavides  de la  Quintana,  and  Juan  Carlos  Escudero  Velando,
respectively,  are duly  empowered to sign, on behalf of CEDIMIN and  MANHATTAN,
respectively,  this  preliminary  deed of the  Agreement of  Assignment  through
Exploration  and Purchase  Option of Mining Rights and its annex, as well as the
public deed resulting from this  preliminary  deed and the other  documents that
may be required for their formalization.

Mr. Notary,  kindly add the introduction and conclusion  required by Law, insert
the necessary  documents and, once this has been done,  convert this preliminary
deed into a public deed.

                                                              Lima, June 5, 2001

                  MANHATTAN                                CEDIMIN
   -(signed) Juan Carlos Escudero Velando     -(signed) Jean Marie Georgel Paris
                  Director                             General Manager


                                      -(signed) Alberto Benavides de la Quintana
                                         Chairman of the Board of Directors


<PAGE>


                                     ANNEX 1
                       GUIDELINES FOR MINERA PAPAYO S.A.C.

1.   SHAREHOLDERS: CEDIMIN and MANHATTAN

2.   CAPITAL  STOCK:  It will equal the  equivalent in nuevos soles of the total
     price of the purchase-sale,  plus US$10,000.00, in its equivalent in nuevos
     soles.

3.   PURPOSE OF THE COMPANY:  Its purpose will be the  performance of every kind
     of mining activity permitted by Law.

4.   INITIAL SHAREHOLDERS' INTEREST IN THE CAPITAL STOCK

     MANHATTAN         :        51%
     CEDIMIN           :        49%

5.   PREEMPTIVE RIGHT OF PURCHASE:  The shareholders,  on a prorata basis and in
     proportion to their  corresponding  interest  percentages  in the company's
     capital  stock,  will be entitled to the preemptive  right of purchase,  in
     case one of the  shareholders  wishes to sell its  shares to third  parties
     that are not shareholders.

6.   SHAREHOLDERS' CONTRIBUTIONS:  Once the company has been incorporated,  each
     shareholder  will  contribute  to its budget in  proportion to its interest
     percentages in the capital stock, except for the following cases:

     6.1  If a company is incorporated  without  MANHATTAN having made the total
          investment of US$4'950,000.00 under the terms referred to in point 2.1
          of Clause Two (a condition  of the  ASSIGNMENT  and OPTION),  then the
          company's  budgets will be only financed by MANHATTAN until completing
          the said sum of US$4'950,000.00 and once this obligation has been met,
          the  difference  between the investment  made by MANHATTAN  during the
          effective  term  of the  ASSIGNMENT  and the  OPTION  and  during  the
          existence of the company  until  completing  this  investment  will be
          considered as a  complementary  capital premium that may be subject to
          capitalization  in favor of the  shareholders  in  proportion to their
          corresponding interest percentages in the company's capital stock.

     6.2  If CEDIMIN or MANHATTAN,  within the term of ninety (90) calendar days
          following the date in which the total  investment of  US$4'950,000  is
          made and by means of a notarial  letter  addressed  to the chairman of
          the  company's  board of  directors,  decides not to contribute to the
          second  stage (five  years) of the project  (which  stage is under the
          responsibility  of the  company),  then it will dilute its interest in
          the company until withholding only 20% of its shares. In this context,
          the party continuing with the project must invest, with its own funds,
          the amount of  US$10'000,000  in this second five-year stage, and once
          the  investment  has been fully made,  it will  acquire from the other
          party,  with no cost  whatsoever,  the number of  shares,  so that the
          diluted  party  withholds  for itself  only 20% of the  representative
          shares of the capital stock of the company on the date of transfer.


<PAGE>


                                     - 2 -


          In the event that the party that decides to continue  investing  fails
          to invest the sum of US$10'000,000 in the said five-year term, CEDIMIN
          and  MANHATTAN  will  reassume,   with  no  cost   whatsoever,   their
          corresponding  original  interest  percentages  (49%  and 51 %) in the
          capital stock of MINERA PAPAYO S.A.C., assuming with these percentages
          any subsequent financing required by the company.

     6.3  If CEDIMIN and MANHATTAN, within the term of ninety (90) calendar days
          following  the date on which  the  investment  of  US$4'950,000.00  is
          completed,  sends to the chairman of the company's  board of directors
          notarial  letters,  expressing each of them its decision to contribute
          for the  second  stage  (five  years) of the  project  assumed  by the
          company,  then  CEDIMIN  and  MANHATTAN  will  invest  the  amount  of
          US$10'000,000.00  from their own funds,  on a prorata basis,  based on
          their respective interest percentages in the original capital stock of
          MINERA PAPAYO S.A.C.  (49% - 51 %).  However,  if within the five-year
          term,  CEDIMIN or MANHATTAN decides to stop investing,  then the party
          that   continues   investing   will   complete   the   investment   of
          US$10'000,000.00, and once this investment has been completed, it will
          acquire from the other party, with no cost, the  corresponding  number
          of  shares,  so that the party  that  failed to invest  withholds  for
          itself, only 20% of the representative  shares of the capital stock of
          the company upon the transfer.

     6.4  In the cases  described in points 6.2 and 6.3, the party that acquires
          the shares of the diluted party will have, for a one-year term counted
          from the  transfer of the shares as set forth in points 6.2 and 6.3, a
          first  preemptive  right  to  purchase  from  the  diluted  party  its
          remaining 20% of the company's shares, at a price of US$5'000,000.

7.   COMPANY'S MANAGEMENT
     --------------------

     7.1  SHAREHOLDERS'  MEETINGS:  For  purposes of the  important  resolutions
          other than those  regulated  by this annex,  in any  meeting,  whether
          called  for the  first  or  second  time,  the  approving  vote of the
          shareholders  representing at least 66% of the company's capital stock
          will be required.

     7.2  BOARD OF DIRECTORS:  The company's board of directors will be composed
          of 5 members,  3 of which will be elected  from the list of persons to
          be proposed by MANHATTAN and 2 from the list of persons to be proposed
          by CEDIMIN. The position of chairman of the board of directors will be
          filled by any of the directors elected at the suggestion of MANHATTAN.

     7.3  MANAGER:  MANHATTAN  will be the manager of the company  and, as such,
          may designate its  representative,  and the representative or operator
          may be an individual or legal entity. MINERA PAPAYO S.A.C. will pay to
          the manager or, if the case may be, the operator to be  designated  by
          MANHATTAN,  annual fees  equivalent to 7.5% of the expenses  incurred,
          which will be entered in the account


<PAGE>


                                     - 3 -


          books and  records on a quarterly  basis.  These fees form part of the
          investment  of  US$4'950,000  referred  to in point 2.2 of clause  two
          hereof.

8.   CONFLICT SETTLEMENT: Any conflict between the shareholders and between them
     and the  company  will be  settled  by means of  arbitration  by law by the
     International Chamber of Commerce. The languages of the arbitration will be
     English and Spanish.

     As a sign of approval and acceptance,  THE PARTIES sign this Annex in three
     counterparts, in Lima, on June 5, 2001.

                 MANHATTAN                                 CEDIMIN
  -(signed) Juan Carlos Escudero Velando      -(signed) Jean Marie Georgel Paris
                  Director                              General Manager


                                  -(signed) Alberto Benavides de la Quintana
                                      Chairman of the Board of Directors