UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

FORM 20-F

REGISTRATION STATEMENT
  PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXHCHANGE ACT OF 1934 OR

ANNUAL REPORT PURSUANT TO SECTION
  13 OR 15(d) OF THE SECURITIES EXCHANGE ACTOF 1934 OR

FOR THE FISCAL YEAR ENDEDAUGUST 31, 2002

TRANSITION REPORT PURSUANT
  TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________________ to __________________

Commission File Number 0-27760

MIRANDA DIAMOND CORP. 
  (Exact name of Registrant as specified in its charter)

BRITISH COLUMBIA, CANADA 
  (Jurisdiction of Incorporation or organization)

Suite 306 - 1140 Homer Street, Vancouver, British Columbia,
  Canada, V6B 2X6 
  (Address of Principal Executive Offices)

Securities registered or to be registered pursuant to Section 12(b) of the Act

|Title of each class | Name of each exchange on which registered:TSX-V
|------------------- | -----------------------------------------------

Securities registered or to be registered pursuant to Section 12(g) of the
  Act None

Common Stock, without par value 
  (Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.

None 
  (Title of Class)

Indicate the number of outstanding shares of each of the issuers classes
  of capital or common stock as of the close of the period by the annual report.     
  5,256,760 common shares

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Indicate by check mark whether the registrant (1) has filed
  all reports required to be filed by Section 13 or 15(d) of the Securities Act
  of 1934 during the preceding 12 months (or for such shorter period that the
  registrant was required to file such reports), and (2) has been subject to such
  filing requirements for the past 90 days.

| | Yes
               No
| | ---------------------

Indicate by check mark which financial statement item the registrant has elected to follow.

| | Item
      17      
      Item 18
| | ---------------------------------

(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.
N/A

| | Yes          No
| | ---------------

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Table of Contents

|ITEM 1  | IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS   | 1  | 
|------- | ------------------------------------------------------- | -- | 
|        |                                                         |    | 
|ITEM 2. | OFFER STATISTICS AND EXPECTED TIMETABLE                 | 1  | 
|        |                                                         |    | 
|ITEM 3. | KEY INFORMATION                                         | 1  | 
|        |                                                         |    | 
|A.      | SELECTED FINANCIAL DATA                                 | 1  | 
|B.      | CAPITALIZATION AND INDEBTEDNESS                         | 2  | 
|C.      | REASONS FOR THE OFFER AND USE OF PROCEEDS               | 3  | 
|D.      | RISK FACTORS                                            | 3  | 
|        |                                                         |    | 
|ITEM 4  | INFORMATION ON THE COMPANY                              | 4  | 
|        |                                                         |    | 
|A.      | HISTORY AND DEVELOPMENT OF THE COMPANY                  | 4  | 
|B.      | BUSINESS OVERVIEW                                       | 6  | 
|C.      | ORGANIZATIONAL STRUCTURE                                | 7  | 
|D.      | PROPERTY, PLANTS AND EQUIPMENT                          | 7  | 
|        |                                                         |    | 
|ITEM 5  | OPERATING AND FINANCIAL REVIEW AND PROSPECTS            | 15 | 
|        |                                                         |    | 
|A.      | OPERATING RESULTS                                       | 15 | 
|B.      | LIQUIDITY AND CAPITAL RESOURCES                         | 16 | 
|C.      | RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES          | 17 | 
|D.      | TREND INFORMATION                                       | 17 | 
|        |                                                         |    | 
|ITEM 6  | DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES              | 17 | 
|        |                                                         |    | 
|A.      | DIRECTORS AND SENIOR MANAGEMENT                         | 17 | 
|B.      | COMPENSATION                                            | 18 | 
|C.      | BOARD PRACTICES                                         | 19 | 
|D.      | EMPLOYEES                                               | 19 | 
|E.      | SHARE OWNERSHIP                                         | 20 | 
|        |                                                         |    | 
|ITEM 7  | MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS       | 22 | 
|        |                                                         |    | 
|A.      | MAJOR SHAREHOLDERS                                      | 22 | 
|B.      | RELATED PARTY TRANSACTIONS                              | 22 | 
|C.      | INTERESTS OF EXPERTS AND COUNSEL                        | 23 | 
|        |                                                         |    | 
|ITEM 8  | FINANCIAL INFORMATION                                   | 23 | 
|        |                                                         |    | 
|A.      | CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION | 23 | 
|B.      | SIGNIFICANT CHANGES                                     | 23 | 
|        |                                                         |    | 
|ITEM9   | THE OFFER AND LISTING                                   | 24 | 
|        |                                                         |    | 
|A.      | OFFER AND LISTING DETAILS                               | 24 | 
|B.      | PLAN OF DISTRIBUTION                                    | 25 | 
|C.      | MARKETS                                                 | 25 | 
|D.      | DILUTION                                                | 25 | 
|E.      | EXPENSES OF THE ISSUE                                   | 25 | 
|        |                                                         |    | 
|ITEM 10 | ADDITIONAL INFORMATION                                  | 25 | 
|        |                                                         |    | 
|A.      | SHARE CAPITAL                                           | 25 | 
|B.      | MEMORANDUM AND ARTICLES OF ASSOCIATION                  | 25 | 
|C.      | MATERIAL CONTRACTS                                      | 27 | 
|D.      | EXCHANGE CONTROLS                                       | 29 | 
|E.      | TAXATION                                                | 30 | 

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|F.                                                | DIVIDENDS AND PAYING AGENTS                                                  | 36 | 
|------------------------------------------------- | ---------------------------------------------------------------------------- | -- | 
|G.                                                | STATEMENT BY EXPERTS                                                         | 36 | 
|H.                                                | DOCUMENTS ON DISPLAY                                                         | 36 | 
|I.                                                | SUBSIDIARY INFORMATION                                                       | 37 | 
|                                                  |                                                                              |    | 
|ITEM 11                                           | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
      RISK             | 37 | 
|                                                  |                                                                              |    | 
|ITEM 12                                           | DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES                       | 37 | 
|                                                  |                                                                              |    | 
|ITEM 13                                           | DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES                              | 37 | 
|                                                  |                                                                              |    | 
|ITEM 14                                           | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY
      HOLDERS               | 37 | 
|                                                  |                                                                              |    | 
|ITEM 15                                           | CONTROLS AND PROCEDURES                                                      | 37 | 
|                                                  |                                                                              |    | 
|ITEM 16                                           | [RESERVED]                                                                   | 37 | 
|                                                  |                                                                              |    | 
|ITEM 17                                           | FINANCIAL STATEMENTS                                                         | 37 | 
|                                                  |                                                                              |    | 
|ITEM 18                                           | FINANCIAL STATEMENTS                                                         | 37 | 
|                                                  |                                                                              |    | 
|ITEM 19                                           | EXHIBITS                                                                     | 38 | 
|                                                  |                                                                              |    | 
|A.                                                | AUDITED CONSOLIDATED FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES: | 38 | 
|B.                                                | MATERIAL CONTRACTS                                                           | 38 | 
|                                                  |                                                                              |   
|SIGNATURES                                        | 39                                                                           |   
|                                                  |                                                                              |    | 
|CERTIFICATIONS                                    | 41                                                                           |   
|                                                  |                                                                              |    | 
|COMMENTS BY INDEPENDENT AUDITORS FOR U.S. READERS | 44                                                                           |   

Responses to Items 1,2,3B,3C,9B,9D,9E,9F,10A,10F,10G and 12 are only required in Securities Act filings in connection with offerings. Item 16 is reserved

* The Company has responded to Item 17 in lieu of responding to this Item.

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ITEM 1.          IDENTITY
  OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS

This Form 20-F is being filed as an annual report under the
  Securities Exchange Act of 1934, and as such, there is no requirement to provide
  any information under this item.

ITEM 2.          OFFER
  STATISTICS AND EXPECTED TIMETABLE

This Form 20-F is being filed as an annual report under the
  Securities Exchange Act of 1934, and as such, there is no requirement to provide
  any information under this item.

ITEM 3.          KEY
  INFORMATION

A.Selected Financial Data

The selected consolidated financial information set out below
  has been obtained from financial statements that reflect the Companys
  operations in the mineral property exploration business.

The following table summarizes information pertaining to operations
  of the Company for the last five fiscal years ended August 31.

For the Year Ended August 31

|                                                                                  | 2002    | 2001    | 2000    | 1999           | 1998          
|--------------------------------------------------------------------------------- | ------- | ------- | ------- | -------------- | --------------
|                                                                                  |         | $       | $       | $              | $             
|Revenues (interest income)                                                        | 894     | 2,611   | 9,014   | 19,786         | 34,282        
|General and Administrative Expenses                                               | 279,694 | 170,660 | 142,441 | 201,844        | 350,238       
|Write off of Abandoned Mineral  Properties and Related Exploration
      Expenses | Nil     | 528,803 | 39,490  | 186,720        | 235,437       
|Loss For The Year                                                                 | 278,800 | 696,852 | 172,917 | 368,778        | 551,293       
|Income (Loss) per share                                                           | (.12)   | (.42)   | (.10)   | Not calculated | Not calculated
|Current Assets                                                                    | 289,705 | 32,493  | 133,280 | 301,122        | 658,264       
|Total Assets                                                                      | 643,430 | 248,783 | 846,124 | 1,021,258      | 1,391,086     
|Current Liabilities                                                               | 9,643   | 15,796  | 285     | 2,500          | 3,550         
|Long Term Debt                                                                    | Nil     | 70,000  | Nil     | Nil            | Nil           
|Shareholders Equity                                                               | 633,787 | 162,987 | 845,839 | 1,018,758      | 1,387,536     

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The following table sets out the rate of exchange for the
  Canadian dollar at August 31, 2002, August 31, 2001, August 31, 2000, August
  31, 1999, August 31, 1998, the average rates for the period, and the range of
  high and low rates for the period.

U.S. Dollar/Canadian Dollar Exchange Rates for Five Most Recent Financial Years

|                                   | Average | High  | Low   | Close
|---------------------------------- | ------- | ----- | ----- | -----
|For the Year Ended August 31, 2002 | $1.56   | $1.61 | $1.50 | $1.56
|For the Year Ended August 31, 2001 | $1.53   | $1.58 | $1.47 | $1.54
|For the Year Ended August 31, 2000 | $1.48   | $1.51 | $1.44 | $1.48
|For the Year Ended August 31, 1999 | $1.51   | $1.56 | $1.45 | $1.49
|For the Year Ended August 31, 1998 | $1.48   | $1.58 | $1.37 | $1.56

The following table sets out the high and low rates of exchange
  for the Canadian dollar for each month during the previous six months.

U.S. Dollar/Canadian Exchange Rates for Previous Six Months

|     | May, 2002 | June, 2002 | July, 2002 | August, 2002 | September, 2002 | October, 2002
|---- | --------- | ---------- | ---------- | ------------ | --------------- | -------------
|High | $1.57     | $1.55      | $1.59      | $1.60        | $1.59           | $1.57        
|Low  | $1.53     | $1.50      | $1.51      | $1.55        | $1.55           | $1.56        

The value of the U.S. Dollar in relation to the Canadian Dollar was $1.5562 as of November 5, 2002.

B.           Capitalization
  and Indebtedness

This Form 20-F is being filed as an annual report under the
  Securities Exchange Act of 1934, and as such, there is no requirement to provide
  any information under this item.

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C.           Reasons
  for the Offer and Use of Proceeds

This Form 20-F is being filed as an annual report under the
  Securities Exchange Act of 1934, and as such, there is no requirement to provide
  any information under this item.

D.Risk
  Factors

Early Stage Exploration Company

The exploration for and development of mineral deposits involves
  significant financial risks over a significant period of time that even a combination
  of careful evaluations, experience and knowledge may not eliminate. While exploration
  for minerals may result in substantial rewards, few properties that are explored
  are ultimately developed into producing mines. Major expenses are required to
  establish reserves by drilling and to construct mining and processing facilities
  at a site. It is impossible to know whether the current exploration programs
  of the Company will ultimately result in a profitable commercial mining operation.

Financial Risk

Prior to completion of the Companys exploration programs,
  the Company anticipates that it will incur increased operating expenses without
  realizing any revenues. The Company expects to incur significant losses into
  the foreseeable future. If the Company is unable to generate significant revenues
  from exploration of its mineral claims and the production of minerals thereon,
  if any, the Company will not be able to earn profits or continue operations.
  There is no history upon which to base any assumption as to the likelihood that
  the Company will prove successful, and the Company can provide investors with
  no assurance that it will generate any operating revenues or ever achieve profitable
  operations.

Competition

The business of mineral exploration and mining is competitive
  in all of its phases. In the search for and acquisition of prospective mineral
  properties, the Company competes with other companies and individuals, including
  competitors having financial and other resources equal to or greater than that
  of the Company. The Companys ultimate success will therefore depend on
  the extent to which its existing properties are developed, as well as its ability
  to compete for and acquire suitable producing properties or prospects for mineral
  exploration in the future, together with its ability to secure adequate financing.

Compliance With Government Regulations

All phases of the Companys operation are subject to
  environmental regulation. Environmental legislation is evolving toward stricter
  standards and more vigorous enforcement, including increased fines and penalties
  for non-compliance. Regulatory requirements encompass more stringent environmental
  assessment of project proposals, and impose greater responsibilities on corporations
  and their directors, officers and employees. Future changes in environmental
  regulatory requirements may result in more complex, costly and time-consuming
  procedures.
  The operations of the Company and the further exploration and the development
  of its properties require various licenses and permits and will be subject to
  ongoing regulation. There can be no guarantee that the Company will be able
  to obtain or maintain all permits and licenses that may be required for its
  activities. Currently, the Company does not have any properties on which commercial
  mining operations are carried out.

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Risks Associated With Mining

The Companys operations are subject to all of the hazards
  and risks normally incident to the exploration for and development and production
  of precious minerals, any of which could result in damage for which the Company
  may be held responsible. Hazards such as unusual or unexpected rock formations,
  landslides, flooding or other adverse conditions may be encountered in the drilling
  and removal of material. While the Company may obtain insurance against certain
  risks in such amounts as it considers adequate, the nature of these risks is
  such that liabilities could exceed policy limits or could be excluded from coverage.
  There are also risks against which the Company cannot insure or against which
  it may decide not to insure. The potential costs which could be associated with
  any liabilities not covered by insurance or in excess of insurance coverage
  may cause substantial delays and require significant capital outlays, adversely
  affecting the Companys earnings and competitive position in the future
  and potentially, its financial position.

ITEM 4.     INFORMATION ON THE COMPANY

A.                History
  and Development of the Company

Miranda Diamond Corp. (the Company) was incorporated
  as Miranda Industries Inc. under the British ColumbiaCompany Act on
  May 4, 1993 by the registration of its memorandum and articles.

On August 3, 2001, the Company altered its memorandum by changing
  its name to "Thrush Industries Inc.", consolidating its share capital on a one-for-five
  basis, and increasing its authorized share capital to 100,000,000 common shares
  without par value. Effective April 15, 2002, the Company changed its name to
  Miranda Diamond Corp. There was no consolidation of capital.

The Company's head office is located at Suite 306  1140
  Homer Street, Vancouver, British Columbia, V6B 2X6. The contact person is Dennis
  Higgs, President, Chief Executive Officer, Chief Financial Officer and Director.
  The telephone number is (604) 689-1659 and the facsimile number is (604) 689-1722.

Since incorporation, the Company has been engaged in the acquisition,
  exploration and development of mineral properties. In late 1994 the Company
  conducted an Initial Public Offering through the facilities of the Vancouver
  Stock Exchange. At that time the Company had varying interests in several mineral
  claims located in the Province of Manitoba and the Province of Saskatchewan,
  and in the State of Wyoming through its subsidiary, Miranda U.S.A., Inc.

In 1995 the Company incorporated a Mexican subsidiary called
  Minas Miranda S.A. de C.V. and expanded its activities into Mexico. The Company
  has acquired and explored several mineral properties in Canada, the United States,
  and Mexico since its incorporation date, mainly for gold.

From 1997 to 1999 the Companys primary exploration focus
  was on its gold properties in Mexico and Nevada, however, since 1999 with the
  softening of the resource markets, specifically the gold sector, along with
  poor financial markets, the Company could not justify performing any further
  work on these projects. As a result there has been limited exploration activity
  for the past couple of years. With the Company being unable to initiate further
  exploration programs on its Mexican and Nevada properties, the Company began
  to seek new opportunities and financing. On August 3, 2001 the Company consolidated
  its share capital on a one-for-five basis and the company name was changed to
  Thrush Industries Inc..

In October, 2001 the Company announced a private placement
  of 2,000,000 special warrants at a price of $0.10 per special warrant. Each
  special warrant is convertible without additional consideration into one

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common share and one warrant. Each warrant entitles the holder
  to acquire one further common share of the Company at a price of $0.12 per share
  at any time on or before January 7, 2004. The Company closed this private placement
  on January 7, 2002.

By agreements dated January 30, 2002 and amended agreements
  dated April 14, 2002, May 29, 2002 and June 28, 2002, the Company acquired six
  diamond exploration properties that comprise a total of 354 mineral claims,
  covering approximately 45,472 acres (18,402 hectares), located in the Otish
  Mountains region of Quebec.

The Companys business purpose in acquiring the properties
  is to acquire a stakeholding in an emerging diamond play. The Otish Mountains
  area became subject to an intense staking rush after Ashton Mining of Canada
  Inc. (Ashton) in joint venture with SOQUEM Inc. announced they had
  discovered two diamondiferous kimberlitic bodies on their Otish Mountains project
  (the Foxtrot property). Majescor Resources Inc. (Majescor)
  identified a broad area of kimberlitic minerals in till samples in the same
  area which led to Majescor acquiring five mineral properties totaling approximately
  1,030 square kilometers (the Portage project), which adjoins and
  partly surrounds Ashtons Foxtrot property where the diamondiferous kimberlite
  bodies (the Renard kimberlitic bodies) were discovered. BHP Diamonds joint
  ventured Majescors Portage project.

The Otish Mountains properties acquired by the Company are
  located in proximity to Ashtons Foxtrot property where the Renard kimberlitic
  rocks were recently discovered, and Majescors (the Portage property)
  that partly surrounds Ashtons Foxtrot property.

In February 2002, the Company held an annual and extraordinary
  general meeting at which time the Company received shareholder approval to complete
  the acquisition of the 354 mineral claims covering over 45,000 acres in the
  Otish Mountains region of Quebec. The Company also received shareholder approval
  to change its name from Thrush Industries Inc. to Miranda Diamond Corp.

In July 2002, the Company closed a private placement of 2,500,000
  units at a price of $0.20 per unit. Each unit consists of one common shares
  and one whole warrant. Each whole warrant entitles the holder to acquire one
  further common share of the Company at a price of $0.27 per share at any time
  on or before July 11, 2004. Commissions were paid to brokers totalling 72,000
  units with the same terms as the private placement units.

Subsequent to the fiscal year end, the Company entered into
  three agreements dated September 10, 2002, to acquire the Lac Herve, Lac Square
  Rock and Lac Taffanel properties in the emerging diamond play within the Superior
  Craton of Quebec. Miranda can acquire a 100% interest in the three properties,
  subject to a 2% net smelter return/gross overriding royalty, by paying for the
  cost of staking the claims.

By agreement dated September 27, 2002, the Company has an
  option to acquire a 100% interest in three gold projects in Nevada known as
  the Hercules Property, the Imperial Mine Property and the Gilman Property, subject
  to a 3% net smelter return royalty (NSR). Upon completion of a bankable
  feasibility study, the Company can buy 2/3 of the NSR royalty on each property
  (i.e. 2% NSR, leaving 1% NSR on each property) for US $2 million.

The total acquisition price for the three properties is payable
  over five years and comprises 450,000 warrants and US $220,000. The warrants
  allow the Optionor the right to purchase common shares of Miranda Diamond Corp.
  at prices ranging from Cdn. $0.25 to $0.40 and are exercisable for a period
  of two years from their date of issue. The cash consideration is prorated to
  allow for the termination of any of the individual properties.

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The Company also has a work commitment of US $650,000 over
  the five years, with a commitment of US $75,000 over each of the first two years.

None of the *Companys properties are beyond the exploration
  stage and there is no assurance that any of the Companys mining properties
  contain a commercially viable ore body until further exploration work is done.

In this Annual Report all currency refers to Canadian Dollars
  (Cdn $) unless indicated otherwise.

B.          Business
  Overview

The Company is a natural resource company engaged in the acquisition,
  exploration and development of mineral properties. The Company has had varying
  interests in a number of mineral properties located in the United States, Mexico
  and Canada since 1993. The Companys primary focus since 1995 has been
  on gold exploration in Nevada and Mexico. The Company plans to explore and develop
  its mineral properties or joint venture them to other companies for their further
  development.

In Nevada, the Company has natural resource properties represented
  by the following: an option to acquire a 100% interest, subject to a 3% net
  smelter return royalty, in three gold projects known as the Hercules Property,
  Lyon County, the Imperial Mine Property, Esmeralda County, and the Gilman Property,
  Lander County; and an agreement to acquire a 100% right, title, and interest
  in the Secret Basin Project, Nye County.

In Mexico, the Company, through its Mexican subsidiary, Minas
  Miranda, S.A. de C.V., maintains title to two Mexican concessions comprising
  2,271 hectares in south central Sonora; Las Catalinas and Ampliacion Las Catalinas
  IV.

In Quebec, Canada the Company has acquired six properties
  comprising a total of 96,957 acres (39,239 hectares) in the Otish Mountains/Superior
  Craton diamond play represented by the following: the Lac Leran property totals
  approximately 15,361 acres (6,217 hectares) and adjoins on the east side of
  Ashton Mining of Canada-SOQUEM Inc. discovery property hosting the Renard kimberlitic
  rocks; the Lac Pigeon property totals approximately 15,392 acres (6,229 hectares)
  and adjoins on the west side of the Majescor-BHP Portage project approximately
  30 kilometres northwest of the Renard discoveries; the Lac Joubert property
  totals approximately 4,341 acres (1,757 hectares) and adjoins the Majescor-BHP
  Portage project to the northeast; the Lac Pigeon #2 property totals approximately
  5,271 acres (2,133 hectares) and adjoins the Majescor portage project to the
  west approximately 40 kilometres west of the Renard kimberlitic discoveries;
  the Lac Leran #2 property totals approximately 129 acres (52.28 hectares) and
  is located approximately 40 kilometres east-southeast of the Renard kimberlitic
  discoveries; and the Lac Orillat property totals approximately 4,978 acres (2,014
  hectares) and is located approximately 35 kilometres north-northeast of the
  Renard kimberlitic discoveries, and is west of the Lac Joubert property described
  above.

Dennis Higgs, (Higgs) the President, and a director
  of the Company, and/or private companies wholly owned by him, was one of the
  optionors of each of the foregoing Quebec properties with the exception
  of a 1/3 interest in the Lac Orillat property. As such, Higgs received a total
  of 330,000 common shares of the Company, cash payments totaling $58,931, and
  a 2% net smelter return/gross overriding royalty from each property. Higgs will
  also receive advance royalty payments totaling $30,000 per annum, being $15,000
  in respect of each of the Lac Leran and Lac Pigeon properties, until such time
  as the Company terminates its interest in those properties.

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The Lac Orillat property was acquired jointly by Higgs and
  Monaco Investment Corp. (Monaco), which is wholly owned by Darcy
  Higgs. Darcy Higgs is an insider of the Company by virtue of owning or exercising
  control or direction over in excess of 10% of the outstanding shares of the
  Issuer. Monaco received $1,787 from the cash consideration payable by the Company
  for the Lac Orillat property, and is also entitled to a proportionate share
  of the 2% royalty from the property.

The Company also has agreements to acquire the Lac Herve,
  Lac Square Rock and Lac Taffanel properties within the Superior Craton of Quebec.
  Miranda can acquire a 100% interest in the three properties, subject to a 2%
  net smelter return/gross overriding royalty, and by paying for the cost of staking
  the claims. Dennis Higgs, a director and officer of Miranda Diamond Corp., is
  an optionor, either directly or indirectly, in each of the Lac Herve, Lac Square
  Rock and Lac Taffanel property transactions.

C.          Organizational
  Structure

The Company has two subsidiaries, Minas Miranda S.A. de C.V.
  and Miranda U.S.A., Inc.

The Companys wholly-owned Mexican subsidiary, Minas
  Miranda S.A. de C.V. was incorporated on June 19, 1995, in the Locality of Pachuca,
  State of Hidalgo under the laws of Mexico.

The Companys wholly-owned U.S. subsidiary, Miranda U.S.A.,
  Inc. was incorporated on September 27, 1993, under the laws of the State of
  Wyoming. On July 19, 1996 Miranda U.S.A., Inc. filed with the Secretary of State
  for the State of Nevada a Statement to Transact Business in Nevada.

D.          Property,
  Plants and Equipment

Nevada

By an agreement dated September 27, 2002, the Company has
  an option to acquire a 100% right, title and interest in three gold projects
  in Nevada; the Hercules property, the Imperial Mine Property and the Gilman
  Property, subject to a 3% net smelter return royalty (NSR), of which
  2% can be purchased, leaving a 1% NSR on each property. By an agreement dated
  February 18, 1999, the Company also has an option to acquire a 100% interest
  in the Secret Basin project located in Nye County, Nevada.

The total acquisition price for the three properties is payable
  over five years and comprises 450,000 warrants and US $220,000. The warrants
  allow the Optionor the right to purchase common shares of the Company at prices
  ranging from Cdn. $0.25 to $0.40 and are exercisable for a period of two years
  from their date of issue. The cash consideration is prorated to allow for the
  termination of any of the individual properties.

The Company also has a work commitment of US $650,000 over
  the five years, with a commitment of US $75,000 over each of the first two years.

The following descriptions of the Companys Hercules,
  Imperial and Gilman properties in Nevada are from Executive Summaries prepared
  by Richard R. Kern, the Optionor, of Reno, Nevada.

Hercules Project

The Hercules project is located in Lyon County, 25 miles (40
  km) southwest of Reno. Over US $2,000,000 has been spent on exploration efforts
  and drilling in the project area by several companies including Asamera, St.
  Joe, Horizon Gold, and Phelps Dodge. Previous drilling totals 176 holes comprising
  over

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33,000 ft (11,015 m). Most of the drilling targeted shallow
  open pit heap-leachable gold mineralization, however the property may contain
  one of the most significant untested Comstock-type vein systems in the Western
  U.S. At Comstock, 16 km away, most of the 8.4 million ounces of gold and 194
  million ounces of silver mined occurred below 1,200 ft (400 m). This bonanza
  grade mineralization averaged 2 ounces gold/ton and 50 ounces silver/ton. The
  depth of erosion of the Hercules vein system appears similar to that of the
  nearby Comstock. The exploration potential at Hercules may include the possibility
  for a bonanza high grade gold and silver deposit at depth, as well as expanding
  the previously delineated, near-surface gold and silver mineralization.

Imperial Mine Property

The Imperial Mine property is located in Esmeralda County
  approximately 30 km southwest of Goldfield. The Imperial Mine produced 10,000
  tons of ore grading +0.5 ounces gold/ton before being shut down at the beginning
  of World War II. The Imperial Mine property had been held by one individual
  since 1955 but was never leased. The individual dropped the claims in 2001 and
  these were subsequently staked. Numerous companies have explored the project
  area and several drill holes have intercepted significant thicknesses of oxide
  gold mineralization grading +0.03 ounces gold/ton. The best drill hole included
  6 m of 0.062 ounces gold/ton.

The primary target at Imperial is open pittable, shallow,
  oxidized, gently dipping Carlin-style gold mineralization. Preliminary metallurgical
  test work in the form of cyanide leach bottle roll tests yielded 67% to 89%
  gold recoveries from as is drill cuttings, reinforcing the primary
  target concept at Imperial. A secondary target at Imperial is high-grade gold
  mineralization hosted by the Imperial Fault. Gold grades of up to 2 ounces gold/t
  are recorded on historic underground maps. The deepest workings of the old mine
  are only 200 ft below the surface.

Gilman Property

The Gilman property is located in Lander County, near Austin.
  Recent work includes evaluation by major mining companies. Numerous surface
  samples have identified grades of up to 1.4 ounces gold/ton in the footwall
  portion of the range front fault. Sampling of the hanging wall portion of the
  fault has returned from 1 to 28 ounces silver/ton. The altered fault zone has
  a defined strike length over 9,000 ft. and there has been no drilling on this
  property.

Surface samples indicate at least two separate target areas:
  the high grade gold along the footwall of the shear and the significant silver
  values on the hanging wall side of the fault. Access is easy and a modest program
  of in-fill geochemical sampling and detailed mapping should quickly provide
  good quality drill targets.

Secret Basin Project

The Company has a 100% interest in ten claims comprising the
  Secret Basin Project located in Nye County, Nevada. These claims were originally
  acquired in 1997 and in order to acquire a 100% interest, the Company paid US
  $5,000, issued 2,000 shares and covered the cost of staking the property. To
  keep its interest in the project, the Company must issue an additional 12,000
  common shares upon the project reaching certain milestones, including positive
  pre-feasibility and feasibility. There is no royalty on the project. The ten
  claims are summarized in the following table:

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|Claim Name | Nye County Number | BLM Number
|---------- | ----------------- | ----------
|Basin 7    | 502106            | 819772    
|Basin 8    | 502107            | 819773    
|Basin 9    | 502108            | 819774    
|Basin 10   | 502109            | 819775    
|Basin 11   | 502110            | 819776    
|Basin 12   | 502111            | 819777    
|Basin 13   | 502112            | 819778    
|Basin 14   | 502113            | 819779    
|Basin 15   | 502114            | 819780    
|Basin 16   | 502115            | 819781    

The Companys Secret Basin project in Nevada is joint
  ventured with Braden Technologies Inc. (Braden), a public junior
  exploration company whose shares are quoted on the OTC Bulletin Board in the
  U.S. Under the joint venture agreement, Braden is required to expend exploration
  expenses on the Secret Basin project. Under an amended agreement dated June
  24, 2002, the Company must incur exploration expenditures of US $10,000 by December
  31, 2002 and incur exploration expenditures of US $250,000 by June 30, 2003.

In order to maintain the Companys Nevada mineral claims
  in good standing, the Company must pay maintenance fees in lieu of completing
  exploration work with the Bureau of Land Management of the United States Department
  of the Interior. Currently, a maintenance fee of U.S $135 per mineral claim
  must be paid in each year to maintain the mineral claims for an additional year.
  Extension of the Companys claims is automatic upon payment of the required
  maintenance fees. If the Company fails to pay the maintenance fees, then the
  mineral claims will lapse and the Company would lose all interest that it has
  in the mineral claims.

Mexico

Las Catalinas

The Company, through its Mexican subsidiary, Minas Miranda,
  S.A. de C.V., maintains title to two Mexican concessions comprising the Las
  Catalinas project: Las Catalinas and Ampliacion Las Catalinas IV. The Las Catalinas
  property is located about ten kilometres southwest of Rosario de Tesopaco and
  70 kilometres east of Ciudad Obregon, in south central Sonora, Mexico. The concessions
  are in good standing and held by the Companys Mexican subsidiary, Minas
  Miranda S.A. de C.V.

The two concessions comprise a total of 2,271 hectares.

|Type        | Name                        | Date           | Title  | Status  
|----------- | --------------------------- | -------------- | ------ | --------
|Exploration | Las Catalinas               | November, 1997 | 207509 | Current 
|Exploration | Ampliación Las Catalinas IV | June, 2000     | 212506 | Current.

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Minimal work and concession maintenance has been performed
  on these properties during this past couple years due to the softening of the
  resource markets, and the Company could not justify performing any extensive
  work on these projects.

During this fiscal year the Company signed an agreement to
  joint venture its Las Catalinas gold project in Sonora State, Mexico, to Exploraciones
  Paradigma (Paradigma). Paradigma has the right to earn a 90% interest
  in the Las Catalinas project by spending US $250,000 on the property over six
  years. Paradigma must pay all taxes and property assessment and keep the properties
  in good standing during that period. Miranda may buy out all of Paradigmas
  interest in the Las Catalinas project at any time prior to Paradigma earning
  the 90% interest by paying to Paradigma three times its expenditures on the
  project and granting to Paradigma a net smelter return royalty of 1⁄2%
  for every US $50,000 expended to a maximum of a 2% net smelter return royalty.

Miranda may also buy out Paradigma, once Paradigma has earned
  its interest in the project, for up to ten years from the date of signing of
  the agreement, for US $1 million during the first seven years and for US $5
  million thereafter. All property acquired by Paradigma within five kilometres
  of the outer boundary of the project becomes subject to this agreement.

Quebec

Otish Mountains

By agreements dated January 30, 2002 and amended agreements
  dated April 14, 2002, May 29,2002 and June 28, 2002, the Company has the right
  to acquire a 100% interest in six mineral properties comprising a total of 354
  mineral claims covering 45,472 acres, located in the Otish Mountains region
  of Quebec.

The Lac Leran property totals approximately 15,361 acres (6,217
  hectares) and adjoins on the east side of the Ashton Mining of Canada-SOQUEM
  Inc. discovery property hosting the Renard kimberlitic rocks (the Foxtrot
  property). The Company has the option to earn a 100% interest in the Lac Leran
  property, subject to a 2% net smelter return/gross overriding royalty. The Company
  made a cash payment totalling $23,000 and issued 165,000 common shares. An annual
  advance royalty payment of $15,000 is due on or before each anniversary date
  of the agreement.

The Lac Pigeon property totals approximately 15,392 acres
  (6,229 hectares) and adjoins on the west side of Majescor s Portage project,
  approximately 30 kilometres Northwest of the Renard discoveries. Similarly,
  the Company has the option to earn a 100% interest in the Lac Pigeon property,
  subject to a 2% net smelter return/gross overriding royalty. The Company has
  made a cash payment totalling $23,000 and issued 165,000 common shares. An annual
  advance royalty of $15,000 is due on or before each anniversary date of the
  agreement.

The Lac Joubert property totals approximately 4,341 acres
  (1,757 hectares) and adjoins the Majescors Portage project to the northeast.
  The Company has the right to acquire a 100% interest in the Lac Joubert property
  subject to a 2% net smelter return/gross overriding royalty. The Company made
  a cash payment totalling $4,341.

The Lac Pigeon #2 property totals approximately 5,271 acres
  (2,133 hectares) and adjoins Majescors Portage project to the west approximately
  40 kilometres west of the Renard kimberlitic discoveries. The Company has the
  right to acquire a 100% interest in the Lac Pigeon #2 property subject to a
  2% net smelter return/gross overriding royalty. The Company made a cash payment
  totalling $5,271.

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The Lac Leran #2 property totals approximately 129 acres (52.28
  hectares) and is located approximately 40 kilometres east-southeast of the Renard
  kimberlitic discoveries, and eastsoutheast of Majescors Portage
  project. The Company has the right to acquire a 100% interest in the Lac Leran
  #2 property subject to a 2% net smelter return/gross overriding royalty. The
  Company made a cash payment totalling $129.

The Lac Orillat property totals approximately 4,978 acres
  (2,014 hectares) and is located approximately 35 kilometres north-northeast
  of the Renard kimberlitic discoveries, and is west of the Lac Joubert property
  described above. The Company has the right to acquire a 100% interest in the
  Lac Orillat property subject to a 2% net smelter return/gross overriding royalty.
  The Company made a cash payment totalling $4,978.

The properties are located in the north central part of the
  Province of Quebec approximately 275 kilometres northeast of Chibougamau, in
  an area known as the Otish Mountains. The properties acquired by the Company
  are located in proximity to Ashtons Foxtrot property where the Renard
  kimberlitic rocks were discovered, and the Majescor property (the Portage
  property) that partly surrounds Ashtons property.

Tenure of the claims is two years from the date title is granted
  by the Quebec Ministere des Ressources Naturelles.

Each of the Companys Otish Mountains properties is subject
  to a 2% net smelter return/gross overriding royalty. The Lac Leran and Lac Pigeon
  properties are also subject to advance royalty payments of $15,000 per annum
  on each property until such time as the Company terminates its interest in those
  properties.

In Quebec, the claim holder has the exclusive right to search
  for all mineral substances in the public domain, with certain exceptions. In
  accordance with the Quebec Mining Act, a claim holder must comply with the obligation
  to carry out work on the claims in an amount based on the surface area of the
  claim and its location in relation to the 52nd parallel. When the
  work carried out is insufficient or if the work was not carried out, the title
  holder may pay an amount equivalent to the required amount in work. Claim renewal
  applications must be received at the latest within fifteen days of the expiry
  of a claim.

The following description of the Companys six mineral
  properties in the Otish Mountains is from the technical report dated April 8,
  2002, prepared for the Company by Roscoe Postle Associates Inc. of Toronto,
  Canada in compliance with National Instrument 43-101.

Climate

The climate of the area is typical of the boreal forest ecosystem.
  Snow covers the region from the months of October or November through to late
  May. Winter conditions are harsh with temperatures reaching minus 40 degrees
  Celsius while the summers are short with temperatures averaging in the range
  of 20 to 25 degrees Celsius. Although the winter conditions are harsh, the cold
  temperatures allow the Company access to the property for drilling and other
  exploration activities that may not be possible in the summer months due to
  low lying swampy terrain. Based on typical conditions the range of season could
  be approximately four to eight months.

Accessibility

Access to the property is limited to helicopters or float-equipped
  aircraft during the summer months and ski-equipped aircraft during the winter.
  There is commercial air service from Montreal to Radisson approximately 350
  kilometres to the northwest of the properties. A small private airstrip is located
  at the

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abandoned Eastmain Mine, approximately 45 kilometers south
  of the Lac Leran property. A road leads to Eastmain Mine, but the bridges have
  been removed and the road is impassible.

Terrain

The terrain covering the properties is typical of the shield
  regions of Canada. The area is covered by stunted black spruce, Labrador tea
  and swamp alder. Poplar, birch, scattered fir and white pine usually occur on
  the flanks of low hills formed by glacial deposits. The topography is generally
  flat with broad whale back hills consisting usually of granite gneiss outcrops
  separated by low lying swampy terrain generally underlain by volcano sedimentary
  sequences. Northwest trending diabase dykes usually form cliffs that rise 10
  to 15 metres above the surrounding terrain. Northeast trending eskers also form
  prominent ridges that rise a few metres above the surrounding terrain. Elevations
  range from 1300 feet at the Eastmain River area to over 3000 feet above mean
  sea level in the area of the Otish Mountains.

History

Uranez Exploration and Mining carried out exploration in this
  area in the mid 1970s for uranium. In 1978 Uranez drilled three diamond drill
  holes on a geophysical target in the Otish Mountains approximately 100 kilometres
  south of the Issuers properties. The drilling program intersected kimberlitic
  dykes in the Beaver-Zoran/Otish structural zone, but the kimberlite core intervals
  were not tested for diamond content at that time.

In 1993-94, INCO staked some claims on geophysical anomalies
  in the area surrounding the Uranerz kimberlite discovery. In 1997, Ditem Exploration
  optioned both the Uranerz and INCO properties and drilled 6 diamond drill holes
  on the kimberlitic targets. A 96.07 kg kimberlite sample collected from the
  drilling program yielded four macro diamonds. The largest of these diamonds
  measured 0.96 by 0.60 by 0.56 mm. Encouraged by the macro diamond counts, Ditem
  collected a 7 tonne bulk sample and staked additional claims in the area. The
  bulk sample was sent to Colorado for analysis and returned no diamonds greater
  than 0.8 mm. Ditem is continuing to explore the property and pursuing other
  geophysical targets on their property.

In 1996 Ashton Mining of Canada (Ashton) and SOQUEM
  Inc. signed a joint venture agreement to explore for diamonds in Quebec. Each
  company holds a 50% interest and Ashton is managing the exploration program.
  As of September 2001, the joint venture had acquired exploration permits in
  the Otish Mountains area. Ashton carried out heavy mineral sampling, airborne
  and ground geophysical surveys. These surveys led to the identification of several
  drilling targets. In December, 2001, Ashton/SOQUEM Inc. announced that two kimberlitic
  bodies, the Renard 1 and Renard 2 had been discovered on their Otish Mountains
  property. Both kimberlitic bodies are diamondiferous and are located about 20
  kilometres west of the Issuers Lac Leran property. The Renard 1 kimberlite
  target returned 54 micro diamonds and 5 macro diamonds from a 205.8 kg sample.
  The 163.1 kilogram sample from the Renard 2 kimberlitic rock contained 116 micro
  diamonds and 29 macro diamonds. Kimberlitic indicator minerals, including pyrope
  garnet and chromite, were also recovered in concentrates derived from the Ashton/SOQUEM
  drill core. A significant percentage of the pyrope garnets have high-chromium,
  low-calcium (G10) chemical compositions. The concentrates also contain elevated
  numbers of chromites similar in composition to the chromite inclusions that
  occur in diamonds. These results signal the presence of potentially high grade
  diamondiferous pipes in the Otish Mountains region of Quebec.

In 1998, Majescor Resources Inc. (Majescor) carried
  out a reconnaissance tills sampling program targeted at airborne magnetic anomalies
  in the Otish Mountains area. Kimberlite indicator minerals were discovered in
  two till samples. In 1999 Majescor identified a broad area of kimberlitic minerals
  in tills. Majescor then

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acquired, in the fall and winter of 2000, five mining exploration
  properties totalling approximately 1,030 square kilometres in the Otish Mountains.
  All of the Companys diamond exploration properties are located in proximity
  to the Ashton and Majescor Otish Mountains properties.

Geological Setting

The Companys diamond exploration properties are situated
  in the Québec portion of the Archean Superior Structural Province. The
  Superior Province contains the oldest rocks found in North America. These rocks
  range in age from 2.2 to 2.9 billion years and generally comprise of granite
  and granodiorite gneiss overlain by elongated and deformed bands of volcano-sedimentary
  sequences termed greenstone belts. To date five kimberlite districts representing
  a minimum of 50 pipes have been identified in the Superior Province. Four of
  these districts are in the Province of Québec, the Temiscamingue, the
  Desmaraisville, the Tourngat and the Otish district.

Regional Geology

The Otish district is situated in north central Québec,
  in the northeast portion of the Opatica sub province, near the Opinaca sub province
  contact to the north. The Opatica sub province consists primarily of paragneiss
  cut by tonalite and monzonite intrusions. The Opatica has a distinctive aeromagnetic
  signature that is defined by prominent east west trending magnetic anomalies.
  In the southern part of the map area, the Opatica sub province is underlain
  by the Proterozoic Otish sedimentary basin. The Otish sedimentary basin is comprised
  of sandstone and conglomerate intercalated with minor carbonate beds. Several
  gabbroic sills cut the sedimentary rocks of the Otish basin. The contact of
  the Opatica with the Opinaca sub province to the north is interpreted to be
  a fault zone.

Local Geology

The basement rocks of the Opinaca sub province are composed
  of tonalitic to granodioritic orthogneisses intermixed with amphibolite units.
  Northwest trending Proterozoic age diabase dykes cut the basement rocks of both
  sub provinces. The kimberlitic rocks of the Otish Mountain area are of undetermined
  age. The dykes located to date are emplaced in the basement rocks of both the
  Opatica and Opinaca sub provinces. The dykes are believe to be associated with
  the broad northwest trending Temiscamie-Corvette structural zone that extends
  form the Saguenay region to the La Grande area of northern Quebec.

Property Geology

Geological field investigations have not been carried out
  on the Companys diamond exploration properties. The Lac Leran, Lac Leran
  #2 and the Lac Joubert properties appear to be underlain by granitic orthogneisses
  of the Opinaca sub province. The recent discoveries by Ashton and Majescor also
  appear to be situated in the same basement rock units. The Lac Orillat, Lac
  Pigeon and Lac Pigeon #2 properties appear to be underlain by sedimentary paragneisses
  also of the Opinaca sub province. A Proterozoic diabase dyke appears to cut
  across the northeastern part of the Lac Pigeon #2 property.

Deposit Types and Mineralization

No mineral deposits or mineralization of economic significance
  are known to exist on the Companys properties at this time.

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Mineral deposits in the region include two gold prospects
  in the Otish Mountains to the southeast, the former Eastmain Gold Mine in the
  Eastmain greenstone belt and the Ashton-Soquem and Ditem diamondiferous kimberlites.

The Eastmain Mine is located about 45 kilometres to 95 kilometres
  south of the Companys properties. It produced 26,000 ounces of gold in
  1995. Except for intermittent exploration, the Eastmain mine has been inactive
  since 1995. Current resources are 863,988 tonne averaging 11.94 g/t Au.

There is little public information describing the kimberlite
  lithology, mineralogy and chemistry or the size, geometry or tonnage potential
  of the Ashton-Soquem Renard kimberlites. Drill testing is at an early stage
  and mini bulk sampling will have to be conducted before diamond grades and economic
  potential are known with any degree of reliability.

The Renard bodies have associated kimberlite indicator heavy
  mineral trains in glacial overburden. The indicators include low calcium-high
  chromium peridotitic (P-type) pyrope garnets classed as G9 and G10.
  Inclusions of G10 pyropes are found in gem diamonds thus the presence of these
  garnets in kimberlite, and in associated mineral dispersal trains in overburden,
  indicates potential for economic diamond deposits. Cored kimberlite has also
  yielded similar G10 pyropes and chromites and this mineral chemistry
  suggests that the Renard kimberlites formed under mantle compositional conditions
  favorable for gem diamond deposits. Exploration by Majescor-BHP has located
  a kimberlite indicator train some 25 kilometres by 45 kilometres in glaciofluvial
  overburden on the Portage Project claims that surround the Ashton-Soquem property.
  Pyropes with G9 and G10 mineral chemistry and picro-ilmenites
  are present in this train.

Ashton reports that the Renard 1 is a hypabyssal rock whereas
  Renard 2 has both hypabyssal and diatreme facies. Both bodies contain macrocrystic
  olivine in a ground mass composed of variable amounts of olivine, phlogopite
  mica, monticellite, perovskite, apatite and spinel. Ashton reports that the
  ground mass mineralogy and chemical characteristics of these rocks indicate
  that they are transitional between kimberlite and melnoites. The latter are
  alkalic, ultramafic intrusive rocks that originate from depths similar to kimberlite
  and may carry diamonds. The presence of diamonds in the Renard kimberlites and
  the encouraging stone counts, described previously in this report, have prompted
  the Aston-Soquem Joint Venture to field an aggressive delineation drilling and
  property exploration program in 2002. The release of the preliminary diamonds
  recovery from the Renard kimberlites caused a staking rush in the Otish area.

The Ditem Beaver Lake kimberlite was discovered and drilled
  by Uranerz in 1976 while conducting uranium exploration in the Proterozoic formations
  of the Otish Mountains. Although the diamond stone counts appear to be low for
  this kimberlite, its diamondiferous nature is reflected by the presence of G10
  pyropes reported to be a constituent of the rock. This suggests that indicator
  mineral sampling would be a useful prospecting tool for locating all three of
  the kimberlites found in the area to date.

The diamondiferous Renard 1 and 2 kimberlite pipes lie at
  distances of about 20 kilometres to 44 kilometres from the center of the Companys
  properties. The Beaver Lake kimberlite is 79 kilometres to 130 kilometres from
  the Issuers properties. Kimberlite pipes in Africa occur in clusters of
  6 to 40 pipes in kimberlite fields with diameters of some 40 kilometres. In
  the NWT of Canada, the Lac de Gras kimberlites cluster has more than 100 pipes
  in a much larger area of about 100 kilometres across. The distances from the
  Companys properties to the Renard kimberlites, and possibly the Beaver
  Lake body, are within these typical kimberlite field sizes indicating that there
  is potential for kimberlite occurrences on the Companys claims.

Exploration

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To date, the Company has not carried out any exploration on
  its properties in the Otish Mountains. The diamond exploration properties of
  the Company are at the earliest stage of exploration and there is no other significant
  relevant exploration data available for these properties at this time.

The business of mineral exploration and mining is competitive
  in all of its phases. In the search for and acquisition of prospective mineral
  properties, the Company competes with other companies and individuals, including
  competitors having financial, technical and other resources equal to or greater
  than its own. The Companys ultimate success will therefore depend on the
  extent to which its existing properties are developed, as well as its ability
  to compete for and acquire suitable producing properties or prospects for mineral
  exploration in the future, together with its ability to secure adequate financing.

The operations of the Company and the further exploration
  and the development of its properties require various licenses and permits and
  will be subject to ongoing regulation. There can be no guarantee that the Company
  will be able to obtain or maintain all permits and licenses that may be required
  for its activities.

Superior Craton

Subsequent to the year end, and by option agreements dated
  September 10, 2002, the Company has the right to acquire a 100% interest in
  three mineral properties within the Superior Craton of Quebec; the Lac Herve,
  Lac Square Rock and Lac Taffanel.

The Lac Herve property totals approximately 34,382 acres (13,915
  hectares). It is located in proximity to Ashtons Taiga project and adjoins
  on the northeast side of Majescor Resources Inc.s (Majescor)
  Fontanges project.

The Lac Square Rock property totals approximately 9,488 acres
  (3840 hectares) and adjoins on the northeast side of Majescors Portage
  Extension project.

The Lac Taffanel property totals approximately 7,615 acres
  (3082 hectares) and adjoins on the southwest side of Majescors Portage
  Extension project.

The Company has not performed any exploration work on these
  properties.

ITEM 5       OPERATING AND FINANCIAL REVIEW
  AND PROSPECTS

A.                 Operating
  Results

Managements discussion and analysis is presented in
  relation to the financial statements of the Company, which statements are prepared
  in accordance with Canadian GAAP.

The Company does not have a producing mineral property and
  has no sources of revenue other than interest income. The activities of the
  Company can be seen as steadily decreasing during the past three years as the
  resource sector experienced a dramatic slow down. However, with gold prices
  increasing during this past year, the Company was able to pursue financing for
  exploration activity.

For the year ended August 31, 2002, the Company incurred a
  loss of $278,800 compared to a loss of $696,852 for the period ending August
  31, 2001. The large loss for 2001 included the write off of its Mexican gold
  exploration projects.

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As at August 31, 2002, the Company had a working capital of
  $280,062 compared to a working capital deficit of $53,303 as of August 31, 2001.
  The Company incurred exploration costs of $10,716 for the period ending August
  31, 2002 compared to $32,249 in Fiscal 2001. The Company engaged the services
  of Roscoe Postle Associates Inc. of Toronto, Canada, to prepare a report on
  its diamond properties in Quebec in compliance with NI 43-101.

Office rent, telephone, and supplies increased for the fiscal
  year ended August 31, 2002 as a result of increased activity during the year.
  There was an increase in all expenditures during the fiscal year ending August
  31, 2002 compared to the fiscal year ending August 31, 2001 as a result of several
  property acquisitions.

Since incorporation, the Company has been engaged in the acquisition,
  exploration and development of mineral properties. The Companys various
  properties are currently at the exploration stage. As a result, the Company
  has no source of operating cash flow and is reliant upon capital markets to
  obtain the funds required by it for its operations. The successful development
  of a mine by the Company would require additional equity or debt financing.
  The Company has limited financial resources and there is no assurance that additional
  funding will be available for this purpose in the future. Failure to obtain
  additional financing could result in the delay or indefinite postponement of
  further exploration and any subsequent development of the Companys properties
  or the possible partial or total loss of the Companys interest in such
  properties.

B.                    Liquidity
  and Capital Resources

The Companys primary source of funds since incorporation
  has been through the issue of its common stock and the exercise of common stock
  options and common stock share purchase warrants. The Company has no revenue
  from mining to date and does not anticipate mining revenues in the foreseeable
  future. The operations of the Company consists of the exploration and evaluation
  of mining properties and as such the Companys financial success will be
  dependent on the extent to which it can discover new mineral deposits.

During this past fiscal year, the Company closed a private
  placement of 2,000,000 special warrants at a price of $0.10 per special warrant.
  Each special warrant is convertible without additional consideration into one
  common share and one warrant. Each warrant entitles the holder to acquire one
  further common share of the Company at a price of $0.12 per share at any time
  on or before January 3, 2004. The Company closed this private placement on January
  3, 2002.

The Company also closed a private placement of 2,500,000 units
  at a price of $0.20 per unit. Each unit consists of one common share and one
  share purchase warrant. Each warrant is exercisable for a period of two years
  at a price of $0.27 per share.

As discussed above, the Company entered into agreements to
  acquire six mineral properties in the Otish Mountains region of Quebec. The
  Company paid the consideration for these property acquisitions totalling $60,718.
  Subsequent to the year end, the Company made cash payments totalling $41,200
  for the right to acquire a 100% interest in three mineral properties within
  the Superior Craton of Quebec.

A report prepared by Roscoe Postle Associates Inc., recommended
  a three-phase diamond exploration program for the six mineral properties in
  the Otish Mountains totalling $2.1 million over 2 years. Because title was not
  received for all the claims described in the Roscoe Postle report, the Company
  estimates this exploration program to be $1,346,900 over two years. However,
  the Company does not have the financial resources to complete these exploration
  programs at this time. The Company may consider joint venturing these properties
  for the exploration of these projects

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Since its inception, the Company has been dependent on investment
  capital as its primary source of funding. The Company anticipates seeking additional
  equity investment from time to time to fund its activities that cannot be funded
  through other means. The Company will need to raise additional capital in order
  to continue with the exploration and development of its mineral properties and
  administrative expenditures. The Company could also consider joint venturing
  or selling some portion of its properties to cover its obligations.

C.                    Research
  and Development, Patents and Licenses

As the Company is a mineral exploration company with no producing
  properties, the information required by this item is inapplicable.

D.                    Trend
  Information

As the Company is a mineral exploration company with no producing
  properties, the information required by this item is inapplicable.

ITEM 6           DIRECTORS,
  SENIOR MANAGEMENT AND EMPLOYEES

A.                     Directors
  and Senior Management

The following table lists as of November 15, 2002, the names
  of the directors and senior management of the company. Each of the directors
  has served in his or her respective capacity since his or her election and/or
  appointment and will serve until the next annual general meeting of shareholders.

|Name                 | Age | Title                            | Date First Elected
|-------------------- | --- | -------------------------------- | ------------------
|Dennis L. Higgs 1    | 44  | President, CEO, CFO              | May 4, 1993       
|John O. McCutcheon 1 | 77  | Director                         | May 4, 1993       
|Aileen Lloyd 1       | 49  | Director                         | May 4, 1993       
|Steve Ristorcelli    | 47  | Director                         | February 20, 1995 
|Douglas Higgs        | 43  | Corporate Secretary              | November 2, 1993  
|Clive de Larrabeiti  | 52  | Vice President Corporate Finance | September 24, 2002

1 Member of the Audit Committee

There are no family relationships between any two or more
  Directors or Executive Officers other than the fact that Dennis Higgs, the President
  of the Company, and Douglas Higgs, the Secretary of the Company, are brothers.
  There are no material arrangements or understandings between any two or more
  Directors or Executive Officers.

The following is a brief description of the principal business
  activities of the directors and senior management of the Company.

17

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Dennis L. Higgs

Mr. Higgs is the President and Chief Executive Officer of
  the Company. Mr. Higgs has been employed by the Company since 1993. Mr. Higgs
  is responsible for the Companys day to day operations as well as the raising
  of capital to fund the operations of the Company. He is also President of Senate
  Capital Group Inc., a private venture capital and resource management company.

John O. McCutcheon

Mr. McCutcheon is one of the directors of the Company and
  contributes to meetings of the board of directors when and as required. Mr.
  McCutcheon has served in this capacity since 1993. Mr. McCutcheon is Chairman
  and Director of Zargon Oil and Gas Ltd., an oil and gas company. He is a member
  of and has held office in a number of professional and technical societies in
  Economics and Engineering, national and international.

Aileen M. Lloyd

Ms. Lloyd is one of the directors of the Company and has served
  in this capacity since 1993. Ms. Lloyd is involved in the day to day operations
  of the Company. Ms. Lloyd is an executive assistant at Senate Capital Group
  Inc., a private venture capital and resource management company involved in
  the administration of publicly traded companies.

Steve Ristorcelli

Mr. Ristorcelli is one of the directors of the Company and
  has served in this capacity since 1995. Mr. Ristorcelli brings 25 years of geological,
  advanced stage/development and mining experience to the Board. He has been Principal
  Geologist with Mine Development Associates of Reno, Nevada for 10 years where
  he specializes in resource modeling. His work as a consultant takes him throughout
  North America, South America, Europe and Africa. Mr. Ristorcelli is also a director
  of several junior resource companies.

Douglas Higgs

Mr. Higgs is the Corporate Secretary of the Company and has
  served in this capacity since 1993. Mr. Higgs is the brother of Dennis Higgs,
  the President of the Company. Mr. Higgs has been a self-employed courier since
  1993.

Clive de Larrabeiti

Clive de Larrabeiti is Vice President, Corporate Finance.
  Based in London, England Mr. de Larrabeiti is responsible for the Companys
  corporate finance initiatives, additional project sourcing, and project finance
  activities. Mr. de Larrabeitis experience in the finance industry and
  public markets in Europe and North America totals twenty-two years. His experience
  includes representation of a number of TSX Venture and NASD-listed companies
  within the European financial community

B.                     Compensation

The Company has no formal plan for compensating its directors
  for their services in their capacity as directors. The board of directors may
  award special remuneration to any director undertaking any special services
  on behalf of the Company other than services ordinarily required of a director.
  As well, directors

18

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are entitled to reimbursement for reasonable travel and other
  out-of-pocket expenses incurred on behalf of the Company.

The Company retains Ubex Capital Inc. (Ubex) to
  provide management services under a Management Services Agreement dated May
  4, 1993. Under the agreement, Ubex receives the sum of $5,000 per month. The
  term of the agreement is month-to-month and may be terminated by either party
  on 30 days written notice. Ubex is wholly owned by Dennis L. Higgs, the President,
  CEO, CFO and a director of the Company.

The Company retains Chesa Management Company Ltd. (Chesa)
  to provide administrative services to the Company. Chesa is paid the sum of
  $1,000 per month. Chesa is wholly owned by Aileen Lloyd, a director of the Company.

Senate Capital Group Inc., is 100% owned by Dennis L. Higgs,
  the President, CEO, CFO, and Director of the Company, and receives a monthly
  fee to recover its costs of providing office space, telephones and related expenses
  to the Company.

During the year, the Company paid Senate Capital Group Inc.,
  a company wholly owned by Dennis Higgs, the president of the Company, $90,377
  (2002) compared to $64,466 (2001) for reimbursement of rent, secretarial and
  office services.

During fiscal 2002, the Company did not incur any exploration
  expenditures with Mine Development Associates, an engineering company of which
  Steve Ristorcelli is a principal compared to expenditures of $10,079 in fiscal
  2001.

As of September 24, 2002, the Company retained the services
  of Clive de Larrabeiti in the position of Vice-President of Corporate Finance.
  Mr. de Larrabeiti is paid the sum of US $3,000 per month. The term of the agreement
  is for a period of six months.

C.                    Board
  Practices

The directors of the Company are elected annually and hold
  office until the next annual general meeting of the members of the Company or
  until their successors in office are duly elected or appointed. All directors
  are elected for a one-year term.

The Companys Board of Directors has one committee, the
  Audit Committee. The members of the Audit Committee do not have any fixed terms
  for holding their positions, are appointed and replaced from time to time by
  resolution of the Board of Directors and do not receive any separate remuneration
  for acting as members of the committee. The Audit Committee is comprised of
  Dennis Higgs, Aileen Lloyd and John McCutcheon.

Currently, there are no directors service contracts
  with the Company or any of its subsidiaries providing for benefits upon termination
  of employment.

D.                    Employees

There are no plans to add any additional personnel, other
  than independent contractors retained to assist in the exploration of the Company's
  mineral properties.

As of October 31, 2002, there are four directors of the Company
  and one senior officer. One of the directors is a geologist and works on an
  as needed basis and one director has a management contract with the

19

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Company, through his wholly owned private company. Also, one
  director performs administrative services through her wholly owned private company.
  The Company appointed Clive de Larrabeiti to the position of Vice President,
  Corporate Finance. Based in London, England Mr. de Larrabeiti is responsible
  for the Companys corporate finance initiatives, additional project sourcing,
  and project finance activities.

E.                    Share
  Ownership

The following table sets forth, as of September 20, 2002 the
  number of the Companys common shares beneficially owned by the directors
  and members of senior management of the Company, individually, and as a group,
  and the percentage of ownership of the outstanding common shares represented
  by such shares.

The shareholders listed below possess sole voting and investment
  power with respect to the shares shown.

Directors and Senior Management Share Ownership

|Name of Beneficial
      Owner | Title of Class | Number of Securities of Class | Percent of Class *
|------------------------------ | -------------- | ----------------------------- | ------------------
|Dennis L. Higgs                | Common         | 907,5201                      | 17.26%            
|Aileen Lloyd                   | Common         | 248,1002                      | 4.72%             
|Steve Ristorcelli              | Common         | 105,7003                      | 2.01%             
|John McCutcheon                | Common         | 122,0004                      | 2.32%             
|Clive de Larrabeiti            | Common         | 121,600                       | 2.31%             
|Douglas Higgs                  | Common         | 44,400                        | 0.84%             

| | * Based on 5,256,760 common shares outstanding1577,220 common shares are held indirectly through private
      companies 100% owned by Dennis Higgs);2 600 are held through Chesa Management Co. Ltd.
      (a private company 100% owned by Aileen Lloyd);3 105,700 are held directly;4McCutcheon Management Ltd. owns 112,000 shares of the
      Company. McCutcheon Management Ltd. is controlled by John McCutcheon;
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Directors and senior management also control 527,500 outstanding
  share purchase warrants exercisable at $0.12 to January 7, 2004, 250,000 outstanding
  share purchase warrants exercisable at $0.27 to July 11, 2004 and 120,000 outstanding
  share purchase warrants exercisable at $0.24 to November, 2004.

20

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As of November 8, 2002, the directors and officers held as
  a group, directly or indirectly, an aggregate of 1,614,120 common shares and
  897,500 share purchase warrants.

Options to Purchase Securities

Stock Options to purchase securities from the Company are
  granted to Directors and Employees of the Company on terms and conditions acceptable
  to the regulatory authorities in Canada, notably the TSX Venture Exchange. Stock
  options must be approved by the Companys shareholders at an Annual General
  Meeting. The Company has no formal written stock option plan.

Under the stock option program, stock options for up to 10%
  of the number of issued and outstanding shares of common stock may be granted
  from time to time, provided that stock options in favor of any one individual
  may not exceed 5% of the total issued and outstanding shares of the Companys
  common stock. No stock option granted under the stock option program is transferable
  by the optionee other than by will or the laws of descent and distribution,
  and each stock option is exercisable during the lifetime of the optionee only
  by such optionee. The maximum term of each stock option may not exceed five
  years.

The exercise prices for stock options are determined in accordance
  with TSX Venture Exchange guidelines and reflect a 20  25% price discount
  immediately preceding the day on which the Directors granted and publicly announce
  the stock options. The shares, which may be obtained by the exercise of this
  option, are subject to a four month hold from the date of the agreement.

The names and titles of the Directors and Executive Officers
  of the Company to whom outstanding stock options have been granted and the number
  of common shares subject to such options are set forth in the following table
  as of October 31, 2002, as well as the number of options granted to Directors
  and all employees as a group. The exercise price of the options is stated in
  Canadian Dollars.

Stock Options Outstanding

|Name                      | Title                     | Number of Shares
      of Common Stock | Exercise Price    | Expiration Date                           
|------------------------- | ------------------------- | -------------------------------------- | ----------------- | ------------------------------------------
|Dennis Higgs              | President                 | 140,000
      10,000                   | $0.14
      $0.20 | December 14, 2006
      September 16, 2007
|Aileen Lloyd              | Director                  | 129,000
      40,000                   | $0.14
      $0.20 | December 14, 2006
      September 16, 2007
|John
      McCutcheon     | Director                  | 40,000
      10,000                    | $0.14
      $0.20 | December 14, 2006
      September 16, 2007
|Steve Ristorcelli         | Director                  | 40,000
      80,000                    | $0.14
      $0.20 | December 14, 2006
      September 16, 2007
|Douglas Higgs             | Corporate
      Secretary | 20,000                                 | $0.14             | December 14, 2006                         
|Clive de
      Larrabeiti | Sr. Officer               | 150,000                                | $0.20             | September 16, 2007                        

Total Officers/Directors (6 persons) 659,000

21

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ITEM 7          MAJOR
  SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

A.                    Major
  Shareholders

To the knowledge of the directors and senior officers of the
  Company only the following own, directly or indirectly, or exercise control
  or direction over, shares carrying more than 5% of the voting rights attached
  to all outstanding shares of the Company.

|Name of Member | Number of Common Shares | Percentage of Issued and Outstanding
|-------------- | ----------------------- | ------------------------------------
|Dennis Higgs   | 907,520                 | 17.26%                              
|Darcy Higgs    | 202,980                 | 3.86%                               

* In addition Darcy Higgs beneficially owns or exercises control
  or direction over a total of 462,500 special warrants of the Company. Each special
  warrant is convertible without further consideration into one common share and
  one share purchase warrant entitling the holder to purchase an additional common
  share at the price of $0.12 exercisable on or before January 7, 2004. With the
  conversion of the special warrants, Darcy Higgs would beneficially own 11.6%
  of the issued and outstanding shares.

The Companys major shareholders do not have different
  voting rights.

To the best of the Companys knowledge, the Company is
  not directly or indirectly owned or controlled by another corporation, by any
  foreign government or by any other natural or legal person severally or jointly.

The Companys common stock is issued in registered form
  and the following information is taken from the records of Pacific Corporate
  Trust located in Vancouver, British Columbia, Canada, the registrar and transfer
  agent for the common stock.

The Companys registered shareholder list for the Companys
  common stock, dated November 6, 2002, showed 50 registered shareholders and
  5,256,760 shares outstanding. Ten of these registered shareholders were US residents,
  owning 106,433 shares representing 2.02% of the issued and outstanding shares
  of the Company.

B.                    Related
  Party Transactions

During the year, the Company paid Ubex Capital Inc., 100%
  wholly owned by Dennis Higgs, the President of the Company, $38,000 for management
  of the Companys affairs.

During the year, the Company paid Senate Capital Group Inc.,
  a company wholly owned by Dennis Higgs, the president of the Company, $90,377
  for reimbursement of rent, secretarial and office services. Also,

22

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during the year the Company paid Chesa Management Co. Ltd.,
  a company wholly owned by Aileen Lloyd, a director of the Company, $12,000 for
  administrative services.

Other than as disclosed above, there have been no transactions
  which have materially affected or will materially affect the Company in which
  any director, executive officer, or beneficial holder of more than 5% of the
  outstanding common stock, or any of their respective relatives, spouses, associates
  or affiliates has had or will have any direct or material indirect interest.
  Management believes the transactions referenced above were on terms at least
  as favorable to the Company as the Company could have obtained from unaffiliated
  parties.

C.                    Interests
  of Experts and Counsel

This Form 20-F is being filed as an annual report under the
  Exchange Act, and, as such, there is no requirement to provide any information
  under this sub-item.

ITEM 8           FINANCIAL
  INFORMATION

A.                    Consolidated
  Statements and Other Financial Information

The Companys financial statements are stated in Canadian
  dollars (Cdn. $) and are prepared in accordance with accounting principles generally
  accepted in Canada (Canadian GAAP), which differ in certain respects
  from those principles that the Company would have followed had its financial
  statements been prepared in accordance with accounting principles generally
  accepted in the United States (U.S. GAAP).

Exhibited hereto are audited consolidated financial statements
  prepared by an independent auditor and accompanied by an audit report:

| | (a) | Auditors Report, dated October 11, 2002;                                                                                                   
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                             
| | (b) | Consolidated Balance Sheets as of August 31, 2001 and August
      31, 2002;                                                                
| |     |                                                                                                                                             
| | (c) | Consolidated Statements of Operations
        and Deficit for the years ended August 31, 2000, August 31, 2001, and
        August 31, 2002;
| |     |                                                                                                                                             
| | (d) | Consolidated Statements of Cash Flows
        for the years ended August 31, 2000, August 31, 2001 and August 31, 2002;                     
| |     |                                                                                                                                             
| | (e) | Notes to Consolidated Financial Statements for the years
      ended August 31, 2001 and August 31, 2002.                                   
| |     |                                                                                                                                             
| |     |                                                                                                                                             

The Company has not declared any dividends for the last five
  years and does not anticipate that it will do so in the foreseeable future.

B.                    Significant
  Changes

No significant changes have occurred since the date of the
  Companys most recent audited financial statements, August 31, 2002, other
  than the following:

| | (a) | By agreements dated September 10, 2002, the Company
        obtained the right to acquire a 100% interest, subject to a 2% net smelter
        return/gross overriding royalty, in three mineral properties,
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

23

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| |     | within the Superior Craton of Quebec;
        the Lac Herve, Lac Square Rock and Lac Taffanel. The Lac Herve property
        comprises 277 claims totalling approximately 34,382 acres (13,915 hectares),
        the Lac Square Rock property comprises 75 claims totalling approximately
        9,488 acres (3,840 hectares) and the Lac Taffanel property comprises 60
        claims totalling approximately 7,615 acres (3,082 hectares);
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (b) | By agreement dated September 27, 2002,
        the Company has an option to acquire a 100% interest in three gold projects
        in Nevada known as the Hercules Property, the Imperial Mine Property and
        the Gilman Property; (see Item 4D)                                                                                                                                                                                          
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (c) | The Company closed a small private placement
        of 135,000 units at a price of $0.20 per unit. Each unit consists of one
        common share and one warrant. Each whole warrant is exercisable for a
        period of two years at a price of $0.24 per share.                                                                                                                                                                          

ITEM 9          THE OFFER
  AND LISTING

A.                    Offer
  and Listing Details

The Companys common shares trade on the TSX Venture
  Exchange (TSX) (formerly known as the Canadian Venture Exchange,
  the successor exchange resulting from the merger of the Vancouver Stock Exchange
  and the Alberta Stock Exchange effective November 29, 1999) in Vancouver, British
  Columbia, Canada, having the trading symbol MAD and CUSIP # 604673103.

The following table lists the annual high and low market sales
  prices on the TSX for the five most recent full financial years.

TSX Venture Exchange Stock Trading Activity, Sales, Cdn.$

|For the Fiscal Year Ended | High | Low
|------------------------- | ---- | ---
|August, 2002              | .42  | .13
|August 2001               | .12  | .06
|August 2000               | .42  | .10
|August 1999               | 1.40 | .40
|August 1998               | 2.65 | .80

The following table lists the volume of trading and high,
  low and closing sales prices on the TSX for shares of the Companys common
  stock for the last eight fiscal quarters.

TSX Venture Exchange Stock Trading Activity, Sales, Cdn.$

|Period
      Ended | Volume  | High | Low  | Close
|------------------ | ------- | ---- | ---- | -----
|11/30/00           | 118,900 | 0.12 | 0.09 | 0.10 
|02/28/01           | 230,900 | .11  | .07  | .08  

24

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|05/30/01 | 96,700  | .09 | .07 | .08
|-------- | ------- | --- | --- | ---
|08/31/01 | 110,751 | .30 | .06 | .30
|11/30/01 | 8,400   | .30 | .14 | .14
|02/28/02 | 35,380  | .35 | .13 | .13
|05/30/02 | 15,942  | .42 | .25 | .30
|08/31/02 | 18,800  | .36 | .20 | .20

Price Fluctuations: Share Price Volatility

In recent years, securities markets in Canada have experienced
  a high level of price and volume volatility, and the market price of many resource
  companies, particularly those considered speculative exploration companies,
  have experienced wide fluctuations in price which have not necessarily been
  related to operating performance or underlying asset values on prospects of
  such companies. The Companys shares fluctuated from a low of $0.06 during
  2001 to a high of $0.30. The share price of $0.30 at the close of August 2001
  is reflective of the consolidation of the Companys capital effective August
  3, 2001. The Company consolidated the authorized and issued capital on the basis
  of one new share for each five shares and to concurrently change its name to
  Thrush Industries Inc. Exploration for minerals is considered high risk and
  highly speculative and the trading market for mineral exploration companies
  is characteristically volatile, with wide fluctuation of price and volume only
  in part related to progress of exploration. There can be no assurance that continual
  fluctuations in the Companys share price and volume will not occur.

B.                    Plan
  of Distribution

This Form 20-F is being filed as an annual report under the Securities Exchange Act of 1934, and as such, there is no requirement to provide any information under this item.

C.                    Markets

See first paragraph of this Item 9.

D.                    Dilution

This Form 20-F is being filed as an annual report under the
  Securities Exchange Act of 1934, and as such, there is no requirement to provide
  any information under this item.

E.                    Expenses
  of the Issue

This Form 20-F is being filed as an annual report under the
  Securities Exchange Act of 1934, and as such, there is no requirement to provide
  any information under this item.

ITEM 10         ADDITIONAL
  INFORMATION

A.                    Share
  Capital

This Form 20-F is being filed as an annual report under the
  Securities Exchange Act 1934, and as such, there is no requirement to provide
  any information under this item.

B.                    Memorandum
  and Articles of Association

25

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Incorporation

The Company was incorporated in British Columbia, Canada on
  May 4, 1993 by registration of its Memorandum and Articles.

Powers and Functions of the Directors

The powers and functions of the directors are set forth in
  the Articles of the Company which were adopted and filed as of the date of its
  incorporation.

| | (i)   | a director is obligated to disclose
        his potential interest in a proposal, arrangement or contract being considered
        by the Company and may not vote on any proposal, arrangement or contract
        proposed, but such director shall be counted in the quorum at the meeting
        of the directors at which the proposal, arrangement or contract is approved;
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                   
| | (ii)  | a director or his firm may act in a
        professional capacity for the company and he or his firm will be entitled
        to remuneration;                                                                                                                                                                                                                                    
| |       |                                                                                                                                                                                                                                                                                                                                                                                   
| | (iii) | the quorum necessary for the transaction
        of the business shall be a majority of the directors holding office at
        the time;                                                                                                                                                                                                                                         
| |       |                                                                                                                                                                                                                                                                                                                                                                                   
| | (iv)  | there are no provisions for the retirement
        or non-retirement of directors under an age limit; and                                                                                                                                                                                                                                                                         
| |       |                                                                                                                                                                                                                                                                                                                                                                                   
| | (v)   | there is no requirement for a director
        to hold any shares in the Company.                                                                                                                                                                                                                                                                                                 

Rights and Restrictions Applied to the Shares

All of the Companys authorized and issued shares are
  of one class and there are no rights or restrictions of any nature attached
  to any of the shares.

Rights of Holders of the Stock

To alter the rights of holders of issued shares of the Company
  such alteration must be approved by the majority vote of the issued shares of
  the Company attending and voting at a meeting of the shareholders of the Company.

Annual General Meetings

Annual general meetings are called and scheduled upon decision
  by the Board of Directors. The directors may convene an extraordinary general
  meeting of the shareholders. All meetings of the shareholders may be attended
  by the registered shareholders or persons who hold powers of attorney or proxies
  given to them by the registered shareholders.

Foreign Ownership

The Companys Memorandum and Articles do not contain
  limitations prohibiting shares being held by nonresidents, foreigners or any
  other group.

26

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Change of Control

There are no provisions in the Companys Memorandum and
  Articles that would have an effect of delaying, deferring or preventing a change
  in control of the Company, and that would operate only with respect to a merger
  acquisition or corporate restructuring involving the Company.

Share Ownership Reporting Obligations

There are no provisions in the Companys Memorandum and
  Articles requiring share ownership to be disclosed. The securities laws of the
  Province of British Columbia require disclosure of shareholdings by:

| | (a) | persons who are directors or senior officers of the Company;
      and                                                                                                                                                                                                                                                                                 
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                        
| | (b) | a person who has direct or indirect
        beneficial ownership of, control or direction over, or a combination of
        direct or indirect beneficial ownership of and control or direction over
        securities of the Company carrying more than 10% of the voting rights
        attached to all the Companys outstanding voting securities.

Differences from U.S. Law

The threshold of share ownership percentage requiring disclosure of ownership
  is higher in the home jurisdiction of British Columbia than the US where US
  securities law prescribes a 5% threshold for ownership disclosure.

C.                    Material
  Contracts

The following is a summary of each material contract contract
  entered into in the ordinary course of business to which the company is a party,
  for the two years immediately preceding publication of the document, including
  dates, parties, general nature of the contracts, terms and conditions, and amount
  of consideration passing to or from the company or any other member of the group.

| | (i)   | Mineral Property Option Agreement dated
        February 18, 1999. The Company signed a joint venture agreement with Braden
        Technologies Inc. for the further exploration of the Secret Basin project.
        Under an Amended Agreement dated June 24, 2002, Braden Technologies Inc.
        can acquire a 50% interest in the Secret Basin project by spending US
        $250,000 in exploration expenses by June 30, 2003 of which $10,000 must
        be spent by December 31, 2002. (See item under 4.B under the heading Secret
        Basin Project).
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (ii)  | A letter agreement dated April 18, 2002 between Exploraciones
      Paradigma, (Paradigma) and Miranda Diamond Corp. whereby Paradigma
      has the exclusive right to acquire a 90%                                                                                                                                                                                                                                                                                                                                                                                    
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (iii) | Interest in the Las Catalinas property
        in Mexico by spending $250,000 on the Property within six years. (See
        item 4.B under the heading Mexico, Las Catalinas)                                                                                                                                                                                                                                                                                                                                                                                           
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (iv)  | Mineral Property Option Agreement dated
        January 30, 2002 between Ubex Capital Inc. and Thrush Industries Inc.
        (now called Miranda Diamond Corp.), and amendment agreements dated April
        14, 2002, May 29, 2002 and June 28, 2002 in respect of an option to acquire
        an undivided 100% right, title and interest in the Lac Joubert property
        comprising 34 mineral claims totalling 4,341 acres (1,757 hectares). (See
        item 4.B under the heading Quebec).                                                                 

27

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| | (v)    | Mineral Property Option Agreement dated
        January 30, 2002 between Ubex Capital Inc. and Thrush Industries Inc.
        (now called Miranda Diamond Corp.), and amendment agreements dated April
        14, 2002, May 29, 2002 and June 28, 2002 in respect of an option to acquire
        an undivided 100% right, title and interest in the Lac Pigeon #2 property
        comprising 41 mineral claims totalling 5,271 acres (2,133 hectares). (See
        item 4.B under the heading Quebec).                                                     
| | ------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (vi)   | Mineral Property Option Agreement dated
        January 30, 2002 between Ubex Capital Inc.and/or Monaco Investment Corp.
        and Thrush Industries Inc. (now called Miranda Diamond Corp.), and amendment
        agreements dated April 14, 2002, May 29, 2002 and June 28, 2002 in respect
        of an option to acquire an undivided 100% right, title and interest in
        the Lac Orillat property comprising 39 mineral claims totalling 4,978
        acres (2,014 hectares). (See item 4.B under the heading Quebec).                         
| |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (vii)  | Mineral Property Option Agreement dated
        January 30, 2002 between Ubex Capital Inc. and/or Menace Capital Corp.
        and Thrush Industries Inc. (now called Miranda Diamond Corp.), and amendment
        agreements dated April 14, 2002, May 29, 2002 and June 28, 2002 in respect
        of an option to acquire an undivided 100% right, title and interest in
        the Lac Pigeon property comprising 120 mineral claims totalling 15,392
        acres (6,229 hectares). (See item 4.B under the heading Quebec).                          
| |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (viii) | Mineral Property Option Agreement dated
        January 30, 2002 between Ubex Capital Inc. and/or Menace Capital Corp.,
        and/or Dennis Higgs and Thrush Industries Inc. (now called Miranda Diamond
        Corp), and amendment agreements dated April 14, 2002, May 29, 2002 and
        June 28, 2002 in respect of an option to acquire an undivided 100% right,
        title and interest in the Lac Leran property comprising 119 mineral claims
        totaling 15,361 acres (6,217 hectares). (See item 4.B under the heading
        Quebec).
| |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (ix)   | Mineral Property Option Agreement dated
        January 30, 2002 between Ubex Capital Inc. and Thrush Industries Inc.
        (now called Miranda Diamond Corp.), and amendment agreements dated April
        14, 2002, May 29, 2002 and June 28, 2002 in respect of an option to acquire
        an undivided 100% right, title and interest in the Lac Leran #2 property
        comprising 1 mineral claim totalling 129 acres (52.28 hectares). (See
        item 4.B under the heading Quebec).                                                          
| |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (x)    | Mineral Property Option Agreement dated
        September 10, 2002 between Ubex Capital Inc. and Carleen Higgs and Miranda
        Diamond Corp. in respect of an option to acquire an undivided 100% right,
        title and interest in the Lac Taffanel property comprising 60 mineral
        claims totalling 7,615 acres (3,082 hectares). (See item 4.B under the
        heading Quebec).                                                                                                                                                             
| |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (xi)   | Mineral Property Option Agreement dated
        September 10, 2002 between Ubex Capital and Carleen Higgs and Miranda
        Diamond Corp. in respect of an option to acquire an undivided 100% right,
        title and interest in the Lac Square Rock property comprising 75 mineral
        claims totalling 9,488 acres (3,840 hectares). (See item 4.B under the
        heading Quebec).                                                                                                                                                               
| |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (xii)  | Mineral Property Option Agreement dated
        September 10, 2002 between Ubex Capital Inc. and Monaco Investment Corp.
        in respect of an option to acquire an undivided 100% right,                                                                                                                                                                                                                                                                                                                                                                     

28

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| |        | title and interest in the Lac Herve property comprising
        277 mineral claims totalling 34,382 acres (13,915 hectares). (See item
        4.B under the heading Quebec). title and interest in the Lac
        Herve property comprising 277 mineral claims totalling 34,382 acres (13,915
        hectares). (See item 4.B under the heading Quebec).
| | ------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |        |                                                                                                                                                                                                                                                                                                                                                                
| | (xiii) | Mineral Property Option Agreement dated September
        27, 2002 between MinQuest, Inc. and Miranda Diamond Corp. in respect of
        an option to earn a 100% interest, subject to a 3% NSR royalty in the
        Hercules Property; the Imperial Mine Property, and the Gilman Property
        . (See item 4.B under the heading Nevada).            

D.                    Exchange
  Controls

There are no governmental laws, decrees or regulations in
  Canada relating restrictions on the export or import of capital, or affecting
  the remittance of interest, dividends or other payments to non-resident holders
  of the Companys common shares. Any remittance of dividends to United States
  residents are; however, subject to a 15% withholding tax (10% if the shareholder
  is a corporation owning at least 10% of the common shares of the Company) pursuant
  to Article X of the reciprocal treaty between Canada and the United States.

Except as provided in the Investment Canada Act, there are
  no limitations under the laws of Canada, the Province of British Columbia or
  in the Articles of Incorporation of the Company on the right of foreigners to
  hold or vote the common shares of the Company. Management believes that in the
  case of the common stock of the Company, there are no limitations on the rights
  of non-Canadians to vote the Companys common shares.

The Investment Canada Act (the "ICA"), which became effective
  on 6/30/85, regulates the acquisition by non-Canadians of control of a Canadian
  business enterprise. In effect, the ICA required review by Investment Canada,
  the agency which administers the ICA, and approval by the Canadian government
  in the case of an acquisition of control of a Canadian business by a non-Canadian
  where: (i) in the case of acquisition (for example, through a share purchase
  or asset purchase), the assets of the business are $5 million or more in value;
  or (ii) in the case of an indirect acquisition (for example, the acquisition
  of the foreign parent of the Canadian business) where the Canadian business
  has assets of $50 million or more in value or if the Canadian business represents
  more than 50% of the assets of the original group and the Canadian business
  has assets of $5 million or more in value. Review and approval are also required
  for the acquisition or establishment of a new business in areas concerning "Canada's
  cultural heritage or national identity" such as book publishing, film production
  and distribution, television and radio, production and distribution of music,
  and the oil and natural gas industry, regardless of the size of the investment.

In the context of the Company, in essence, three methods of
  acquiring control of a Canadian business are regulated by the ICA: (i) the acquisition
  of all or substantially all of the assets used in carrying on the Canadian business;
  (ii) the acquisition, directly or indirectly, of voting shares of a Canadian
  corporation carrying on the Canadian business; and (iii) the acquisition of
  voting of an entity which controls, directly or indirectly, another entity carrying
  on a Canadian business. An acquisition of a majority of the voting interests
  of an entity, including a corporation, is deemed to be an acquisition of control
  under the ICA. An acquisition of less than one- third of the voting shares of
  a corporation is deemed not to be an acquisition of control. An acquisition
  of less than a majority, but one-third or more, of the voting shares of a corporation
  is presumed to be an acquisition of control unless it can be established that
  on the acquisition the corporation is not, in fact, controlled by the acquirer
  through the ownership of voting shares. For partnerships, trusts,

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joint ventures or other unincorporated entities, an acquisition
  of less than a majority of the voting interests is deemed not to be an acquisition
  of control.

In 1988, the ICA was amended pursuant to the Free Trade Agreement
  dated 1/2/88 between Canada and the United States to relax the restriction of
  the ICA. As a result of these amendments, except where the Canadian business
  is in the cultural, oil and gas, uranium, financial services or transportation
  sectors, the threshold for direct acquisition of control by U.S. investors and
  other foreign investors acquiring control of a Canadian business from U.S. investors
  has been raised from $5 million to $150 million of gross assets, and indirect
  acquisitions are not reviewable.

In addition to the foregoing, the ICA requires that all other
  acquisitions of control of Canadian businesses by non-Canadians are subject
  to formal notification to the Canadian government. These provisions require
  a foreign investor to give notice in the required form, which notices are for
  information, as opposed to review, purposes.

E.                    Taxation

The following summary of the material Canadian federal income
  tax considerations generally applicable in respect of the common stock reflects
  the Companys opinion. The tax consequences to any particular holder of
  common stock will vary according to the status of that holder as an individual,
  trust, corporation or member of a partnership, the jurisdiction in which that
  holder is subject to taxation, the place where that holder is resident and,
  generally, according to that holders particular circumstances. This summary
  is applicable only to holders who are resident in the United States, have never
  been resident in Canada, deal at arms length with the Company, hold their
  common stock as capital property and who will not use or hold the common stock
  in carrying on business in Canada. Special rules, which are not discussed in
  this summary, may apply to a United States holder that is an issuer that carries
  on business in Canada and elsewhere.

This summary is based upon the provisions of the Income Tax
  Act of Canada and the regulations thereunder (collectively, the "Tax Act" or
  ITA) and the Canada-United States Tax Convention (the Tax
  Convention) as at the date of the Registration Statement and the current
  administrative practices of Revenue Canada, Taxation. This summary does not
  take into account provincial income tax consequences.

This summary is not exhaustive of all possible income tax
  consequences. It is not intended as legal or tax advice to any particular holder
  of common stock and should not be so construed. Each holder should consult his
  own tax advisor with respect to the income tax consequences applicable to him
  in his own particular circumstances.

Based on managements independent review, they believe
  that the tax discussion covers all material income tax consequences.

Disposition of Common Stock.

If a non-resident were to dispose of common stock of the Company
  to another Canadian corporation which deals or is deemed to deal on a non-arms
  length basis with the non-resident and which, immediately after the disposition,
  is connected with the Company (i.e., which holds shares representing more than
  10% of the voting power and more than 10% of the market value of all issued
  and outstanding shares of the Company), the amount by which the fair market
  value of any consideration (other than any shares of the purchaser corporation)
  exceeds the paid-up capital of the common stock sold will be deemed to be taxable
  as a dividend paid by the purchasing corporation, either immediately or eventually
  by means of a deduction in

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computing the paid-up capital of the purchasing corporation,
  and subject to withholding taxes as described below.

Under the Tax Act, a gain from the sales of common stock by
  a non-resident will not be subject to Canadian tax, provided the shareholder
  (and/or persons who do not deal at arms length with the shareholder) have
  not held a substantial interest in the Company (25% or more of the
  shares of any class of the Companys stock) at any time in the five years
  preceding the disposition. Generally, the Tax Convention will exempt from Canadian
  taxation any capital gain realized by the resident of the United States, provided
  that the value of the common stock is not derived principally from real property
  situated in Canada.

Dividend

In the case of any dividends paid to non-residents, the Canadian
  tax is withheld by the Company, which remits only the net amount to the shareholder.
  By virtue of Article X of the Tax Convention, the rate of tax on dividends paid
  to residents of the United States is generally limited to 15% of the gross dividend
  (or 10% in the case of certain corporate shareholders owning at least 10% of
  the Companys voting shares). In the absence of the treaty provisions,
  the rate of Canadian withholding tax imposed on non-residents is 25% of the
  gross dividend. Stock dividends received by non-residents from the Company are
  taxable by Canada as ordinary dividends.

Where a holder disposes of common stock to the Company (unless
  the Company acquired the common stock in the open market in the manner in which
  shares would normally be purchased by any member of the public) will result
  in a deemed dividend to the U.S. holder equal to the amount by which the consideration
  paid by the Company exceeds the paid-up capital of such stock, the amount of
  such dividend will be subject to withholding tax as described above.

Capital Gains

A non-resident of Canada is not subject to tax under the ITA
  in respect of a capital gain realized upon the disposition of a share of a class
  that is listed on a prescribed stock exchange unless the share represents taxable
  Canadian property to the holder thereof. A common share of the Company
  will be taxable Canadian property to a non-resident holder if, at any time during
  the period of five years immediately preceding the disposition, the non-resident
  holder, persons with whom the non-resident holder did not deal at arms
  length, or the non-resident holder and persons with whom he/she did not deal
  at arms length owned 25% or more of the issued shares of any class or
  series of the Company. In the case of a non-resident holder to whom shares of
  the Company represent taxable Canadian property and who is resident in the United
  States, no Canadian tax will be payable on a capital gain realized on such shares
  by reason of the Canada-United States Income Tax Convention 1980) (the Treaty)
  unless the value of such shares is derived principally from real property situated
  in Canada or the non-resident holder previously held the shares while resident
  in Canada. However, in such a case, certain transitional relief under the Treaty
  may be available.

Certain United States Federal Income Tax Consequences

The following is a discussion of certain possible United States
  Federal income tax consequences, under the law, generally applicable to a U.S.
  Holder (as defined below) of common shares of the Company. This discussion does
  not address all potentially relevant Federal income tax matters and it does
  not address consequences peculiar to persons subject to special provisions of
  Federal income tax law, such as those

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described below as excluded from the definition of a U.S.
  Holder. In addition, this discussion does not cover any state, local or foreign
  tax consequences.

The following discussion is based upon the sections of the
  Internal Revenue Code of 1986, as amended (the Code), Treasury Regulations,
  published Internal Revenue Service (IRS) rulings, published administrative
  positions of the IRS and court decisions that are currently applicable, any
  or all of which could be materially and adversely changed, possible on a retroactive
  basis, at any time. In addition, the discussion does not consider the potential
  effects, both adverse and beneficial, or recently proposed legislation which,
  if enacted, could be applied, possibly on a retroactive basis, at any time.
  The following discussion is for general information only and is not intended
  to be, nor should it be construed to be, legal or tax advice to any holder or
  prospective holder of common shares of the Company and no opinion or representation
  with respect to the United States Federal income tax consequences to any such
  holder or prospective holder is made. Accordingly, holders and prospective holders
  of common shares of the Company should consult their own tax advisors about
  the federal, state, local, and foreign tax consequences of purchasing, owning
  and disposing of common shares of the Company.

Based on managements independent review, they believe
  that the discussion covers all material tax consequences.

U.S. Holders

As used herein, a (U.S. Holder) includes a holder
  of common shares of the Company who is a citizen or resident of the United States,
  a corporation created or organized in or under the laws of the United States
  or of any political subdivision thereof and any other person or entity whose
  ownership of common shares of the Company is effectively connected with the
  conduct of a trade or business in the United States. A U.S. Holder does not
  include persons subject to special provisions of Federal income tax law, such
  as tax-exempt organizations, qualified retirement plans, financial institutions,
  insurance companies, real estate investment trusts, regulated investment companies,
  broker-dealers, non-resident alien individuals or foreign corporations whose
  ownership of common shares of the Company is not effectively connected with
  the conduct of a trade or business in the United States and shareholders who
  acquired their stock through the exercise of employee stock options or otherwise
  as compensation.

Distribution on Common Shares of the Company

U.S. Holders receiving dividend distributions (including constructive
  dividends) with respect to common shares of the Company are required to include
  in gross income for United States Federal income tax purposes the gross amount
  of such distributions to the extent that the Company has current or accumulated
  earnings and profits, without reduction for any Canadian income tax withheld
  from such distributions. Such Canadian tax withheld may be credited, subject
  to certain limitations, against the U.S. Holders United States Federal
  Income tax liability or, alternatively, may be deducted in computing the U.S.
  Holders United States Federal taxable income by those who itemize deductions.
  (See more detailed discussion at Foreign Tax Credit below). To the
  extent that distributions exceed current or accumulated earnings and profits
  of the Company, they will be treated first as a return of capital up to the
  U.S. Holders adjusted basis in the common shares and thereafter as gain
  from the sale or exchange of the common shares. Preferential tax rates for long-term
  capital gains are applicable to a U.S. Holder which is an individual, estate
  or trust. There are currently no preferential tax rates for long-term capital
  gains for a U.S. Holder which is a corporation.

Dividends paid on the common shares of the Company will not
  generally be eligible for the dividends received deduction provided to corporations.
  A U.S. Holder which is a corporation may, under certain circumstances, be entitled
  to a 70% deduction of the United States source portion of dividends received

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from the Company (unless the Company qualifies as a foreign
  personal holding company or a passive foreign investment company,
  as defined below) if such U.S. Holder owns shares representing at least 10%
  of the voting power and value of the Company. The availability of this deduction
  is subject to several complex limitations which are beyond the scope of this
  discussion.

Foreign Tax Credit

A U.S. Holder who pays (or has withheld from distributions)
  Canadian income tax with respect to the ownership of common shares of the Company
  may be entitled, at the option of the U.S. Holder, to either a deduction or
  a tax credit for such foreign tax paid or withheld. Generally, it will be more
  advantageous to claim a credit because a credit reduces United States Federal
  income taxes on a dollar-for-dollar basis, while a deduction merely reduces
  the taxpayers income subject to tax. This election is made on a year-by-year
  basis and applies to all foreign income taxes (or taxes in lieu of income tax)
  paid by (or withheld from) the U.S. Holder during the year. There are significant
  and complex limitations which apply to the credit, among which is the general
  limitation that the credit cannot exceed the proportionate share of the U.S.
  Holders United States income tax liability that the U.S. Holders
  foreign source income bears to his/her or its application of this limitation.
  The various items of income and deduction must be classified into foreign and
  domestic sources. Complex rules govern this classification process. There are
  further limitations on the foreign tax credit for certain types of income such
  as passive income, high withholding tax interest, financial
  services income, shipping income, and certain other classifications
  of income. The availability of the foreign tax credit and the application of
  the limitations on the credit are fact specific and holders and prospective
  holders of common shares of the Company should consult their own tax advisors
  regarding their individual circumstances.

Disposition of Common Shares of the Company

A U.S. Holder will recognize gain or loss upon the sale of
  common shares of the Company equal to the difference, if any, between (I) the
  amount of cash plus the fair market value of any property received, and (ii)
  the shareholders tax basis in the common shares of the Company. This gain
  or loss will be capital gain or loss if the common shares are capital assets
  in the hands of the U.S. Holder, which will be a short-term or long-term capital
  gain or loss depending upon the holding period of the U.S. Holder. Gains and
  losses are netted and combined according to special rules in arriving at the
  overall capital gain or loss for a particular tax year. Deductions for net capital
  losses are subject to significant limitations. For U.S. Holders which are individuals,
  any unused portion of such net capital loss may be carried over to be used in
  later tax years until such net capital loss is thereby exhausted. For U.S. Holders
  which are corporations (other than corporations subject to Subchapter S of the
  Code), an unused net capital loss may be carried back three years from the loss
  year and carried forward five years from the loss year to be offset against
  capital gains until such net capital loss is thereby exhausted.

Other Considerations

In the following circumstances, the above sections of the
  discussion may not describe the United States Federal income tax consequences
  resulting from the holding and disposition of common shares of the Company.

Foreign Personal Holding Company

If at any time during a taxable year more than 50% of the
  total combined voting power or the total value of the Companys outstanding
  shares is owned, actually or constructively, by five or fewer individuals who
  are citizens or residents of the United States and 60% or more of the Companys
  gross income for such year

33

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was derived from certain passive sources (e.g. from dividends
  received from its subsidiaries), the Company would be treated as a foreign
  personal holding company. In that event, U.S. Holders that hold common
  shares of the Company would be required to include in gross income for such
  year their allowable portions of such passive income to the extent the Company
  does not actually distribute such income.

Foreign Investment Company

If 50% or more of the combined voting power or total value
  of the Companys outstanding shares are held, actually or constructively,
  by citizens or residents of the United States, United States domestic partnerships
  or corporations, or estates or trusts other than foreign estates or trusts (as
  defined by the Code Section 7701(a)(31), and the Company is found to be engaged
  primarily in the business of investing, reinvesting, or trading in securities,
  commodities, or any interest therein, it is possible that the Company might
  be treated as a foreign investment company as defined in Section
  1246 of the Code, causing all or part of any gain realized by a U.S. Holder
  selling or exchanging common shares of the Company to be treated as ordinary
  income rather than capital gains.

Passive Foreign Investment Company

As a foreign corporation with U.S. Holders, the Company could
  potentially be treated as a passive foreign investment company (PFIC),
  as defined in Section 1296 of the Code, depending upon the percentage of the
  Companys assets which is held for the purpose of producing passive income.

Certain United States income tax legislation contains rules
  governing PFICs which can have significant tax effects on U.S. Shareholders
  of foreign corporations. These rules do not apply to non-U.S. shareholders.
  Section 1296 of the Code defines a PFIC as a corporation that is not formed
  in the United States and, for any taxable year, either (i) 75% or more of its
  gross income is passive income, which includes interest, dividends
  and certain rents and royalties or (ii) the average percentage, by fair market
  value or, if the Company is a controlled foreign corporation or makes an election,
  by adjusted tax basis, of its assets that produce or are held for the production
  of passive income, is 50% or more.

A U.S. shareholder who holds stock in a foreign corporation
  during any year in which such corporation qualifies as a PFIC is subject to
  U.S. Federal income taxation under one of two alternative tax regimes at the
  election of each such U.S. shareholder. The following is a discussion of such
  two alternative tax regimes applied to such U.S. shareholders of the Company.

A U.S. shareholder who elects in a timely manner to treat
  the Company as a Qualified Electing Fund (QEF), as defined in the
  Code (an Electing U.S. Shareholder), will be subject, under Section
  1293 of the Code, to current federal income tax for any taxable year in which
  the Company qualifies as a PFIC on his pro-rata share of the Companys
  (i) net capital gain (the excess of net long-term capital gain over
  net short-term capital loss), which will be taxed as long-term capital gain
  to the Electing U.S. Shareholder and (ii) ordinary earnings (the
  excess of earnings and profits over net capital gain), which will be taxed as
  ordinary income to the Electing U.S. Shareholder, in each case, for the shareholders
  taxable year in which (or with which) the Companys taxable year ends,
  regardless of whether such amounts are actually distributed.

The effective QEF election also allows the Electing U.S. Shareholder
  to (i) generally treat any gain realized on the disposition of his Common Shares
  (or deemed to be realized on the pledge of his Common Shares) as capital, (ii)
  treat his share of the Companys net capital gain, if any, as long-term
  capital gain instead of ordinary income, and (iii) either avoid interest charges
  resulting from PFIC status altogether, or make an annual election, subject to
  certain limitations, to defer payment of current taxes on his share of the

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Companys annual realized net capital gain and ordinary
  earnings subject, however, to an interest charge on the deferred taxes. If the
  Electing U.S. Shareholder is not a corporation, such an interest charge would
  be treated generally as personal interest that can be deducted only
  when it is paid or accrued an is only 10% deductible in taxable years beginning
  in 1990 and not deductible at all in taxable years beginning after 1990.

The procedures a U.S. Shareholder must comply with in making
  an effective QEF election will depend on whether the year of the election is
  the first year in the U.S. Shareholders holding period in which the Company
  is a PFIC. If the U.S. Shareholder makes a QEF election in such first year,
  i.e. a timely QEF election, then the U.S. Shareholder may make the QEF election
  by simply filing the appropriate documentation at the time the U.S. Shareholder
  files its tax return for such first year. If, however, the Company qualified
  as a PFIC in a prior year during such shareholders holding period, then
  in addition to filing documents, the U.S. Shareholder must elect to recognize
  (i) (under the rules of Section 1291 discussed below), any gain that he would
  otherwise recognize if the U.S. Shareholder sold his stock on the application
  date or (ii) if the Company is a controlled foreign corporation, and such shareholder
  so elects, his/her allocable portion of the Companys post-1986 earnings
  and profits.

When a timely QEF election is made, if the Company no longer
  qualifies as a PFIC in a subsequent year, normal code rules will apply. It is
  unclear whether a new QEF election is necessary if the Company thereafter re-qualifies
  as a PFIC. U.S. Shareholders should seriously consider making a new QEF election
  under those circumstances.

If a U.S. Shareholder does not make a timely QEF election
  in the year in which it holds (or is deemed to have held) the shares in question
  and the Company is a PFIC (a Non-resident U.S. shareholder), then
  special taxation rules under Section 1291 of the Code will apply to (i) gains
  realized on disposition (or deemed to be realized by reason by of a pledge)
  of his/her common shares and (ii) certain excess contributions,
  as specially defined, by the Company.

Non-electing U.S. shareholders generally would be required
  to pro-rata all gains realized on the disposition of his/her common shares and
  all excess distributions over the entire holding period for the common shares.
  All gains or excess distributions allocated to prior years of the U.S. shareholder
  (other than years prior to the first taxable year of the Company during such
  U.S. Shareholders holding period and beginning after January 1, 1987 for
  which it was a PFIC) would be taxed at the highest tax rate for each such prior
  year applicable to ordinary income. The Non-electing U.S. Shareholder also would
  be liable for interest on the foregoing tax liability for each such prior year
  calculated as if such tax liability had been due with respect to each such prior
  year. A Non-electing U.S. Shareholder that is not a corporation must treat this
  interest charge as personal interest which, as discussed above,
  is partially or wholly non-deductible. The balance of the gain or the excess
  distribution will be treated as ordinary income in the year of the disposition
  or distribution, and no interest charge will be incurred with respect to such
  balance.

If the Company is a PFIC for any taxable year during which
  a Non-electing U.S. Shareholder holds common shares, then the Company will continue
  to be treated as a PFIC with respect to such common shares, even if it is no
  longer definitionally a PFIC. A Non-electing U.S. Shareholder may terminate
  this deemed PFIC status by electing to recognize a gain (which will be taxed
  under the rules discussed above for Non-electing U.S. Shareholders) as if such
  common shares had been sold on the last day of the last taxable year for which
  it was a PFIC.

35

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Under Section 1291(f) of the Code, the Department of the Treasury
  has issued proposed regulations that would treat as taxable certain transfers
  of PFIC stock by Non-electing U.S. Shareholders that are generally not otherwise
  taxed, such as gifts, exchanges pursuant to corporate reorganizations, and transfers
  at death.

Certain special, generally adverse, rules will apply with
  respect to the common shares while the Company is a PFIC whether or not it is
  treated as a QEF. For example under Section 1297(b)(6) of the Code, a U.S. shareholder
  who uses PFIC stock as security for a loan (including a margin loan) will, except
  as may be provided in regulations, be treated as having made a taxable disposition
  of such stock.

The foregoing discussion is based on existing provisions of
  the Code, existing and proposed regulations thereunder, and current administrative
  ruling and court decisions, all of which are subject to change. Any such change
  could affect the validity of this discussion. In addition, the implementation
  of certain aspects of the PFIC rules requires the issuance of regulations which
  in many instances have not been promulgated and which may have retroactive effect.
  There can be no assurance any of these proposed regulations will be enacted
  or promulgated, and if so, the form they will take or the effect that they may
  have on this discussion. Accordingly, and due to the complexity of the PFIC
  rules, U.S. persons who are shareholders of the Company are strongly urged to
  consult their own tax advisors concerning the impact of these rules on their
  investment in the Company.

Controlled Foreign Corporation

If more than 50% of the voting power of all classes of stock
  or the total value of the stock of the Company is owned, directly or indirectly,
  by citizens or residents of the United States, United States domestic partnerships
  and corporations or estates or trusts other than foreign estates or trusts,
  each of whom own 10% or more of the total combined voting power of all classes
  of stock of the Company or the total value of the stock of (United States
  Shareholder) the Company, could be treated as a controlled foreign
  corporation under Subpart F of the Code. This classification would effect
  many complex results including the required inclusion by such United States
  shareholders in income of their pro rata shares of Subpart F income
  (as specially defined by the Code) of the Company and the Companys earnings
  invested in U.S. property and earnings invested excess passive assets
  (as specifically defined by the Code). In addition, under Section 1248 of the
  Code, gain from the sale or exchange of common shares of the Company by a U.S.
  person who is or was a United States shareholder (as defined in the Code) at
  any time during the five year period ending with the sale or exchange is treated
  as ordinary dividend income to the extent of earnings and profits of the company
  attributable to the stock sold or exchanged. Because of the complexity of Subpart
  F., and because it is not clear that the Company is a controlled foreign corporation,
  a more detailed review of these rules is outside of the scope of this discussion.

F.                     Dividends
  and Paying Agents

This Form 20-F is being filed as an annual report under the
  Securities Exchange Act of 1934, and as such, there is no requirement to provide
  any information under this item.

G.                     Statement
  By Experts

This Form 20-F is being filed as an annual report under the
  Securities Exchange Act of 1934, and as such, there is no requirement to provide
  any information under this item.

H.                     Documents
  on Display

36

---

Any of the documents referred to in this Form 20-F can be
  viewed at the office of the Company, which is located at Suite 306  1140
  Homer Street, Vancouver, British Columbia, V6B 2X6 during normal business hours.
  All of the documents referred to above are in English.

I.                       Subsidiary
  Information

This information is not required for reports filed in the United States.

ITEM 11          QUANTITATIVE
  AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is a small business issuer, and as such, does not need to provide
  the information required by this Item 11.

ITEM 12          DESCRIPTION
  OF SECURITIES OTHER THAN EQUITY SECURITIES

Not applicable

ITEM 13          DEFAULTS,
  DIVIDEND ARREARAGES AND DELINQUENCIES

Not applicable

ITEM 14          MATERIAL
  MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS

Not applicable

ITEM 15          CONTROLS
  AND PROCEDURES

As of October 31, 2002, an evaluation was performed under
  the supervision and with the participation of the Companys management,
  including the Chief Executive Officer, of the effectiveness of the design and
  operation of the Companys disclosure controls and procedures. Based on
  that evaluation, the Companys management, including the Chief Executive
  Officer, concluded that the Companys disclosure controls and procedures
  were effective as of October 31, 2002. There have been no significant changes
  in the Companys internal controls or in other factors that could significantly
  affect internal controls subsequent to October, 31, 2002.

ITEM 16          [RESERVED]

ITEM 17          FINANCIAL
  STATEMENTS

The financial statements as required under Item 17 are attached
  hereto and found immediately following the text of this Form 20-F. The Auditors
  Report of Morgan & Co., Chartered Accountants, for the audited financial
  statements is included herein immediately preceding the audited financial statements.

ITEM 18          FINANCIAL
  STATEMENTS

Not applicable

ITEM 19          EXHIBITS

A.                      Audited
  Consolidated Financial Statements and Financial Statement Schedules:

37

---

Auditor's Report, dated October 11, 2002;

Consolidated Balance Sheet at 8/31/01 and 8/31/02;

Consolidated Statements of Deferred Exploration Expenditures, for the years
  ended 8/31/01, and 8/31/02;

Consolidated Statements of Operations and Deficit for the years ended 08/31/00,
  08/31/01 and 08/31/02;

Consolidated Statements of Cash Flow for the years ended 08/31/00, 08/31/01
  and 08/31/02;

Notes to Consolidated Financial Statements; and

Notice of Annual and Extraordinary General Meeting held March 27, 2002.

B.                      Material
  Contracts

| | 1.  | Amended Mineral Property Option Agreement
        dated June 24, 2002;                                                                                                                                                   
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                          
| | 2.  | A letter agreement dated April 18, 2002
        between Exploraciones Paradigma, (Paradigma) and Miranda Diamond
        Corp.;                                                                                        
| |     |                                                                                                                                                                                                                          
| | 3.  | Mineral Property Option Agreement dated
        January 30, 2002 between Ubex Capital Inc. and Thrush Industries Inc.
        (now called Miranda Diamond Corp.);                                                        
| |     |                                                                                                                                                                                                                          
| | 4.  | Mineral Property Option Agreement dated
        January 30, 2002 between Ubex Capital Inc. and Thrush Industries Inc.
        (now called Miranda Diamond Corp.);                                                        
| |     |                                                                                                                                                                                                                          
| | 5.  | Mineral Property Option Agreement dated
        January 30, 2002 between Ubex Capital Inc.and/or Monaco Investment Corp.
        and Thrush Industries Inc.;                                                             
| |     |                                                                                                                                                                                                                          
| | 6.  | Mineral Property Option Agreement dated
        January 30, 2002 between Ubex Capital Inc. and/or Menace Capital Corp.
        and Thrush Industries Inc.;                                                               
| |     |                                                                                                                                                                                                                          
| | 7.  | Mineral Property Option Agreement dated
        January 30, 2002 between Ubex Capital Inc. and/or Menace Capital Corp.,
        and/or Dennis Higgs and Thrush Industries Inc. (now called Miranda Diamond
        Corp.;
| |     |                                                                                                                                                                                                                          
| | 8.  | Mineral Property Option Agreement dated
        January 30, 2002 between Ubex Capital Inc. and Thrush Industries Inc.
        (now called Miranda Diamond Corp.);                                                        
| |     |                                                                                                                                                                                                                          
| | 9.  | Mineral Property Option Agreement dated
        September 10, 2002 between Ubex Capital Inc. and Carleen Higgs and Miranda
        Diamond Corp.;                                                                        
| |     |                                                                                                                                                                                                                          
| | 10. | Mineral Property Option Agreement dated
        September 10, 2002 between Ubex Capital and Carleen Higgs and Miranda
        Diamond Corp.;                                                                             
| |     |                                                                                                                                                                                                                          
| | 11. | Mineral Property Option Agreement dated
        September 10, 2002 between Ubex Capital Inc. and Monaco Investment Corp.;                                                                                                
| |     |                                                                                                                                                                                                                          
| | 12. | Mineral Property Option Agreement dated September 27, 2002
      between MinQuest, Inc. and Miranda Diamond Corp.                                                                                                        

38

---

SIGNATURES

Pursuant to the requirements of Section 12g of the Securities
  Exchange Act of 1934, the Registrant certifies that it meets all of the requirements
  for filing on Form 10-F and has duly caused this Registration Statement to be
  signed on its behalf by the undersigned, thereunto duly authorized.

| | MIRANDA DIAMOND CORP.Registrant
| | -------------------------------



Date: November 6, 2002

By: /s/ Aileen Lloyd

Aileen Lloyd, Director

39

---

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL
  OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Dennis Higgs, certify, pursuant to 18 U.S.C. Section 1350,
  as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the
  Annual Report on Form 20-F of Miranda Diamond Corp. for the year ended August
  31, 2002 fully complies with the requirements of Section 13(a) or 15(d) of the
  Securities Exchange Act of 1934 and that the information contained in the Annual
  Report on Form 20-F fairly presents in all material respects the financial condition
  and results of operations of Miranda Diamond Corp.

| | By:    | Dennis L. Higgs                
| | ------ | ---------------------------------
| |        |                                  
| |        |                                  
| | Name:  | DENNIS L. HIGGS                  
| |        |                                  
| |        |                                  
| | Title: | Chief Executive Officer and Chief
| |        | Financial Officer                
| |        |                                  
| |        |                                  
| | Date:  | November 6, 2002                 

40

---

CERTIFICATIONS

I, Dennis L. Higgs certify that:

| | 1. | I have reviewed this annual
      report on Form 20-F of Miranda Diamond Corp. (Miranda);                                                                                                                                                                                                                                                                     
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                 
| | 2. | Based
        on my knowledge, this annual report does not contain any untrue statement
        of a material fact or omit to state a material fact necessary to make
        the statements made, in light of the circumstances under which such statements
        were made, not misleading with respect to the period covered by this annual
        report;
| |    |                                                                                                                                                                                                                                                                                                                                                                 
| | 3. | Based
        on my knowledge, the financial statements, and other financial information
        included in this annual report, fairly present in all material respects
        the financial condition, results of operations and cash flows of the registrant
        as of, and for, the periods presented in this annual report;                           
| |    |                                                                                                                                                                                                                                                                                                                                                                 
| | 4. | I
        am responsible for establishing and maintaining disclosure controls and
        procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
        registrant and have:                                                                                                                                                                  
| |    |                                                                                                                                                                                                                                                                                                                                                                 
| |    | a)                                                                                                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                 
| |    | b)                                                                                                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                 
| |    | c)                                                                                                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                 
| | 5. | I
        have disclosed, based on our most recent evaluation, to Mirandas
        auditors and the audit committee of Mirandas board of directors
        (or persons performing the equivalent function):                                                                                                                                                   
| |    |                                                                                                                                                                                                                                                                                                                                                                 
| |    | a)                                                                                                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                 
| |    | b)                                                                                                                                                                                                                                                                                                                                                              

41

---

|6. |  | I have indicated in this annual
        report whether or not there were significant changes in internal controls
        or in other factors that could significantly affect internal controls
        subsequent to the date of our most recent evaluation, including any corrective
        actions with regard to significant deficiencies and material weaknesses.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Dennis L. Higgs

Dennis L. Higgs 
  Chief Executive Officer 
  Chief Financial Officer

Date: November 6, 2002

42

---





MIRANDA DIAMOND CORP.

(Formerly Thrush Industries Inc.)







CONSOLIDATED FINANCIAL STATEMENTS







AUGUST 31, 2002 AND 2001









43

---

| | 
| | 

AUDITORS REPORT

To the Shareholders 
  Miranda Diamond Corp. 
  (Formerly Thrush Industries Inc.)

We have audited the consolidated balance sheets of Miranda
  Diamond Corp. (formerly Thrush Industries Inc.) as at August 31, 2002 and 2001,
  and the consolidated statements of deferred exploration expenditures, operations
  and deficit, and cash flows for the years ended August 31, 2002, 2001 and 2000.
  These consolidated financial statements are the responsibility of the Company's
  management. Our responsibility is to express an opinion on these consolidated
  financial statements based on our audits.

We conducted our audits in accordance with generally accepted
  auditing standards in Canada and the United States of America. Those standards
  require that we plan and perform an audit to obtain reasonable assurance whether
  the financial statements are free of material misstatement. An audit includes
  examining, on a test basis, evidence supporting the amounts and disclosures
  in the financial statements. An audit also includes assessing the accounting
  principles used and significant estimates made by management, as well as evaluating
  the overall financial statement presentation.

In our opinion, these consolidated financial statements present
  fairly, in all material respects, the financial position of the Company as at
  August 31, 2002 and 2001, and the results of its operations and cash flows for
  the years ended August 31, 2002, 2001 and 2000 in accordance with Canadian generally
  accepted accounting principles. As required by the British Columbia Company
  Act, we report that, in our opinion, these principles have been applied on a
  consistent basis.

|Vancouver, B.C.  | Morgan & Company   
|---------------- | ---------------------
|                 |                      
|October 11, 2002 | Chartered Accountants

COMMENTS BY INDEPENDENT AUDITORS FOR U.S. READERS ON CANADA-U.S. REPORTING CONFLICT

In the United States, reporting standards for auditors require
  the addition of an explanatory paragraph (following the opinion paragraph) when
  the financial statements are affected by significant uncertainties and contingencies
  such as those described in the financial statements. Our report to the shareholders,
  dated October 11, 2002, is expressed in accordance with Canadian reporting standards
  which do not permit a reference to such matters in the Auditors Report
  when the uncertainties are adequately disclosed in the financial statements.

|Vancouver, B.C.  | Morgan & Company   
|---------------- | ---------------------
|October 11, 2002 | Chartered Accountants

|Tel: (604) 687-5841 |                                      | P.O. Box 10007 Pacific Centre
|------------------- | ------------------------------------ | -----------------------------
|Fax: (604) 687-0075 | Suite 1488 - 700 West Georgia Street
|www.morgan-cas.com  | Vancouver, B.C. V7Y 1A1             

44

---

MIRANDA DIAMONDCORP. (Formerly Thrush Industries Inc.)

CONSOLIDATED BALANCE SHEETS

|                                  |           |           
|--------------------------------- | --------- | ----------
|                                  | AUGUST 31 |           
|                                  | 2002      |           
|                                  |           |           
|ASSETS                            |           |           
|                                  |           |           
|Current                           |           |           
|Cash and short term deposits      | $         | 266,605   
|Accounts receivable               |           | 11,911    
|Prepaid expenses                  |           | 11,189    
|                                  |           |           
|                                  |           | 289,705   
|                                  |           |           
|Mineral Properties(Note 2)        |           | 143,627   
|                                  |           |           
|Deferred Exploration Expenditures |           | 210,098   
|                                  |           |           
|                                  |           |           
|                                  | $         | 643,430   
|                                  |           |           
|LIABILITIES                       |           |           
|Current                           |           |           
|Accounts payable                  | $         | 9,643     
|                                  |           |           
|Loan Payable(Note 3)              |           | -         
|                                  |           |           
|                                  |           | 9,643     
|                                  |           |           
|SHAREHOLDERS EQUITY              |           |           
|                                  |           |           
|Share Capital(Note 4)             |           | 4,140,114 
|                                  |           |           
|Special Warrants(Note 5)          |           | 147,250   
|                                  |           |           
|Deficit                           |           | (3,653,577
|                                  |           |           
|                                  |           | 633,787   
|                                  |           |           
|                                  |           |           
|                                  | $         | 643,430   
|                                  |           |           

Approved by the Directors:

| | Dennis L. Higgs | Aileen Lloyd"
| | ----------------- | --------------

45

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.)

CONSOLIDATED STATEMENTS OF DEFERRED EXPLORATION EXPENDITURES

|                                                        |             |           |  |   |          |  
|------------------------------------------------------- | ----------- | --------- |  | - | -------- | -
|                                                        | YEARS ENDED |          
|                                                        |             | AUGUST 31 | 
|                                                        |             |           |  |   |          |  
|                                                        |             | 2002      |  |   | 2001     |  
|                                                        |             |           |  |   |          |  
|                                                        |             |           |  |   |          |  
|Exploration Expenditures                                |             |           |  |   |          |  
|Assays                                                  | $           | -         |  | $ | -        |  
|Drilling and excavation                                 |             | -         |  |   | -        |  
|Professional fees and wages                             |             | -         |  |   | 15,732   |  
|Travel, board and lodging                               |             | -         |  |   | 3,209    |  
|Office and field supplies                               |             | -         |  |   | 6,926    |  
|Registration and assessment fees                        |             | 716       |  |   | 6,382    |  
|Report                                                  |             | 10,000    |  |   | -        |  
|                                                        |             |           |  |   |          |  
|                                                        |             | 10,716    |  |   | 32,249   |  
|                                                        |             |           |  |   |          |  
|Deferred Expenditures, Beginning Of
      Year          |             | 199,382   |  |   | 657,183  |  
|                                                        |             |           |  |   |          |  
|Write Off Accumulated Expenditures On Abandoned Mineral |             |           |  |   |          |  
|Properties                                              |             | -         |  |   | (490,050 | )
|                                                        |             |           |  |   |          |  
|                                                        |             |           |  |   |          |  
|Deferred Expenditures, End Of Year                      | $           | 210,098   |  | $ | 199,382  |  
|                                                        |             |           |  |   |          |  
|                                                        |             |           |  |   |          |  
|                                                        |             |           |  |   |          |  
|Allocation Of Deferred Expenditures                     |             |           |  |   |          |  
|Quebec properties                                       | $           | 10,716    |  | $ | -        |  
|Secret Basin property                                   |             | 199,382   |  |   | 199,382  |  
|                                                        |             |           |  |   |          |  
|                                                        |             |           |  |   |          |  
|                                                        | $           | 210,098   |  | $ | 199,382  |  
|                                                        |             |           |  |   |          |  

46

---

MIRANDA DIAMOND CORP.

(Formerly Thrush Industries Inc.)

CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT

|                                                     |                             |          
|---------------------------------------------------- | --------------------------- | ---------
|                                                     | YEARS ENDED AUGUST
      31 |          
|                                                     | 2002                        |          
|                                                     |                             |          
|                                                     |                             |          
|Expenses                                             |                             |          
|Interest and loan bonus                              | $                           | 2,711    
|Office rent, telephone,
      secretarial and sundry |                             |          
|                                                     |                             | 131,017  
|Professional fees                                    |                             | 57,249   
|Management fees                                      |                             | 38,000   
|Property investigation
      costs                   |                             | 25,611   
|Travel and business
      promotion                  |                             | 6,614    
|Transfer agent and
      regulatory fees             |                             | 18,492   
|                                                     |                             |          
|                                                     |                             | 279,694  
|Less: Interest income                                |                             | (894     
|                                                     |                             |          
|                                                     |                             |          
|Loss Before The Following                            |                             | 278,800  
|                                                     |                             |          
|Write Off Of Abandoned Mineral Properties            |                             |          
|And Related Exploration
      Expenditures           |                             | -        
|                                                     |                             |          
|                                                     |                             |          
|Loss For The Year                                    |                             | 278,800  
|                                                     |                             |          
|Deficit, Beginning
      Of Year                     |                             | 3,374,777
|                                                     |                             |          
|                                                     |                             |          
|Deficit, End Of Year                                 | $                           | 3,653,577
|                                                     |                             |          
|                                                     |                             |          
|Basic And Diluted Loss
      Per Share               | $                           | 0.12     
|                                                     |                             |          
|                                                     |                             |          
|Weighted Average Number Of Shares                    |                             |          
|Outstanding                                          |                             | 2,257,436
|                                                     |                             |          

47

---

MIRANDA DIAMOND CORP.
  (Formerly Thrush Industries Inc.) 
  CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                              |                             |         
|--------------------------------------------- | --------------------------- | --------
|                                              | YEARS ENDED AUGUST
      31 |         
|                                              | 2002                        |         
|                                              |                             |         
|Cash Flows From Operating Activities          |                             |         
|Loss for the year                             | $                           | (278,800
|Add (Deduct): Non-cash items:                 |                             |         
|Write off of abandoned mineral properties and |                             |         
|related exploration expenditures              |                             | -       
|Shares issued as consideration for loan       |                             | -       
|                                              |                             |         
|                                              |                             | (278,800
|                                              |                             |         
|Change In non-cash working capital items:     |                             |         
|Accounts receivable                           |                             | (6,395  
|Prepaid expenses                              |                             | (2,189  
|Accounts payable                              |                             | (6,153  
|                                              |                             |         
|                                              |                             | (293,537
|                                              |                             |         
|                                              |                             |         
|Cash Flows From Investing Activities          |                             |         
|Mineral properties                            |                             | (60,719 
|Exploration expenditures                      |                             | (10,716 
|                                              |                             |         
|                                              |                             | (71,435 
|                                              |                             |         
|                                              |                             |         
|Cash Flows From Financing Activities          |                             |         
|Loan payable                                  |                             | (70,000 
|Special warrant subscriptions received        |                             | 200,000 
|Issue of share capital                        |                             | 500,000 
|Share issue costs                             |                             | (16,400 
|                                              |                             |         
|                                              |                             | 613,600 
|                                              |                             |         
|                                              |                             |         
|Increase (Decrease) In Cash And Cash          |                             |         
|Equivalents                                   |                             | 248,628 
|                                              |                             |         
|Cash And Cash Equivalents, Beginning Of Year  |                             |         
|                                              |                             | 17,977  
|                                              |                             |         
|                                              |                             |         
|Cash And Cash Equivalents, End Of Year        | $                           | 266,605 
|                                              |                             |         

**SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING AND INVESTING ACTIVITIES:**

During the year ended August 31, 2002, the Company issued
  72,000 units at a fair value of $0.20 per unit as part commission for the private
  placement described in Note 4(c), and 330,000 common shares at a fair value
  of $0.20 per share as part consideration under the mineral property option agreements
  described in Note 2(b).

48

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2002 AND 2001

1. a) NATURE OF OPERATIONS

The Company is in the process of exploring its mineral properties
  and has not yet determined whether the properties contain ore reserves that
  are economically recoverable.

The recoverability of amounts shown as mineral properties
  and related deferred exploration expenditures is dependent upon the discovery
  of economically recoverable reserves, confirmation of the Company's interest
  in the underlying mineral claims, and the ability of the Company to obtain profitable
  production or proceeds from the disposition thereof.

b) SIGNIFICANT ACCOUNTING POLICIES

i)     Consolidation

These financial statements include the accounts of the Company
  and its wholly owned U.S. subsidiary, Miranda U.S.A., Inc. and its Mexican subsidiary,
  Minas Miranda S.A. de C.V.

ii)     Use of Estimates

The preparation of financial statements in conformity with
  generally accepted accounting principles requires management to make estimates
  and assumptions which affect the reported amounts of assets and liabilities,
  and the disclosure of contingent assets and liabilities at the date of the financial
  statements, and revenues and expenses for the periods reported. Actual results
  could differ from these estimates.

iii)     Financial Instruments

The Companys financial instruments consist of cash,
  accounts receivable, prepaid expenses and accounts payable.

Unless otherwise noted, it is managements opinion that
  this Company is not exposed to significant interest or credit risks arising
  from these financial instruments. The fair value of these financial instruments
  approximate their carrying values, unless otherwise noted.

iv)     Mineral Properties and Related Deferred Exploration
  Expenditures

The Company defers all direct exploration expenditures on
  mineral properties in which it has a continuing interest to be amortized over
  the productive period when a property reaches commercial production. On abandonment
  of any property, applicable accumulated deferred exploration expenditures will
  be written off.

49

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2002 AND 2001

1. b) SIGNIFICANT ACCOUNTING POLICIES (Continued)

v)     Future Income Taxes

The Company has adopted the new requirements of the CICA Handbook,
  Section 3465, whereby unused tax losses, income tax reductions and deductible
  temporary differences are only recognized as a future income tax benefit to
  the extent that these amounts will be more than likely realized.

vi)     Loss per Share

Loss per share has been calculated based on the weighted average number of
  shares outstanding during the year.

vii)     Foreign Currency Translation

Transactions recorded in United States dollars and Mexican
  new pesos have been translated into Canadian dollars using the Temporal Method
  as follows:

i) monetary items at the rate prevailing at the balance sheet date; 
  ii) non-monetary items at the historical exchange rate; 
  iii) revenue and expense at the average rate in effect during the applicable
  accounting period.

Gains or losses arising on translation are included in the results of operations.

viii)     Stock Based Compensation

Employee and director stock options granted by the Company
  are not recognized in the accounts until exercised, and then are recorded only
  as a credit to share capital to the extent of the exercise price. No remuneration
  expense is recorded by the Company on the excess, if any, of the trading price
  of the stock over its exercise price.

50

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AUGUST 31, 2002 AND 2001

2.  MINERAL PROPERTIES

|                                                                         |   | 2002   |   |   | 2001   |  
|------------------------------------------------------------------------ | - | ------ | - | - | ------ | -
|                                                                         |   |        |   |   |        |  
|Secret Basin Property, Nevada                                            |   |        |   |   |        |  
|                                                                         |   |        |   |   |        |  
|The Company has acquired a 100% interest in the Secret
      Basin       |   |        |   |   |        |  
|property located in Nye County, Nevada for U.S. $5,000
      and the     |   |        |   |   |        |  
|issuance of 10,000 shares. The Company will issue an additional          |   |        |   |   |        |  
|60,000 shares upon the project reaching certain development              |   |        |   |   |        |  
|and exploration milestones including positive pre-feasibility
      and  |   |        |   |   |        |  
|feasibility.                                                             | $ | 18,400 |   | $ | 18,400 |  
|                                                                         |   |        |   |   |        |  
|Option payment received                                                  |   | (1,492 | ) |   | (1,492 | )
|                                                                         |   |        |   |   |        |  
|                                                                         |   | 16,908 |   |   | 16,908 |  
|                                                                         |   |        |   |   |        |  
|The Company has granted an option to acquire a 50% interest
      in     |   |        |   |   |        |  
|its Secret Basin, Nevada property for the following consideration:       |   |        |   |   |        |  
|cash
      payment of U.S. $1,000;                                       |   |        |   |   |        |  
|exploration
      expenditures totalling U.S. $250,000 by June           |   |        |   |   |        |  
|30,
      2003, U.S. $10,000 of which must be expended by                |   |        |   |   |        |  
|December
      31, 2002.                                                 |   |        |   |   |        |  
|Otish Mountains, Quebec                                                  |   |        |   |   |        |  
|                                                                         |   |        |   |   |        |  
|The Company has entered into agreements, as amended, to                  |   |        |   |   |        |  
|acquire a 100% interest, subject to certain net smelter
      return and |   |        |   |   |        |  
|gross overriding royalty obligations, in six mineral properties,         |   |        |   |   |        |  
|comprising a total of 354 mineral claims covering 45,466
      acres,    |   |        |   |   |        |  
|located in the Otish Mountains region of Quebec. Consideration           |   |        |   |   |        |  
|payable for each property is as follows:                                 |   |        |   |   |        |  

|PROPERTY      |   | CASH   | SHARES               
|------------- | - | ------ | ---------------------
|              |   |        |                      
|Lac Leran     | $ | 23,000 | 165,000 common shares
|Lac Pigeon    | $ | 23,000 | 165,000 common shares
|Lac Leran #2  | $ | 129    | -                    
|Lac Pigeon #2 | $ | 5,271  | -                    
|Lac Joubert   | $ | 4,341  | -                    
|Lac Orillat   | $ | 4,978  | -                    

|Total consideration paid                                             | 126,719             -
|-------------------------------------------------------------------- | ---------------------
|                                                                     |                      
|In addition, an annual advance royalty payment of $15,000 is payable |                      
|under the Lac Leran and Lac Pigeon property agreements.              |                      

51

---

MIRANDA DIAMOND CORP.
  (Formerly Thrush Industries Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2002 AND 2001

2. MINERAL PROPERTIES (Continued)

|                                                                   |   | 2002    |  |   | 2001  
|------------------------------------------------------------------ | - | ------- |  | - | ------
|                                                                   |   |         |  |   |       
|Las Catalinas, Mexico                                              |   |         |  |   |       
|                                                                   |   |         |  |   |       
|The Company has title to two concessions covering an area
      of |   |         |  |   |       
|2,271 hectares in Sonora State, Mexico.                            |   |         |  |   |       
|                                                                   |   |         |  |   |       
|Written down value                                                 | $ | -       |  | $ | -     
|                                                                   |   |         |  |   |       
|                                                                   |   |         |  |   |       
|                                                                   | $ | 143,627 |  | $ | 16,908
|                                                                   |   |         |  |   |       

The Company has granted an option to earn a 90% interest in
  the Las Catalinas concessions with the expenditure of US$250,000 on the property
  over six years. The optionee must pay all taxes and property assessment and
  keep the concessions in good standing during that period. The Company may buy
  out all of the optionees interest in the concessions at any time prior
  to the optionee earning the 90% interest by paying to the optionee three times
  its expenditures on the project and granting a net smelter return royalty of
  1⁄2% for every $50,000 expended to a maximum of a 2% net smelter return
  royalty.

The Company may also buy out the optionee, once the optionee
  has earned its interest in the concessions, for up to ten years from the date
  of signing of the agreement, for US$1,000,000 during the first seven years and
  for US$5,000,000 thereafter.

3.     LOAN PAYABLE

The loan is unsecured, bears interest at 10% per annum and
  is due on December 28, 2002. As additional consideration for granting the loan,
  the lender received a bonus of 28,000 common shares.

4.     SHARE CAPITAL

a)           Authorized
  
           100,000,000 common shares without
  par value

52

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2002 AND 2001

4.     SHARE CAPITAL (Continued)

|b) | Issued and Outstanding
|-- | ----------------------

| |                                                        | NUMBER    |  |               |          
| | ------------------------------------------------------ | --------- |  | ------------- | ---------
| |                                                        | OF        |  | CONSIDERATION |          
| |                                                        | SHARES    |  |               |          
| |                                                        |           |  |               |          
| |                                                        |           |  |               |          
| | Balance August 31, 2000 and 1999                       | 8,321,300 |  | $             | 3,523,764
| |                                                        |           |  |               |          
| | 1 for 5 share consolidation                            | 1,664,260 |  |               | 3,523,764
| | Shares issued as consideration for loan (Note 3)       | 28,000    |  |               | 14,000   
| |                                                        |           |  |               |          
| |                                                        |           |  |               |          
| | Balance, August 31, 2001                               | 1,692,260 |  |               | 3,537,764
| |                                                        |           |  |               |          
| | Shares issued on conversion of special warrants        | 527,500   |  |               | 52,750   
| | Shares issued for cash pursuant to a private placement | 2,500,000 |  |               | 500,000  
| | Shares issued for commissions                          | 72,000    |  |               | 14,400   
| | Shares issued pursuant to property option agreement    | 330,000   |  |               | 66,000   
| | Less: Share issue costs                                | -         |  |               | (30,800  
| |                                                        |           |  |               |          
| |                                                        |           |  |               |          
| | Balance, August 31, 2002                               | 5,121,760 |  | $             | 4,140,114
| |                                                        |           |  |               |          

|c) | During the year ended August 31, 2002, the Company
        completed a private placement of 2,500,000 units at $0.20 per unit. Each
        unit consists of one common share and one share purchase warrant entitling
        the holder to purchase an additional common share at $0.27 per share to
        July 11, 2004. In addition, the Company issued 72,000 units and paid $16,400
        cash as commissions relating to the private placement.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|d) | Options Outstanding
      As at August 31, 2002, options were outstanding for the purchase of common
        shares as follows:                                                                                                                                                                                                                                                                                                                           

| | NUMBER  |  | PRICE  |  |                   | 
| | ------- |  | ------ |  | ----------------- | 
| | OF      |  | PER    |  | EXPIRY            | 
| | SHARES  |  | SHARE  |  | DATE              | 
| |         |  |        |  |                   | 
| |         |  |        |  |                   | 
| | 369,000 |  | $ 0.14 |  | December 14, 2006 | 

53

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2002 AND 2001

4.SHARE CAPITAL (Continued)

|d) | Options Outstanding (Continued)
      A summary of the changes in stock options for the year ended August 31,
        2002 is presented below:
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------

| |                          |         |  | WEIGHTED |     
| | ------------------------ | ------- |  | -------- | ----
| |                          |         |  | AVERAGE  |     
| |                          |         |  | EXERCISE |     
| |                          | SHARES  |  | PRICE    |     
| |                          |         |  |          |     
| | Balance, August 31, 2001 | -       |  | $        | -   
| |                          |         |  |          |     
| | Granted                  | 369,000 |  |          | 0.14
| |                          |         |  |          |     
| |                          |         |  |          |     
| | Balance, August 31, 2002 | 369,000 |  | $        | 0.14
| |                          |         |  |          |     

|e) | Share Purchase Warrants
      As at August 31, 2002, share purchase warrants were outstanding for the
        purchase of common shares as follows:
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------

| | NUMBER    |  | PRICE  |  |                 | 
| | --------- |  | ------ |  | --------------- | 
| |           |  |        |  |                 | 
| | OF        |  | PER    |  | EXPIRY          | 
| |           |  |        |  |                 | 
| | SHARES    |  | SHARE  |  | DATE            | 
| |           |  |        |  |                 | 
| | 527,500   |  | $ 0.12 |  | January 7, 2004 | 
| |           |  |        |  |                 | 
| | 2,500,000 |  | $ 0.27 |  | July 11, 2004   | 
| |           |  |        |  |                 | 

A summary of the changes in share purchase warrants for the year ended August
  31, 2002 is presented below:

| |                          |           |  | WEIGHTED |     
| | ------------------------ | --------- |  | -------- | ----
| |                          |           |  | AVERAGE  |     
| |                          |           |  | EXERCISE |     
| |                          | SHARES    |  | PRICE    |     
| |                          |           |  |          |     
| | Balance, August 31, 2002 | -         |  | $        | -   
| |                          |           |  |          |     
| | Granted                  | 3,027,500 |  |          | 0.24
| |                          |           |  |          |     
| | Balance, August 31, 2002 | 3,027,500 |  | $        | 0.24
| |                          |           |  |          |     

54

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2002 AND 2001

|5. | SPECIAL WARRANTS
|-- | ----------------

| |                            | NUMBER OF |   |               |        
| | -------------------------- | --------- | - | ------------- | -------
| |                            | WARRANTS  |   |               |        
| |                            |           |   | CONSIDERATION |        
| |                            |           |   |               |        
| |                            |           |   |               |        
| | Balance, August 31, 2001   | -         |   | $             | -      
| |                            |           |   |               |        
| | Issued for cash            | 2,000,000 |   |               | 200,000
| | Converted to common shares | (527,500  | ) |               | (52,750
| |                            |           |   |               |        
| |                            |           |   |               |        
| | Balance, August 31, 2002   | 1,472,500 |   | $             | 147,250
| |                            |           |   |               |        

|       | Each special warrant entitles
        the holder to receive one unit, with each unit consisting of one common
        share and one non-transferable share purchase warrant entitling the holder
        to purchase an additional common share at $0.12 to January 7, 2004.
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                             
|**6.** | RELATED PARTY TRANSACTIONS                                                                                                                                                                                                                                                  
|       |                                                                                                                                                                                                                                                                             
|       | a)                                                                                                                                                                                                                                                                          
|       |                                                                                                                                                                                                                                                                             
|       | b)                                                                                                                                                                                                                                                                          
|       |                                                                                                                                                                                                                                                                             
|       | c)                                                                                                                                                                                                                                                                          
|       |                                                                                                                                                                                                                                                                             
|       | d)                                                                                                                                                                                                                                                                          

55

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2002 AND 2001

|7. | INCOME TAXES
      The Company has non-capital loss carryforwards of approximately CDN$1,890,406
        and US$394,291 that may be available for tax purposes. The losses are
        in the following countries and expire as follows:
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | EXPIRY     |  |   | CANADIAN  |  |   | US      | 
| | ---------- |  | - | --------- |  | - | ------- | 
| | DATE       |  |   | DOLLARS   |  |   | DOLLARS | 
| |            |  |   |           |  |   |         | 
| |            |  |   |           |  |   |         | 
| | 2003       |  | $ | 348,495   |  | $ | -       | 
| | 2004       |  |   | 413,610   |  |   | -       | 
| | 2005       |  |   | 341,304   |  |   | -       | 
| | 2006       |  |   | 206,430   |  |   | -       | 
| | 2007       |  |   | 133,534   |  |   | -       | 
| | 2008       |  |   | 168,146   |  |   | -       | 
| | 2009       |  |   | 278,887   |  |   | -       | 
| | Thereafter |  |   | -         |  |   | 394,291 | 
| |            |  |   |           |  |   |         | 
| |            |  |   |           |  |   |         | 
| |            |  | $ | 1,890,406 |  | $ | 394,291 | 
| |            |  |   |           |  |   |         | 

|       | In addition, the Company has
        incurred resource expenditures of approximately $321,499 (2001 - $310,870)
        which may be carried forward indefinitely and used to reduce taxable income
        in future years.
      The potential benefits of these items have not been recognized
        as realization is not considered more likely than not.
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                 
|**8.** | SUBSEQUENT EVENTS
      Subsequent to August 31, 2002:                                                                                                                                                                                                                                                                                                          
|       |                                                                                                                                                                                                                                                                                                                                                                 
|       | a)                                                                                                                                                                                                                                                                                                                                                              

56

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2002 AND 2001



|8. | SUBSEQUENT EVENTS (Continued)
|-- | -----------------------------
|   |                              
|   | b)                           

| | PROPERTY        |  |   | CASH   | 
| | --------------- |  | - | ------ | 
| |                 |  |   |        | 
| |                 |  |   |        | 
| | Lac Herve       |  | $ | 27,700 | 
| | Lac Square Rock |  | $ | 7,500  | 
| | Lac Taffanel    |  | $ | 6,000  | 

| | c) | The Company has entered
        into an option agreement for the acquisition of a 100% interest in three
        mineral properties in Nevada. Consideration payable under the option agreement
        is as follows:                                                                                                                                        
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                               
| |    | i)                                                                                                                                                                                                                                                                                                                                                            
| |    |                                                                                                                                                                                                                                                                                                                                                               
| |    | ii)                                                                                                                                                                                                                                                                                                                                                           
| |    |                                                                                                                                                                                                                                                                                                                                                               
| |    | iii)                                                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                               
| |    | iv)                                                                                                                                                                                                                                                                                                                                                           
| |    |                                                                                                                                                                                                                                                                                                                                                               
| |    | v)                                                                                                                                                                                                                                                                                                                                                            
| |    |                                                                                                                                                                                                                                                                                                                                                               
| |    | vi)                                                                                                                                                                                                                                                                                                                                                           
| |    |                                                                                                                                                                                                                                                                                                                                                               
| |    | In addition, the Company
        has agreed to pay a finders fee consisting of warrants to purchase
        50,000 shares at $0.25, 5% of the cash payments received by the Company
        and warrants to purchase 50,000 shares at $0.40 once a positive feasibility
        study has been produced for any one of the three properties in the agreement.

57

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2002 AND 2001

|8. | SUBSEQUENT EVENTS(Continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|9. | MATERIAL DIFFERENCES BETWEEN
        CANADIAN AND UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP)
      The Company prepares its financial statements in accordance
        with accounting principles generally accepted in Canada (Canadian
        GAAP), which differ in certain respects from those principles that
        the Company would have followed had its financial statements been prepared
        in accordance with accounting principles generally accepted in the United
        States (US GAAP). The major differences between Canadian and
        US GAAP, which affect the Companys financial statements, are described
        below, and their effect on the financial statements is summarized as follows:

| |                                                       |       | 2002      |   |   | 2001      |   |   | 2000      |  
| | ----------------------------------------------------- | ----- | --------- | - | - | --------- | - | - | --------- | -
| |                                                       |       |           |   |   |           |   |   |           |  
| |                                                       |       |           |   |   |           |   |   |           |  
| | Loss in accordance with Canadian GAAP                 | **$** | (278,800  | ) | $ | (696,852  | ) | $ | (172,917  | )
| |                                                       |       |           |   |   |           |   |   |           |  
| | Deduct:                                               |       |           |   |   |           |   |   |           |  
| | Mineral property costs incurred in the year and       |       |           |   |   |           |   |   |           |  
| | capitalized                                           |       | (126,719  | ) |   | -         |   |   | (3,669    | )
| | Deferred exploration expenditures                     |       | (10,716   | ) |   | (32,249   | ) |   | (28,529   | )
| | Stock based compensation                              |       | (22,140   | ) |   | -         |   |   | -         |  
| |                                                       |       |           |   |   |           |   |   |           |  
| | Add:                                                  |       |           |   |   |           |   |   |           |  
| | Mineral property costs written off in the period      |       |           |   |   |           |   |   |           |  
| | that would have been expensed in a prior
      period |       |           |   |   |           |   |   |           |  
| |                                                       |       | -         |   |   | 528,803   |   |   | 39,490    |  
| |                                                       |       |           |   |   |           |   |   |           |  
| | Loss in accordance with US GAAP                       | **$** | (438,375  | ) | $ | (200,298  | ) | $ | (165,625  | )
| |                                                       |       |           |   |   |           |   |   |           |  
| |                                                       |       |           |   |   |           |   |   |           |  
| |                                                       |       | 2002      |   |   | 2001      |   |   | 2000      |  
| |                                                       |       |           |   |   |           |   |   |           |  
| |                                                       |       |           |   |   |           |   |   |           |  
| | Loss per share (US GAAP)                              | $     | (0.19     | ) | $ | (0.12     | ) | $ | (0.10     | )
| |                                                       |       |           |   |   |           |   |   |           |  
| | Weighted average shares outstanding (US               |       |           |   |   |           |   |   |           |  
| | GAAP)                                                 |       | 2,257,436 |   |   | 1,665,948 |   |   | 1,664,260 |  
| |                                                       |       |           |   |   |           |   |   |           |  

58

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2002 AND 2001

|**9.** | MATERIAL DIFFERENCES BETWEEN CANADIAN AND UNITED STATES
        GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP)(Continued)
      Statement of Cash Flows in Accordance with US GAAP
|------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |                                                | 2002 |          | 2001 |   | 2000     |  
| | ---------------------------------------------- | ---- | -------- | ---- | - | -------- | -
| |                                                |      |          |      |   |          |  
| | Cash flows from operating activities           |      |          |      |   |          |  
| | Loss in accordance with US GAAP                | $    | (438,375 | )    | $ | (200,298 | )
| |                                                |      |          |      |   |          |  
| | Adjustments to reconcile loss to net cash used |      |          |      |   |          |  
| | by operating activities                        |      |          |      |   |          |  
| | Shares issued as consideration for loan        |      | -        |      |   | 14,000   |  
| | Shares issued for other than cash              |      | 66,000   |      |   | -        |  
| | Stock based compensation                       |      | 22,140   |      |   | -        |  
| |                                                |      |          |      |   |          |  
| | Change in non-cash working capital items:      |      |          |      |   |          |  
| | Accounts receivable                            |      | (6,395   | )    |   | (1,389   | )
| | Prepaid expenses                               |      | (2,189   | )    |   | (9,000   | )
| | Accounts payable                               |      | (6,153   | )    |   | 15,511   |  
| |                                                |      |          |      |   |          |  
| |                                                |      | (364,972 | )    |   | (181,176 | )
| |                                                |      |          |      |   |          |  
| |                                                |      |          |      |   |          |  
| | Cash flows from financing activities           |      |          |      |   |          |  
| | Loan payable                                   |      | (70,000  | )    |   | 70,000   |  
| | Special warrant subscriptions received         |      | 200,000  |      |   | -        |  
| | Issue of share capital                         |      | 500,000  |      |   | -        |  
| | Share issue costs                              |      | (16,400  | )    |   | -        |  
| |                                                |      |          |      |   |          |  
| |                                                |      | 613,600  |      |   | 70,000   |  
| |                                                |      |          |      |   |          |  
| |                                                |      |          |      |   |          |  
| | Increase (Decrease) in cash                    | $    | 248,628  |      | $ | (111,176 | )
| |                                                |      |          |      |   |          |  
| |                                                |      |          |      |   |          |  
| |                                                |      | 2002     |      |   | 2001     |  
| |                                                |      |          |      |   |          |  
| | Shareholders equity (deficiency)  Canadian   |      |          |      |   |          |  
| | GAAP                                           | $    | 633,787  |      | $ | 162,987  |  
| | Mineral properties and deferred exploration    |      |          |      |   |          |  
| | expenditures                                   |      | (353,725 | )    |   | (182,474 | )
| |                                                |      |          |      |   |          |  
| |                                                |      |          |      |   |          |  
| | Shareholders equity (deficiency)  US GAAP    | $    | 280,062  |      | $ | (19,487  | )
| |                                                |      |          |      |   |          |  

59

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2002 AND 2001

|9. | MATERIAL DIFFERENCES BETWEEN CANADIAN AND UNITED
        STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) (Continued)
|-- | ---------------------------------------------------------------------------------------------------------------------------

| |                                             |   | 2002     |   |   | 2001     |   |   | 2000     |  
| | ------------------------------------------- | - | -------- | - | - | -------- | - | - | -------- | -
| |                                             |   |          |   |   |          |   |   |          |  
| | Mineral properties and deferred exploration |   |          |   |   |          |   |   |          |  
| | expenditures  Canadian GAAP                | $ | 353,725  |   | $ | 182,474  |   | $ | 712,844  |  
| | Mineral properties and deferred exploration |   |          |   |   |          |   |   |          |  
| | expenditures expensed per US GAAP           |   | (353,725 | ) |   | (182,474 | ) |   | (712,844 | )
| |                                             |   |          |   |   |          |   |   |          |  
| | Mineral properties and deferred exploration |   |          |   |   |          |   |   |          |  
| | expenditures  US GAAP                      | $ | -        |   | $ | -        |   | $ | -        |  
| |                                             |   |          |   |   |          |   |   |          |  

| | i)  | Under Canadian GAAP, companies have the option to
        defer mineral exploration expenditures on prospective properties until
        such time as it is determined that further work is not warranted, at which
        point property costs would be written off. Under US GAAP, all exploration
        expenditures are expensed until an independent feasibility study has determined
        that the property is capable of commercial production. At this stage,
        the Company has not yet identified economically recoverable reserves on
        any of its properties. Accordingly, under US GAAP, all exploration costs
        incurred are expensed.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | ii) | The Company accounts for options granted according
        to requirements of Canadian GAAP, and those requirements are similar to
        the accounting prescribed in Accounting Principles Board Opinion No. 25
        (APB 25). Under APB 25, because the exercise price of the
        Companys employee stock options equals the market price of the underlying
        stock on the date of grant, no compensation expense is recognized. An
        alternative method under US GAAP is the fair value accounting provided
        for under FASB Statement No. 123 (SFAS No. 123), which requires
        the use of option valuation models. Pro-forma information regarding net
        income and earnings per share is required by SFAS No. 123, and has been
        determined as if the Company had accounted for its options granted under
        the fair value method of that Statement. The fair value for these options
        was estimated at the date of the grant using a Black-Scholes option pricing
        model with the following weighted average assumptions for 2002 and 2001:
        risk free rate of 5.25%; no dividends; volatility factor of the expected
        life of the Companys common stock of 128%; and weighted average
        expected life of the options granted in each year of four years.

60

---

MIRANDA DIAMOND CORP. 
  (Formerly Thrush Industries Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2002 AND 2001

|9. | MATERIAL DIFFERENCES BETWEEN CANADIAN AND UNITED STATES
          GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) (Continued)
        The pro-forma effect of SFAS No. 123 is as follows:
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | August 31, 2002             |   |          |  
| | --------------------------- | - | -------- | -
| | Loss for the year  US GAAP | $ | (480,776 | )
| | Loss per share              |   | (0.21    | )
| |                             |   |          |  
| | August 31, 2001             |   |          |  
| | Loss for the year  US GAAP |   | (200,298 | )
| | Loss per share              |   | (0.12    | )
| |                             |   |          |  
| | August 31, 2000             |   |          |  
| | Loss for the year  US GAAP |   | (165,625 | )
| | Loss per share              |   | (0.10    | )

61

---



THRUSH INDUSTRIES INC.

NOTICE OF ANNUAL AND EXTRAORDINARY GENERAL 
  MEETING OF MEMBERS

TAKE NOTICE that an Annual and Extraordinary General Meeting
  (the "Meeting") of the members of THRUSH INDUSTRIES INC. (the "Company")
  will be held in the boardroom at 306 -1140 Homer Street, Vancouver, British
  Columbia, V6B 2X6 on Wednesday, the 27th day of March, 2002 at 10:00
  a.m. for the following purposes:

|1. | To receive the report of the directors.                                                                                                                                                                                                                                                                                          
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                  
|2. | To receive the audited financial statements
        of the Company for the fiscal year ending August 31, 2001, together with
        the auditors report thereon, and the audited financial statements
        of the Company for the three months ending November 30, 2001, together
        with the auditors report thereon.
|   |                                                                                                                                                                                                                                                                                                                                  
|3. | To appoint the auditor for the Company.                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                  
|4. | To fix the number of directors and to
        elect directors for the ensuing year.                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                  
|5. | To consider and, if thought fit, to
        approve a resolution of the disinterested shareholders granting to the
        directors the general authority to amend stock options held by insiders.                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                  
|6. | To consider and, if thought fit, to
        approve a resolution of the disinterested shareholders approving the Companys
        acquisition of the Otish Mountains mineral properties from related parties.                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                  
|7. | To consider and, if thought fit, to
        approve special resolutions with respect to a proposed change of the Companys
        name.                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                  
|8. | To transact such other business as may
        be properly brought before the Meeting.                                                                                                                                                                                                                                           

A member entitled to attend and vote at the Meeting is
  entitled to appoint a proxyholder to attend and vote in his stead. If you are
  unable to attend the Meeting in person, please read the notes accompanying the
  instrument of proxy enclosed and then complete and return the proxy within the
  time set out in the notes. As set out in the notes, the enclosed instrument
  of proxy is solicited by management, but you may amend it, if you so desire,
  by striking out the names listed therein and inserting in the space provided
  the name of the person you wish to represent you at the Meeting.

DATED at Vancouver, British Columbia, this 21st day of February, 2002.

BY ORDER OF THE BOARD

DENNIS HIGGS PRESIDENT

---

THRUSH INDUSTRIES INC.

INFORMATION CIRCULAR FOR THE 2002 ANNUAL AND EXTRAORDINARY GENERAL MEETING OF MEMBERS

This information is given as of February 21, 2002

SOLICITATION OF PROXIES

This Information Circular is furnished in connection with
  the solicitation of proxies by the management of THRUSH INDUSTRIES INC.
  (the "Company"), for use at the Annual and Extraordinary General Meeting (the
  "Meeting"), of the members of the Company, to be held at the time and place
  and for the purposes set forth in the accompanying Notice of Meeting and at
  any adjournment thereof.

PERSONS OR COMPANIES MAKING THE SOLICITATION

The enclosed instrument of proxy is solicited by management.
  Solicitations will be made by mail and possibly supplemented by telephone or
  other personal contact to be made without special compensation by regular officers
  and employees of the Company. The Company may reimburse members' nominees or
  agents (including brokers holding shares on behalf of clients) for the cost
  incurred in obtaining authorization from their principals to execute the instrument
  of proxy. No solicitation will be made by specifically engaged employees or
  soliciting agents. The cost of solicitation will be borne by the Company. No
  director of the Company has advised management in writing that he intends to
  oppose any action intended to be taken by management as set forth in this Information
  Circular.

APPOINTMENT AND REVOCATION OF PROXIES

The persons named in the accompanying instrument of proxy
  are directors or officers of the Company. A member has the right to appoint
  a person to attend and act for him on his behalf at the Meeting other than the
  persons named in the enclosed instrument of proxy. To exercise this right, a
  member shall strike out the names of the persons named in the instrument of
  proxy and insert the name of his appointee in the blank space provided, or complete
  another instrument of proxy.

The completed instrument of proxy must be dated and signed
  and the duly completed instrument of proxy must be deposited at the Company's
  transfer agent at Pacific Corporate Trust Company, 10thFloor, 625 Howe Street, Vancouver, British Columbia, V6C 3B8, at least 48 hours
  before the time of the Meeting or any adjournment thereof, excluding Saturdays,
  Sundays and holidays.

The instrument of proxy must be signed by the member or by
  his duly authorized attorney. If signed by a duly authorized attorney, the instrument
  of proxy must be accompanied by the original power of attorney or a notarially
  certified copy thereof. If the member is a corporation, the instrument of proxy
  must be signed by a duly authorized attorney, officer, or corporate representative,
  and must be accompanied by the original power of attorney or document whereby

---

2

the duly authorized officer or corporate representative derives
  his power, as the case may be, or a notarially certified copy thereof. The Chairman
  of the Meeting has discretionary authority to accept proxies which do not strictly
  conform to the foregoing requirements.

In addition to revocation in any other manner permitted
  by law, a member may revoke a proxy by (a) signing a proxy bearing a later date
  and depositing it at the place and within the time aforesaid, (b) signing and
  dating a written notice of revocation (in the same manner as the instrument
  of proxy is required to be executed as set out in the notes to the instrument
  of proxy) and either depositing it at the place and within the time aforesaid
  or with the Chairman of the Meeting on the day of the Meeting or on the day
  of any adjournment thereof, or (c) registering with the scrutineer at the Meeting
  as a member present in person, whereupon such proxy shall be deemed to be have
  been revoked.

VOTING OF SHARES AND EXERCISE OF DISCRETION OF PROXIES

On any poll, the persons named in the enclosed instrument
  of proxy will vote the shares in respect of which they are appointed and, where
  directions are given by the member in respect of voting for or against any resolution,
  will do so in accordance with such direction.

In the absence of any direction in the instrument of proxy,
  it is intended that such shares will be voted in favour of the motions proposed
  to be made at the Meeting and for the election of the management nominees for
  directors and auditor, as stated under the headings in this Information Circular.
  The instrument of proxy enclosed, when properly signed, confers discretionary
  authority with respect to amendments or variations to any matters which may
  properly be brought before the Meeting. At the time of printing of this Information
  Circular, the management of the Company is not aware that any such amendments,
  variations or other matters are to be presented for action at the Meeting. However,
  if any other matters which are not now known to the management should properly
  come before the Meeting, the proxies hereby solicited will be exercised on such
  matters in accordance with the best judgment of the nominee.

VOTING SHARES AND PRINCIPAL HOLDERS THEREOF

On February 21, 2002, 1,692,260 common shares without par
  value were issued and outstanding, each share carrying the right to one vote.
  At a general meeting of the Company, on a show of hands, every member present
  in person shall have one vote and, on a poll, every member shall have one vote
  for each share of which he is the holder.

Only members of record on the close of business on the 21st
  day of February, 2002, who either personally attend the Meeting or who complete
  and deliver an instrument of proxy in the manner and subject to the provisions
  set out under the heading "Appointment and Revocation of Proxies" will be entitled
  to have his or her shares voted at the Meeting or any adjournment thereof. To
  the knowledge of the directors and senior officers of the Company only the following
  own, directly

---

3

or indirectly, or exercise control or direction over, shares
  carrying more than l0% of the voting rights attached to all outstanding shares
  of the Company.

|NAME OF MEMBER | NUMBER OF SHARES | PERCENTAGE OF
      ISSUED AND
      OUTSTANDING
|-------------- | ---------------- | ------------------------------------------------
|               |                  |                                                 
|Dennis Higgs   | 172,820*         | 10.21%                                          
|Darcy Higgs    | 270,980*         | 16.01%                                          

|* | In addition, Dennis Higgs beneficially owns or exercises
        control or direction over a total of 212,500 special warrants of the Company
        and Darcy Higgs beneficially owns or exercises control or direction over
        a total of 462,500 special warrants of the Company. Each special warrant
        is convertible without further consideration into one common share and
        one share purchase warrant entitling the holder to purchase an additional
        common share at the price of $0.12, exercisable on or before January 7,
        2004.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON

Other than as disclosed elsewhere in this Information Circular,
  none of the directors or senior officers of the Company, no proposed nominee
  for election as a director of the Company, none of the persons who have been
  directors or senior officers of the Company since the commencement of the Company's
  last completed financial year and no associate or affiliate of any of the foregoing
  persons has any material interest, direct or indirect, by way of beneficial
  ownership of securities or otherwise, in any matter to be acted upon at the
  Meeting.

INTEREST OF INSIDERS IN MATERIAL TRANSACTIONS

Other than as set forth in the following or previously disclosed
  in an Information Circular, no insider, no proposed nominee for election as
  a director of the Company and no associate or affiliate of any such insider
  or proposed nominee, has any material interest, direct or indirect, in any material
  transaction since the commencement of the Company's last completed financial
  year or in any proposed transaction, which, in either case, has materially affected
  or will materially affect the Company.

Private Placement

In January, 2002, the Company closed a private placement of 2,000,000 special
  warrants at $0.10 per special warrant. Each special warrant is convertible,
  without further consideration, into one unit, each unit comprising one common
  share and one non-transferable share purchase warrant entitling the holder thereof
  to purchase an additional share of the Company at a price of $0.12 per share
  for a period of two years. The following persons purchased special warrants
  under the

---

4

private placement.

|Name & Address                                                                                                                                    | Number of Special
      Warrants
|------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------
|Dennis Higgs
      4520 West 5thAvenue,
      Vancouver, B.C. V6R 1S7                                                                             | 193,000                         
|McCutcheon Management Ltd.
      (wholly owned by John McCutcheon) 
      Suite 1201  845 Chilco Street 
      Vancouver, B.C. V6G 2R2           | 100,000                         
|Aileen Lloyd
      3996 Michener Court 
      North Vancouver, B.C. V7K 3C7                                                                       | 200,000                         
|Steven Ristorcelli
      Suite 860  625 Howe Street 
      Vancouver, B.C. V6C 2T6                                                               | 15,000                          
|Senate Equities Corp.
      (wholly owned by Dennis Higgs) 
      Suite 306  1140 Homer Street 
      Vancouver, B.C. 
      V6B 2X6             | 8,500                           
|Haywood Securities Inc. ITF for Kaylie,
      Cameryn and Brooklyn Higgs, RESP 
      Suite 2000  400 Burrard St. 
      Vancouver, B.C. V6C 3A6 | 11,000(1)                       
|Darlene Higgs
      4520 West 5thAvenue, 
      Vancouver, B.C.V6R 1S7                                                                            | 350,000(2)                      
|Darcy Higgs,
      4756 Drummond Drive, 
      Vancouver, B.C. V6T 1B4                                                                            | 362,500(3)                      
|Carleen Higgs, RRSP
      4756 Drummond Drive, Vancouver,
      B.C. V6T 1B4                                                                      | 100,000(4)                      

|(1) | Dennis Higgs exercises control or direction over these shares.                                                                                                                   
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                  
|(2) | associate of Dennis Higgs.                                                                                                                                                       
|    |                                                                                                                                                                                  
|(3) | Darcy Higgs is an insider of the Company
        by reason of his ownership of or control or direction over more than 10%
        of the issued voting securities of the Company.
|    |                                                                                                                                                                                  
|(4) | associate of Darcy Higgs.                                                                                                                                                        

---

5

STATEMENT OF EXECUTIVE COMPENSATION

A.    Executive Officers of the
  Company

For the purposes of this Information Circular:

"CEO" of the Company means an individual who served as Chief
  Executive Officer of the Company or acted in a similar capacity during the most
  recently completed financial year;

"executive officer" of the Company means an individual who
  at any time during the most recently completed financial year was the Chairman
  or Vice-Chairman of the Board, where that person performed the function of such
  office on a full-time basis, the President, a Vice-President in charge of a
  principal business unit such as sales, finance or production, and any officer
  of the Company or any of its subsidiaries who performed a policy-making function
  in respect of the Company; and
  "Named Executive Officers" means:

| | (a) | each CEO regardless of the amount of his compensation;                                                                                                                                                                                                                 
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                        
| | (b) | each of the Company's four most highly compensated executive
      officers, other than the CEO, who were serving as executive officers at
      the end of the most recently completed financial year and had total salary
      and bonuses of at least $100,000; and
| |     |                                                                                                                                                                                                                                                                        
| | (c) | any person who would be included under paragraph (b) but
      for the fact that he was not serving as an executive officer at the end
      of the most recently completed financial year.                                                                            

---

6

B.Summary Compensation Table



|1 | The Company has paid to Ubex Capital Inc. the sum
        of $2,500 per month since May 1993 and $3000 per month since July, 2001
        for the provision of management services to the Company. Ubex Capital
        Inc. is wholly owned by Dennis L. Higgs, the President, CEO, CFO and a
        director of the Company.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

C.Long-term Incentive Plan ("LTIP")
  Awards

No LTIP awards were made to a Named Executive Officer during the most recently
  completed financial year.

D.Options and Stock Appreciation
  Rights ("SARs")

OPTION/SAR GRANTS DURING THE MOST RECENTLY COMPLETED FINANCIAL YEAR

|Name         | Securities
      Under 
      Options/SARs
      Granted 
      (#) | % of Total
      Options/SARs 
      Granted to 
      Employees in 
      Financial Year | Exercise or
      Base Price 
      ($/Security) | Market Value of
      Securities
      Underlying 
      Options/SARs on 
      the Date of Grant 
      ($/Security) | Expiration
      Date
|------------ | ------------------------------------------------------------------- | ----------------------------------------------------------------------------------------- | ------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------- | ---------------------
|Dennis Higgs | Nil                                                                 | N/A                                                                                       | N/A                                              | N/A                                                                                                                   | N/A                  

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7

AGGREGATED OPTION/SAR EXERCISES DURING THE MOST RECENTLY
  COMPLETED FINANCIAL YEAR AND FINANCIAL YEAR-END OPTION/SAR VALUES

|Name         | Securities Acquired
      on Exercise 
      (#) | Aggregate Value
      Realized 
      ($) | Unexercised
      Options/SARs at 
      FY-End 
      (#) 
      Exercisable/ 
      Unexercisable | Value of
      Unexercised
      in-the-Money 
      Options/SARs at 
      FY-End
      ($)
      Exercisable/ 
      Unexercisable
|------------ | ------------------------------------------------ | ----------------------------------------- | --------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------
|Dennis Higgs | Nil                                              | N/A                                       | Nil
      (exercisable)                                                                             | Nil
      (exercisable)                                                                                                             

E.     Termination of Employment, Change in
  Responsibilities and EmploymentContracts

The Company retains Ubex Capital Inc. ("Ubex") to provide management services
  under a Management Services Agreement dated May 4, 1993. Under the agreement,
  Ubex has received the sum of $2,500 per month since May 1993, and the sum of
  $3,000 per month since July, 2001, which amount may be increased by agreement
  between the parties, subject to the approval of the Canadian Venture Exchange.
  The term of the agreement is month-to-month and may be terminated by either
  party on 30 days written notice. Ubex is wholly owned by Dennis L. Higgs, the
  President, CEO, CFO and a director of the Company.

There are no compensatory plans or arrangements between the Company and a Named
  Executive Officer with respect to the resignation, retirement or other termination
  of employment of the Named Executive Officer, a change in control of the Company
  or a change in the Named Executive Officer's responsibilities following a change
  in control of the Company involving an amount, including all periodic payments
  or instalments, exceeding $100,000.

F.     Compensation of Directors

During the most recently completed financial year, no director of the Company
  who is not a Named Executive Officer has received compensation pursuant to:

|(a) | any standard arrangement for the compensation
        of directors for their services in their capacity as directors, including
        any additional amounts payable for committee participation or special
        assignments;
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                   
|(b) | any other arrangement, in addition to, or in lieu of, any
      standard arrangement, for the compensation of directors in their capacity
      as directors; or                                                                  

---

8

|(c) | any arrangement for the compensation of directors for services as consultants
      or experts.
|--- | -----------------------------------------------------------------------------------------------

INDEBTEDNESS OF DIRECTORS, EXECUTIVE OFFICERS AND SENIOR OFFICERS

No person who is or at any time during the most recently completed
  financial year was a director, executive officer or senior officer of the Company,
  no proposed nominee for election as a director of the Company, and no associate
  of any of the foregoing persons has been indebted to the Company at any time
  since the commencement of the Company's last completed financial year. No guarantee,
  support agreement, letter of credit or other similar arrangement or understanding
  has been provided by the Company at any time since the beginning of the most
  recently completed financial year with respect to any indebtedness of any such
  person.

PARTICULARS OF MATTERS TO BE ACTED UPON

A.Election of Directors

Management intends to propose for adoption an ordinary resolution
  that the number of directors of the Company be fixed at four.

Advance notice of the Meeting was originally published pursuant
  to section 111 of the Company Act in the Vancouver Province on December
  6, 2001, and notice of the postponement of the Meeting was published in the
  Vancouver Province on January 30, 2002. No nominations for directors were received
  from the members of the Company.

Each director of the Company is elected annually and holds
  office until the next Annual General Meeting of the members unless that person
  ceases to be a director before then. In the absence of instructions to the contrary,
  the shares represented by proxy will, on a poll, be voted for the nominees herein
  listed. Management does not contemplate that any of the nominees will be
  unable to serve as a director.

The following table sets out the names of the persons to be
  nominated for election as directors, the positions and offices which they presently
  hold with the Company, their respective principal occupations and the number
  of shares of the Company which each beneficially owns, directly or indirectly,
  or over which control or direction is exercised as of the date of this Information
  Circular:

---

9

|Name of Nominee and
      Present Offices Held                                                        | Principal Occupation                                                                                                                                        | Director
      Since | Shares
      Beneficially 
      Owned or
      Controlled
|----------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------- | ----------------------------------------------------------
|DENNIS L. HIGGSPresident, Chief Executive 
      Officer, Chief Financial 
      Officer and Director | President and Chief Executive
        Officer of the Company; President, Senate Capital Group Inc., a private
        venture capital company.              | May 4, 1993          | 172,820 1                                                 
|JOHN O. McCUTCHEONDirector                                                                            | Chairman & Director,
        Zargon Oil & Gas Ltd., an oil and gas company. Chairman, Xenex Laboratories
        Inc., a pharmaceutical chemicals supplier. | November 1, 1993     | 22,000 1                                                  
|AILEEN LLOYDDirector                                                                                  | Executive Assistant, Senate
        Capital Group Inc., a private venture capital company.                                                                  | November 1, 1993     | 48,100 1                                                  
|STEVE RISTORCELLIDirector                                                                             | Principal Geologist, Mine
        Development Associates, a mine engineering company.                                                                       | February 20, 1995    | 70,7001                                                   

|1 | On January 7, 2002, the Company closed a private
        placement of 2,000,000 special warrants, with each special warrant being
        convertible, without further consideration, into one common share and
        one share purchase warrant entitling the holder to purchase an additional
        common share at the price of $0.12, exercisable on or before January 7,
        2004. The following directors beneficially own or exercise control or
        direction over, the following special warrants purchased under the private
        placement:
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Name               | Number of Special Warrants
| | ------------------ | --------------------------
| | Dennis L. Higgs    | 212,500                   
| | John O. McCutcheon | 100,000                   
| | Aileen Lloyd       | 200,000                   
| | Steve Ristorcelli  | 15,000                    

The above information was provided by management of the Company.

The Company is required to have an audit committee pursuant
  to the provisions of the Company Act (British Columbia). The members
  of the Companys audit committee are Dennis Higgs, John McCutcheon and
  Aileen Lloyd. The Company does not have an executive committee.

---

10

B.Appointment of Auditor

Management proposes that Morgan & Company, Chartered Accountants,
  of 1488 - 700 West Georgia Street, Vancouver, British Columbia, V7Y 1A1 be re-appointed
  as auditor of the Company for the ensuing year.

C.Stock Option Amendments

The policy of the Canadian Venture Exchange requires that
  the approval of a company's disinterested shareholders be received as a condition
  of certain amendments to stock options held by insiders of the company.

In order to avoid the time and expense of convening a shareholders
  meeting each time it is proposed to amend insiders stock options, management
  seeks the general approval of the shareholders to such amendments. Accordingly,
  management proposes the following resolution:



All of the Companys insiders eligible to receive stock
  options, and their associates, will abstain from voting on the foregoing resolution.

D.Acquisition of Otish Mountains
  Mineral Properties

The Company has entered into agreements dated January 30,
  2002, to acquire six mineral properties, comprising a total of 564 mineral claims
  covering 72,350 acres, located in the Otish Mountains region of Quebec. The
  individual properties are the Lac Leran property (119 mineral claims / 15,300
  acres); the Lac Pigeon property (120 mineral claims / 15,400 acres); the Lac
  Leran #2 property (100 mineral claims / 12,900 acres); the Lac Pigeon #2 property
  (41 mineral claims / 5,300 acres); the Lac Joubert property (34 mineral claims
  / 4,300 acres); and the Lac Orillat property (150 mineral claims / 19,150 acres).

The Otish Mountains area is within the Superior Craton, which
  represents one of the largest accumulations of Archaen crustal rocks in the
  world. Ashton Mining of Canada-SOQUEM Inc. (Ashton) recently reported
  promising diamond counts at the Renard 1 and Renard 2 kimberlitic discoveries
  on its Otish Mountains property. According to Ashton, the 163.1 kilogram sample
  from the Renard 2 kimberlitic rock contained 116 micro diamonds and 29 macro
  diamonds. Kimberlitic indicator minerals, including pyrope garnet and chromite,
  were also recovered in concentrates derived from the Ashton drill core. A significant
  percentage of the pyrope garnets have high-chromium, low-calcium (G10) chemical
  compositions. The concentrates also contain elevated numbers of chromites similar
  in composition to the chromite inclusions that occur in

---

11

diamonds. These results signal the presence of potentially
  high grade diamondiferous pipes in the Otish Mountains region of Quebec.

In 1998, Majescor Resources (Majescor) carried
  out a reconnaissance tills sampling program targeted at airborne magnetic anomalies
  in the Otish Mountains area. This program led to the discovery of kimberlite
  indicator minerals in two till samples. In the fall and winter of 2000, Majescor
  acquired five mining exploration properties totaling approximately 1,030 square
  kilometres in the Otish Mountains.

The properties acquired by the Company are located in proximity
  to the Ashton property where the Renard 1 and Renard 2 kimberlitic rocks were
  recently discovered, and the Majescor property. The Lac Leran property adjoins
  on the east side of the Ashton property and the Lac Pigeon property adjoins
  on the west side of the Majescor property, approximately 30 kilometres northwest
  of the Renard discoveries. The Lac Joubert property adjoins the Majescor property
  to the northeast and the Lac Pigeon #2 property adjoins the Majescor property
  to the west, approximately 40 kilometres west of the Renard 1 and 2 discoveries.
  The Lac Leran #2 property is located approximately 35 kilometres east-southeast
  of the Renard 1 and 2 discoveries, adjoining the eastsoutheast corner
  of the Majescor property. The Lac Orillat property adjoins the Majescor property
  to the north-northeast approximately 35 kilometres north of the Renard 1 and
  2 discoveries, and also adjoins to the west of the Lac Joubert property described
  above.

The consideration payable by the Company for each property is as follows:

Lac Leran property - 165,000 shares and $23,000; 
  Lac Pigeon property - 165,000 shares and $23,000; 
  Lac Leran #2 property - $12,904; 
  Lac Pigeon #2 - $5,271; 
  Lac Joubert - $4,341; 
  Lac Orillat - $19,154.

All of the properties are subject to a net smelter/gross overriding
  royalty of 2% in favour of the optionor. In the case of the Lac Leran and Lac
  Pigeon properties, advance royalty payments of $15,000 per annum are payable
  to the optionor on each property.

With respect to each of the properties, other than the Lac
  Orillat property, the optionor is Dennis Higgs, the President, CEO, CFO and
  a director of the Company, and/or private companies wholly owned by Dennis Higgs.
  With respect to the Lac Orillat property, the optionor is Dennis Higgs and /or
  private companies wholly owned by Dennis Higgs as to approximately 66 2/3 %,
  and Monaco Investment Corp. (Monaco) (wholly owned by Darcy Higgs)
  as to approximately 33 1/3 %. Darcy Higgs is an insider of the Company by virtue
  of owning or exercising control or direction over in excess of 10% of the issued
  shares of the Company. Dennis Higgs original cost of the properties was
  $51,400 in the aggregate and Monacos original cost was $5,000.

---

12

The Companys acquisition of the foregoing properties
  from related parties is subject to the prior approval of the Canadian Venture
  Exchange. Dennis Higgs currently owns, directly and indirectly, 172,820 common
  shares of the Company and 212,500 special warrants of the Company convertible
  into common shares without further consideration. Upon the issuance to him of
  330,000 common shares as consideration for the Lac Leran and Lac Pigeon properties,
  Dennis Higgs will own 17.78% of the outstanding shares of the Company assuming
  the full conversion of the currently outstanding special warrants. Under these
  circumstances, the Canadian Venture Exchange requires disinterested shareholder
  approval as a condition of approving the Companys acquisition of these
  properties.

In this regard, management proposes the following resolution:



Dennis Higgs, Darcy Higgs and their associates and affiliates will abstain
  from voting on the foregoing resolution.

The Company retained Roscoe Postle Associates Inc. of Toronto,
  Ontario to prepare a technical report on the foregoing properties in accordance
  with National Instrument 43-101 issued by the Canadian Securities Administrators.
  The resulting report, entitled Report on Diamond Exploration Properties
  of Thrush Industries Inc., North Central Quebec and dated February 8,
  2002, is attached to this Information Circular. Reference is also made to the
  Companys news release dated February 11, 2002 and its amended material
  change report dated February 19, 2002.

E.Change of Name

In light of the proposed acquisition of the mineral properties
  referred to in the foregoing, management considers it desirable to adopt a new
  name for the Company to more closely reflect its new business direction. In
  this regard, management proposes Miranda Diamond Corp. as the new
  name of the Company. To effect this name change, the members will be asked to
  approve the following special resolution:



---

13

It may occur that management hereafter determines, for valid
  reason, that some name other than Miranda Diamond Corp. should be
  substituted as the new name of the Company. To avoid the time and expense of
  convening another meeting of the members, management seeks the approval of the
  members to a resolution authorizing the directors to approve some other name
  as the new name of the Company. Accordingly, the members will be asked to approve
  the following special resolution:

> RESOLVED, by special resolution, that in the event
>     that the directors consider, for valid reason, that the name of the Company
>     should be changed to some name other than Miranda Diamond Corp.,
>     the directors be authorized to approve a name other than Miranda Diamond
>     Corp. as the new name of the Company and to substitute such name for
>     Miranda Diamond Corp. in the special resolution changing the name
>     of the Company, and such resolution as so amended shall for all purposes be
>     deemed a special resolution of the members.

In the event that management determines prior to the Meeting
  that some name other than "Miranda Diamond Corp." should be substituted as the
  new name of the Company, the new name will be inserted in the special resolution
  presented to the members for their consideration.

The proposed name change is subject to the approval of the Canadian Venture
  Exchange.

OTHER MATTERS TO BE ACTED UPON

It is not known that any other matters will come before the
  Meeting other than as set forth above and in the Notice of Meeting, but if such
  should occur the persons named in the accompanying form of proxy intend to vote
  on them in accordance with their best judgment exercising discretionary authority
  with respect to amendments or variations of matters identified in the Notice
  of Meeting and other matters which may properly come before the meeting or any
  adjournment thereof.

BOARD APPROVAL

The contents of this Information Circular have been approved
  and its mailing has been authorized by the directors of the Company.

CERTIFICATION

The foregoing contains no untrue statement of material fact
  and does not omit to state a material fact that is required to be stated or
  that is necessary to make a statement not misleading in light of the circumstances
  in which it was made.

---

14

**DATED** at Vancouver, British Columbia, this 21st
  day of February, 2002.

Dennis L. Higgs
  DENNIS HIGGS, Chief Executive Officer & Chief Financial Officer

---

17

THRUSH INDUSTRIES INC. INSTRUMENT OF PROXY

The undersigned, being a shareholder of THRUSH INDUSTRIES
  INC. (the "Company"), hereby appoints DENNIS HIGGS or, failing him, AILEEN LLOYD,
  both directors of the Company, or , ____________________, as my proxyholder,
  to attend and act for me at the Annual and Extraordinary General Meeting of
  the Company to be held on the 27th day of March, 2002, and at any adjournment
  thereof, and to vote the shares in the capital stock of the Company registered
  in the name of the undersigned with respect to the matters set forth as follows:

1.         To fix the number
  of directors at four.

| | IN FAVOUR |  | AGAINST
| | --------- |  | -------

2.         To elect as a director:

|                  | IN FAVOUR | WITHHOLD VOTE
|----------------- | --------- | -------------
|                  |           |              
|DENNIS L. HIGGS   |           |              
|                  |           |              
|JOHNO. McCUTCHEON |           |              
|                  |           |              
|AILEEN LLOYD      |           |              
|                  |           |              
|STEVE RISTORCELLI |           |              

---

18

3.         For the appointment
  of Morgan & Company, Chartered Accountants, as auditor.

| | IN FAVOUR |  | WITHHOLD VOTE
| | --------- |  | -------------

---

19

4.         With
  respect to the proposed resolution for the general approval of amendments made
  to stock options held by insiders, the full text of which is set forth in the
  Information Circular.

| | IN FAVOUR |  | AGAINST |  | ABSTAIN
| | --------- |  | ------- |  | -------



5.         With
  respect to the proposed resolution for the approval of the acquisition of the
  Otish Mountains mineral properties, the full text of which is set forth in the
  Information Circular.

| | IN FAVOUR |  | AGAINST |  | ABSTAIN
| | --------- |  | ------- |  | -------



6.         With
  respect to the proposed special resolution for the approval of the Companys
  name change to Miranda Diamond Corp., the full text of which is
  set forth in the Information Circular.

| | IN FAVOUR |  | AGAINST
| | --------- |  | -------

7.         With
  respect to the proposed special resolution to authorize the directors to substitute
  a name other than Miranda Diamond Corp. as the new name of the Company,
  the full text of which is set forth in the Information Circular.

| | IN FAVOUR |  | AGAINST
| | --------- |  | -------

The shares represented by this instrument of proxy will
  be voted or withheld from voting on any ballot that may be called for in accordance
  with the instructions given and, if a choice is specified with respect to any
  matter to be acted upon, the shares will be voted

---

20

accordingly. This instrument of proxy confers upon the
  person named herein as nominee discretionary authority with respect to amendments
  or variations to matters identified in the Notice of Meeting and other matters
  which may properly come before the Meeting. This instrument of proxy does not
  confer authority to vote for the election of any person as a director of the
  Company other than those persons named in the accompanying Information Circular.

The undersigned hereby revokes any proxy previously given in respect of the
  Meeting.

DATED this ______ day of ____________________ , 2002.

|               |  |                    
|-------------- |  | -------------------
|NAME OF MEMBER |  | SIGNATURE OF MEMBER
|(PLEASE PRINT) |  |                    

|Address: |  | 
|-------- |  | 
|         |  | 
|         |  | 

If the member wishes this instrument of proxy to represent
  less than 100% of the shares registered in his name, indicate the number of
  shares to be represented hereby: _________________________

NOTES TO INSTRUMENT OF PROXY

1.This
  instrument of proxy is solicited on behalf of management of the Company.
  Please refer to the Information Circular enclosed herewith.



3.         The
  instrument of proxy will not be valid unless it is dated and signed. The instrument
  of proxy must be signed by the member or by his duly authorized attorney. If
  signed by a duly authorized attorney, the instrument of proxy must be accompanied
  by the original power of attorney or a notarially certified copy thereof. If
  the member is a company, the instrument of proxy must be signed by a duly authorized
  attorney, officer, or corporate representative, and must be accompanied by the
  original power of attorney or document whereby the duly authorized officer or
  corporate representative derives his power, as the case may be, or a notarially
  certified copy thereof.

4.         The
  form of proxy to be effective must be deposited at the Companys transfer
  agent, Pacific Corporate Trust Company, 10th floor, 625 Howe Street,
  Vancouver, B.C. V6C 3B8, not less than 48 hours before the time of the Meeting,
  or any adjournment thereof, excluding Saturdays, Sundays and holidays.

---



Miranda Diamond Corp. Suite 306  1140 Homer Street 
  Vancouver, B.C. V6B 2X6

April 18, 2002

Mr. Ed Chipp 
  1700 Foothill Road 
  Gardnerville, NV 
  89710

Attention: Mr. Ed Chipp

Dear Mr. Chipp:

Thank you for the interest you have shown in the Las Catalinas
  project. The preliminary geochemical, geological and geophysical evidence at
  Las Catalinas suggest the potential of a significant gold deposit existing within
  its boundaries.

This letter serves as a letter of intent between Ed Chipp,
  doing business as Exploraciones Paradigma, (Chipp) and Miranda Diamond
  Corp. (TRY) to joint venture the Las Catalinas concessions, Sonora,
  Mexico, as defined by the property schedule attached hereto (the Property).

All dollar amounts are in United States currency.

|1. | Chipp will have the exclusive right
        to acquire a 90% interest in the Property by spending $250,000 on the
        Property within six years of the date of signing this letter of intent
        on a joint venture (Letter of Intent);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|2. | Chipp and Miranda, (the Parties
        and ndividuallythe Party) hereby agree that upon Chipp
        earning a 90% interest in the Property pursuant to clause 1 herein, the
        Parties may agree to join and participate in a single purpose joint venture
        (the Joint Venture) for the purpose of further exploring and
        developing and, if economically and politically feasible, constructing
        and operating a mine on the Property. The Joint Venture shall be governed
        by an agreement which shall be entered into by the Parties incorporating
        a simple dilution clause as described in clause 3 herein, to address the
        event of one Party wishing to advance the Property and the other Party
        not wishing to participate or not being able to;
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|3. | Dilution shall be prorated at 1% for
        every additional $20,000 expended. For example if TRY elects not to contribute
        their portion ($2000), then TRY is reduced by 1% for each $2000 not contributed.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|4. | In the case of one Party being diluted
        to a 5% interest in the Property, then that interest will convert to a
        5% carried interest on the Property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|5. | Chipp to pay all taxes and property
        assessments due after the signing date of this Letter of Intent during
        the six years and will perform annual assessment work as required by Mexican
        law, unless this Letter of Intent is terminated;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

Suite 306  1140 Homer Street, Vancouver, B.C. V6B
  2X6 
  Tel: (604) 689-1659, Fax: (604) 689-1722

---

|6.  | TRY may buy out all of Chipps
        interest in the Property at any time prior to Chipp earning an interest
        in the Property under Clause 1 herein by paying to Chipp three times Chipps
        expenditures on the Property and granting Chipp a 1⁄2 % net smelter
        return royalty for every $50,000 that Chipp has expended on the Property
        pursuant to this agreement, to a maximum of a 2% net smelter return royalty.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|7.  | TRY may buy out all of Chipps
        interest in the Property for $1,000,000 at any time up to seven years
        from the date of signing this Letter of Intent;                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|8.  | TRY may buy out all of Chipps
        interest in the Property for $5,000,000 at any time after seven years
        from the date of signing this Letter of Intent. TRYs right to buy
        out all of Chipps interest in the Property will expire 10 years
        from the date of signing this Letter of Intent;                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|9.  | TRY to be kept apprised of any and all
        work being performed on the property, including all assay results obtained;                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10. | All news and information relating to
        the Property must be sent to TRY and TRY retains the exclusive right to
        issue news releases and issue information regarding the Property and the
        results of work being conducted on the Property, provided however, any
        news releases are subject to the prior approval of both Parties which
        approval shall not be unreasonably withheld;                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|11. | TRY will have the right to review the
        data at any time with reasonable notice, understanding that it may only
        be available in field form. All assay data will be released
        to TRY immediately upon receipt;                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|12. | All property acquired by Chipp within
        a 5 km area of interest surrounding the outer boundary of the Property
        automatically becomes subject to this Letter of Intent;                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|13. | Chipp has the right to withdraw from
        this Letter of Intent venture at any time, with 30 days written notice,
        provided that Chipp is not in default under any provision of the Letter
        of Intent. Any property taxes or assessments due within the 30 days notice
        period must be paid by Chipp;                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|14. | The Parties hereto hereby covenant and
        agree that they will execute such further agreements, conveyances and
        assurances as may be requisite, or which counsel for the Parties may deem
        necessary to effectually carry out the intent of this Letter of Intent,
        for the purposes of the Joint Venture;                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|15. | The parties will use their best efforts
        to formalize this Letter of Intent at such time as it is deemed necessary
        by either party;                                                                                                                                                                                                                                                                                                 

Miranda is enthusiastic about the potential at Las Catalinas.
  We look forward to the possibility of having the project exploration advanced.

Sincerely,

MIRANDA DIAMOND CORP.

Dennis L. Higgs, B. Comm 
  President

Suite 306  1140 Homer Street, Vancouver, B.C. V6B
  2X6 
  Tel: (604) 689-1659, Fax: (604) 689-1722

---

The terms of this letter are hereby agreed to and create a binding letter
  of intent this 22nd day of April, 2001





SIGNED, SEALED and DELIVERED BY MIRANDA DIAMOND CORP. in the presence 
  of:

"Dennis L. Higgs"

"Ed Chipp"
  Ed Chipp

Suite 306  1140 Homer Street, Vancouver, B.C. V6B
  2X6 
  Tel: (604) 689-1659, Fax: (604) 689-1722

---

Schedule A

Minas Miranda, S.A. de C.V. maintains title to two Mexican
  concessions comprising the Las Catalinas project: Las Catalinas and Ampliacion
  Las Catalinas IV. The Las Catalinas property is located about ten kilometres
  southwest of Rosario de Tesopaco and 70 kilometres east of Ciudad Obregon, in
  south central Sonora, Mexico.

The two concessions comprise a total of approximately 2,271 hectares.

|Type        | Name                        | Date           | Title  | Status  
|----------- | --------------------------- | -------------- | ------ | --------
|Exploration | Las Catalinas               | November, 1997 | 207509 | Current 
|Exploration | Ampliación Las Catalinas IV | June, 2000     | 212506 | Current.

Suite 306  1140 Homer Street, Vancouver, B.C. V6B
  2X6 
  Tel: (604) 689-1659, Fax: (604) 689-1722

---



AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 24th day of June, 2002.

|BETWEEN: | MIRANDA DIAMOND CORP.            
|-------- | ---------------------------------
|         | (Formerly Thrush Industries Inc.)
|         | Suite 306  1140 Homer Street    
|         | Vancouver, B.C.                  
|         | V6B 2X6                          
|         |                                  
|         | (the Optionor)                 

OF THE FIRST PART

|AND: | BRADEN TECHNOLOGIES INC.     
|---- | -----------------------------
|     | Suite 306  1140 Homer Street
|     | Vancouver, B.C.              
|     | V6B 2X6                      
|     |                              
|     | (Braden)                   

OF THE SECOND PART

WHEREAS:

|A. | The parties entered into a property option agreement
        dated the 18thday of February, 1999 (the Agreement),
        and an amendment agreement dated June 25, 2001 with respect to the acquisition
        by Braden of an option on the Secret Basin property; and
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                            
|B. | The parties now wish to amend the Agreement;                                                                                                                                                                                                                               

NOW THEREFORE THIS AGREEMENT WITNESSES that the Agreement is amended as follows:

|1. | By the deletion of paragraph 2.01 in its entirety and the substitution
      therefor of the following:
|-- | -------------------------------------------------------------------------------------------------------

2.01. The Optionor hereby grants to Braden the exclusive right
  and option to acquire an undivided 50% right, title and interest in and to the
  Property for total consideration consisting of cash payments to the Optionor
  totalling $1000 and the incurrence of Property Expenditures totalling $250,000
  to be made as follows:

|(a) | upon execution of this Agreement, the payment to the Optionor
      of the sum of $1000;    
|--- | --------------------------------------------------------------------------------------------
|    |                                                                                             
|(b) | by December 31, 2002 the incurrence of Property Expenditures
      in the amount of $10,000;

---

|(c) | by June 30, 2003, the incurrence of Property Expenditures in the cumulative
      amount of $250,000.
|--- | -----------------------------------------------------------------------------------------------------

2. The parties hereby ratify and confirm the Agreement in all other respects.

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

|THE COMMON SEAL OF MIRANDA     | c/s
|------------------------------ | ---
|DIAMOND CORP. was hereunto     |    
|affixed in the presence of:    |    
|                               |    
|                               |    
|*/s/ Aileen Lloyd*             |    
|                               |    
|                               |    
|                               |    
|                               |    
|THE COMMON SEAL OF BRADEN      | c/s
|TECHNOLOGIES INC, was hereunto |    
|affixed in the presence of:    |    
|                               |    
|                               |    
|/s/ Peter Bell                 |    
|                               |    

---



MINERAL PROPERTY OPTION AGREEMENT

THIS AGREEMENTis dated for reference the 30th day of January, 2002

|BETWEEN: | Ubex Capital Inc.                   |                   
|-------- | ----------------------------------- | ------------------
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (the Optionor or the Optionors) |                   
|         |                                     | OF THE FIRST PART 
|AND:     | Thrush Industries Inc.              |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (Thrush)                          |                   
|         |                                     | OF THE SECOND PART

WHEREAS the Optionor has made staking applications
  for a 100% interest in certain exploration claims in the Otish Mountains region
  of Quebec (the Lac Leran #2 property), through the internet by way
  of the website maintained by the Province of Quebec for such purposes;

AND WHEREASsuch applications to stake claims have
  been received by the Province of Quebec, Ministere des Ressources Naturelles,
  although confirmations of title to the claims have not yet been issued;

AND WHEREASThrush is desirous of acquiring an interest
  in such exploration claims on the terms and conditions contained herein:

NOW THEREFORE THIS AGREEMENT WITNESSESthat in consideration
  of the premises and the mutual covenants and agreements hereinafter contained,
  the parties hereto agree as follows:

|1.   | DEFINITIONS       
|---- | ------------------
|     |                   
|1.01 | In this Agreement:
|     |                   
|     | (a)               
|     |                   
|     | (b)               

---

|     | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Net Smelter Returns shall have the
      meaning ascribed by Schedule B attached hereto;                                       
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | "Property" means and includes:                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (i)                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (ii)                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|2.   | ACQUISITION OF INTEREST                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|2.01 | The Optionor hereby grants
        to Thrush the exclusive right and option to acquire an undivided 100%
        right, title and interest in and to the Property, subject to the Net Smelter
        Returns and Gross Overriding Royalty described in Article 4 of this Agreement,
        for total consideration consisting of cash payments to the Optionor totalling
        $12,904 to be made as follows:                                                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | the payment to the Optionor of $2,000, the receipt
      of which is hereby acknowledged;                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | upon shareholder approval
        and approval of this Agreement by the Exchange, the payment to the Optionor
        of $10,904.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|2.02 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to receipt of title certificates
        for the exploration claims comprising the Property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|2.03 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to the prior approval of
        the shareholders of Thrush, at an annual and extraordinary general meeting
        proposed to be held on March 27, 2002 (and any adjournments) and of the
        Exchange, based , if necessary, on the submission of engineering data
        satisfactory to the Exchange, which Thrush undertakes to use its best
        efforts to file within a reasonable period of time so as to obtain the
        necessary approval by the earliest possible date. Notwithstanding any
        other provision of this Agreement, so long as Thrush has filed the engineering
        data

---

|     | referred to herein with
        the Exchange within a reasonable time after receiving same, the time for
        making any cash payment or share issuance referred to in this paragraph
        shall be extended, where necessary, to the day that is five business days
        following the receipt by Thrush of the necessary Exchange approval.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                       
|2.04 | This Agreement is an option
        only and, subject to paragraph 11.02, the doing of any act or the incurrence
        of any cash payments by Thrush shall not obligate Thrush to do any further
        acts or make any further payments.                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                       
|3.   | TRANSFER OF TITLE                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                       
|3.01 | Upon execution of this Agreement
        Thrush shall be entitled to record this Agreement against title to the
        Property, once title is granted by the Province of Quebec, Ministere des
        Ressources Naturelles to the Optionor.                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                       
|3.02 | Upon Thrush exercising the option to acquire
      the Property pursuant to article 2, the Optionor shall deliver to Thrush
      duly executed transfers for the transfer to Thrush of a 100% interest in
      and to the Property, subject to the royalty interest pursuant to Article
      4.                                                    
|     |                                                                                                                                                                                                                                                                                                                                                       
|4.   | ROYALTY                                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                       
|4.01 | Thrush agrees that the
        Property shall be subject to a royalty in favour of the Optionor equal
        to 2% of Net Smelter Returns to be calculated and paid according to and
        otherwise governed by Schedule B hereto.                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                       
|4.02 | Thrush agrees that the Property
        shall be subject to a royalty in favour of the Optionor equal to a 2%
        Gross Overriding Royalty to be calculated and paid according to and otherwise
        governed by Schedule C hereto.                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                       
|5.   | PAYMENTS                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                       
|5.01 | The payments to be made
        to the Optionors pursuant to section 2 and such other payments as are
        to be made to the Optionors pursuant to this Agreement shall be made in
        full to Ubex Capital Inc. (Ubex).                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                       
|6.   | COVENANTS OF THRUSH                                                                                                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                       
|6.01 | Thrush covenants and agrees with the Optionor
      that during the term of this Agreement:                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                       
|     | (a)                                                                                                                                                                                                                                                                                                                                                   

---

|     | (b)            | Thrush shall carry on all operations
        on the Property in a good and workmanlike manner and in compliance with
        all applicable governmental regulations and restrictions including but
        not limited to the posting of any reclamation bonds and the conduct of
        all reclamation work as may be required by any governmental regulations
        or regulatory authorities;                                                                                            
|---- | -------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (c)            | Thrush shall pay or cause to be paid
        any rates, taxes, duties, royalties, Workers Compensation or other
        assessments or fees levied with respect to the Property or Thrushs
        operations thereon;                                                                                                                                                                                                                                                                         
|     |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (d)            | Thrush shall hold harmless, indemnify,
        and defend the Optionor from any claims, loss, damage, judgement or expense
        for loss or damage to property and death, including environmental damages,
        or injury to persons arising out of Thrushs activities or operations
        on the Property, except to the extent that any such claim, loss, damage,
        judgement, or expense is caused by the negligence of the Optionor, its
        employees, agents or assigns;
|     |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (e)            | Thrush shall ensure that, in connection
        with the entry onto the Property of any exploration contractor or other
        worker, there shall be in place, either through Thrush or such contractor
        or worker, comprehensive broad-form liability insurance covering claims
        for personal injury, death or property damage with a coverage limit of
        at least $1,000,000;                                                                                            
|     |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (f)            | Thrush shall maintain books of account
        in respect of its expenditures and operations on the Property and, upon
        reasonable notice, shall make such books available for inspection by representatives
        of the Optionor;                                                                                                                                                                                                                                                     
|     |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (g)            | Thrush shall allow any duly authorized
        agent or representative of the Optionor to inspect the Property at reasonable
        times and intervals and upon reasonable notice given to Thrush, provided
        however that it is agreed and understood that any such agent or representative
        shall be at his own risk in respect of, and Thrush shall not be liable
        for, any injury incurred while on the Property, howsoever caused; and                                
|     |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (h)            | Thrush shall provide to the Optionor,
        semi-annually, a summary report outlining Thrushs progress on the
        Property and shall provide to Optionor, annually, a copy of all factual,
        non-interpretive data derived from Thrushs operations on the Property.                                                                                                                                                                                                                
|     |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|7.   | RIGHT OF ENTRY
|     |                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|7.01 |                | During the currency of this Agreement,
        Thrush, its servants, agents and workmen and any persons duly authorized
        by Thrush, shall have the right of access to and from and to enter upon
        and take possession of and prospect, explore and develop the Property
        in such manner as Thrush in its sole discretion may deem advisable and
        shall have the right to                                                                                             

---

|     | remove and ship therefrom
        ores, minerals, metals, diamonds, or other products recovered in any manner
        therefrom.                                                                                                                
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                 
|7.02 | Thrush shall be provided access to all maps,
      reports, assay results and other technical data in the possession or under
      the control of the Optionor with respect to the Property and shall be entitled
      to take copies thereof.
|     |                                                                                                                                                                                                                                                 
|8.   | REPRESENTATIONS AND WARRANTIES                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                 
|8.01 | The Optionor hereby represents and warrants that:                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                 
|     | (a)                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                 
|     | (b)                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                 
|     | (c)                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                 
|     | (d)                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                 
|8.02 | Thrush hereby represents and warrants that:                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                 
|     | (a)                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                 
|     | (b)                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                 
|9.   | CONFIDENTIALITY OF INFORMATION                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                 
|9.01 | The Optionor shall treat all data, reports,
      records and other information of any nature whatsoever relating to this
      Agreement and the Property as confidential. While this                                                          

---

|                                                                                                                                                                                                                                                                                                           | Agreement is in effect,
        the Optionor shall not, without the express written consent of Thrush,
        disclose to any third party any information concerning the Property or
        any operations thereon, nor shall the Optionor buy, sell or otherwise
        deal in the shares of Thrush while any material, confidential information
        in its possession relating to this Agreement or the Property remains undisclosed
        to the general public.                          
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                          
|10.                                                                                                                                                                                                                                                                                                        | ASSIGNMENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|10.01                                                                                                                                                                                                                                                                                                      | With the consent of the
        other party, which consent shall not be unreasonably withheld, each party
        has the right to assign all or any part of its interest in this Agreement
        and in the Property, subject to the terms and conditions of this Agreement.
        It shall be a condition precedent to any such assignment that the assignee
        of the interest being transferred agrees to be bound by the terms of this
        Agreement, insofar as they are applicable.
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|11.                                                                                                                                                                                                                                                                                                        | TERMINATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|11.01                                                                                                                                                                                                                                                                                                      | This Agreement shall terminate upon the occurrence
      of one of the following events:                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|In the event that Thrush
        gives notice that it denies that a default has occurred, Thrush shall
        not be deemed in default until the matter shall have been determined finally
        through such means of dispute resolution as such matter has been subjected
        to by either party.
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|11.02                                                                                                                                                                                                                                                                                                      | Upon termination of this Agreement under paragraph
      11.01, Thrush shall:                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

---

|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | have paid, as required by the Province
        of Quebec any annual maintenance fees and/or taxes necessary to hold all
        the exploration claims subject to this Agreement for the one year period
        beginning January 1 immediately following termination, and provided proof
        of such payment to the Optionor by December 15 immediately following termination;
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | transfer title to the Property to the
        Optionor free and clear of all liens, charges and encumbrances and obligations
        for reclamation or detoxification;                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | turn over to the Optionor copies of
        all non-interpretive maps, reports, sample results, contracts and other
        data and documentation in the possession of Thrush or, to the extent within
        Thrushs control, in the possession of its agents, employees or independent
        contractors, in connection with its operations on the Property;                 
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | ensure that the Property is in a safe
        condition and complies with all environmental and safety standards including
        standards for reclamation and detoxification, imposed by any duly authorized
        regulatory authority; and                                                                                                                                   
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | ensure that its covenants under subparagraphs 6.01 (a)
        through (e) have been fully complied with.                                                                                                                                                                                                                                                                           
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|11.03 | Upon the termination of
        this Agreement under paragraph 11.01, Thrush shall cease to be liable
        to the Optionor in debt, damages or otherwise save for the performance
        of those obligations in paragraph 11.02.                                                                                                                                                                                                                                                                                                          
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|11.04 | Upon termination of this
        Agreement under paragraph 11.01, Thrush shall vacate the Property within
        a reasonable time after such termination, but shall have the right of
        access to the property for a period of six months thereafter for the purpose
        of removing its chattels, machinery, equipment and fixtures.                                                                                                                                                                                              
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|12.   | FORCE MAJEURE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|12.01 | The time for performance
        of any act or making any payment or any expenditure required under this
        Agreement shall be extended by the period of any delay or inability to
        perform due to fire, strikes, labour disturbances, riots, civil commotion,
        wars, acts of God, any present or future law or governmental regulation,
        any shortages of labour, equipment or materials, or any other cause not
        reasonably within the control of the party in default, other than lack
        of finances.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|13.   | REGULATORY APPROVAL                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|13.01 | This Agreement is subject
        to the prior approval of the Exchange. Thrush shall use its best efforts
        to obtain such approval as soon as reasonably possible, provided however
        that if                                                                                                                                                                                                                                                                                                                                    

---

|      | such approval has not been received by April 15, 2002, this Agreement
      shall be null and void and of no further effect.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.   | AFTER-ACQUIRED PROPERTY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.01 | In the event that at any time hereafter Thrush shall
        acquire any portion of any combined group of any mining claims, any mining
        claim, lease, or other mineral right or interest within a three kilometre
        radius of the outside boundary of the Property to be described in Schedule
        A hereto, such interest shall be deemed to have been acquired on behalf
        of and for the benefit of the parties, pursuant to the terms of this Agreement
        and such after-acquired interest as aforesaid shall be included in and
        shall form a part of the definition of Property contained
        in paragraph 1.01 and shall be subject to this Agreement as if it had
        been originally so included.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.02 | In the event that at any time hereafter Thrush shall
        acquire any portion of any combined group of any mining claims, any mining
        claim, lease, or other mineral right or interest within a three kilometre
        radius of the outside boundary of the Property as constituted on the date
        of this Agreement, such interest shall be subject to the royalties in
        favour of the Optionor as described in Article 4 of this Agreement, and,
        if so requested by the Optionor, shall be transferred to the Optionor
        upon abandonment by Thrush.                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|15.   | NOTICES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|15.01 | Any notice, election, consent or other writing required
        or permitted to be given hereunder shall be deemed to be sufficiently
        given if delivered or mailed postage prepaid or if given by telegram,
        telex or telecopier, addressed as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

|In the case of the Optionor: | Ubex Capital Inc.            
|---------------------------- | -----------------------------
|                             | Suite 306  1140 Homer Street
|                             | Vancouver, B.C.              
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          
|                             |                              
|                             |                              
|In the case of Thrush:       | THRUSH INDUSTRIES INC.       
|                             | Suite306  1140 Homer Street 
|                             | Vancouver, British Columbia  
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          

and any such notice given us aforesaid shall be deemed to
  have been given to the parties hereto if delivered, when delivered, or if mailed,
  on the third business day following the date of mailing, or, if telegraphed,
  telexed or telecopied, on the same day as the telegraphing, telexing or telecopying
  thereof provided however that during the period of any postal interruption in
  Canada or the United States any notice given hereunder by mail shall be deemed
  to have been given only

---

as of the date of actual delivery of the same. Any party may
  from time to time by notice in writing change its address for the purposes of
  this paragraph 15.01.

16. GENERAL TERMS AND CONDITIONS

16.01 The parties hereto hereby covenant and agree that they
  will execute such further agreements, conveyances and assurances as may be requisite,
  or which counsel for the parties may deem necessary to effectually carry out
  the intent of this Agreement.

16.02 This Agreement shall constitute the entire agreement
  between the parties with respect to the Property. No representations or inducements
  have been made save as herein set forth. No changes, alterations or modifications
  of this Agreement shall be binding upon either party until and unless a memorandum
  in writing to such effect shall have been signed by all parties hereto. This
  Agreement shall supersede all previous written, oral or implied understandings
  between the parties with respect to the matters hereby.

16.03 Time shall be of the essence of this Agreement.

16.04 The titles to the articles in this Agreement shall not
  be deemed to form part of this Agreement but shall be regarded as having been
  used for convenience of reference only.

16.05 All currency references contained in this Agreement
  shall be deemed to be references to Canadian funds.

16.06 Wherever possible, each provision of this Agreement
  shall be interpreted in such manner as to be effective and valid under applicable
  law, but if any provision shall be prohibited by or be invalid under applicable
  law, such provision shall be ineffective only to the extent of such prohibition
  or invalidity, without invalidating the remainder of such provision or the remaining
  provisions of this Agreement.

16.07 The Schedules to this Agreement shall be construed with
  and as an integral part of this Agreement to the same extent as if they were
  set forth verbatim herein. Defined terms contained in this Agreement shall have
  the same meanings where used in the Schedules.

16.08 This Agreement shall be governed by and interpreted
  in accordance with the laws of the Province of British Columbia and the laws
  of Canada applicable therein.

16.09 In the event that any suit, legal action, or arbitration
  proceeding is instituted to interpret or enforce the terms of this Agreement,
  including but not limited to any contest proceeding under paragraph 11.01, the
  prevailing party shall be entitled to recover from the other party such sum
  as the court or arbitrator may adjudge reasonable for attorneys fees at
  trial and on appeal of such suit, action or proceeding in addition to all other
  sums provided by law.

16.10 This Agreement shall enure to the benefit of and be binding
  upon the parties hereto and their respective heirs, executors, administrators,
  successors and assigns.

---

IN WITNESS WHEREOFthis Agreement has been executed
  by the parties hereto as of the day and year first above written.

|The COMMON SEALof UBEX CAPITAL              | c/s
|------------------------------------------- | ---
|INC.was hereunto affixed in the presence    |    
|of:                                         |    
|                                            |    
|Dennis Higgs                              |    
|                                            |    
|                                            |    
|                                            |    
|SIGNED AND DELIVERED BY THRUSH              |    
|INDUSTRIES INC. and affixed in the presence |    
|of:                                         |    
|                                            |    
|Aileen Fehr                               |    
|                                            |    
|Authorized Signatory                        |    

---

Schedule B

NET SMELTER RETURN ROYALTY

References
  in this Schedule B to Sections and Articles in this Schedule B are so identified,
  and references in this Schedule B to Sections and Articles in the agreement
  to which this Schedule B is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule B except as otherwise expressly stated in
  this Schedule B. The Net Smelter Returns royalty defined in Article 1 of the
  Main Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As used in this Schedule B, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-in-interest,
  including without limitation, assignees, partners, joint venture partners, lessees
  and when applicable mortgagees and affiliated companies having or claiming an
  interest in the Properties or projects.

1.2As used in this Schedule B, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in-interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment
  of Production Royalty.Grantor shall pay to Grantee the royalty described
  in Section 4 below (Royalty) pursuant to the terms and provisions
  of this Schedule B.

3.       Term.The
  term of the Royalty hereby created shall be perpetual, it being the intent of
  the parties hereto that, to the extent allowed by law, the Royalty constitutes
  a vested interest in and a covenant running with the land and affecting the
  Property and all successions thereof whether created privately or through governmental
  action. In the event a court of competent jurisdiction determines that the term
  of this Agreement violates the Rule Against Perpetuities, then the term of this
  Agreement shall automatically be revised and reformed to coincide with the maximum
  term permitted by the Rule Against Perpetuities, and this Agreement shall not
  be terminated solely as a result of a violation of the Rule Against Perpetuities.

4.       Production Royalty.Grantor shall pay to Grantee a perpetual Royalty in the amount of two percent
  (2%) of Net Smelter Returns from the sale or other disposition of all locatable
  minerals produced from the Properties determined in accordance with the provisions
  set forth in this Section 4 and, if applicable, Section 7.

---

4.1       For
  Precious Metals.Net Smelter Returns, in the case of gold, silver, and platinum
  group metals (Precious Metals), shall be determined by multiplying
  (i) the gross number of troy ounces of Precious Metals contained in the production
  delivered to the smelter, refiner, processor, purchaser or other recipient (including
  the operator) of such production, or an insurer as a result of casualty to such
  production (collectively, Payor) during the preceding calendar month
  by (ii) for gold, the average of the London Bullion Market, Morning Fix, spot
  prices for the preceding calendar month; for all other Precious Metals, the
  average of the New York Commodities Exchange final daily spot prices for the
  preceding calendar month, and subtracting from the product of (i) and (ii) only
  the following if actually incurred:

| | (1) | charges imposed by the Payor for refining
        bullion from the Beneficiated Precious Metals contained in such production
        (as used in this Agreement, Beneficiated Precious Metals includes
        only doré or concentrates of Precious Metals produced by Grantors
        final mill or other processing plant, but does not include raw or crushed
        ore containing Precious Metals or other preliminarily processed Precious
        Metals); and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (2) | penalty substance, assaying, and sampling
        charges imposed by the Payor for refining Beneficiated Precious Metals
        contained in such production.                                                                                                                                                                                                                                                                                                             

In the event the refining of bullion from the Beneficiated
  Precious Metals contained in such production is carried out in custom toll facilities
  owned or controlled, in whole or in part, by Grantor, which facilities were
  not constructed for the purpose of refining Beneficiated Precious Metals from
  the Property, then charges, costs and penalties for such refining shall mean
  the amount Grantor would have incurred if such refining were carried out at
  facilities not owned or controlled by Grantor then offering comparable services
  for comparable products on prevailing terms, but in no event greater than actual
  costs incurred by Grantor with respect to such refining.

In the event the Grantor receives insurance proceeds for loss
  of production, Grantor shall pay to Payee the Royalty percentage of any such
  insurance proceeds which are received by Grantor for such loss of production.

4.2     
  For Other Minerals.Net Smelter Returns, in the case of all metals, minerals,
  mineral substances, and the beneficiated products thereof, which are not or
  do not contain economically recoverable Precious Metals (Other Minerals),
  shall be determined by multiplying (i) the gross amount of the particular Other
  Mineral contained in the production delivered to the Payor during the preceding
  calendar month by (ii) the average of the New York Commodities Exchange final
  daily spot prices for the preceding calendar month of the appropriate Other
  Mineral, and subtracting from the product of (i) and (ii) only the following
  if actually incurred:

---

| | (1) | charges imposed by the Payor for smelting,
        refining or processing Other Minerals contained in such production, but
        excluding any and all charges and costs related to Grantor mill
        or other processing plants constructed for the purpose of milling or processing
        Other Minerals, in whole or in part; and                                                      
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                   
| | (2) | penalty substance, assaying, and sampling
        charges imposed by the Payor for smelting, refining, or processing Other
        Minerals contained in such production, but excluding any and all charges
        and costs of or related to Grantor mills or other processing plants
        constructed for the purpose of milling or processing Other Minerals, in
        whole or in part.

In the event smelting, refining, or processing of Other Minerals
  are carried out in custom toll facilities owned or controlled, in whole or in
  part, by Grantor, which facilities were not constructed for the purpose of milling
  or processing Other Minerals, then charges, costs and penalties for such smelting,
  refining or processing shall mean the amount Grantor would have incurred if
  such smelting, refining or processing were carried out at facilities not owned
  or controlled by Grantor then offering comparable services for comparable products
  on prevailing terms, but in no event greater than actual costs incurred by Grantor
  with respect to such smelting and refining.

In the event Grantor receives insurance proceeds for loss
  of production, Grantor shall pay to Payee the Royalty percentage of any such
  insurance proceeds which are received by Grantor for such loss of production.

Notwithstanding anything contained in the foregoing, the term
  Other Minerals shall not be deemed to include Diamonds
  as defined in Schedule C to the Main Agreement, it being the intention of the
  parties that all payments of royalties in respect of Diamonds shall be governed
  by Schedule C attached to the Main Agreement.

4.3      
  Time and Manner; In-Kind or Cash Payment.At the time of making payment
  to or otherwise crediting the account of Grantor for production from the Property
  pursuant to Sections 4.1 or 4.2 (but within the time provided in Section 4.4),
  the smelter, refiner, processor, purchaser, or other user (Payor)
  of the Precious Metals or Other Minerals shall contemporaneously pay the Royalty
  in accordance with written instructions given to the Payor by Grantee as provided
  in Sections 4.3.1 and 4.3.2. Once the Payor has received instructions from Grantee,
  such instructions shall remain in effect until the Payor has received different
  instructions from Grantee. All contractual or other arrangements entered into
  by Grantor with the Payor shall contain provisions implementing the terms and
  conditions of payment set forth in Sections 4.3 and 4.4 hereof and Grantor shall
  procure the written undertaking of Payor contractually binding Payor to perform
  in accordance with Sections 4.3 and 4.4 in form and substance enforceable by
  Grantee. Grantor acknowledges its primary obligation to pay the Royalty and
  that no undertaking by the Payor shall relieve Grantor of that obligation, and
  Grantor agrees to indemnify, protect and defend Grantee from and against any
  loss, cost

---

(including attorneys fees incurred) or liability arising
  from the performance or failure of performance by Payor hereunder or under any
  contractual or other arrangements entered into by Grantor with the Payor pursuant
  to or for the purposes of complying with Sections 4.3 and 4.4 hereof. Grantee
  may, from time to time in its discretion, change the bank or account number
  for payment under to Sections 4.3.1 and 4.3.2 by giving written notice thereof
  to Grantor and the Payor; such notice shall be effective upon actual receipt
  by the Payor, or upon the fourth day after deposit of such notice in the mail,
  first class postage prepaid, addressed to the Payor, whichever occurs first.
  All costs charged by the Payor as a result of complying with the payment provisions
  of Sections 4.3 and 4.4 shall be paid by Grantee, and Grantor shall have no
  liability or responsibility therefor.

4.3.1      
  Precious Metals.The Payor shall pay the Royalty for each shipment of Precious
  Metals either (a) in the form of gold bullion (.995 + fine gold) directly to
  Payees account maintained with the Payor as directed by Payee, or (b)
  by delivery of a cheque or draft payable to Payees account with a bank
  to be designated in writing by Payee. In the event Payee instructs the Payor
  to deliver the Royalty in the form of gold bullion, the Royalty payable on silver
  or platinum group metals shall be converted to the gold equivalent of such silver
  or platinum group metals by using the average monthly spot prices for Precious
  Metals described in Section 4.1.

4.3.2       
  Other Minerals.The Payor shall pay the Royalty for each shipment of Other
  Minerals by delivery of a cheque or draft payable to the Payees account
  with a bank to be designated in writing by Payee.

4.4
           Payment Accounting; Interim
  Settlements; Late Charges.All credits or payments of the Royalty shall
  be accompanied by a detailed statement explaining the manner in which the payment
  was calculated together with any available settlement sheets from the Payor.
  In no event shall payment of the Royalty be made later that thirty (30) days
  after the delivery to the Payor of the Precious Metals, Beneficiated Precious
  Metals, or Other Minerals. Such payments and statements shall be deemed conclusively
  correct unless Grantee objects to them in writing within eighteen (18) months
  after receipt thereof. On those occasions when all necessary information is
  not available to the Payor within the thirty (30) day period, the Payor shall
  make an interim settlement of the Royalty for such shipment or use within the
  thirty (30) day period; such interim settlement shall provide for payment of
  not less than ninety percent (90%) of the anticipated final settlement Royalty
  as determined by the assays and quantities of the Precious Metals or Other Minerals
  received by the Payor with respect to which such interim settlement is being
  made. Final settlement of the Royalty shall be promptly made upon receipt by
  the Payor of all information necessary or appropriate to make final settlement
  for such shipment. In the event payment of any Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Royalty payment, the Grantor shall pay an additional sum
  equal to ten percent (10%) of the delinquent payment (late charge)
  plus interest on the delinquent payment and the late charge at the rate twelve
  percent (12%) per annum which shall accrue from the day

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the delinquent payment was due to the date of payment of the Royalty, late
  charge and accrued interest.

4.5
            Hedging Transactions:
  Futures, Options and Other Trading.All profits and losses resulting from
  Grantor engaging in any commodity futures trading, option trading, or metals
  trading, or any combination thereof, and any other hedging transactions (collectively
  hedging transactions) are specifically excluded from Royalty calculations
  pursuant to this Agreement. All hedging transactions by Grantor and all profits
  or losses associated therewith, if any, shall be solely for Grantors account.
  The Royalty payable on Precious Metals or Other Minerals subject to hedging
  transactions shall be determined as follows:

4.5.1       
  Affecting Precious Metals.The amount of Royalty to be paid on all Precious
  Metals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.1 with the understanding that the average
  monthly spot price shall be for the calendar month during which Precious Metals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor. 4.5.2       
  Affecting Other Minerals. The amount of Royalty to be paid on all Other
  Minerals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.2 with the understanding that the average
  monthly spot price shall be for the calendar month during which Other Minerals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.6
            Commingling.Before
  any Precious Metals or Other Minerals produced from the Property are commingled
  with minerals from other properties, the Precious Metals or Other Minerals produced
  from the Property shall be measured and sampled in accordance with sound mining
  and metallurgical practices for moisture, metal, commercial minerals and other
  appropriate content. Representative samples of the Precious Metals or Other
  Minerals shall be retained by Grantor and assays (including moisture and penalty
  substances) and other appropriate analyses of these samples shall be made before
  commingling to determine metal, commercial minerals, and other appropriate content.
  Detailed records shall be kept by Grantor showing measures, moisture, assays
  of metal, commercial minerals, and other appropriate content and penalty substances,
  and gross metal content of the Precious Metals or gross metal or mineral content
  of Other Minerals. From this information, Grantor shall determine the amount
  of Royalty due and payable to Payee from Precious Metals or Other Minerals produced
  from the Property commingled with minerals from other properties. Following
  the expiration of the period for objection described above in Section 4.4, and
  absent timely objection, if any, made by Payee, Grantor may dispose of the materials
  and data required to be kept and produced by this Section 4.6.

5.        Books; Records:
  Inspections; Confidentiality.

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5.1          
  Books.Grantor shall keep true and accurate books and records of all of
  its operations and activities on the Property and under this Agreement. Such
  books and records shall be kept on the accrual basis in accordance with generally
  accepted accounting principles consistently applied. Not more frequently than
  annually and within the time provided in Section 4.4 of this Agreement, Payee
  may, at Payees sole expense, give notice to Grantor that Payee desires
  to perform an audit or other examination of all of Grantors books and
  records kept as required by this Agreement. All financial information shall
  conclusively be deemed correct for purposes of this Agreement unless Payee has
  given timely notice that it desires to audit or examine Grantors books
  and records in the manner and within the time provided in Section 4.4 of this
  Agreement. Payee shall promptly commence any such audits and shall diligently
  prosecute the same to conclusion.

5.2          
  Reports.Not later than March 1 following the end of each calendar year,
  Grantor shall provide Payee with an annual report of all activities and operations
  conducted upon or with respect to the Property during the preceding calendar
  year. Such annual report shall include estimates of proposed expenditures upon,
  anticipated production from, and estimated remaining ore reserves on the Property
  for the succeeding calendar year. Additionally, and within 30 days of the end
  of each calendar quarter, Grantor shall provide Payee access to all data and
  information generated with respect to the Property during the calendar quarter
  just ended.

5.3          
  Inspections.Payee, or its authorized agents or representatives, on not
  less than two (2) days notice to Grantor, may enter upon all surface and subsurface
  portions of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4
            Investor Tours.Upon reasonable notice to Grantor and not more frequently than semi-annually,
  Payee shall have the right to conduct an investors tour on the Property and
  facilities associated therewith; provided that such tours shall not unreasonably
  interfere with Grantors activities and operations. Such investors tours
  shall be at the sole risk of the Payee and its invitees, and Payee shall indemnify
  and hold Grantor harmless from any liability, damage, claim or demand by reason
  of injury to Payee or Grantor or any of their respective invitees, employees,
  officers, directors, agents, or representatives caused solely by Payees
  exercise of its rights under this Section.

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5.5
            Confidentiality.Payee shall not, without the express written consent of Grantor, which consent
  shall not be unreasonably withheld, disclose any data or information concerning
  the Operations conducted on the Property or obtained under the Main Agreement
  or this Agreement which is not already in the public domain; provided, however,
  Payee may disclose data or information obtained under this Agreement without
  the consent of Grantor: (i) if required for compliance with applicable laws,
  rules, regulations or orders of a governmental agency or stock exchange having
  jurisdiction over Payee or its parent or affiliated corporations; (ii) to any
  of Payees consultants; (iii) to any third party to whom Payee, in good
  faith, anticipates selling or assigning Payees interest hereunder; or
  (iv) to a prospective lender to whom an interest in the Royalty payments to
  be made to Payee hereunder is proposed to be granted as security, provided that
  Grantor shall first have been provided with a confidentiality agreement executed
  by such consultant, third party or lender, which agreement shall include the
  confidentiality provisions of this Section 5.5. Payee shall not issue any press
  releases pertaining to the Property except upon giving Grantor three (3) days
  advance written notice of the contents thereof, and Payee shall make any reasonable
  changes to such proposed press releases requested by Grantor. Payee shall not,
  without Grantors consent, issue any press release that implies or infers
  that Grantor endorses or joins in Payees statements or representations
  contained in any press release.

6.       Compliance with Laws;
  Reclamation, Environmental Obligations, and Indemnities.

6.1          
  Compliance with Laws.Grantor shall at all times comply with all applicable
  present or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2
            Reclamation, Environmental
  Obligations, and Indemnities.Grantor shall, from and after the date this
  Agreement takes effect, timely and fully perform all reclamation required by
  all governmental authorities pertaining or related to Grantors operations
  or activities on or with respect to the Property or required under this Agreement.
  Grantor, from and after the date this Agreement takes effect, covenants and
  agrees not to undertake, cause, suffer, or permit any condition or activity
  at, on or in the vicinity of the Property which constitutes a nuisance or which
  results in a violation of or liability under any present or future applicable
  federal, provincial, or local environmental laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants

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and agrees to indemnify and hold Payee harmless from any and
  all liabilities, obligations, claims (including administrative claims and claims
  for injunctive relief), demands, losses, costs, damages, expenses, attorney
  fees and causes of action asserted against Payee related to Grantors failure
  to comply with and satisfy Environmental Obligations or other obligations under
  this Agreement. The covenants and agreements of this Section 6.2 shall survive
  the termination of Grantors rights under this Agreement or to the Property.

7. Stockpiling.The rights of Grantor to stockpile, store or place Precious Metals or Other
  Minerals off of the Property pursuant to any of the provisions of this Agreement
  shall not be exercisable until Grantor has first secured from the property owner
  where such stockpiling, storage or placement is to occur a written agreement
  in recordable form which provides that Payees rights to the Precious Metals
  and Other Minerals shall be preserved. Such agreement shall provide,inter
  alia, that (i) Payees rights pursuant to this Agreement, insofar
  as they are applicable, shall continue in full force and effect with respect
  to Precious Metals and Other Minerals from the property; (ii) Payees rights
  in and to the Precious and Other Minerals shall be the same as if the Precious
  Metals and Other Minerals were situate on the Property; (iii) Payees rights
  set forth in this Section 7 shall have precedence over the rights to the Precious
  Metals and Other Minerals of the property owner where the Precious Metals and
  Other Minerals are stockpiled, stored or placed, as well as the creditors of
  the said property owner; and (iv) the agreement shall be irrevocable as long
  as the Precious Metals and Other Minerals from the Property, or any part thereof,
  remain on the property not part of the Property.

8.       Tailings and Residues.All tailings, residues, waste rock, spoiled leach materials, and other materials
  (collectively Materials) resulting from Grantors operations
  and activities on the Property shall be the sole property of Grantor, but shall
  remain subject to the Royalty should the same be processed or reprocessed, as
  the case may be, in the future and result in the production of Precious Metals
  or Other Minerals. Notwithstanding the foregoing, Grantor shall have the right
  to dispose of Materials from the Property on or off of the Property and to commingle
  the same with Material from other properties. In the event Materials are processed
  or reprocessed, as the case may be, the Royalty payable thereon shall be determined
  by using the best engineering and technical practices then available, subject
  to adjustment on a pro rata basis where commingling has occurred.

9.       Title Maintenance,
  Maintenance, and Taxes; Abandonment.

9.1
            Title Maintenance
  and Taxes.From the date this Agreement takes effect, Grantor shall maintain
  title to the Property, including without limitation, paying when due all taxes
  on or with respect to the Property and doing all things and making all payments
  necessary or appropriate to maintain the right, title and interest of Grantor
  and Payee, respectively, in the Property and under this Agreement.

9.2          
  Abandonment.In the event Grantor intends to abandon any of the lands comprising
  a portion or all of the Property (Abandonment Property), Grantor
  shall first

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give notice of such intention to Payee at least 70 days in
  advance of the proposed date of abandonment. If not later than 10 days before
  the proposed date of abandonment Grantor receives from Payee written notice
  that Payee desires Grantor to convey the Abandonment Property to Payee, Grantor
  shall, without additional consideration, convey the Abandonment Property in
  good standing by quit claim deed, without warranty, to Payee and shall thereafter
  have no further obligation to maintain the title to the Abandonment Property.
  If Payee does not timely give such notice to Grantor, Grantor may abandon the
  Abandonment Property and shall thereafter have no further obligation to maintain
  the title to the Abandonment Property; provided, however, if Grantor reacquires
  any of the ground covered by the Abandonment Property at any time within five
  (5) years following abandonment, the Precious Metals and Other Minerals previously
  or thereafter produced from such ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange
  at its own expense and shall keep in force at all times, directly or through
  the services of an independent contractor, insurance, including but not limited
  to, the following:

10.1          
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

10.2
            General Liability.Comprehensive general public liability insurance against claims for bodily
  injury or death or property damage arising out of or resulting from Grantors
  activities or operations on or with respect to the Property, in such amounts
  as will adequately protect Grantor, Payee, the Royalty, and the Property from
  any and all claims, liabilities and damages which may arise with respect to
  this Agreement or the Property. Payee shall be named as a co-insured.

10.3
            Self Insurance.Grantor may self insure the foregoing obligations, provided such self insurance
  is sufficient to meet the requirements of Sections 10.1 and 10.2 above and is
  in compliance with applicable laws, statutes, rules and regulations.

11. General Provisions.

11.1          The Miscellaneous
  Provisions set forth in Article 16 of the Main Agreement shall apply to this
  Schedule B as applicable.

11.2          In this Schedule
  B in all matters of interpretation, whenever necessary to give effect to any
  provision of this instrument, the masculine shall include the feminine and neuter
  and vice versa, the singular shall include the plural, and the plural shall
  include the singular.

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Schedule C

GROSS OVERRIDING ROYALTY

References in this Schedule C to Sections and Articles in
  this Schedule C are so identified, and references in this Schedule C to Sections
  and Articles in the agreement to which this Schedule C is attached ( the Main
  Agreement) are so identified. The defined words used in the Main Agreement
  shall have the same meaning when used in this Schedule C except as otherwise
  expressly stated in this Schedule C. The Gross Overriding Royalty defined in
  Article 1 of the Main Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As used in this Schedule C, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-in-interest,
  including without limitation, assignees, partners, joint venture partners, lessees
  and when applicable mortgagees and affiliated companies having or claiming an
  interest in the Properties or projects.

1.2As used in this Schedule C, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in-interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Gross Overriding Royalty.Grantor
  shall pay to Grantee the royalty described in Section 4 below (the Gross
  Overriding Royalty) pursuant to the terms and provisions of this Schedule
  C.

3. Term.The term of the Gross Overriding Royalty hereby
  created shall be perpetual, it being the intent of the parties hereto that,
  to the extent allowed by law, the Gross Overriding Royalty constitutes a vested
  interest in and a covenant running with the land and affecting the Property
  and all successions thereof whether created privately or through governmental
  action. In the event a court of competent jurisdiction determines that the term
  of this Agreement violates the Rule Against Perpetuities, then the term of this
  Agreement shall automatically be revised and reformed to coincide with the maximum
  term permitted by the Rule Against Perpetuities, and this Agreement shall not
  be terminated solely as a result of a violation of the Rule Against Perpetuities.

4. Gross Overriding Royalty.Grantor shall
  pay to Grantee a perpetual Gross Overriding Royalty in the amount of two percent
  (2%) of the Average Appraised Value (as hereinafter defined) of all gems, precious
  and semi-precious stones, and gem and industrial diamonds recovered, sorted,
  and graded from the Properties (the Diamonds)

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determined in accordance with the provisions set forth in
  this Section 4 and, if applicable, Section 7.

4.1
  Average Appraised Value.Average Appraised Value means the average
  of the valuations in Canadian dollars of the Diamonds determined by two independent
  graders, one appointed by the Grantor and one appointed by the Grantee. Such
  independent graders shall be duly qualified and accredited, and shall sort,
  grade and value the Diamonds in accordance with industry standards, having regard
  to, but without limiting the generality of the foregoing, the commercial demand
  for the Diamonds. Each independent valuator shall value each particular classification
  of the Diamonds in accordance with the industry price books, standards and formulas.
  The parties acknowledge that the intention is that the Gross Overriding Royalty
  is to be paid to the Grantee on this basis, regardless of the price or proceeds
  actually received by the Grantor for or in connection with the Diamonds or the
  manner in which a sale of the Diamonds to a third party is made, and without
  deduction.

In the event the Grantor receives insurance proceeds for loss
  of production, Grantor shall pay to Payee the Gross Overriding Royalty percentage
  of any such insurance proceeds which are received by Grantor for such loss of
  production.

4.2
  Time and Manner; In Kind or Cash Payment. The Grantor will calculate and
  pay the Gross Overriding Royalty to the Grantee by delivery of a cheque or draft
  payable to the Grantee within 60 days of the end of each calendar quarter, based
  on all Diamonds from the Property which were graded in such calendar quarter.

The Grantee shall, at its election, have the right to take its Gross Overriding
  Royalty in kind.

4.3
  Grantors Profits and Losses. The Grantee shall not be entitled to
  participate in the profits or be obligated to share in any losses generated
  by the Grantors actual marketing or sales practices.

4.4
  Payment Accounting; Interim Settlements; Late Charges. All credits or payments
  of the Gross Overriding Royalty shall be accompanied by a detailed statement
  explaining the manner in which the payment was calculated together with any
  available settlement sheets. In no event shall payment of the Gross Overriding
  Royalty be made later that sixty (60) days after the end of each calendar quarter.
  Such payments and statements shall be deemed conclusively correct unless Grantee
  objects to them in writing within eighteen (18) months after receipt thereof.
  In the event payment of any Gross Overriding Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Gross Overriding Royalty payment, the Grantor shall pay an
  additional sum equal to ten percent (10%) of the delinquent payment (late
  charge) plus interest on the delinquent payment and the late charge at
  the rate twelve percent (12%) per annum which shall accrue from the day the
  delinquent payment

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was due to the date of payment of the Gross Overriding Royalty, late charge
  and accrued interest.

4.5
  Hedging Transactions: Futures, Options and Other Trading.All profits and
  losses resulting from Grantor engaging in any commodity futures trading, option
  trading, or diamonds trading, or any combination thereof, and any other hedging
  transactions (collectively hedging transactions) are specifically
  excluded from Gross Overriding Royalty calculations pursuant to this Agreement.
  All hedging transactions by Grantor and all profits or losses associated therewith,
  if any, shall be solely for Grantors account. The Gross Overriding Royalty
  payable on Diamonds subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Diamonds.The amount of Gross Overriding Royalty to be paid on
  all Diamonds subject to hedging transactions by Grantor shall be determined
  in the same manner as provided in this Section 4.

4.6
  Commingling.Before any Diamonds recovered from the Property are commingled
  with minerals from other properties, the Diamonds recovered from the Property
  shall be measured and sampled in accordance with this Section 4 of this Agreement.
  Detailed records shall be kept by Grantor showing the Average Appraised Value
  of the Diamonds. From this information, Grantor shall determine the amount of
  Gross Overriding Royalty due and payable to Payee from Diamonds recovered from
  the Property commingled with minerals from other properties.

5. Books; Records: Inspections; Confidentiality.

5.1
  Books.Grantor shall keep true and accurate books and records of all of
  its operations and activities on the Property and under this Agreement. Such
  books and records shall be kept on the accrual basis in accordance with generally
  accepted accounting principles consistently applied. Not more frequently than
  annually and within the time provided in Section 4.4 of this Agreement, Payee
  may, at Payees sole expense, give notice to Grantor that Payee desires
  to perform an audit or other examination of all of Grantors books and
  records kept as required by this Agreement. All financial information shall
  conclusively be deemed correct for purposes of this Agreement unless Payee has
  given timely notice that it desires to audit or examine Grantors books
  and records in the manner and within the time provided in Section 4.4 of this
  Agreement. Payee shall promptly commence any such audits and shall diligently
  prosecute the same to conclusion.

5.2
  Reports.Not later than March 1 following the end of each calendar year,
  Grantor shall provide Payee with an annual report of all activities and operations
  conducted upon or with respect to the Property during the preceding calendar
  year. Such annual report shall include estimates of proposed expenditures upon,
  anticipated production from, and estimated remaining ore reserves on the Property
  for the succeeding calendar year. Additionally, and within 30 days of the end
  of each calendar quarter,

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Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3
  Inspections.Payee, or its authorized agents or representatives, on not
  less than two (2) days notice to Grantor, may enter upon all surface and subsurface
  portions of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4
  Investor Tours.Upon reasonable notice to Grantor and not more frequently
  than semi-annually, Payee shall have the right to conduct an investors tour
  on the Property and facilities associated therewith; provided that such tours
  shall not unreasonably interfere with Grantors activities and operations.
  Such investors tours shall be at the sole risk of the Payee and its invitees,
  and Payee shall indemnify and hold Grantor harmless from any liability, damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  invitees, employees, officers, directors, agents, or representatives caused
  solely by Payees exercise of its rights under this Section.

5.5
  Confidentiality.Payee shall not, without the express written consent of
  Grantor, which consent shall not be unreasonably withheld, disclose any data
  or information concerning the Operations conducted on the Property or obtained
  under the Main Agreement or this Agreement which is not already in the public
  domain; provided, however, Payee may disclose data or information obtained under
  this Agreement without the consent of Grantor: (i) if required for compliance
  with applicable laws, rules, regulations or orders of a governmental agency
  or stock exchange having jurisdiction over Payee or its parent or affiliated
  corporations; (ii) to any of Payees consultants; (iii) to any third party
  to whom Payee, in good faith, anticipates selling or assigning Payees
  interest hereunder; or (iv) to a prospective lender to whom an interest in the
  Gross Overriding Royalty payments to be made to Payee hereunder is proposed
  to be granted as security, provided that Grantor shall first have been provided
  with a confidentiality agreement executed by such consultant, third party or
  lender, which agreement shall include the confidentiality provisions of this
  Section 5.5. Payee shall not issue any press releases pertaining to the Property
  except upon giving Grantor three (3) days advance written notice of the contents
  thereof, and Payee shall make any reasonable changes to such proposed press
  releases requested by Grantor. Payee shall not, without Grantors consent,
  issue any press release that implies or infers that Grantor endorses or joins
  in Payees statements or representations contained in any press release.

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6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1
  Compliance with Laws.Grantor shall at all times comply with all applicable
  present or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2
  Reclamation, Environmental Obligations, and Indemnities.Grantor shall,
  from and after the date this Agreement takes effect, timely and fully perform
  all reclamation required by all governmental authorities pertaining or related
  to Grantors operations or activities on or with respect to the Property
  or required under this Agreement. Grantor, from and after the date this Agreement
  takes effect, covenants and agrees not to undertake, cause, suffer, or permit
  any condition or activity at, on or in the vicinity of the Property which constitutes
  a nuisance or which results in a violation of or liability under any present
  or future applicable federal, provincial, or local environmental laws, statutes,
  rules, regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants and agrees to indemnify and hold Payee harmless
  from any and all liabilities, obligations, claims (including administrative
  claims and claims for injunctive relief), demands, losses, costs, damages, expenses,
  attorney fees and causes of action asserted against Payee related to Grantors
  failure to comply with and satisfy Environmental Obligations or other obligations
  under this Agreement. The covenants and agreements of this Section 6.2 shall
  survive the termination of Grantors rights under this Agreement or to
  the Property.

7. Stockpiling.The rights of Grantor to stockpile,
  store or place Diamonds off of the Property pursuant to any of the provisions
  of this Agreement shall not be exercisable until Grantor has first secured from
  the property owner where such stockpiling, storage or placement is to occur
  a written agreement in recordable form which provides that Payees rights
  to the Diamonds shall be preserved. Such agreement shall provide,inter
  alia, that (i) Payees rights pursuant to this Agreement, insofar
  as they are applicable, shall continue in full force and effect with respect
  to Diamonds from the property; (ii) Payees rights in and to the Diamonds
  shall be the same as if the Diamonds were situate on the Property; (iii) Payees
  rights set forth in this Section 7 shall have precedence over the rights to
  the Diamonds of the property owner where the Diamonds are stockpiled, stored
  or placed, as well as the creditors of the said property owner; and (iv) the
  agreement shall be irrevocable as long as the Diamonds from the Property, or
  any part thereof, remain on the property not part of the Property.



---

8. Tailings and Residues.All tailings, residues, waste
  rock, spoiled leach materials, and other materials (collectively Materials)
  resulting from Grantors operations and activities on the Property shall
  be the sole property of Grantor, but shall remain subject to the Gross Overriding
  Royalty should the same be processed or reprocessed, as the case may be, in
  the future and result in the production of Diamonds. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Gross Overriding Royalty payable thereon shall be determined by using the technique
  described in Section 4 of this Agreement, subject to adjustment on a pro rata
  basis where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1
  Title Maintenance and Taxes.From the date this Agreement takes effect,
  Grantor shall maintain title to the Property, including without limitation,
  paying when due all taxes on or with respect to the Property and doing all things
  and making all payments necessary or appropriate to maintain the right, title
  and interest of Grantor and Payee, respectively, in the Property and under this
  Agreement.

9.2
  Abandonment.In the event Grantor intends to abandon any of the lands comprising
  a portion or all of the Property (Abandonment Property), Grantor
  shall first give notice of such intention to Payee at least 70 days in advance
  of the proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Diamonds previously or thereafter produced from such
  ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange at its own
  expense and shall keep in force at all times, directly or through the services
  of an independent contractor, insurance, including but not limited to, the following:

10.1
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

---

10.2
  General Liability.Comprehensive general public liability insurance against
  claims for bodily injury or death or property damage arising out of or resulting
  from Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Gross Overriding
  Royalty, and the Property from any and all claims, liabilities and damages which
  may arise with respect to this Agreement or the Property. Payee shall be named
  as a co-insured.

10.3
  Self Insurance.Grantor may self insure the foregoing obligations, provided
  such self insurance is sufficient to meet the requirements of Sections 10.1
  and 10.2 above and is in compliance with applicable laws, statutes, rules and
  regulations.

11. General Provisions.

11.1The Miscellaneous Provisions set forth in Article 16 of the Main Agreement
  shall apply to this Schedule C as applicable.

11.2In this Schedule C in all matters of interpretation, whenever necessary
  to give effect to any provision of this instrument, the masculine shall include
  the feminine and neuter and vice versa, the singular shall include the plural,
  and the plural shall include the singular.

---

AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 14thday of April, 2002.

|BETWEEN: | UBEX CAPITAL INC.             |                   
|-------- | ----------------------------- | ------------------
|         | Suite 306  1140 Homer Street |                   
|         | Vancouver, B.C., V6B 2X6      |                   
|         |                               |                   
|         | (the Optionor)              |                   
|         |                               | OF THE FIRST PART 
|         |                               |                   
|AND:     | THRUSH INDUSTRIES INC.        |                   
|         | Suite 306  1140 Homer Street |                   
|         | Vancouver, B.C., V6B 2X6      |                   
|         |                               |                   
|         | (Thrush)                    |                   
|         |                               | OF THE SECOND PART

|WHEREAS:                                                                              
|--------------------------------------------------------------------------------------
|                                                                                      
|A.                                                                                    
|                                                                                      
|B.                                                                                    
|                                                                                      
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Agreement is amended as follows:
|                                                                                      
|1.                                                                                    
|                                                                                      
|                                                                                      
|                                                                                      
|                                                                                      

|THE COMMON SEAL OF UBEX            | c/s
|---------------------------------- | ---
|CAPITAL INC. was hereunto          |    
|affixed in the presence of:        |    
|                                   |    
|Dennis Higgs                     |    
|                                   |    
|                                   |    
|SIGNED AND DELIVERED BY THRUSH     |    
|INDUSTRIES INC, and affixed in the |    
|presence of:                       |    
|                                   |    
|                                   |    
|Aileen Lloyd                     |    
|                                   |    
|Authorized Signatory               |    

---

SECOND AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 29thday of May, 2002.

|BETWEEN: | UBEX CAPITAL INC.                 |                   
|-------- | --------------------------------- | ------------------
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (the Optionor)                  |                   
|         |                                   | OF THE FIRST PART 
|         |                                   |                   
|AND:     | MIRANDA DIAMOND CORP.             |                   
|         | (Formerly Thrush Industries Inc.) |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (Thrush)                        |                   
|         |                                   | OF THE SECOND PART

|WHEREAS:                                                                                      
|----------------------------------------------------------------------------------------------
|                                                                                              
|A.                                                                                            
|B.                                                                                            
|                                                                                              
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Amended Agreement is amended as follows:
|                                                                                              
|1.                                                                                            

The parties hereby ratify and confirm the Agreement in all other respects.

IN WITNESS WHEREOF the parties hereto have executed this Second
  Amendment Agreement as of the day and year first above written.

| | 
| | 
| | 
| | 
| | 

---

|THE COMMON SEAL OF UBEX     | c/s
|--------------------------- | ---
|CAPITAL INC. was hereunto   |    
|affixed in the presence of: |    

Dennis Higgs

SIGNED AND DELIVERED BY MIRANDA 
  DIAMOND CORP. (FORMERLY THRUSH 
  INDUSTRIES INC.), and affixed in the 
  presence of:

Aileen Lloyd

Authorized Signatory

---

THIRD AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 28thday of June, 2002.

|BETWEEN: | UBEX CAPITAL INC.                 |                   
|-------- | --------------------------------- | ------------------
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (the Optionor)                  |                   
|         |                                   | OF THE FIRST PART 
|         |                                   |                   
|AND:     | MIRANDA DIAMOND CORP.             |                   
|         | (Formerly Thrush Industries Inc.) |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (Thrush)                        |                   
|         |                                   | OF THE SECOND PART

|WHEREAS:                                                                                      
|----------------------------------------------------------------------------------------------
|                                                                                              
|A.                                                                                            
|                                                                                              
|B.                                                                                            
|                                                                                              
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Amended Agreement is amended as follows:
|                                                                                              
|1.                                                                                            

The parties hereby ratify and confirm the Agreement in all other respects.

IN WITNESS WHEREOF the parties hereto have executed this Third
  Amendment Agreement as of the day and year first above written.

---

|THE COMMON SEAL OF UBEX     | c/s
|--------------------------- | ---
|CAPITAL INC. was hereunto   |    
|affixed in the presence of: |    

Dennis Higgs

SIGNED AND DELIVERED BY MIRANDA 
  DIAMOND CORP. (FORMERLY THRUSH 
  INDUSTRIES INC.), and affixed in the 
  presence of:

Aileen Lloyd

Authorized Signatory

---



MINERAL PROPERTY OPTION AGREEMENT

THIS AGREEMENTis dated for reference the 30th day of January, 2002

|BETWEEN: | Ubex Capital Inc.                   |                   
|-------- | ----------------------------------- | ------------------
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (the Optionor or the Optionors) |                   
|         |                                     | OF THE FIRST PART 
|AND:     | Thrush Industries Inc.              |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (Thrush)                          |                   
|         |                                     | OF THE SECOND PART

WHEREAS the Optionor has made staking applications
  for a 100% interest in certain exploration claims in the Otish Mountains region
  of Quebec (the Lac Pigeon #2 property), through the internet by
  way of the website maintained by the Province of Quebec for such purposes;

AND WHEREASsuch applications to stake claims have
  been received by the Province of Quebec, Ministere des Ressources Naturelles,
  although confirmations of title to the claims have not yet been issued;

AND WHEREASThrush is desirous of acquiring an interest
  in such exploration claims on the terms and conditions contained herein:

NOW THEREFORE THIS AGREEMENT WITNESSESthat in consideration
  of the premises and the mutual covenants and agreements hereinafter contained,
  the parties hereto agree as follows:

|1.   | DEFINITIONS       
|---- | ------------------
|     |                   
|1.01 | In this Agreement:
|     |                   
|     | (a)               
|     |                   
|     | (b)               

---

| | (c) | Net Smelter Returns shall have the
      meaning ascribed by Schedule B attached hereto;
| | --- | ------------------------------------------------------------------------------------------
| |     |                                                                                           
| | (d) | "Property" means and includes:                                                            
| |     |                                                                                           
| |     | (i)                                                                                       
| |     |                                                                                           
| |     | (ii)                                                                                      

|2.   | ACQUISITION OF INTEREST                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|2.01 | The Optionor hereby grants
        to Thrush the exclusive right and option to acquire an undivided 100%
        right, title and interest in and to the Property, subject to the Net Smelter
        Returns and Gross Overriding Royalty described in Article 4 of this Agreement,
        for total consideration consisting of cash payments to the Optionor totalling
        $5,271 to be made as follows:                                                                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|2.02 | The cash payment provided for in subparagraph
      2.01 (b) shall be subject to receipt of title certificates for the exploration
      claims comprising the Property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|2.03 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to the prior approval of
        the shareholders of Thrush, at an annual and extraordinary general meeting
        proposed to be held on March 27, 2002 (and any adjournments) and of the
        Exchange, based , if necessary, on the submission of engineering data
        satisfactory to the Exchange, which Thrush undertakes to use its best
        efforts to file within a reasonable period of time so as to obtain the
        necessary approval by the earliest possible date. Notwithstanding any
        other provision of this Agreement, so long as Thrush has filed the engineering
        data

---

|     | referred to herein with
        the Exchange within a reasonable time after receiving same, the time for
        making any cash payment or share issuance referred to in this paragraph
        shall be extended, where necessary, to the day that is five business days
        following the receipt by Thrush of the necessary Exchange approval.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                       
|2.04 | This Agreement is an option
        only and, subject to paragraph 11.02, the doing of any act or the incurrence
        of any cash payments by Thrush shall not obligate Thrush to do any further
        acts or make any further payments.                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                       
|3.   | TRANSFER OF TITLE                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                       
|3.01 | Upon execution of this Agreement
        Thrush shall be entitled to record this Agreement against title to the
        Property, once title is granted by the Province of Quebec, Ministere des
        Ressources Naturelles to the Optionor.                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                       
|3.02 | Upon Thrush exercising the
        option to acquire the Property pursuant to article 2, the Optionor shall
        deliver to Thrush duly executed transfers for the transfer to Thrush of
        a 100% interest in and to the Property, subject to the royalty interest
        pursuant to Article 4.                                            
|     |                                                                                                                                                                                                                                                                                                                                                       
|4.   | ROYALTY                                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                       
|4.01 | Thrush agrees that the Property shall be subject
      to a royalty in favour of the Optionor equal to 2% of Net Smelter Returns
      to be calculated and paid according to and otherwise governed by Schedule
      B hereto.                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                       
|4.02 | Thrush agrees that the Property
        shall be subject to a royalty in favour of the Optionor equal to a 2%
        Gross Overriding Royalty to be calculated and paid according to and otherwise
        governed by Schedule C hereto.                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                       
|5.   | PAYMENTS                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                       
|5.01 | The payments to be made
        to the Optionors pursuant to section 2 and such other payments as are
        to be made to the Optionors pursuant to this Agreement shall be made in
        full to Ubex Capital Inc. (Ubex).                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                       
|6.   | COVENANTS OF THRUSH                                                                                                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                       
|6.01 | Thrush covenants and agrees with the Optionor
      that during the term of this Agreement:                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                       
|     | (a)                                                                                                                                                                                                                                                                                                                                                   

---

|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                  | Thrush shall carry on all operations
        on the Property in a good and workmanlike manner and in compliance with
        all applicable governmental regulations and restrictions including but
        not limited to the posting of any reclamation bonds and the conduct of
        all reclamation work as may be required by any governmental regulations
        or regulatory authorities;                                                                                            
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (c)                                                                                                                                                                                                                                                                                                                                                                                                  | Thrush shall pay or cause to be paid
        any rates, taxes, duties, royalties, Workers Compensation or other
        assessments or fees levied with respect to the Property or Thrushs
        operations thereon;                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                  | Thrush shall hold harmless, indemnify,
        and defend the Optionor from any claims, loss, damage, judgement or expense
        for loss or damage to property and death, including environmental damages,
        or injury to persons arising out of Thrushs activities or operations
        on the Property, except to the extent that any such claim, loss, damage,
        judgement, or expense is caused by the negligence of the Optionor, its
        employees, agents or assigns;
|     |                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (e)                                                                                                                                                                                                                                                                                                                                                                                                  | Thrush shall ensure that, in connection
        with the entry onto the Property of any exploration contractor or other
        worker, there shall be in place, either through Thrush or such contractor
        or worker, comprehensive broad-form liability insurance covering claims
        for personal injury, death or property damage with a coverage limit of
        at least $1,000,000;                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (f)                                                                                                                                                                                                                                                                                                                                                                                                  | Thrush shall maintain books of account
        in respect of its expenditures and operations on the Property and, upon
        reasonable notice, shall make such books available for inspection by representatives
        of the Optionor;                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (g)                                                                                                                                                                                                                                                                                                                                                                                                  | Thrush shall allow any duly authorized
        agent or representative of the Optionor to inspect the Property at reasonable
        times and intervals and upon reasonable notice given to Thrush, provided
        however that it is agreed and understood that any such agent or representative
        shall be at his own risk in respect of, and Thrush shall not be liable
        for, any injury incurred while on the Property, howsoever caused; and                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (h)                                                                                                                                                                                                                                                                                                                                                                                                  | Thrush shall provide to the Optionor,
        semi-annually, a summary report outlining Thrushs progress on the
        Property and shall provide to Optionor, annually, a copy of all factual,
        non-interpretive data derived from Thrushs operations on the Property.                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|7.   | RIGHT OF ENTRY                                                                                                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|7.01 | During the currency of this
        Agreement, Thrush, its servants, agents and workmen and any persons duly
        authorized by Thrush, shall have the right of access to and from and to
        enter upon and take possession of and prospect, explore and develop the
        Property in such manner as Thrush in its sole discretion may deem advisable
        and shall have the right to

---

|remove and ship therefrom ores, minerals, metals,
      diamonds, or other products recovered in any manner therefrom.
|----------------------------------------------------------------------------------------------------------------------
|                                                                                                                      
|7.02                                                                                                                  
|                                                                                                                      
|8.                                                                                                                    
|                                                                                                                      
|8.01                                                                                                                  
|                                                                                                                      
|                                                                                                                      
|                                                                                                                      
|                                                                                                                      
|                                                                                                                      
|                                                                                                                      
|                                                                                                                      
|                                                                                                                      
|                                                                                                                      
|8.02                                                                                                                  
|                                                                                                                      
|                                                                                                                      
|                                                                                                                      
|                                                                                                                      
|                                                                                                                      
|9.                                                                                                                    
|                                                                                                                      
|9.01                                                                                                                  

---

|                                                                                                                                                                                                                                                                                                           | Agreement is in effect,
        the Optionor shall not, without the express written consent of Thrush,
        disclose to any third party any information concerning the Property or
        any operations thereon, nor shall the Optionor buy, sell or otherwise
        deal in the shares of Thrush while any material, confidential information
        in its possession relating to this Agreement or the Property remains undisclosed
        to the general public.                          
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|10.                                                                                                                                                                                                                                                                                                        | ASSIGNMENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|10.01                                                                                                                                                                                                                                                                                                      | With the consent of the
        other party, which consent shall not be unreasonably withheld, each party
        has the right to assign all or any part of its interest in this Agreement
        and in the Property, subject to the terms and conditions of this Agreement.
        It shall be a condition precedent to any such assignment that the assignee
        of the interest being transferred agrees to be bound by the terms of this
        Agreement, insofar as they are applicable.
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|11.                                                                                                                                                                                                                                                                                                        | TERMINATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|11.01                                                                                                                                                                                                                                                                                                      | This Agreement shall terminate upon the occurrence
      of one of the following events:                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|In the event that Thrush
        gives notice that it denies that a default has occurred, Thrush shall
        not be deemed in default until the matter shall have been determined finally
        through such means of dispute resolution as such matter has been subjected
        to by either party.
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|11.02                                                                                                                                                                                                                                                                                                      | Upon termination of this Agreement under paragraph
      11.01, Thrush shall:                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                           | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

---

|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | have paid, as required by the Province
        of Quebec any annual maintenance fees and/or taxes necessary to hold all
        the exploration claims subject to this Agreement for the one year period
        beginning January 1 immediately following termination, and provided proof
        of such payment to the Optionor by December 15 immediately following termination;
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | transfer title to the Property to the
        Optionor free and clear of all liens, charges and encumbrances and obligations
        for reclamation or detoxification;                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | turn over to the Optionor copies of
        all non-interpretive maps, reports, sample results, contracts and other
        data and documentation in the possession of Thrush or, to the extent within
        Thrushs control, in the possession of its agents, employees or independent
        contractors, in connection with its operations on the Property;                 
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | ensure that the Property is in a safe
        condition and complies with all environmental and safety standards including
        standards for reclamation and detoxification, imposed by any duly authorized
        regulatory authority; and                                                                                                                                   
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | ensure that its covenants under subparagraphs 6.01 (a)
        through (e) have been fully complied with.                                                                                                                                                                                                                                                                           
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|11.03 | Upon the termination of
        this Agreement under paragraph 11.01, Thrush shall cease to be liable
        to the Optionor in debt, damages or otherwise save for the performance
        of those obligations in paragraph 11.02.                                                                                                                                                                                                                                                                                                          
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|11.04 | Upon termination of this
        Agreement under paragraph 11.01, Thrush shall vacate the Property within
        a reasonable time after such termination, but shall have the right of
        access to the property for a period of six months thereafter for the purpose
        of removing its chattels, machinery, equipment and fixtures.                                                                                                                                                                                              
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|12.   | FORCE MAJEURE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|12.01 | The time for performance
        of any act or making any payment or any expenditure required under this
        Agreement shall be extended by the period of any delay or inability to
        perform due to fire, strikes, labour disturbances, riots, civil commotion,
        wars, acts of God, any present or future law or governmental regulation,
        any shortages of labour, equipment or materials, or any other cause not
        reasonably within the control of the party in default, other than lack
        of finances.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|13.   | REGULATORY APPROVAL                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|13.01 | This Agreement is subject
        to the prior approval of the Exchange. Thrush shall use its best efforts
        to obtain such approval as soon as reasonably possible, provided however
        that if                                                                                                                                                                                                                                                                                                                                    

---

|      | such approval has not been received by April
      15, 2002, this Agreement shall be null and void and of no further effect.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.   | AFTER-ACQUIRED PROPERTY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.01 | In the event that at any
        time hereafter Thrush shall acquire any portion of any combined group
        of any mining claims, any mining claim, lease, or other mineral right
        or interest within a three kilometre radius of the outside boundary of
        the Property to be described in Schedule A hereto, such interest shall
        be deemed to have been acquired on behalf of and for the benefit of the
        parties, pursuant to the terms of this Agreement and such after-acquired
        interest as aforesaid shall be included in and shall form a part of the
        definition of Property contained in paragraph 1.01 and shall
        be subject to this Agreement as if it had been originally so included.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.02 | In the event that at any
        time hereafter Thrush shall acquire any portion of any combined group
        of any mining claims, any mining claim, lease, or other mineral right
        or interest within a three kilometre radius of the outside boundary of
        the Property as constituted on the date of this Agreement, such interest
        shall be subject to the royalties in favour of the Optionor as described
        in Article 4 of this Agreement, and, if so requested by the Optionor,
        shall be transferred to the Optionor upon abandonment by Thrush.                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|15.   | NOTICES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|15.01 | Any notice, election, consent
        or other writing required or permitted to be given hereunder shall be
        deemed to be sufficiently given if delivered or mailed postage prepaid
        or if given by telegram, telex or telecopier, addressed as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

|In the case of the Optionor: | Ubex Capital Inc.            
|---------------------------- | -----------------------------
|                             | Suite 306  1140 Homer Street
|                             | Vancouver, B.C.              
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          
|                             |                              
|                             |                              
|In the case of Thrush:       | THRUSH INDUSTRIES INC.       
|                             | Suite306  1140 Homer Street 
|                             | Vancouver, British Columbia  
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          

and any such notice given us aforesaid shall be deemed to
  have been given to the parties hereto if delivered, when delivered, or if mailed,
  on the third business day following the date of mailing, or, if telegraphed,
  telexed or telecopied, on the same day as the telegraphing, telexing or telecopying
  thereof provided however that during the period of any postal interruption in
  Canada or the United States any notice given hereunder by mail shall be deemed
  to have been given only

---

as of the date of actual delivery of the same. Any party may
  from time to time by notice in writing change its address for the purposes of
  this paragraph 15.01.

16. GENERAL TERMS AND CONDITIONS

16.01 The parties hereto hereby covenant and agree that they
  will execute such further agreements, conveyances and assurances as may be requisite,
  or which counsel for the parties may deem necessary to effectually carry out
  the intent of this Agreement.

16.02 This Agreement shall constitute the entire agreement
  between the parties with respect to the Property. No representations or inducements
  have been made save as herein set forth. No changes, alterations or modifications
  of this Agreement shall be binding upon either party until and unless a memorandum
  in writing to such effect shall have been signed by all parties hereto. This
  Agreement shall supersede all previous written, oral or implied understandings
  between the parties with respect to the matters hereby.

16.03 Time shall be of the essence of this Agreement.

16.04 The titles to the articles in this Agreement shall not
  be deemed to form part of this Agreement but shall be regarded as having been
  used for convenience of reference only.

16.05 All currency references contained in this Agreement shall be deemed
  to be references to Canadian funds.

16.06 Wherever possible, each provision of this Agreement
  shall be interpreted in such manner as to be effective and valid under applicable
  law, but if any provision shall be prohibited by or be invalid under applicable
  law, such provision shall be ineffective only to the extent of such prohibition
  or invalidity, without invalidating the remainder of such provision or the remaining
  provisions of this Agreement.

16.07 The Schedules to this Agreement shall be construed with
  and as an integral part of this Agreement to the same extent as if they were
  set forth verbatim herein. Defined terms contained in this Agreement shall have
  the same meanings where used in the Schedules.

16.08 This Agreement shall be governed by and interpreted
  in accordance with the laws of the Province of British Columbia and the laws
  of Canada applicable therein.

16.09 In the event that any suit, legal action, or arbitration
  proceeding is instituted to interpret or enforce the terms of this Agreement,
  including but not limited to any contest proceeding under paragraph 11.01, the
  prevailing party shall be entitled to recover from the other party such sum
  as the court or arbitrator may adjudge reasonable for attorneys fees at
  trial and on appeal of such suit, action or proceeding in addition to all other
  sums provided by law.

16.10 This Agreement shall enure to the benefit of and be
  binding upon the parties hereto and their respective heirs, executors, administrators,
  successors and assigns.

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IN WITNESS WHEREOFthis Agreement has been executed by the parties
  hereto as of the day and year first above written.

|The COMMON SEAL of UBEX CAPITAL          | c/s
|---------------------------------------- | ---
|INC.was hereunto affixed in the presence |    
|of:                                      |    

Dennis Higgs

SIGNED AND DELIVERED BY THRUSH 
  INDUSTRIES INC. and affixed in the presence 
  of:

Aileen Fehr

Authorized Signatory

---

Schedule B

NET SMELTER RETURN ROYALTY

References
  in this Schedule B to Sections and Articles in this Schedule B are so identified,
  and references in this Schedule B to Sections and Articles in the agreement
  to which this Schedule B is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule B except as otherwise expressly stated in
  this Schedule B. The Net Smelter Returns royalty defined in Article 1 of the
  Main Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As used in this Schedule B, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-in-interest,
  including without limitation, assignees, partners, joint venture partners, lessees
  and when applicable mortgagees and affiliated companies having or claiming an
  interest in the Properties or projects.

1.2As used in this Schedule B, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in-interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Production Royalty.Grantor
  shall pay to Grantee the royalty described in Section 4 below (Royalty)
  pursuant to the terms and provisions of this Schedule B.

3. Term.The term of the Royalty hereby created shall
  be perpetual, it being the intent of the parties hereto that, to the extent
  allowed by law, the Royalty constitutes a vested interest in and a covenant
  running with the land and affecting the Property and all successions thereof
  whether created privately or through governmental action. In the event a court
  of competent jurisdiction determines that the term of this Agreement violates
  the Rule Against Perpetuities, then the term of this Agreement shall automatically
  be revised and reformed to coincide with the maximum term permitted by the Rule
  Against Perpetuities, and this Agreement shall not be terminated solely as a
  result of a violation of the Rule Against Perpetuities.

4. Production Royalty.Grantor shall pay to Grantee
  a perpetual Royalty in the amount of two percent (2%) of Net Smelter Returns
  from the sale or other disposition of all locatable minerals produced from the
  Properties determined in accordance with the provisions set forth in this Section
  4 and, if applicable, Section 7.

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4.1 For Precious
  Metals.Net Smelter Returns, in the case of gold, silver, and platinum group
  metals (Precious Metals), shall be determined by multiplying (i)
  the gross number of troy ounces of Precious Metals contained in the production
  delivered to the smelter, refiner, processor, purchaser or other recipient (including
  the operator) of such production, or an insurer as a result of casualty to such
  production (collectively, Payor) during the preceding calendar month
  by (ii) for gold, the average of the London Bullion Market, Morning Fix, spot
  prices for the preceding calendar month; for all other Precious Metals, the
  average of the New York Commodities Exchange final daily spot prices for the
  preceding calendar month, and subtracting from the product of (i) and (ii) only
  the following if actually incurred:

| | (1) | charges imposed by the Payor for refining
        bullion from the Beneficiated Precious Metals contained in such production
        (as used in this Agreement, Beneficiated Precious Metals includes
        only doré or concentrates of Precious Metals produced by Grantors
        final mill or other processing plant, but does not include raw or crushed
        ore containing Precious Metals or other preliminarily processed Precious
        Metals); and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | penalty substance, assaying, and sampling
        charges imposed by the Payor for refining Beneficiated Precious Metals
        contained in such production.                                                                                                                                                                                                                                                                                                             

In the event the refining of bullion from the Beneficiated
  Precious Metals contained in such production is carried out in custom toll facilities
  owned or controlled, in whole or in part, by Grantor, which facilities were
  not constructed for the purpose of refining Beneficiated Precious Metals from
  the Property, then charges, costs and penalties for such refining shall mean
  the amount Grantor would have incurred if such refining were carried out at
  facilities not owned or controlled by Grantor then offering comparable services
  for comparable products on prevailing terms, but in no event greater than actual
  costs incurred by Grantor with respect to such refining.

In the event the Grantor receives insurance proceeds for loss
  of production, Grantor shall pay to Payee the Royalty percentage of any such
  insurance proceeds which are received by Grantor for such loss of production.

4.2
  For Other Minerals.Net Smelter Returns, in the case of all metals, minerals,
  mineral substances, and the beneficiated products thereof, which are not or
  do not contain economically recoverable Precious Metals (Other Minerals),
  shall be determined by multiplying (i) the gross amount of the particular Other
  Mineral contained in the production delivered to the Payor during the preceding
  calendar month by (ii) the average of the New York Commodities Exchange final
  daily spot prices for the preceding calendar month of the appropriate Other
  Mineral, and subtracting from the product of (i) and (ii) only the following
  if actually incurred:

---

| | (1) | charges imposed by the Payor for smelting,
        refining or processing Other Minerals contained in such production, but
        excluding any and all charges and costs related to Grantor mill
        or other processing plants constructed for the purpose of milling or processing
        Other Minerals, in whole or in part; and                                                      
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                   
| | (2) | penalty substance, assaying, and sampling
        charges imposed by the Payor for smelting, refining, or processing Other
        Minerals contained in such production, but excluding any and all charges
        and costs of or related to Grantor mills or other processing plants
        constructed for the purpose of milling or processing Other Minerals, in
        whole or in part.

In the event smelting, refining, or processing of Other Minerals
  are carried out in custom toll facilities owned or controlled, in whole or in
  part, by Grantor, which facilities were not constructed for the purpose of milling
  or processing Other Minerals, then charges, costs and penalties for such smelting,
  refining or processing shall mean the amount Grantor would have incurred if
  such smelting, refining or processing were carried out at facilities not owned
  or controlled by Grantor then offering comparable services for comparable products
  on prevailing terms, but in no event greater than actual costs incurred by Grantor
  with respect to such smelting and refining.

In the event Grantor receives insurance proceeds for loss
  of production, Grantor shall pay to Payee the Royalty percentage of any such
  insurance proceeds which are received by Grantor for such loss of production.

Notwithstanding anything contained in the foregoing, the term
  Other Minerals shall not be deemed to include Diamonds
  as defined in Schedule C to the Main Agreement, it being the intention of the
  parties that all payments of royalties in respect of Diamonds shall be governed
  by Schedule C attached to the Main Agreement.

4.3
  Time and Manner; In-Kind or Cash Payment.At the time of making payment
  to or otherwise crediting the account of Grantor for production from the Property
  pursuant to Sections 4.1 or 4.2 (but within the time provided in Section 4.4),
  the smelter, refiner, processor, purchaser, or other user (Payor)
  of the Precious Metals or Other Minerals shall contemporaneously pay the Royalty
  in accordance with written instructions given to the Payor by Grantee as provided
  in Sections 4.3.1 and 4.3.2. Once the Payor has received instructions from Grantee,
  such instructions shall remain in effect until the Payor has received different
  instructions from Grantee. All contractual or other arrangements entered into
  by Grantor with the Payor shall contain provisions implementing the terms and
  conditions of payment set forth in Sections 4.3 and 4.4 hereof and Grantor shall
  procure the written undertaking of Payor contractually binding Payor to perform
  in accordance with Sections 4.3 and 4.4 in form and substance enforceable by
  Grantee. Grantor acknowledges its primary obligation to pay the Royalty and
  that no undertaking by the Payor shall relieve Grantor of that obligation, and
  Grantor agrees to indemnify, protect and defend Grantee from and against any
  loss, cost

---

(including attorneys fees incurred) or liability arising
  from the performance or failure of performance by Payor hereunder or under any
  contractual or other arrangements entered into by Grantor with the Payor pursuant
  to or for the purposes of complying with Sections 4.3 and 4.4 hereof. Grantee
  may, from time to time in its discretion, change the bank or account number
  for payment under to Sections 4.3.1 and 4.3.2 by giving written notice thereof
  to Grantor and the Payor; such notice shall be effective upon actual receipt
  by the Payor, or upon the fourth day after deposit of such notice in the mail,
  first class postage prepaid, addressed to the Payor, whichever occurs first.
  All costs charged by the Payor as a result of complying with the payment provisions
  of Sections 4.3 and 4.4 shall be paid by Grantee, and Grantor shall have no
  liability or responsibility therefor.

4.3.1
  Precious Metals.The Payor shall pay the Royalty for each shipment of Precious
  Metals either (a) in the form of gold bullion (.995 + fine gold) directly to
  Payees account maintained with the Payor as directed by Payee, or (b)
  by delivery of a cheque or draft payable to Payees account with a bank
  to be designated in writing by Payee. In the event Payee instructs the Payor
  to deliver the Royalty in the form of gold bullion, the Royalty payable on silver
  or platinum group metals shall be converted to the gold equivalent of such silver
  or platinum group metals by using the average monthly spot prices for Precious
  Metals described in Section 4.1.

4.3.2
  Other Minerals.The Payor shall pay the Royalty for each shipment of Other
  Minerals by delivery of a cheque or draft payable to the Payees account
  with a bank to be designated in writing by Payee.

4.4
  Payment Accounting; Interim Settlements; Late Charges.All credits or payments
  of the Royalty shall be accompanied by a detailed statement explaining the manner
  in which the payment was calculated together with any available settlement sheets
  from the Payor. In no event shall payment of the Royalty be made later that
  thirty (30) days after the delivery to the Payor of the Precious Metals, Beneficiated
  Precious Metals, or Other Minerals. Such payments and statements shall be deemed
  conclusively correct unless Grantee objects to them in writing within eighteen
  (18) months after receipt thereof. On those occasions when all necessary information
  is not available to the Payor within the thirty (30) day period, the Payor shall
  make an interim settlement of the Royalty for such shipment or use within the
  thirty (30) day period; such interim settlement shall provide for payment of
  not less than ninety percent (90%) of the anticipated final settlement Royalty
  as determined by the assays and quantities of the Precious Metals or Other Minerals
  received by the Payor with respect to which such interim settlement is being
  made. Final settlement of the Royalty shall be promptly made upon receipt by
  the Payor of all information necessary or appropriate to make final settlement
  for such shipment. In the event payment of any Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Royalty payment, the Grantor shall pay an additional sum
  equal to ten percent (10%) of the delinquent payment (late charge)
  plus interest on the delinquent payment and the late charge at the rate twelve
  percent (12%) per annum which shall accrue from the day

---

the delinquent payment was due to the date of payment of the Royalty, late
  charge and accrued interest.

4.5
  Hedging Transactions: Futures, Options and Other Trading.All profits and
  losses resulting from Grantor engaging in any commodity futures trading, option
  trading, or metals trading, or any combination thereof, and any other hedging
  transactions (collectively hedging transactions) are specifically
  excluded from Royalty calculations pursuant to this Agreement. All hedging transactions
  by Grantor and all profits or losses associated therewith, if any, shall be
  solely for Grantors account. The Royalty payable on Precious Metals or
  Other Minerals subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Precious Metals.The amount of Royalty to be paid on all Precious
  Metals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.1 with the understanding that the average
  monthly spot price shall be for the calendar month during which Precious Metals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.5.2
  Affecting Other Minerals. The amount of Royalty to be paid on all Other
  Minerals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.2 with the understanding that the average
  monthly spot price shall be for the calendar month during which Other Minerals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.6
  Commingling.Before any Precious Metals or Other Minerals produced from
  the Property are commingled with minerals from other properties, the Precious
  Metals or Other Minerals produced from the Property shall be measured and sampled
  in accordance with sound mining and metallurgical practices for moisture, metal,
  commercial minerals and other appropriate content. Representative samples of
  the Precious Metals or Other Minerals shall be retained by Grantor and assays
  (including moisture and penalty substances) and other appropriate analyses of
  these samples shall be made before commingling to determine metal, commercial
  minerals, and other appropriate content. Detailed records shall be kept by Grantor
  showing measures, moisture, assays of metal, commercial minerals, and other
  appropriate content and penalty substances, and gross metal content of the Precious
  Metals or gross metal or mineral content of Other Minerals. From this information,
  Grantor shall determine the amount of Royalty due and payable to Payee from
  Precious Metals or Other Minerals produced from the Property commingled with
  minerals from other properties. Following the expiration of the period for objection
  described above in Section 4.4, and absent timely objection, if any, made by
  Payee, Grantor may dispose of the materials and data required to be kept and
  produced by this Section 4.6.

5. Books; Records: Inspections; Confidentiality.

---

5.1
  Books.Grantor shall keep true and accurate books and records of all of
  its operations and activities on the Property and under this Agreement. Such
  books and records shall be kept on the accrual basis in accordance with generally
  accepted accounting principles consistently applied. Not more frequently than
  annually and within the time provided in Section 4.4 of this Agreement, Payee
  may, at Payees sole expense, give notice to Grantor that Payee desires
  to perform an audit or other examination of all of Grantors books and
  records kept as required by this Agreement. All financial information shall
  conclusively be deemed correct for purposes of this Agreement unless Payee has
  given timely notice that it desires to audit or examine Grantors books
  and records in the manner and within the time provided in Section 4.4 of this
  Agreement. Payee shall promptly commence any such audits and shall diligently
  prosecute the same to conclusion.

5.2
  Reports.Not later than March 1 following the end of each calendar year,
  Grantor shall provide Payee with an annual report of all activities and operations
  conducted upon or with respect to the Property during the preceding calendar
  year. Such annual report shall include estimates of proposed expenditures upon,
  anticipated production from, and estimated remaining ore reserves on the Property
  for the succeeding calendar year. Additionally, and within 30 days of the end
  of each calendar quarter, Grantor shall provide Payee access to all data and
  information generated with respect to the Property during the calendar quarter
  just ended.

5.3
  Inspections.Payee, or its authorized agents or representatives, on not
  less than two (2) days notice to Grantor, may enter upon all surface and subsurface
  portions of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4
  Investor Tours.Upon reasonable notice to Grantor and not more frequently
  than semi-annually, Payee shall have the right to conduct an investors tour
  on the Property and facilities associated therewith; provided that such tours
  shall not unreasonably interfere with Grantors activities and operations.
  Such investors tours shall be at the sole risk of the Payee and its invitees,
  and Payee shall indemnify and hold Grantor harmless from any liability, damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  invitees, employees, officers, directors, agents, or representatives caused
  solely by Payees exercise of its rights under this Section.

---

5.5
  Confidentiality.Payee shall not, without the express written consent of
  Grantor, which consent shall not be unreasonably withheld, disclose any data
  or information concerning the Operations conducted on the Property or obtained
  under the Main Agreement or this Agreement which is not already in the public
  domain; provided, however, Payee may disclose data or information obtained under
  this Agreement without the consent of Grantor: (i) if required for compliance
  with applicable laws, rules, regulations or orders of a governmental agency
  or stock exchange having jurisdiction over Payee or its parent or affiliated
  corporations; (ii) to any of Payees consultants; (iii) to any third party
  to whom Payee, in good faith, anticipates selling or assigning Payees
  interest hereunder; or (iv) to a prospective lender to whom an interest in the
  Royalty payments to be made to Payee hereunder is proposed to be granted as
  security, provided that Grantor shall first have been provided with a confidentiality
  agreement executed by such consultant, third party or lender, which agreement
  shall include the confidentiality provisions of this Section 5.5. Payee shall
  not issue any press releases pertaining to the Property except upon giving Grantor
  three (3) days advance written notice of the contents thereof, and Payee shall
  make any reasonable changes to such proposed press releases requested by Grantor.
  Payee shall not, without Grantors consent, issue any press release that
  implies or infers that Grantor endorses or joins in Payees statements
  or representations contained in any press release.

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1
  Compliance with Laws.Grantor shall at all times comply with all applicable
  present or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2
  Reclamation, Environmental Obligations, and Indemnities.Grantor shall,
  from and after the date this Agreement takes effect, timely and fully perform
  all reclamation required by all governmental authorities pertaining or related
  to Grantors operations or activities on or with respect to the Property
  or required under this Agreement. Grantor, from and after the date this Agreement
  takes effect, covenants and agrees not to undertake, cause, suffer, or permit
  any condition or activity at, on or in the vicinity of the Property which constitutes
  a nuisance or which results in a violation of or liability under any present
  or future applicable federal, provincial, or local environmental laws, statutes,
  rules, regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants

---

and agrees to indemnify and hold Payee harmless from any and
  all liabilities, obligations, claims (including administrative claims and claims
  for injunctive relief), demands, losses, costs, damages, expenses, attorney
  fees and causes of action asserted against Payee related to Grantors failure
  to comply with and satisfy Environmental Obligations or other obligations under
  this Agreement. The covenants and agreements of this Section 6.2 shall survive
  the termination of Grantors rights under this Agreement or to the Property.

7. Stockpiling.The rights of Grantor to
  stockpile, store or place Precious Metals or Other Minerals off of the Property
  pursuant to any of the provisions of this Agreement shall not be exercisable
  until Grantor has first secured from the property owner where such stockpiling,
  storage or placement is to occur a written agreement in recordable form which
  provides that Payees rights to the Precious Metals and Other Minerals
  shall be preserved. Such agreement shall provide,inter alia,
  that (i) Payees rights pursuant to this Agreement, insofar as they are
  applicable, shall continue in full force and effect with respect to Precious
  Metals and Other Minerals from the property; (ii) Payees rights in and
  to the Precious and Other Minerals shall be the same as if the Precious Metals
  and Other Minerals were situate on the Property; (iii) Payees rights set
  forth in this Section 7 shall have precedence over the rights to the Precious
  Metals and Other Minerals of the property owner where the Precious Metals and
  Other Minerals are stockpiled, stored or placed, as well as the creditors of
  the said property owner; and (iv) the agreement shall be irrevocable as long
  as the Precious Metals and Other Minerals from the Property, or any part thereof,
  remain on the property not part of the Property.

8. Tailings and Residues.All tailings, residues, waste
  rock, spoiled leach materials, and other materials (collectively Materials)
  resulting from Grantors operations and activities on the Property shall
  be the sole property of Grantor, but shall remain subject to the Royalty should
  the same be processed or reprocessed, as the case may be, in the future and
  result in the production of Precious Metals or Other Minerals. Notwithstanding
  the foregoing, Grantor shall have the right to dispose of Materials from the
  Property on or off of the Property and to commingle the same with Material from
  other properties. In the event Materials are processed or reprocessed, as the
  case may be, the Royalty payable thereon shall be determined by using the best
  engineering and technical practices then available, subject to adjustment on
  a pro rata basis where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1
  Title Maintenance and Taxes.From the date this Agreement takes effect,
  Grantor shall maintain title to the Property, including without limitation,
  paying when due all taxes on or with respect to the Property and doing all things
  and making all payments necessary or appropriate to maintain the right, title
  and interest of Grantor and Payee, respectively, in the Property and under this
  Agreement.

9.2
  Abandonment.In the event Grantor intends to abandon any of the lands comprising
  a portion or all of the Property (Abandonment Property), Grantor
  shall first

---

give notice of such intention to Payee at least 70 days in
  advance of the proposed date of abandonment. If not later than 10 days before
  the proposed date of abandonment Grantor receives from Payee written notice
  that Payee desires Grantor to convey the Abandonment Property to Payee, Grantor
  shall, without additional consideration, convey the Abandonment Property in
  good standing by quit claim deed, without warranty, to Payee and shall thereafter
  have no further obligation to maintain the title to the Abandonment Property.
  If Payee does not timely give such notice to Grantor, Grantor may abandon the
  Abandonment Property and shall thereafter have no further obligation to maintain
  the title to the Abandonment Property; provided, however, if Grantor reacquires
  any of the ground covered by the Abandonment Property at any time within five
  (5) years following abandonment, the Precious Metals and Other Minerals previously
  or thereafter produced from such ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange
  at its own expense and shall keep in force at all times, directly or through
  the services of an independent contractor, insurance, including but not limited
  to, the following:

10.1
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

10.2
  General Liability.Comprehensive general public liability insurance against
  claims for bodily injury or death or property damage arising out of or resulting
  from Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Royalty, and
  the Property from any and all claims, liabilities and damages which may arise
  with respect to this Agreement or the Property. Payee shall be named as a co-insured.

10.3
  Self Insurance.Grantor may self insure the foregoing obligations, provided
  such self insurance is sufficient to meet the requirements of Sections 10.1
  and 10.2 above and is in compliance with applicable laws, statutes, rules and
  regulations.

11. General Provisions.

11.1The Miscellaneous Provisions set forth in Article 16 of the Main Agreement
  shall apply to this Schedule B as applicable.

11.2In this Schedule B in all matters of interpretation, whenever necessary
  to give effect to any provision of this instrument, the masculine shall include
  the feminine and neuter and vice versa, the singular shall include the plural,
  and the plural shall include the singular.

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Schedule C

GROSS OVERRIDING ROYALTY

References
  in this Schedule C to Sections and Articles in this Schedule C are so identified,
  and references in this Schedule C to Sections and Articles in the agreement
  to which this Schedule C is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule C except as otherwise expressly stated in
  this Schedule C. The Gross Overriding Royalty defined in Article 1 of the Main
  Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As used in this Schedule C, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-in-interest,
  including without limitation, assignees, partners, joint venture partners, lessees
  and when applicable mortgagees and affiliated companies having or claiming an
  interest in the Properties or projects.

1.2As used in this Schedule C, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in-interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Gross Overriding Royalty.Grantor
  shall pay to Grantee the royalty described in Section 4 below (the Gross
  Overriding Royalty) pursuant to the terms and provisions of this Schedule
  C.

3. Term.The term of the Gross Overriding Royalty hereby
  created shall be perpetual, it being the intent of the parties hereto that,
  to the extent allowed by law, the Gross Overriding Royalty constitutes a vested
  interest in and a covenant running with the land and affecting the Property
  and all successions thereof whether created privately or through governmental
  action. In the event a court of competent jurisdiction determines that the term
  of this Agreement violates the Rule Against Perpetuities, then the term of this
  Agreement shall automatically be revised and reformed to coincide with the maximum
  term permitted by the Rule Against Perpetuities, and this Agreement shall not
  be terminated solely as a result of a violation of the Rule Against Perpetuities.

4. Gross Overriding Royalty.Grantor shall
  pay to Grantee a perpetual Gross Overriding Royalty in the amount of two percent
  (2%) of the Average Appraised Value (as hereinafter defined) of all gems, precious
  and semi-precious stones, and gem and industrial diamonds recovered, sorted,
  and graded from the Properties (the Diamonds)

---

determined in accordance with the provisions set forth in this Section 4 and,
  if applicable, Section 7.

4.1
  Average Appraised Value.Average Appraised Value means the average
  of the valuations in Canadian dollars of the Diamonds determined by two independent
  graders, one appointed by the Grantor and one appointed by the Grantee. Such
  independent graders shall be duly qualified and accredited, and shall sort,
  grade and value the Diamonds in accordance with industry standards, having regard
  to, but without limiting the generality of the foregoing, the commercial demand
  for the Diamonds. Each independent valuator shall value each particular classification
  of the Diamonds in accordance with the industry price books, standards and formulas.
  The parties acknowledge that the intention is that the Gross Overriding Royalty
  is to be paid to the Grantee on this basis, regardless of the price or proceeds
  actually received by the Grantor for or in connection with the Diamonds or the
  manner in which a sale of the Diamonds to a third party is made, and without
  deduction.

In the event the Grantor receives insurance proceeds for loss
  of production, Grantor shall pay to Payee the Gross Overriding Royalty percentage
  of any such insurance proceeds which are received by Grantor for such loss of
  production.

4.2
  Time and Manner; In Kind or Cash Payment. The Grantor will calculate and
  pay the Gross Overriding Royalty to the Grantee by delivery of a cheque or draft
  payable to the Grantee within 60 days of the end of each calendar quarter, based
  on all Diamonds from the Property which were graded in such calendar quarter.

The Grantee
  shall, at its election, have the right to take its Gross Overriding Royalty
  in kind.

4.3
  Grantors Profits and Losses. The Grantee shall not be entitled to
  participate in the profits or be obligated to share in any losses generated
  by the Grantors actual marketing or sales practices.

4.4
  Payment Accounting; Interim Settlements; Late Charges. All credits or payments
  of the Gross Overriding Royalty shall be accompanied by a detailed statement
  explaining the manner in which the payment was calculated together with any
  available settlement sheets. In no event shall payment of the Gross Overriding
  Royalty be made later that sixty (60) days after the end of each calendar quarter.
  Such payments and statements shall be deemed conclusively correct unless Grantee
  objects to them in writing within eighteen (18) months after receipt thereof.
  In the event payment of any Gross Overriding Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Gross Overriding Royalty payment, the Grantor shall pay an
  additional sum equal to ten percent (10%) of the delinquent payment (late
  charge) plus interest on the delinquent payment and the late charge at
  the rate twelve percent (12%) per annum which shall accrue from the day the
  delinquent payment

---

was due to the date of payment of the Gross Overriding Royalty, late charge
  and accrued interest.

4.5
  Hedging Transactions: Futures, Options and Other Trading.All profits and
  losses resulting from Grantor engaging in any commodity futures trading, option
  trading, or diamonds trading, or any combination thereof, and any other hedging
  transactions (collectively hedging transactions) are specifically
  excluded from Gross Overriding Royalty calculations pursuant to this Agreement.
  All hedging transactions by Grantor and all profits or losses associated therewith,
  if any, shall be solely for Grantors account. The Gross Overriding Royalty
  payable on Diamonds subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Diamonds.The amount of Gross Overriding Royalty to be paid on
  all Diamonds subject to hedging transactions by Grantor shall be determined
  in the same manner as provided in this Section 4.

4.6
  Commingling.Before any Diamonds recovered from the Property are commingled
  with minerals from other properties, the Diamonds recovered from the Property
  shall be measured and sampled in accordance with this Section 4 of this Agreement.
  Detailed records shall be kept by Grantor showing the Average Appraised Value
  of the Diamonds. From this information, Grantor shall determine the amount of
  Gross Overriding Royalty due and payable to Payee from Diamonds recovered from
  the Property commingled with minerals from other properties.

5. Books; Records: Inspections; Confidentiality.

5.1
  Books.Grantor shall keep true and accurate books and records of all of
  its operations and activities on the Property and under this Agreement. Such
  books and records shall be kept on the accrual basis in accordance with generally
  accepted accounting principles consistently applied. Not more frequently than
  annually and within the time provided in Section 4.4 of this Agreement, Payee
  may, at Payees sole expense, give notice to Grantor that Payee desires
  to perform an audit or other examination of all of Grantors books and
  records kept as required by this Agreement. All financial information shall
  conclusively be deemed correct for purposes of this Agreement unless Payee has
  given timely notice that it desires to audit or examine Grantors books
  and records in the manner and within the time provided in Section 4.4 of this
  Agreement. Payee shall promptly commence any such audits and shall diligently
  prosecute the same to conclusion.

5.2
  Reports.Not later than March 1 following the end of each calendar year,
  Grantor shall provide Payee with an annual report of all activities and operations
  conducted upon or with respect to the Property during the preceding calendar
  year. Such annual report shall include estimates of proposed expenditures upon,
  anticipated production from, and estimated remaining ore reserves on the Property
  for the succeeding calendar year. Additionally, and within 30 days of the end
  of each calendar quarter,

---

Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3
  Inspections.Payee, or its authorized agents or representatives, on not
  less than two (2) days notice to Grantor, may enter upon all surface and subsurface
  portions of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4
  Investor Tours.Upon reasonable notice to Grantor and not more frequently
  than semi-annually, Payee shall have the right to conduct an investors tour
  on the Property and facilities associated therewith; provided that such tours
  shall not unreasonably interfere with Grantors activities and operations.
  Such investors tours shall be at the sole risk of the Payee and its invitees,
  and Payee shall indemnify and hold Grantor harmless from any liability, damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  invitees, employees, officers, directors, agents, or representatives caused
  solely by Payees exercise of its rights under this Section.

5.5
  Confidentiality.Payee shall not, without the express written consent of
  Grantor, which consent shall not be unreasonably withheld, disclose any data
  or information concerning the Operations conducted on the Property or obtained
  under the Main Agreement or this Agreement which is not already in the public
  domain; provided, however, Payee may disclose data or information obtained under
  this Agreement without the consent of Grantor: (i) if required for compliance
  with applicable laws, rules, regulations or orders of a governmental agency
  or stock exchange having jurisdiction over Payee or its parent or affiliated
  corporations; (ii) to any of Payees consultants; (iii) to any third party
  to whom Payee, in good faith, anticipates selling or assigning Payees
  interest hereunder; or (iv) to a prospective lender to whom an interest in the
  Gross Overriding Royalty payments to be made to Payee hereunder is proposed
  to be granted as security, provided that Grantor shall first have been provided
  with a confidentiality agreement executed by such consultant, third party or
  lender, which agreement shall include the confidentiality provisions of this
  Section 5.5. Payee shall not issue any press releases pertaining to the Property
  except upon giving Grantor three (3) days advance written notice of the contents
  thereof, and Payee shall make any reasonable changes to such proposed press
  releases requested by Grantor. Payee shall not, without Grantors consent,
  issue any press release that implies or infers that Grantor endorses or joins
  in Payees statements or representations contained in any press release.

---

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1
  Compliance with Laws.Grantor shall at all times comply with all applicable
  present or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2
  Reclamation, Environmental Obligations, and Indemnities.Grantor shall,
  from and after the date this Agreement takes effect, timely and fully perform
  all reclamation required by all governmental authorities pertaining or related
  to Grantors operations or activities on or with respect to the Property
  or required under this Agreement. Grantor, from and after the date this Agreement
  takes effect, covenants and agrees not to undertake, cause, suffer, or permit
  any condition or activity at, on or in the vicinity of the Property which constitutes
  a nuisance or which results in a violation of or liability under any present
  or future applicable federal, provincial, or local environmental laws, statutes,
  rules, regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants and agrees to indemnify and hold Payee harmless
  from any and all liabilities, obligations, claims (including administrative
  claims and claims for injunctive relief), demands, losses, costs, damages, expenses,
  attorney fees and causes of action asserted against Payee related to Grantors
  failure to comply with and satisfy Environmental Obligations or other obligations
  under this Agreement. The covenants and agreements of this Section 6.2 shall
  survive the termination of Grantors rights under this Agreement or to
  the Property.

7. Stockpiling.The rights of Grantor to stockpile,
  store or place Diamonds off of the Property pursuant to any of the provisions
  of this Agreement shall not be exercisable until Grantor has first secured from
  the property owner where such stockpiling, storage or placement is to occur
  a written agreement in recordable form which provides that Payees rights
  to the Diamonds shall be preserved. Such agreement shall provide,inter
  alia, that (i) Payees rights pursuant to this Agreement, insofar
  as they are applicable, shall continue in full force and effect with respect
  to Diamonds from the property; (ii) Payees rights in and to the Diamonds
  shall be the same as if the Diamonds were situate on the Property; (iii) Payees
  rights set forth in this Section 7 shall have precedence over the rights to
  the Diamonds of the property owner where the Diamonds are stockpiled, stored
  or placed, as well as the creditors of the said property owner; and (iv) the
  agreement shall be irrevocable as long as the Diamonds from the Property, or
  any part thereof, remain on the property not part of the Property.

---

8. Tailings and Residues.All tailings, residues, waste
  rock, spoiled leach materials, and other materials (collectively Materials)
  resulting from Grantors operations and activities on the Property shall
  be the sole property of Grantor, but shall remain subject to the Gross Overriding
  Royalty should the same be processed or reprocessed, as the case may be, in
  the future and result in the production of Diamonds. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Gross Overriding Royalty payable thereon shall be determined by using the technique
  described in Section 4 of this Agreement, subject to adjustment on a pro rata
  basis where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1
  Title Maintenance and Taxes.From the date this Agreement takes effect,
  Grantor shall maintain title to the Property, including without limitation,
  paying when due all taxes on or with respect to the Property and doing all things
  and making all payments necessary or appropriate to maintain the right, title
  and interest of Grantor and Payee, respectively, in the Property and under this
  Agreement.

9.2
  Abandonment.In the event Grantor intends to abandon any of the lands comprising
  a portion or all of the Property (Abandonment Property), Grantor
  shall first give notice of such intention to Payee at least 70 days in advance
  of the proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Diamonds previously or thereafter produced from such
  ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange
  at its own expense and shall keep in force at all times, directly or through
  the services of an independent contractor, insurance, including but not limited
  to, the following:

10.1
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

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10.2
  General Liability.Comprehensive general public liability insurance against
  claims for bodily injury or death or property damage arising out of or resulting
  from Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Gross Overriding
  Royalty, and the Property from any and all claims, liabilities and damages which
  may arise with respect to this Agreement or the Property. Payee shall be named
  as a co-insured.

10.3
  Self Insurance.Grantor may self insure the foregoing obligations, provided
  such self insurance is sufficient to meet the requirements of Sections 10.1
  and 10.2 above and is in compliance with applicable laws, statutes, rules and
  regulations.

11. General Provisions.

11.1The Miscellaneous Provisions set forth in Article 16 of the Main Agreement
  shall apply to this Schedule C as applicable.

11.2In this Schedule C in all matters of interpretation, whenever necessary
  to give effect to any provision of this instrument, the masculine shall include
  the feminine and neuter and vice versa, the singular shall include the plural,
  and the plural shall include the singular.

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AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 14thday of April, 2002.

|BETWEEN: | UBEX CAPITAL INC.             |                   
|-------- | ----------------------------- | ------------------
|         | Suite 306  1140 Homer Street |                   
|         | Vancouver, B.C., V6B 2X6      |                   
|         |                               |                   
|         | (the Optionor)              |                   
|         |                               | OF THE FIRST PART 
|         |                               |                   
|AND:     | THRUSH INDUSTRIES INC.        |                   
|         | Suite 306  1140 Homer Street |                   
|         | Vancouver, B.C., V6B 2X6      |                   
|         |                               |                   
|         | (Thrush)                    |                   
|         |                               | OF THE SECOND PART

|WHEREAS:                                                                              
|--------------------------------------------------------------------------------------
|                                                                                      
|A.                                                                                    
|                                                                                      
|B.                                                                                    
|                                                                                      
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Agreement is amended as follows:
|                                                                                      
|1.                                                                                    

The parties hereby ratify and confirm the Agreement in all other respects.

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

|THE COMMON SEAL OFUBEX      | c/s
|--------------------------- | ---
|CAPITAL INC. was hereunto   |    
|affixed in the presence of: |    

Dennis Higgs

SIGNED AND DELIVERED BY THRUSH 
  INDUSTRIES INC, and affixed in the 
  presence of:

Aileen Lloyd

Authorized Signatory

---

SECOND AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 29thday of May, 2002.

|BETWEEN: | UBEX CAPITAL INC.                 |                   
|-------- | --------------------------------- | ------------------
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (the Optionor)                  |                   
|         |                                   | OF THE FIRST PART 
|         |                                   |                   
|AND:     | MIRANDA DIAMOND CORP.             |                   
|         | (Formerly Thrush Industries Inc.) |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (Thrush)                        |                   
|         |                                   | OF THE SECOND PART

|WHEREAS:                                                                                      
|----------------------------------------------------------------------------------------------
|                                                                                              
|A.                                                                                            
|                                                                                              
|B.                                                                                            
|                                                                                              
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Amended Agreement is amended as follows:
|                                                                                              
|1.                                                                                            

The parties hereby ratify and confirm the Agreement in all other respects.

IN WITNESS WHEREOF the parties hereto have executed this Second Amendment
  Agreement as of the day and year first above written.

---

|THE COMMON SEAL OF UBEX     | c/s
|--------------------------- | ---
|CAPITAL INC. was hereunto   |    
|affixed in the presence of: |    

Dennis Higgs

SIGNED AND DELIVERED BY MIRANDA 
  DIAMOND CORP. (FORMERLY THRUSH 
  INDUSTRIES INC), and affixed in the
  presence of:

Aileen Lloyd

Authorized Signatory

---

THIRD AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 28thday of June, 2002.

|BETWEEN: | UBEX CAPITAL INC.                 |                   
|-------- | --------------------------------- | ------------------
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (the Optionor)                  |                   
|         |                                   | OF THE FIRST PART 
|         |                                   |                   
|AND:     | MIRANDA DIAMOND CORP.             |                   
|         | (Formerly Thrush Industries Inc.) |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (Thrush)                        |                   
|         |                                   | OF THE SECOND PART

|WHEREAS:                                                                                      
|----------------------------------------------------------------------------------------------
|                                                                                              
|A.                                                                                            
|                                                                                              
|B.                                                                                            
|                                                                                              
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Amended Agreement is amended as follows:
|                                                                                              
|1.                                                                                            

The parties hereby ratify and confirm the Agreement in all other respects.

IN WITNESS WHEREOF the parties hereto have executed this Third
  Amendment Agreement as of the day and year first above written.

---

|THE COMMON SEAL OF UBEX     | c/s
|--------------------------- | ---
|CAPITAL INC. was hereunto   |    
|affixed in the presence of: |    

*Dennis Higgs*

SIGNED AND DELIVERED BY MIRANDA 
  DIAMOND CORP. (FORMERLY THRUSH 
  INDUSTRIES INC), and affixed in the 
  presence of:

Aileen Lloyd

Authorized Signatory

---



MINERAL PROPERTY OPTION AGREEMENT

THIS AGREEMENTis dated for reference the 30th day of January, 2002

|BETWEEN: | Ubex Capital Inc. and/or            |                   
|-------- | ----------------------------------- | ------------------
|         | Monaco Investment Corp.             |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (the Optionor or the Optionors) |                   
|         |                                     | OF THE FIRST PART 
|AND:     | Thrush Industries Inc.              |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (Thrush)                          |                   
|         |                                     | OF THE SECOND PART

WHEREAS the Optionor has made staking applications
  for a 100% interest in certain exploration claims in the Otish Mountains region
  of Quebec (the Lac Orillat property), through the internet by way
  of the website maintained by the Province of Quebec for such purposes;

AND WHEREASsuch applications to stake claims have
  been received by the Province of Quebec, Ministere des Ressources Naturelles,
  although confirmations of title to the claims have not yet been issued;

AND WHEREASThrush is desirous of acquiring an interest
  in such exploration claims on the terms and conditions contained herein:

NOW THEREFORE THIS AGREEMENT WITNESSESthat in consideration
  of the premises and the mutual covenants and agreements hereinafter contained,
  the parties hereto agree as follows:



|1.   | DEFINITIONS       
|---- | ------------------
|     |                   
|1.01 | In this Agreement:
|     |                   
|     | (a)               
|     |                   
|     | (b)               

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|     | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Net Smelter Returns shall have the
      meaning ascribed by Schedule B attached hereto;                                       
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | "Property" means and includes:                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (i)                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (ii)                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|2.   | ACQUISITION OF INTEREST                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|2.01 | The Optionor hereby grants
        to Thrush the exclusive right and option to acquire an undivided 100%
        right, title and interest in and to the Property, subject to the Net Smelter
        Returns and Gross Overriding Royalty described in Article 4 of this Agreement,
        for total consideration consisting of cash payments to the Optionor totalling
        $19,154 to be made as follows:                                                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | the payment to the Optionor of $2,000, the receipt
      of which is hereby acknowledged;                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | upon shareholder approval
        and approval of this Agreement by the Exchange, the payment to the Optionor
        of $17,154.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|2.02 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to receipt of title certificates
        for the exploration claims comprising the Property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                  
|2.03 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to the prior approval of
        the shareholders of Thrush, at an annual and extraordinary general meeting
        proposed to be held on March 27, 2002 (and any adjournments) and of the
        Exchange, based , if necessary, on the submission of engineering data
        satisfactory to the Exchange, which Thrush undertakes to use its best
        efforts to file within a reasonable period of time so as to obtain the
        necessary approval by the earliest possible date. Notwithstanding any
        other provision of this Agreement, so long as Thrush has filed the engineering
        data

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|     | referred to herein with
        the Exchange within a reasonable time after receiving same, the time for
        making any cash payment or share issuance referred to in this paragraph
        shall be extended, where necessary, to the day that is five business days
        following the receipt by Thrush of the necessary Exchange approval.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                       
|2.04 | This Agreement is an option
        only and, subject to paragraph 11.02, the doing of any act or the incurrence
        of any cash payments by Thrush shall not obligate Thrush to do any further
        acts or make any further payments.                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                       
|3.   | TRANSFER OF TITLE                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                       
|3.01 | Upon execution of this Agreement
        Thrush shall be entitled to record this Agreement against title to the
        Property, once title is granted by the Province of Quebec, Ministere des
        Ressources Naturelles to the Optionor.                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                       
|3.02 | Upon Thrush exercising the
        option to acquire the Property pursuant to article 2, the Optionor shall
        deliver to Thrush duly executed transfers for the transfer to Thrush of
        a 100% interest in and to the Property, subject to the royalty interest
        pursuant to Article 4.                                            
|     |                                                                                                                                                                                                                                                                                                                                                       
|4.   | ROYALTY                                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                       
|4.01 | Thrush agrees that the Property
        shall be subject to a royalty in favour of the Optionor equal to 2% of
        Net Smelter Returns to be calculated and paid according to and otherwise
        governed by Schedule B hereto.                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                       
|4.02 | Thrush agrees that the Property shall be subject
      to a royalty in favour of the Optionor equal to a 2% Gross Overriding Royalty
      to be calculated and paid according to and otherwise governed by Schedule
      C hereto.                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                       
|5.   | PAYMENTS                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                       
|5.01 | The payments to be made
        to the Optionors pursuant to section 2 and such other payments as are
        to be made to the Optionors pursuant to this Agreement shall be made in
        full to Ubex Capital Inc. (Ubex). Ubex shall determine with
        the Optionors the percentage portions of the payments to each of the Optionors.   
|     |                                                                                                                                                                                                                                                                                                                                                       
|6.   | COVENANTS OF THRUSH                                                                                                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                       
|6.01 | Thrush covenants and agrees with the Optionor
      that during the term of this Agreement:                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                       
|     | (a)                                                                                                                                                                                                                                                                                                                                                   

---

|     | paid for each year and copies of receipts for such payment
      are forwarded to the Optionor for each year;                                                                                                                                                                                                                                                                                                                                                                                    
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(b)  | Thrush shall carry on all operations
        on the Property in a good and workmanlike manner and in compliance with
        all applicable governmental regulations and restrictions including but
        not limited to the posting of any reclamation bonds and the conduct of
        all reclamation work as may be required by any governmental regulations
        or regulatory authorities;                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(c)  | Thrush shall pay or cause to be paid
        any rates, taxes, duties, royalties, Workers Compensation or other
        assessments or fees levied with respect to the Property or Thrushs
        operations thereon;                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(d)  | Thrush shall hold harmless, indemnify,
        and defend the Optionor from any claims, loss, damage, judgement or expense
        for loss or damage to property and death, including environmental damages,
        or injury to persons arising out of Thrushs activities or operations
        on the Property, except to the extent that any such claim, loss, damage,
        judgement, or expense is caused by the negligence of the Optionor, its
        employees, agents or assigns;
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(e)  | Thrush shall ensure that, in connection
        with the entry onto the Property of any exploration contractor or other
        worker, there shall be in place, either through Thrush or such contractor
        or worker, comprehensive broad-form liability insurance covering claims
        for personal injury, death or property damage with a coverage limit of
        at least $1,000,000;                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(f)  | Thrush shall maintain books of account
        in respect of its expenditures and operations on the Property and, upon
        reasonable notice, shall make such books available for inspection by representatives
        of the Optionor;                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(g)  | Thrush shall allow any duly authorized
        agent or representative of the Optionor to inspect the Property at reasonable
        times and intervals and upon reasonable notice given to Thrush, provided
        however that it is agreed and understood that any such agent or representative
        shall be at his own risk in respect of, and Thrush shall not be liable
        for, any injury incurred while on the Property, howsoever caused; and                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(h)  | Thrush shall provide to the Optionor, semi-annually, a summary
      report outlining Thrushs progress on the Property and shall provide
      to Optionor, annually, a copy of all factual, non-interpretive data derived
      from Thrushs operations on the Property.                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|7.   | RIGHT OF ENTRY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|7.01 | During the currency of this Agreement,
        Thrush, its servants, agents and workmen and any persons duly authorized
        by Thrush, shall have the right of access to and from and to enter upon
        and take possession of and prospect, explore and develop the Property
        in such                                                                                                                                                                                            

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|     |                                                                                                                                                                                                                                                        | manner as Thrush in its sole discretion may deem advisable
      and shall have the right to remove and ship therefrom ores, minerals, metals,
      diamonds, or other products recovered in any manner therefrom.                                                                                                                                                                                                                                        
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|7.02 | Thrush shall be provided
        access to all maps, reports, assay results and other technical data in
        the possession or under the control of the Optionor with respect to the
        Property and shall be entitled to take copies thereof.
|     |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|8.   | REPRESENTATIONS AND WARRANTIES                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|8.01 | The Optionor hereby represents and warrants that:                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | (a)                                                                                                                                                                                                                                                    | the Optionor has made staking applications
        for a 100% interest in the exploration claims comprising the Property
        and has the right to enter into this Agreement to sell and assign an interest
        in the Property absolutely in accordance with the terms of this Agreement;                                                                                                                                                          
|     |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | (b)                                                                                                                                                                                                                                                    | applications for the exploration claims
        comprising the Property have been, to the best information, knowledge,
        and belief of the Optionor, properly staked through the internet by way
        of the website maintained by the Province of Quebec for such purposes,
        and to the best information, knowledge, and belief of the Optionor there
        are no disputes over the title, staking or recording of such mineral claims;
|     |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | (c)                                                                                                                                                                                                                                                    | if title is awarded to the Optionor,
        the mineral claims comprising the Property will be in good standing and
        free and clear of any liens, charges or encumbrances of any nature or
        kind whatsoever, to the best information, knowledge, and belief of the
        Optionor; and                                                                                                                                                    
|     |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | (d)                                                                                                                                                                                                                                                    | the Optionor has not done anything whereby
        the mineral claims comprising the Property may be in any way encumbered.                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|8.02 | Thrush hereby represents and warrants that:                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | (a)                                                                                                                                                                                                                                                    | Thrush has full corporate power and
        authority to enter into this Agreement and the entering into of this Agreement
        does not conflict with any applicable laws or with the charter documents
        of Thrush or any contract or other commitment to which Thrush is party;
        and                                                                                                                                                    
|     |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | (b)                                                                                                                                                                                                                                                    | the execution of this Agreement and
        the performance of its terms have been duly authorized by all necessary
        corporate actions including the resolution of the Board of Directors of
        Thrush.                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|9.   | CONFIDENTIALITY OF INFORMATION                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|9.01 | The Optionor shall treat all data, reports, records
      and other information of any nature                                                                                                                                                         

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|                                                                                                                                                                                                                                                                                             | whatsoever relating to this
        Agreement and the Property as confidential. While this Agreement is in
        effect, the Optionor shall not, without the express written consent of
        Thrush, disclose to any third party any information concerning the Property
        or any operations thereon, nor shall the Optionor buy, sell or otherwise
        deal in the shares of Thrush while any material, confidential information
        in its possession relating to this Agreement or the Property remains undisclosed
        to the general public.
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|10.                                                                                                                                                                                                                                                                                          | ASSIGNMENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|10.01                                                                                                                                                                                                                                                                                        | With the consent of the other party, which consent
      shall not be unreasonably withheld, each party has the right to assign all
      or any part of its interest in this Agreement and in the Property, subject
      to the terms and conditions of this Agreement. It shall be a condition precedent
      to any such assignment that the assignee of the interest being transferred
      agrees to be bound by the terms of this Agreement, insofar as they are applicable.                                                                                   
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|11.                                                                                                                                                                                                                                                                                          | TERMINATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|11.01                                                                                                                                                                                                                                                                                        | This Agreement shall terminate upon the occurrence
      of one of the following events:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                             | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                             | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                             | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|In the event that Thrush gives notice that it
      denies that a default has occurred, Thrush shall not be deemed in default
      until the matter shall have been determined finally through such means of
      dispute resolution as such matter has been subjected to by either party.
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|11.02                                                                                                                                                                                                                                                                                        | Upon termination of this Agreement under paragraph
      11.01, Thrush shall:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                             | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

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|      | period of at least one year from the date of
      termination;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|11.03 | Upon the termination of
        this Agreement under paragraph 11.01, Thrush shall cease to be liable
        to the Optionor in debt, damages or otherwise save for the performance
        of those obligations in paragraph 11.02.                                                                                                                                                                                                                                                                                                          
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|11.04 | Upon termination of this
        Agreement under paragraph 11.01, Thrush shall vacate the Property within
        a reasonable time after such termination, but shall have the right of
        access to the property for a period of six months thereafter for the purpose
        of removing its chattels, machinery, equipment and fixtures.                                                                                                                                                                                              
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|12.   | FORCE MAJEURE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|12.01 | The time for performance
        of any act or making any payment or any expenditure required under this
        Agreement shall be extended by the period of any delay or inability to
        perform due to fire, strikes, labour disturbances, riots, civil commotion,
        wars, acts of God, any present or future law or governmental regulation,
        any shortages of labour, equipment or materials, or any other cause not
        reasonably within the control of the party in default, other than lack
        of finances.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|13.   | REGULATORY APPROVAL                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|13.01 | This Agreement is subject
        to the prior approval of the Exchange. Thrush shall use its best efforts
        to obtain such approval as soon as reasonably possible, provided however
        that if                                                                                                                                                                                                                                                                                                                                    

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|      | such approval has not been
        received by April 15, 2002, this Agreement shall be null and void and
        of no further effect.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.   | AFTER-ACQUIRED PROPERTY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.01 | In the event that at any
        time hereafter Thrush shall acquire any portion of any combined group
        of any mining claims, any mining claim, lease, or other mineral right
        or interest within a three kilometre radius of the outside boundary of
        the Property to be described in Schedule A hereto, such interest shall
        be deemed to have been acquired on behalf of and for the benefit of the
        parties, pursuant to the terms of this Agreement and such after-acquired
        interest as aforesaid shall be included in and shall form a part of the
        definition of Property contained in paragraph 1.01 and shall
        be subject to this Agreement as if it had been originally so included.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.02 | In the event that at any
        time hereafter Thrush shall acquire any portion of any combined group
        of any mining claims, any mining claim, lease, or other mineral right
        or interest within a three kilometre radius of the outside boundary of
        the Property as constituted on the date of this Agreement, such interest
        shall be subject to the royalties in favour of the Optionor as described
        in Article 4 of this Agreement, and, if so requested by the Optionor,
        shall be transferred to the Optionor upon abandonment by Thrush.                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|15.   | NOTICES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|15.01 | Any notice, election, consent
        or other writing required or permitted to be given hereunder shall be
        deemed to be sufficiently given if delivered or mailed postage prepaid
        or if given by telegram, telex or telecopier, addressed as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

|In the case of the Optionor: | Ubex Capital Inc.            
|---------------------------- | -----------------------------
|                             | Suite 306  1140 Homer Street
|                             | Vancouver, B.C.              
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          
|                             |                              
|                             |                              
|In the case of Thrush:       | THRUSH INDUSTRIES INC.       
|                             | Suite306  1140 Homer Street 
|                             | Vancouver, British Columbia  
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          

and any such notice given us aforesaid shall be deemed to have
  been given to the parties hereto if delivered, when delivered, or if mailed,
  on the third business day following the date of mailing, or, if telegraphed,
  telexed or telecopied, on the same day as the telegraphing, telexing or telecopying
  thereof provided however that during the period of any postal interruption in
  Canada or the United States any notice given hereunder by mail shall be deemed
  to have been given only

---

as of the date of actual delivery of the same. Any party may
  from time to time by notice in writing change its address for the purposes of
  this paragraph 15.01.

16. GENERAL TERMS AND CONDITIONS

16.01 The parties hereto hereby covenant and agree that they
  will execute such further agreements, conveyances and assurances as may be requisite,
  or which counsel for the parties may deem necessary to effectually carry out
  the intent of this Agreement.

16.02 This Agreement shall constitute the entire agreement
  between the parties with respect to the Property. No representations or inducements
  have been made save as herein set forth. No changes, alterations or modifications
  of this Agreement shall be binding upon either party until and unless a memorandum
  in writing to such effect shall have been signed by all parties hereto. This
  Agreement shall supersede all previous written, oral or implied understandings
  between the parties with respect to the matters hereby.

16.03 Time shall be of the essence of this Agreement.

16.04 The titles to the articles in this Agreement shall not
  be deemed to form part of this Agreement but shall be regarded as having been
  used for convenience of reference only.

16.05 All currency references contained in this Agreement shall be deemed
  to be references to Canadian funds.

16.06 Wherever possible, each provision of this Agreement
  shall be interpreted in such manner as to be effective and valid under applicable
  law, but if any provision shall be prohibited by or be invalid under applicable
  law, such provision shall be ineffective only to the extent of such prohibition
  or invalidity, without invalidating the remainder of such provision or the remaining
  provisions of this Agreement.

16.07 The Schedules to this Agreement shall be construed with
  and as an integral part of this Agreement to the same extent as if they were
  set forth verbatim herein. Defined terms contained in this Agreement shall have
  the same meanings where used in the Schedules.

16.08 This Agreement shall be governed by and interpreted
  in accordance with the laws of the Province of British Columbia and the laws
  of Canada applicable therein.

16.09 In the event that any suit, legal action, or arbitration
  proceeding is instituted to interpret or enforce the terms of this Agreement,
  including but not limited to any contest proceeding under paragraph 11.01, the
  prevailing party shall be entitled to recover from the other party such sum
  as the court or arbitrator may adjudge reasonable for attorneys fees at
  trial and on appeal of such suit, action or proceeding in addition to all other
  sums provided by law.

16.10 This Agreement shall enure to the benefit of and be
  binding upon the parties hereto and their respective heirs, executors, administrators,
  successors and assigns.

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IN WITNESS WHEREOFthis Agreement has been executed by the parties
  hereto as of the day and year first above written.

|The COMMON SEALof UBEX CAPITAL           | c/s
|---------------------------------------- | ---
|INC.was hereunto affixed in the presence |    
|of:                                      |    

Dennis Higgs

SIGNED AND DELIVERED BY MONACO
  INVESTMENT CORP.and affixed in the
  presence of :

Darcy Higgs

Authorized Signatory

SIGNED AND DELIVERED BY THRUSH 
  INDUSTRIES INC. and affixed in the presence 
  of:

Aileen Fehr

Authorized Signatory

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Schedule B

NET SMELTER RETURN ROYALTY

References in
  this Schedule B to Sections and Articles in this Schedule B are so identified,
  and references in this Schedule B to Sections and Articles in the agreement
  to which this Schedule B is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule B except as otherwise expressly stated in
  this Schedule B. The Net Smelter Returns royalty defined in Article 1 of the
  Main Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As
  used in this Schedule B, the term Grantor shall mean Optionee as
  defined in the Main Agreement, and shall include all of Optionees successors-in-interest,
  including without limitation, assignees, partners, joint venture partners, lessees
  and when applicable mortgagees and affiliated companies having or claiming an
  interest in the Properties or projects.

1.2As
  used in this Schedule B, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in-interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Production Royalty.Grantor shall pay
  to Grantee the royalty described in Section 4 below (Royalty) pursuant
  to the terms and provisions of this Schedule B.

3. Term.The term of the Royalty hereby created shall be perpetual,
  it being the intent of the parties hereto that, to the extent allowed by law,
  the Royalty constitutes a vested interest in and a covenant running with the
  land and affecting the Property and all successions thereof whether created
  privately or through governmental action. In the event a court of competent
  jurisdiction determines that the term of this Agreement violates the Rule Against
  Perpetuities, then the term of this Agreement shall automatically be revised
  and reformed to coincide with the maximum term permitted by the Rule Against
  Perpetuities, and this Agreement shall not be terminated solely as a result
  of a violation of the Rule Against Perpetuities.

4. Production Royalty.Grantor shall pay to Grantee
  a perpetual Royalty in the amount of two percent (2%) of Net Smelter Returns
  from the sale or other disposition of all locatable minerals produced from the
  Properties determined in accordance with the provisions set forth in this Section
  4 and, if applicable, Section 7.

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4.1 For Precious
  Metals.Net Smelter Returns, in the case of gold, silver, and platinum group
  metals (Precious Metals), shall be determined by multiplying (i)
  the gross number of troy ounces of Precious Metals contained in the production
  delivered to the smelter, refiner, processor, purchaser or other recipient (including
  the operator) of such production, or an insurer as a result of casualty to such
  production (collectively, Payor) during the preceding calendar month
  by (ii) for gold, the average of the London Bullion Market, Morning Fix, spot
  prices for the preceding calendar month; for all other Precious Metals, the
  average of the New York Commodities Exchange final daily spot prices for the
  preceding calendar month, and subtracting from the product of (i) and (ii) only
  the following if actually incurred:

| | (1) | charges imposed by the Payor for refining bullion from the
      Beneficiated Precious Metals contained in such production (as used in this
      Agreement, Beneficiated Precious Metals includes only doré
      or concentrates of Precious Metals produced by Grantors final mill
      or other processing plant, but does not include raw or crushed ore containing
      Precious Metals or other preliminarily processed Precious Metals); and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | (2) | penalty substance, assaying, and sampling
        charges imposed by the Payor for refining Beneficiated Precious Metals
        contained in such production.                                                                                                                                                                                                                                                                                           

In the event the refining of bullion from the Beneficiated Precious Metals
  contained in such production is carried out in custom toll facilities owned
  or controlled, in whole or in part, by Grantor, which facilities were not constructed
  for the purpose of refining Beneficiated Precious Metals from the Property,
  then charges, costs and penalties for such refining shall mean the amount Grantor
  would have incurred if such refining were carried out at facilities not owned
  or controlled by Grantor then offering comparable services for comparable products
  on prevailing terms, but in no event greater than actual costs incurred by Grantor
  with respect to such refining.

In the event the Grantor receives insurance proceeds for loss of production,
  Grantor shall pay to Payee the Royalty percentage of any such insurance proceeds
  which are received by Grantor for such loss of production.

4.2
  For Other Minerals.Net Smelter Returns, in the case of all metals, minerals,
  mineral substances, and the beneficiated products thereof, which are not or
  do not contain economically recoverable Precious Metals (Other Minerals),
  shall be determined by multiplying (i) the gross amount of the particular Other
  Mineral contained in the production delivered to the Payor during the preceding
  calendar month by (ii) the average of the New York Commodities Exchange final
  daily spot prices for the preceding calendar month of the appropriate Other
  Mineral, and subtracting from the product of (i) and (ii) only the following
  if actually incurred:

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| | (1) | charges imposed by the Payor for smelting, refining or processing
      Other Minerals contained in such production, but excluding any and all charges
      and costs related to Grantor mill or other processing plants constructed
      for the purpose of milling or processing Other Minerals, in whole or in
      part; and                                              
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                   
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for smelting, refining, or processing Other Minerals contained
      in such production, but excluding any and all charges and costs of or related
      to Grantor mills or other processing plants constructed for the purpose
      of milling or processing Other Minerals, in whole or in part.

In the event smelting, refining, or processing of Other Minerals are carried
  out in custom toll facilities owned or controlled, in whole or in part, by Grantor,
  which facilities were not constructed for the purpose of milling or processing
  Other Minerals, then charges, costs and penalties for such smelting, refining
  or processing shall mean the amount Grantor would have incurred if such smelting,
  refining or processing were carried out at facilities not owned or controlled
  by Grantor then offering comparable services for comparable products on prevailing
  terms, but in no event greater than actual costs incurred by Grantor with respect
  to such smelting and refining.

In the event Grantor receives insurance proceeds for loss of production, Grantor
  shall pay to Payee the Royalty percentage of any such insurance proceeds which
  are received by Grantor for such loss of production.

Notwithstanding anything contained in the foregoing, the term Other
  Minerals shall not be deemed to include Diamonds as defined
  in Schedule C to the Main Agreement, it being the intention of the parties that
  all payments of royalties in respect of Diamonds shall be governed by Schedule
  C attached to the Main Agreement.

4.3
  Time and Manner; In-Kind or Cash Payment.At the time of making payment
  to or otherwise crediting the account of Grantor for production from the Property
  pursuant to Sections 4.1 or 4.2 (but within the time provided in Section 4.4),
  the smelter, refiner, processor, purchaser, or other user (Payor)
  of the Precious Metals or Other Minerals shall contemporaneously pay the Royalty
  in accordance with written instructions given to the Payor by Grantee as provided
  in Sections 4.3.1 and 4.3.2. Once the Payor has received instructions from Grantee,
  such instructions shall remain in effect until the Payor has received different
  instructions from Grantee. All contractual or other arrangements entered into
  by Grantor with the Payor shall contain provisions implementing the terms and
  conditions of payment set forth in Sections 4.3 and 4.4 hereof and Grantor shall
  procure the written undertaking of Payor contractually binding Payor to perform
  in accordance with Sections 4.3 and 4.4 in form and substance enforceable by
  Grantee. Grantor acknowledges its primary obligation to pay the Royalty and
  that no undertaking by the Payor shall relieve Grantor of that obligation, and
  Grantor agrees to indemnify, protect and defend Grantee from and against any
  loss, cost

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(including attorneys fees incurred) or liability arising from the performance
  or failure of performance by Payor hereunder or under any contractual or other
  arrangements entered into by Grantor with the Payor pursuant to or for the purposes
  of complying with Sections 4.3 and 4.4 hereof. Grantee may, from time to time
  in its discretion, change the bank or account number for payment under to Sections
  4.3.1 and 4.3.2 by giving written notice thereof to Grantor and the Payor; such
  notice shall be effective upon actual receipt by the Payor, or upon the fourth
  day after deposit of such notice in the mail, first class postage prepaid, addressed
  to the Payor, whichever occurs first. All costs charged by the Payor as a result
  of complying with the payment provisions of Sections 4.3 and 4.4 shall be paid
  by Grantee, and Grantor shall have no liability or responsibility therefor.

4.3.1
  Precious Metals.The Payor shall pay the Royalty for each shipment of Precious
  Metals either (a) in the form of gold bullion (.995 + fine gold) directly to
  Payees account maintained with the Payor as directed by Payee, or (b)
  by delivery of a cheque or draft payable to Payees account with a bank
  to be designated in writing by Payee. In the event Payee instructs the Payor
  to deliver the Royalty in the form of gold bullion, the Royalty payable on silver
  or platinum group metals shall be converted to the gold equivalent of such silver
  or platinum group metals by using the average monthly spot prices for Precious
  Metals described in Section 4.1.

4.3.2
  Other Minerals.The Payor shall pay the Royalty for each shipment of Other
  Minerals by delivery of a cheque or draft payable to the Payees account
  with a bank to be designated in writing by Payee.

4.4
  Payment Accounting; Interim Settlements; Late Charges.All credits or payments
  of the Royalty shall be accompanied by a detailed statement explaining the manner
  in which the payment was calculated together with any available settlement sheets
  from the Payor. In no event shall payment of the Royalty be made later that
  thirty (30) days after the delivery to the Payor of the Precious Metals, Beneficiated
  Precious Metals, or Other Minerals. Such payments and statements shall be deemed
  conclusively correct unless Grantee objects to them in writing within eighteen
  (18) months after receipt thereof. On those occasions when all necessary information
  is not available to the Payor within the thirty (30) day period, the Payor shall
  make an interim settlement of the Royalty for such shipment or use within the
  thirty (30) day period; such interim settlement shall provide for payment of
  not less than ninety percent (90%) of the anticipated final settlement Royalty
  as determined by the assays and quantities of the Precious Metals or Other Minerals
  received by the Payor with respect to which such interim settlement is being
  made. Final settlement of the Royalty shall be promptly made upon receipt by
  the Payor of all information necessary or appropriate to make final settlement
  for such shipment. In the event payment of any Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Royalty payment, the Grantor shall pay an additional sum
  equal to ten percent (10%) of the delinquent payment (late charge)
  plus interest on the delinquent payment and the late charge at the rate twelve
  percent (12%) per annum which shall accrue from the day

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the delinquent payment was due to the date of payment of the Royalty, late
  charge and accrued interest.

4.5 Hedging
  Transactions: Futures, Options and Other Trading.All profits and losses
  resulting from Grantor engaging in any commodity futures trading, option trading,
  or metals trading, or any combination thereof, and any other hedging transactions
  (collectively hedging transactions) are specifically excluded from
  Royalty calculations pursuant to this Agreement. All hedging transactions by
  Grantor and all profits or losses associated therewith, if any, shall be solely
  for Grantors account. The Royalty payable on Precious Metals or Other
  Minerals subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Precious Metals.The amount of Royalty to be paid on all Precious
  Metals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.1 with the understanding that the average
  monthly spot price shall be for the calendar month during which Precious Metals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.5.2
  Affecting Other Minerals. The amount of Royalty to be paid on all Other
  Minerals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.2 with the understanding that the average
  monthly spot price shall be for the calendar month during which Other Minerals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.6
  Commingling.Before any Precious Metals or Other Minerals produced from
  the Property are commingled with minerals from other properties, the Precious
  Metals or Other Minerals produced from the Property shall be measured and sampled
  in accordance with sound mining and metallurgical practices for moisture, metal,
  commercial minerals and other appropriate content. Representative samples of
  the Precious Metals or Other Minerals shall be retained by Grantor and assays
  (including moisture and penalty substances) and other appropriate analyses of
  these samples shall be made before commingling to determine metal, commercial
  minerals, and other appropriate content. Detailed records shall be kept by Grantor
  showing measures, moisture, assays of metal, commercial minerals, and other
  appropriate content and penalty substances, and gross metal content of the Precious
  Metals or gross metal or mineral content of Other Minerals. From this information,
  Grantor shall determine the amount of Royalty due and payable to Payee from
  Precious Metals or Other Minerals produced from the Property commingled with
  minerals from other properties. Following the expiration of the period for objection
  described above in Section 4.4, and absent timely objection, if any, made by
  Payee, Grantor may dispose of the materials and data required to be kept and
  produced by this Section 4.6.

5. Books; Records: Inspections; Confidentiality.

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5.1
  Books.Grantor shall keep true and accurate books and records of all of
  its operations and activities on the Property and under this Agreement. Such
  books and records shall be kept on the accrual basis in accordance with generally
  accepted accounting principles consistently applied. Not more frequently than
  annually and within the time provided in Section 4.4 of this Agreement, Payee
  may, at Payees sole expense, give notice to Grantor that Payee desires
  to perform an audit or other examination of all of Grantors books and
  records kept as required by this Agreement. All financial information shall
  conclusively be deemed correct for purposes of this Agreement unless Payee has
  given timely notice that it desires to audit or examine Grantors books
  and records in the manner and within the time provided in Section 4.4 of this
  Agreement. Payee shall promptly commence any such audits and shall diligently
  prosecute the same to conclusion.

5.2
  Reports.Not later than March 1 following the end of each calendar year,
  Grantor shall provide Payee with an annual report of all activities and operations
  conducted upon or with respect to the Property during the preceding calendar
  year. Such annual report shall include estimates of proposed expenditures upon,
  anticipated production from, and estimated remaining ore reserves on the Property
  for the succeeding calendar year. Additionally, and within 30 days of the end
  of each calendar quarter, Grantor shall provide Payee access to all data and
  information generated with respect to the Property during the calendar quarter
  just ended.

5.3
  Inspections.Payee, or its authorized agents or representatives, on not
  less than two (2) days notice to Grantor, may enter upon all surface and subsurface
  portions of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4
  Investor Tours.Upon reasonable notice to Grantor and not more frequently
  than semi-annually, Payee shall have the right to conduct an investors tour
  on the Property and facilities associated therewith; provided that such tours
  shall not unreasonably interfere with Grantors activities and operations.
  Such investors tours shall be at the sole risk of the Payee and its invitees,
  and Payee shall indemnify and hold Grantor harmless from any liability, damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  invitees, employees, officers, directors, agents, or representatives caused
  solely by Payees exercise of its rights under this Section.

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5.5
  Confidentiality.Payee shall not, without the express written consent of
  Grantor, which consent shall not be unreasonably withheld, disclose any data
  or information concerning the Operations conducted on the Property or obtained
  under the Main Agreement or this Agreement which is not already in the public
  domain; provided, however, Payee may disclose data or information obtained under
  this Agreement without the consent of Grantor: (i) if required for compliance
  with applicable laws, rules, regulations or orders of a governmental agency
  or stock exchange having jurisdiction over Payee or its parent or affiliated
  corporations; (ii) to any of Payees consultants; (iii) to any third party
  to whom Payee, in good faith, anticipates selling or assigning Payees
  interest hereunder; or (iv) to a prospective lender to whom an interest in the
  Royalty payments to be made to Payee hereunder is proposed to be granted as
  security, provided that Grantor shall first have been provided with a confidentiality
  agreement executed by such consultant, third party or lender, which agreement
  shall include the confidentiality provisions of this Section 5.5. Payee shall
  not issue any press releases pertaining to the Property except upon giving Grantor
  three (3) days advance written notice of the contents thereof, and Payee shall
  make any reasonable changes to such proposed press releases requested by Grantor.
  Payee shall not, without Grantors consent, issue any press release that
  implies or infers that Grantor endorses or joins in Payees statements
  or representations contained in any press release.

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1
  Compliance with Laws.Grantor shall at all times comply with all applicable
  present or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2
  Reclamation, Environmental Obligations, and Indemnities.Grantor shall,
  from and after the date this Agreement takes effect, timely and fully perform
  all reclamation required by all governmental authorities pertaining or related
  to Grantors operations or activities on or with respect to the Property
  or required under this Agreement. Grantor, from and after the date this Agreement
  takes effect, covenants and agrees not to undertake, cause, suffer, or permit
  any condition or activity at, on or in the vicinity of the Property which constitutes
  a nuisance or which results in a violation of or liability under any present
  or future applicable federal, provincial, or local environmental laws, statutes,
  rules, regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants

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and agrees to indemnify and hold Payee harmless from any and all liabilities,
  obligations, claims (including administrative claims and claims for injunctive
  relief), demands, losses, costs, damages, expenses, attorney fees and causes
  of action asserted against Payee related to Grantors failure to comply
  with and satisfy Environmental Obligations or other obligations under this Agreement.
  The covenants and agreements of this Section 6.2 shall survive the termination
  of Grantors rights under this Agreement or to the Property.

7. Stockpiling.The rights of Grantor to stockpile, store
  or place Precious Metals or Other Minerals off of the Property pursuant to any
  of the provisions of this Agreement shall not be exercisable until Grantor has
  first secured from the property owner where such stockpiling, storage or placement
  is to occur a written agreement in recordable form which provides that Payees
  rights to the Precious Metals and Other Minerals shall be preserved. Such agreement
  shall provide,inter alia, that (i) Payees rights
  pursuant to this Agreement, insofar as they are applicable, shall continue in
  full force and effect with respect to Precious Metals and Other Minerals from
  the property; (ii) Payees rights in and to the Precious and Other Minerals
  shall be the same as if the Precious Metals and Other Minerals were situate
  on the Property; (iii) Payees rights set forth in this Section 7 shall
  have precedence over the rights to the Precious Metals and Other Minerals of
  the property owner where the Precious Metals and Other Minerals are stockpiled,
  stored or placed, as well as the creditors of the said property owner; and (iv)
  the agreement shall be irrevocable as long as the Precious Metals and Other
  Minerals from the Property, or any part thereof, remain on the property not
  part of the Property.

8. Tailings and Residues.All tailings, residues, waste rock, spoiled
  leach materials, and other materials (collectively Materials) resulting
  from Grantors operations and activities on the Property shall be the sole
  property of Grantor, but shall remain subject to the Royalty should the same
  be processed or reprocessed, as the case may be, in the future and result in
  the production of Precious Metals or Other Minerals. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Royalty payable thereon shall be determined by using the best engineering and
  technical practices then available, subject to adjustment on a pro rata basis
  where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1
  Title Maintenance and Taxes.From the date this Agreement takes effect,
  Grantor shall maintain title to the Property, including without limitation,
  paying when due all taxes on or with respect to the Property and doing all things
  and making all payments necessary or appropriate to maintain the right, title
  and interest of Grantor and Payee, respectively, in the Property and under this
  Agreement.

9.2
  Abandonment.In the event Grantor intends to abandon any of the lands comprising
  a portion or all of the Property (Abandonment Property), Grantor
  shall first

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give notice of such intention to Payee at least 70 days in advance of the
  proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Precious Metals and Other Minerals previously or
  thereafter produced from such ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange at its own
  expense and shall keep in force at all times, directly or through the services
  of an independent contractor, insurance, including but not limited to, the following:

10.1
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

10.2
  General Liability.Comprehensive general public liability insurance against
  claims for bodily injury or death or property damage arising out of or resulting
  from Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Royalty, and
  the Property from any and all claims, liabilities and damages which may arise
  with respect to this Agreement or the Property. Payee shall be named as a co-insured.

10.3
  Self Insurance.Grantor may self insure the foregoing obligations, provided
  such self insurance is sufficient to meet the requirements of Sections 10.1
  and 10.2 above and is in compliance with applicable laws, statutes, rules and
  regulations.

11. General Provisions.

11.1The Miscellaneous Provisions set forth in Article 16 of the Main Agreement
  shall apply to this Schedule B as applicable.

11.2In this Schedule B in all matters of interpretation, whenever necessary
  to give effect to any provision of this instrument, the masculine shall include
  the feminine and neuter and vice versa, the singular shall include the plural,
  and the plural shall include the singular.

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Schedule C

GROSS OVERRIDING ROYALTY

References
  in this Schedule C to Sections and Articles in this Schedule C are so identified,
  and references in this Schedule C to Sections and Articles in the agreement
  to which this Schedule C is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule C except as otherwise expressly stated in
  this Schedule C. The Gross Overriding Royalty defined in Article 1 of the Main
  Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As used in this Schedule C, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-in-interest,
  including without limitation, assignees, partners, joint venture partners, lessees
  and when applicable mortgagees and affiliated companies having or claiming an
  interest in the Properties or projects.

1.2As used in this Schedule C, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in-interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Gross Overriding Royalty.Grantor
  shall pay to Grantee the royalty described in Section 4 below (the Gross
  Overriding Royalty) pursuant to the terms and provisions of this Schedule
  C.

3. Term.The term of the Gross Overriding Royalty hereby
  created shall be perpetual, it being the intent of the parties hereto that,
  to the extent allowed by law, the Gross Overriding Royalty constitutes a vested
  interest in and a covenant running with the land and affecting the Property
  and all successions thereof whether created privately or through governmental
  action. In the event a court of competent jurisdiction determines that the term
  of this Agreement violates the Rule Against Perpetuities, then the term of this
  Agreement shall automatically be revised and reformed to coincide with the maximum
  term permitted by the Rule Against Perpetuities, and this Agreement shall not
  be terminated solely as a result of a violation of the Rule Against Perpetuities.

4. Gross Overriding Royalty.Grantor shall
  pay to Grantee a perpetual Gross Overriding Royalty in the amount of two percent
  (2%) of the Average Appraised Value (as hereinafter defined) of all gems, precious
  and semi-precious stones, and gem and industrial diamonds recovered, sorted,
  and graded from the Properties (the Diamonds)



---

determined in accordance with the provisions set forth in this Section 4 and,
  if applicable, Section 7.

4.1
  Average Appraised Value.Average Appraised Value means the average
  of the valuations in Canadian dollars of the Diamonds determined by two independent
  graders, one appointed by the Grantor and one appointed by the Grantee. Such
  independent graders shall be duly qualified and accredited, and shall sort,
  grade and value the Diamonds in accordance with industry standards, having regard
  to, but without limiting the generality of the foregoing, the commercial demand
  for the Diamonds. Each independent valuator shall value each particular classification
  of the Diamonds in accordance with the industry price books, standards and formulas.
  The parties acknowledge that the intention is that the Gross Overriding Royalty
  is to be paid to the Grantee on this basis, regardless of the price or proceeds
  actually received by the Grantor for or in connection with the Diamonds or the
  manner in which a sale of the Diamonds to a third party is made, and without
  deduction.

In the event the Grantor receives insurance proceeds for loss
  of production, Grantor shall pay to Payee the Gross Overriding Royalty percentage
  of any such insurance proceeds which are received by Grantor for such loss of
  production.

4.2
  Time and Manner; In Kind or Cash Payment. The Grantor will calculate and
  pay the Gross Overriding Royalty to the Grantee by delivery of a cheque or draft
  payable to the Grantee within 60 days of the end of each calendar quarter, based
  on all Diamonds from the Property which were graded in such calendar quarter.

The Grantee
  shall, at its election, have the right to take its Gross Overriding Royalty
  in kind.

4.3
  Grantors Profits and Losses. The Grantee shall not be entitled to
  participate in the profits or be obligated to share in any losses generated
  by the Grantors actual marketing or sales practices.

4.4
  Payment Accounting; Interim Settlements; Late Charges. All credits or payments
  of the Gross Overriding Royalty shall be accompanied by a detailed statement
  explaining the manner in which the payment was calculated together with any
  available settlement sheets. In no event shall payment of the Gross Overriding
  Royalty be made later that sixty (60) days after the end of each calendar quarter.
  Such payments and statements shall be deemed conclusively correct unless Grantee
  objects to them in writing within eighteen (18) months after receipt thereof.
  In the event payment of any Gross Overriding Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Gross Overriding Royalty payment, the Grantor shall pay an
  additional sum equal to ten percent (10%) of the delinquent payment (late
  charge) plus interest on the delinquent payment and the late charge at
  the rate twelve percent (12%) per annum which shall accrue from the day the
  delinquent payment

---

was due to the date of payment of the Gross Overriding Royalty, late charge
  and accrued interest.

4.5
  Hedging Transactions: Futures, Options and Other Trading.All profits and
  losses resulting from Grantor engaging in any commodity futures trading, option
  trading, or diamonds trading, or any combination thereof, and any other hedging
  transactions (collectively hedging transactions) are specifically
  excluded from Gross Overriding Royalty calculations pursuant to this Agreement.
  All hedging transactions by Grantor and all profits or losses associated therewith,
  if any, shall be solely for Grantors account. The Gross Overriding Royalty
  payable on Diamonds subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Diamonds.The amount of Gross Overriding Royalty to be paid on
  all Diamonds subject to hedging transactions by Grantor shall be determined
  in the same manner as provided in this Section 4.

4.6
  Commingling.Before any Diamonds recovered from the Property are commingled
  with minerals from other properties, the Diamonds recovered from the Property
  shall be measured and sampled in accordance with this Section 4 of this Agreement.
  Detailed records shall be kept by Grantor showing the Average Appraised Value
  of the Diamonds. From this information, Grantor shall determine the amount of
  Gross Overriding Royalty due and payable to Payee from Diamonds recovered from
  the Property commingled with minerals from other properties.

5. Books; Records: Inspections; Confidentiality.

5.1
  Books.Grantor shall keep true and accurate books and records of all of
  its operations and activities on the Property and under this Agreement. Such
  books and records shall be kept on the accrual basis in accordance with generally
  accepted accounting principles consistently applied. Not more frequently than
  annually and within the time provided in Section 4.4 of this Agreement, Payee
  may, at Payees sole expense, give notice to Grantor that Payee desires
  to perform an audit or other examination of all of Grantors books and
  records kept as required by this Agreement. All financial information shall
  conclusively be deemed correct for purposes of this Agreement unless Payee has
  given timely notice that it desires to audit or examine Grantors books
  and records in the manner and within the time provided in Section 4.4 of this
  Agreement. Payee shall promptly commence any such audits and shall diligently
  prosecute the same to conclusion.

5.2
  Reports.Not later than March 1 following the end of each calendar year,
  Grantor shall provide Payee with an annual report of all activities and operations
  conducted upon or with respect to the Property during the preceding calendar
  year. Such annual report shall include estimates of proposed expenditures upon,
  anticipated production from, and estimated remaining ore reserves on the Property
  for the succeeding calendar year. Additionally, and within 30 days of the end
  of each calendar quarter,

---

Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3
  Inspections.Payee, or its authorized agents or representatives, on not
  less than two (2) days notice to Grantor, may enter upon all surface and subsurface
  portions of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4
  Investor Tours.Upon reasonable notice to Grantor and not more frequently
  than semi-annually, Payee shall have the right to conduct an investors tour
  on the Property and facilities associated therewith; provided that such tours
  shall not unreasonably interfere with Grantors activities and operations.
  Such investors tours shall be at the sole risk of the Payee and its invitees,
  and Payee shall indemnify and hold Grantor harmless from any liability, damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  invitees, employees, officers, directors, agents, or representatives caused
  solely by Payees exercise of its rights under this Section.

5.5
  Confidentiality.Payee shall not, without the express written consent of
  Grantor, which consent shall not be unreasonably withheld, disclose any data
  or information concerning the Operations conducted on the Property or obtained
  under the Main Agreement or this Agreement which is not already in the public
  domain; provided, however, Payee may disclose data or information obtained under
  this Agreement without the consent of Grantor: (i) if required for compliance
  with applicable laws, rules, regulations or orders of a governmental agency
  or stock exchange having jurisdiction over Payee or its parent or affiliated
  corporations; (ii) to any of Payees consultants; (iii) to any third party
  to whom Payee, in good faith, anticipates selling or assigning Payees
  interest hereunder; or (iv) to a prospective lender to whom an interest in the
  Gross Overriding Royalty payments to be made to Payee hereunder is proposed
  to be granted as security, provided that Grantor shall first have been provided
  with a confidentiality agreement executed by such consultant, third party or
  lender, which agreement shall include the confidentiality provisions of this
  Section 5.5. Payee shall not issue any press releases pertaining to the Property
  except upon giving Grantor three (3) days advance written notice of the contents
  thereof, and Payee shall make any reasonable changes to such proposed press
  releases requested by Grantor. Payee shall not, without Grantors consent,
  issue any press release that implies or infers that Grantor endorses or joins
  in Payees statements or representations contained in any press release.

---

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1
  Compliance with Laws.Grantor shall at all times comply with all applicable
  present or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2
  Reclamation, Environmental Obligations, and Indemnities.Grantor shall,
  from and after the date this Agreement takes effect, timely and fully perform
  all reclamation required by all governmental authorities pertaining or related
  to Grantors operations or activities on or with respect to the Property
  or required under this Agreement. Grantor, from and after the date this Agreement
  takes effect, covenants and agrees not to undertake, cause, suffer, or permit
  any condition or activity at, on or in the vicinity of the Property which constitutes
  a nuisance or which results in a violation of or liability under any present
  or future applicable federal, provincial, or local environmental laws, statutes,
  rules, regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants and agrees to indemnify and hold Payee harmless
  from any and all liabilities, obligations, claims (including administrative
  claims and claims for injunctive relief), demands, losses, costs, damages, expenses,
  attorney fees and causes of action asserted against Payee related to Grantors
  failure to comply with and satisfy Environmental Obligations or other obligations
  under this Agreement. The covenants and agreements of this Section 6.2 shall
  survive the termination of Grantors rights under this Agreement or to
  the Property.

7. Stockpiling.The rights of Grantor to stockpile,
  store or place Diamonds off of the Property pursuant to any of the provisions
  of this Agreement shall not be exercisable until Grantor has first secured from
  the property owner where such stockpiling, storage or placement is to occur
  a written agreement in recordable form which provides that Payees rights
  to the Diamonds shall be preserved. Such agreement shall provide,inter
  alia, that (i) Payees rights pursuant to this Agreement, insofar
  as they are applicable, shall continue in full force and effect with respect
  to Diamonds from the property; (ii) Payees rights in and to the Diamonds
  shall be the same as if the Diamonds were situate on the Property; (iii) Payees
  rights set forth in this Section 7 shall have precedence over the rights to
  the Diamonds of the property owner where the Diamonds are stockpiled, stored
  or placed, as well as the creditors of the said property owner; and (iv) the
  agreement shall be irrevocable as long as the Diamonds from the Property, or
  any part thereof, remain on the property not part of the Property.

---

8. Tailings and Residues.All tailings, residues, waste
  rock, spoiled leach materials, and other materials (collectively Materials)
  resulting from Grantors operations and activities on the Property shall
  be the sole property of Grantor, but shall remain subject to the Gross Overriding
  Royalty should the same be processed or reprocessed, as the case may be, in
  the future and result in the production of Diamonds. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Gross Overriding Royalty payable thereon shall be determined by using the technique
  described in Section 4 of this Agreement, subject to adjustment on a pro rata
  basis where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1
  Title Maintenance and Taxes.From the date this Agreement takes effect,
  Grantor shall maintain title to the Property, including without limitation,
  paying when due all taxes on or with respect to the Property and doing all things
  and making all payments necessary or appropriate to maintain the right, title
  and interest of Grantor and Payee, respectively, in the Property and under this
  Agreement.

9.2
  Abandonment.In the event Grantor intends to abandon any of the lands comprising
  a portion or all of the Property (Abandonment Property), Grantor
  shall first give notice of such intention to Payee at least 70 days in advance
  of the proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Diamonds previously or thereafter produced from such
  ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange at its own
  expense and shall keep in force at all times, directly or through the services
  of an independent contractor, insurance, including but not limited to, the following:

10.1
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

---

10.2
  General Liability.Comprehensive general public liability insurance against
  claims for bodily injury or death or property damage arising out of or resulting
  from Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Gross Overriding
  Royalty, and the Property from any and all claims, liabilities and damages which
  may arise with respect to this Agreement or the Property. Payee shall be named
  as a co-insured.

10.3
  Self Insurance.Grantor may self insure the foregoing obligations, provided
  such self insurance is sufficient to meet the requirements of Sections 10.1
  and 10.2 above and is in compliance with applicable laws, statutes, rules and
  regulations.

11. General Provisions.

11.1The Miscellaneous Provisions set forth in Article 16 of the Main Agreement
  shall apply to this Schedule C as applicable.

11.2In this Schedule C in all matters of interpretation, whenever necessary
  to give effect to any provision of this instrument, the masculine shall include
  the feminine and neuter and vice versa, the singular shall include the plural,
  and the plural shall include the singular.

---

AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 14thday of April, 2002.

|BETWEEN: | UBEX CAPITAL INC. and/or      |                   
|-------- | ----------------------------- | ------------------
|         | MONACO INVESTMENT CORP.       |                   
|         | Suite 306  1140 Homer Street |                   
|         | Vancouver, B.C., V6B 2X6      |                   
|         |                               |                   
|         | (the Optionor)              |                   
|         |                               | OF THE FIRST PART 
|         |                               |                   
|AND:     | THRUSH INDUSTRIES INC.        |                   
|         | Suite 306  1140 Homer Street |                   
|         | Vancouver, B.C., V6B 2X6      |                   
|         |                               |                   
|         | (Thrush)                    |                   
|         |                               | OF THE SECOND PART

|WHEREAS:                                                                              
|--------------------------------------------------------------------------------------
|                                                                                      
|A.                                                                                    
|                                                                                      
|B.                                                                                    
|                                                                                      
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Agreement is amended as follows:
|                                                                                      
|1.                                                                                    

The parties hereby ratify and confirm the Agreement in all other respects.

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

---

|THE COMMON SEAL OF UBEX           | c/s
|--------------------------------- | ---
|CAPITAL CORP.was hereunto affixed |    
|affixed in the presence of:       |    

Dennis Higgs

SIGNED AND DELIVERED BY MONACO 
  INVESTMENT CORP.and affixed in the 
  presence of :

Darcy Higgs

Authorized Signatory

SIGNED AND DELIVERED BY THRUSH 
  INDUSTRIES INC, and affixed in the 
  presence of:

Aileen Fehr

Authorized Signatory

---

SECOND AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 29thday of May, 2002.

|BETWEEN: | UBEX CAPITAL INC. and/or          |                   
|-------- | --------------------------------- | ------------------
|         | MONACO INVESTMENT CORP.           |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (the Optionor)                  |                   
|         |                                   | OF THE FIRST PART 
|         |                                   |                   
|AND:     | MIRANDA DIAMOND CORP.             |                   
|         | (Formerly Thrush Industries Inc.) |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (Thrush)                        |                   
|         |                                   | OF THE SECOND PART

|WHEREAS:                                                                                      
|----------------------------------------------------------------------------------------------
|                                                                                              
|A.                                                                                            
|                                                                                              
|B.                                                                                            
|                                                                                              
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Amended Agreement is amended as follows:
|                                                                                              
|1.                                                                                            

The parties hereby ratify and confirm the Agreement in all other respects.

IN WITNESS WHEREOF the parties hereto have executed this Second Amendment
  Agreement as of the day and year first above written.

---

|THE COMMON SEAL OF UBEX           | c/s
|--------------------------------- | ---
|CAPITAL CORP.was hereunto affixed |    
|affixed in the presence of:       |    

Dennis Higgs

SIGNED AND DELIVERED BY MONACO 
  INVESTMENT CORP.and affixed in the 
  presence of :

Darcy Higgs

Authorized Signatory

SIGNED AND DELIVERED BY MIRANDA DIAMOND CORP. (formerly Thrush Industries Inc.) 
  and affixed in the presence of:

Aileen Fehr

Authorized Signatory

---

THIRD AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 28th day of June, 2002.

|BETWEEN: | UBEX CAPITAL INC. and/or          |                   
|-------- | --------------------------------- | ------------------
|         | MONACO INVESTMENT CORP.           |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (the Optionor)                  |                   
|         |                                   | OF THE FIRST PART 
|         |                                   |                   
|AND:     | MIRANDA DIAMOND CORP.             |                   
|         | (Formerly Thrush Industries Inc.) |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (Thrush)                        |                   
|         |                                   | OF THE SECOND PART

|WHEREAS:                                                                                      
|----------------------------------------------------------------------------------------------
|                                                                                              
|A.                                                                                            
|                                                                                              
|B.                                                                                            
|                                                                                              
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Amended Agreement is amended as follows:
|                                                                                              
|1.                                                                                            

The parties hereby ratify and confirm the Agreement in all other respects.

IN WITNESS WHEREOF the parties hereto have executed this Third
  Amendment Agreement as of the day and year first above written.

---

|THE COMMON SEAL OF UBEX           | c/s
|--------------------------------- | ---
|CAPITAL CORP.was hereunto affixed |    
|affixed in the presence of:       |    

Dennis Higgs

SIGNED AND DELIVERED BY MONACO 
  INVESTMENT CORP.and affixed in the 
  presence of :

Darcy Higgs

Authorized Signatory

SIGNED AND DELIVERED BY MIRANDA DIAMOND CORP. (formerly Thrush Industries Inc.) 
  and affixed in the presence of:

Aileen Fehr

Authorized Signatory

---



MINERAL PROPERTY OPTION AGREEMENT

THIS AGREEMENTis dated for reference the 30th day of January, 2002

|BETWEEN: | Ubex Capital Inc., and/or           |                   
|-------- | ----------------------------------- | ------------------
|         | Menace Capital Corp.                |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (the Optionor or the Optionors) |                   
|         |                                     | OF THE FIRST PART 
|         |                                     |                   
|AND:     | Thrush Industries Inc.              |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (Thrush)                          |                   
|         |                                     | OF THE SECOND PART

WHEREASthe Optionor has made staking applications
  for a 100% interest in certain exploration claims in the Otish Mountains region
  of Quebec (the Lac Pigeon property), through the internet by way
  of the website maintained by the Province of Quebec for such purposes;

AND WHEREASsuch applications to stake claims have
  been received by the Province of Quebec, Ministere des Ressources Naturelles,
  although confirmations of title to the claims have not yet been issued;

AND WHEREASThrush is desirous of acquiring an interest
  in such exploration claims on the terms and conditions contained herein:

NOW THEREFORE THIS AGREEMENT WITNESSESthat in consideration
  of the premises and the mutual covenants and agreements hereinafter contained,
  the parties hereto agree as follows:

|1.   | DEFINITIONS       
|---- | ------------------
|     |                   
|1.01 | In this Agreement:
|     |                   
|     | (a)               
|     |                   
|     | (b)               

---

|     | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Net Smelter Returns shall have the
      meaning ascribed by Schedule B attached hereto;                                                                                                                   
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                              
|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | "Property" means and includes:                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | (i)                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | (ii)                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                              
|2.   | ACQUISITION OF INTEREST                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                              
|2.01 | The Optionor hereby grants
        to Thrush the exclusive right and option to acquire an undivided 100%
        right, title and interest in and to the Property, subject to the Net Smelter
        Returns and Gross Overriding Royalty described in Article 4 of this Agreement,
        for total consideration consisting of the issuance of 165,000 common shares
        of Thrush and cash payments to the Optionor totalling $23,000 to be made
        as follows:
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                              
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | the payment to the Optionor of $5,000, the receipt
      of which is hereby acknowledged;                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                              
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | upon shareholder approval
        and approval of this Agreement by the Exchange, the issuance to the Optionor
        of 165,000 common shares of Thrush and the payment to the Optionor of
        $18,000.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                              
|2.02 | The cash payment and share
        issuance provided for in subparagraph 2.01 (b) shall be subject to receipt
        of title certificates for the exploration claims comprising the Property.                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                              
|2.03 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                              

---

|     | so as to obtain the necessary
        approval by the earliest possible date. Notwithstanding any other provision
        of this Agreement, so long as Thrush has filed the engineering data referred
        to herein with the Exchange within a reasonable time after receiving same,
        the time for making any cash payment or share issuance referred to in
        this paragraph shall be extended, where necessary, to the day that is
        five business days following the receipt by Thrush of the necessary Exchange
        approval.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.04 | The Optionor acknowledges
        that the shares to be issued pursuant to paragraph 2.01will be issued
        pursuant to available exemptions under the Securities Act(British
        Columbia), the requirements of which may be subject to change. Thrush
        makes no representation as to any resale restrictions which may be imposed
        with respect to such shares from time to time.                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.05 | This Agreement is an option
        only and, subject to paragraph 11.02, the doing of any act or the incurrence
        of any share issuances or cash payments by Thrush shall not obligate Thrush
        to do any further acts or make any further share issuances or payments.                                                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|3.   | TRANSFER OF TITLE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|3.01 | Upon execution of this Agreement
        Thrush shall be entitled to record this Agreement against title to the
        Property, once title is granted by the Province of Quebec, Ministere des
        Ressources Naturelles to the Optionor.                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|3.02 | Upon Thrush exercising the
        option to acquire the Property pursuant to article 2, the Optionor shall
        deliver to Thrush duly executed transfers for the transfer to Thrush of
        a 100% interest in and to the Property, subject to the royalty interest
        pursuant to Article 4.                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.   | ROYALTY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.01 | Thrush agrees that the Property
        shall be subject to a royalty in favour of the Optionor equal to 2% of
        Net Smelter Returns to be calculated and paid according to and otherwise
        governed by Schedule B hereto.                                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.02 | Thrush agrees that the Property
        shall be subject to a royalty in favour of the Optionor equal to a 2%
        Gross Overriding Royalty to be calculated and paid according to and otherwise
        governed by Schedule C hereto.                                                                                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.03 | Thrush shall make a minimum
        annual advance royalty payment of $15,000 due on or before each anniversary
        date of this Agreement. This advance royalty shall be paid each year,
        subject to this Agreement being terminated pursuant to Article 11, regardless
        of any actual production or mining or procuring of diamonds, other minerals,
        ores, and metals from and out of the Property.                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|5.   | PAYMENTS AND SHARE ISSUANCES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

---

|5.01 | The payments and share
        issuances to be made to the Optionors pursuant to section 2 and such other
        payments as are to be made to the Optionors pursuant to this Agreement
        shall be made in full to Ubex Capital Inc. (Ubex). Ubex shall
        determine with the Optionors the percentage portions of the payments to
        each of the Optionors.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                
|6.   | COVENANTS OF THRUSH                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|6.01 | Thrush covenants and agrees with the Optionor
      that during the term of this Agreement:                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (a)                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (b)                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (c)                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (d)                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (e)                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (f)                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (g)                                                                                                                                                                                                                                                                                                                                                                            

---

|     | given to Thrush, provided
        however that it is agreed and understood that any such agent or representative
        shall be at his own risk in respect of, and Thrush shall not be liable
        for, any injury incurred while on the Property, howsoever caused; and                                                                                                                                                                                                                                                
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     | (h)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|7.   | RIGHT OF ENTRY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|7.01 | During the currency of this
        Agreement, Thrush, its servants, agents and workmen and any persons duly
        authorized by Thrush, shall have the right of access to and from and to
        enter upon and take possession of and prospect, explore and develop the
        Property in such manner as Thrush in its sole discretion may deem advisable
        and shall have the right to remove and ship therefrom ores, minerals,
        metals, diamonds, or other products recovered in any manner therefrom.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|7.02 | Thrush shall be provided
        access to all maps, reports, assay results and other technical data in
        the possession or under the control of the Optionor with respect to the
        Property and shall be entitled to take copies thereof.                                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|8.   | REPRESENTATIONS AND WARRANTIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|8.01 | The Optionor hereby represents and warrants that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|8.02 | Thrush hereby represents and warrants that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

---

|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (a)                                                                                                                                                                                                                                                                                                                     | Thrush has full corporate power and
        authority to enter into this Agreement and the entering into of this Agreement
        does not conflict with any applicable laws or with the charter documents
        of Thrush or any contract or other commitment to which Thrush is party;
        and
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (b)                                                                                                                                                                                                                                                                                                                     | the execution of this Agreement and
        the performance of its terms have been duly authorized by all necessary
        corporate actions including the resolution of the Board of Directors of
        Thrush.                                                                                    
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                        
|9.    | CONFIDENTIALITY OF INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                        
|9.01  | The Optionor shall treat
        all data, reports, records and other information of any nature whatsoever
        relating to this Agreement and the Property as confidential. While this
        Agreement is in effect, the Optionor shall not, without the express written
        consent of Thrush, disclose to any third party any information concerning
        the Property or any operations thereon, nor shall the Optionor buy, sell
        or otherwise deal in the shares of Thrush while any material, confidential
        information in its possession relating to this Agreement or the Property
        remains undisclosed to the general public.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                        
|10.   | ASSIGNMENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|10.01 | With the consent of the
        other party, which consent shall not be unreasonably withheld, each party
        has the right to assign all or any part of its interest in this Agreement
        and in the Property, subject to the terms and conditions of this Agreement.
        It shall be a condition precedent to any such assignment that the assignee
        of the interest being transferred agrees to be bound by the terms of this
        Agreement, insofar as they are applicable.                                                                                                                                                                 
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|11.   | TERMINATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|11.01 | This Agreement shall terminate upon the occurrence
      of one of the following events:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|      | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | in the event that Thrush, not being at the time
      in default under any provision of this Agreement, gives 30 days written
      notice to the Optionor of the termination of this Agreement;                                                                                                                      
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                        
|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | in the event that Thrush shall fail to comply
      with any of the requirements to issue shares and make cash payments in the
      amounts and within the time limits set forth in Article 2;                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                        
|      | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | in the event that Thrush shall fail to comply
      with any of its obligations hereunder, other than the obligations referred
      to in subparagraph 11.01(b), and, subject to paragraph 12.01, within 30
      days of receipt by Thrush of written notice from the Optionor of such default,
      Thrush has not:
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (i)                                                                                                                                                                                                                                                                                                                     | cured such default, or commenced proceedings
        to cure such default and prosecuted same to completion without undue delay;
        or                                                                                                                                                            

---

|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   | (ii)                                                                                                                                                                                                                                                                                                                                                                                         | given the Optionor notice that it denies that such fault
      has occurred.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|In the event that Thrush
        gives notice that it denies that a default has occurred, Thrush shall
        not be deemed in default until the matter shall have been determined finally
        through such means of dispute resolution as such matter has been subjected
        to by either party.
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|11.02                                                                                                                                                                                                                                                                                                      | Upon termination of this Agreement under paragraph
      11.01, Thrush shall:                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                           | (a)                                                                                                                                                                                                                                                                                                                                               | if termination occurs after
        July 31 of the year in which it occurs, have completed and either recorded
        or delivered to the Optionor, in a form satisfactory for filing, sufficient
        assessment work on the Property to maintain the Property in good standing
        for a period of at least one year from the date of termination;                                
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|                                                                                                                                                                                                                                                                                                           | (b)                                                                                                                                                                                                                                                                                                                                               | have paid, as required by
        the Province of Quebec any annual maintenance fees and/or taxes necessary
        to hold all the exploration claims subject to this Agreement for the one
        year period beginning January 1 immediately following termination, and
        provided proof of such payment to the Optionor by December 15 immediately
        following termination;
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|                                                                                                                                                                                                                                                                                                           | (c)                                                                                                                                                                                                                                                                                                                                               | transfer title to the Property
        to the Optionor free and clear of all liens, charges and encumbrances
        and obligations for reclamation or detoxification;                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|                                                                                                                                                                                                                                                                                                           | (d)                                                                                                                                                                                                                                                                                                                                               | turn over to the Optionor
        copies of all non-interpretive maps, reports, sample results, contracts
        and other data and documentation in the possession of Thrush or, to the
        extent within Thrushs control, in the possession of its agents,
        employees or independent contractors, in connection with its operations
        on the Property;                 
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|                                                                                                                                                                                                                                                                                                           | (e)                                                                                                                                                                                                                                                                                                                                               | ensure that the Property
        is in a safe condition and complies with all environmental and safety
        standards including standards for reclamation and detoxification, imposed
        by any duly authorized regulatory authority; and                                                                                                                                           
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|                                                                                                                                                                                                                                                                                                           | (f)                                                                                                                                                                                                                                                                                                                                               | ensure that its covenants under subparagraphs
      6.01 (a) through (e) have been fully complied with.                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|11.03                                                                                                                                                                                                                                                                                                      | Upon the termination of
        this Agreement under paragraph 11.01, Thrush shall cease to be liable
        to the Optionor in debt, damages or otherwise save for the performance
        of those obligations in paragraph 11.02.                                                                                                            
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|11.04                                                                                                                                                                                                                                                                                                      | Upon termination of this
        Agreement under paragraph 11.01, Thrush shall vacate the Property within
        a reasonable time after such termination, but shall have the right of
        access to the property for a period of six months thereafter for the purpose
        of removing its chattels, machinery, equipment and fixtures.

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|12.   | FORCE MAJEURE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|12.01 | The time for performance
        of any act or making any payment or any expenditure required under this
        Agreement shall be extended by the period of any delay or inability to
        perform due to fire, strikes, labour disturbances, riots, civil commotion,
        wars, acts of God, any present or future law or governmental regulation,
        any shortages of labour, equipment or materials, or any other cause not
        reasonably within the control of the party in default, other than lack
        of finances.                                                                                                                                                                                                          
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|13.   | REGULATORY APPROVAL                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|13.01 | This Agreement is subject
        to the prior approval of the Exchange. Thrush shall use its best efforts
        to obtain such approval as soon as reasonably possible, provided however
        that if such approval has not been received by April 15, 2002, this Agreement
        shall be null and void and of no further effect.                                                                                                                                                                                                                                                                                                                                                                                                               
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.   | AFTER-ACQUIRED PROPERTY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.01 | In the event that at any
        time hereafter Thrush shall acquire any portion of any combined group
        of any mining claims, any mining claim, lease, or other mineral right
        or interest within a three kilometre radius of the outside boundary of
        the Property to be described in Schedule A hereto, such interest shall
        be deemed to have been acquired on behalf of and for the benefit of the
        parties, pursuant to the terms of this Agreement and such after-acquired
        interest as aforesaid shall be included in and shall form a part of the
        definition of Property contained in paragraph 1.01 and shall
        be subject to this Agreement as if it had been originally so included.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.02 | In the event that at any
        time hereafter Thrush shall acquire any portion of any combined group
        of any mining claims, any mining claim, lease, or other mineral right
        or interest within a three kilometre radius of the outside boundary of
        the Property as constituted on the date of this Agreement, such interest
        shall be subject to the royalties in favour of the Optionor as described
        in Article 4 of this Agreement, and, if so requested by the Optionor,
        shall be transferred to the Optionor upon abandonment by Thrush.                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|15.   | NOTICES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|15.01 | Any notice, election, consent
        or other writing required or permitted to be given hereunder shall be
        deemed to be sufficiently given if delivered or mailed postage prepaid
        or if given by telegram, telex or telecopier, addressed as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

|In the case of the Optionor: | Ubex Capital Inc.            
|---------------------------- | -----------------------------
|                             | Suite 306  1140 Homer Street
|                             | Vancouver, B.C.              
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          
|                             |                              
|                             |                              
|In the case of Thrush:       | THRUSH INDUSTRIES INC.       
|                             | Suite306  1140 Homer Street 
|                             | Vancouver, British Columbia  
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          

---

and any such notice given us aforesaid shall be deemed to
  have been given to the parties hereto if delivered, when delivered, or if mailed,
  on the third business day following the date of mailing, or, if telegraphed,
  telexed or telecopied, on the same day as the telegraphing, telexing or telecopying
  thereof provided however that during the period of any postal interruption in
  Canada or the United States any notice given hereunder by mail shall be deemed
  to have been given only as of the date of actual delivery of the same. Any party
  may from time to time by notice in writing change its address for the purposes
  of this paragraph 15.01.

16. GENERAL TERMS AND CONDITIONS

16.01 The parties hereto hereby covenant and agree that they
  will execute such further agreements, conveyances and assurances as may be requisite,
  or which counsel for the parties may deem necessary to effectually carry out
  the intent of this Agreement.

16.02 This Agreement shall constitute the entire agreement
  between the parties with respect to the Property. No representations or inducements
  have been made save as herein set forth. No changes, alterations or modifications
  of this Agreement shall be binding upon either party until and unless a memorandum
  in writing to such effect shall have been signed by all parties hereto. This
  Agreement shall supersede all previous written, oral or implied understandings
  between the parties with respect to the matters hereby.

16.03 Time shall be of the essence of this Agreement.

16.04 The titles to the articles in this Agreement shall not
  be deemed to form part of this Agreement but shall be regarded as having been
  used for convenience of reference only.

16.05 All currency references contained in this Agreement shall be deemed
  to be references to Canadian funds.

16.06 Wherever possible, each provision of this Agreement shall
  be interpreted in such manner as to be effective and valid under applicable
  law, but if any provision shall be prohibited by or be invalid under applicable
  law, such provision shall be ineffective only to the extent of such prohibition
  or invalidity, without invalidating the remainder of such provision or the remaining
  provisions of this Agreement.

16.07 The Schedules to this Agreement shall be construed with
  and as an integral part of this Agreement to the same extent as if they were
  set forth verbatim herein. Defined terms contained

---

in this Agreement shall have the same meanings where used in the Schedules.

16.08 This Agreement shall be governed by and interpreted
  in accordance with the laws of the Province of British Columbia and the laws
  of Canada applicable therein.

16.09 In the event that any suit, legal action, or arbitration
  proceeding is instituted to interpret or enforce the terms of this Agreement,
  including but not limited to any contest proceeding under paragraph 11.01, the
  prevailing party shall be entitled to recover from the other party such sum
  as the court or arbitrator may adjudge reasonable for attorneys fees at
  trial and on appeal of such suit, action or proceeding in addition to all other
  sums provided by law.

16.10 This Agreement shall enure to the benefit of and be
  binding upon the parties hereto and their respective heirs, executors, administrators,
  successors and assigns.

IN WITNESS WHEREOFthis Agreement has been executed
  by the parties hereto as of the day and year first above written.

|The COMMON SEALof UBEX CAPITAL              | c/s
|------------------------------------------- | ---
|INC.was hereunto affixed in the presence    |    
|of:                                         |    
|                                            |    
|Dennis Higgs                              |    
|                                            |    
|                                            |    
|The COMMON SEALof MENACE                    | c/s
|CAPITAL CORP.,was hereunto affixed          |    
|in the presence of:                         |    
|                                            |    
|                                            |    
|Dennis Higgs                              |    
|                                            |    
|                                            |    
|SIGNED AND DELIVERED BY THRUSH              |    
|INDUSTRIES INC. and affixed in the presence |    
|of:                                         |    
|                                            |    
|                                            |    
|Aileen Fehr
      Authorized Signatory    |    

---

Schedule B

NET SMELTER RETURN ROYALTY

References in
  this Schedule B to Sections and Articles in this Schedule B are so identified,
  and references in this Schedule B to Sections and Articles in the agreement
  to which this Schedule B is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule B except as otherwise expressly stated in
  this Schedule B. The Net Smelter Returns royalty defined in Article 1 of the
  Main Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As
  used in this Schedule B, the term Grantor shall mean Optionee as
  defined in the Main Agreement, and shall include all of Optionees successors-in-interest,
  including without limitation, assignees, partners, joint venture partners, lessees
  and when applicable mortgagees and affiliated companies having or claiming an
  interest in the Properties or projects.

1.2As
  used in this Schedule B, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in-interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Production Royalty.Grantor shall pay
  to Grantee the royalty described in Section 4 below (Royalty) pursuant
  to the terms and provisions of this Schedule B.

3. Term.The term of the Royalty hereby created shall
  be perpetual, it being the intent of the parties hereto that, to the extent
  allowed by law, the Royalty constitutes a vested interest in and a covenant
  running with the land and affecting the Property and all successions thereof
  whether created privately or through governmental action. In the event a court
  of competent jurisdiction determines that the term of this Agreement violates
  the Rule Against Perpetuities, then the term of this Agreement shall automatically
  be revised and reformed to coincide with the maximum term permitted by the Rule
  Against Perpetuities, and this Agreement shall not be terminated solely as a
  result of a violation of the Rule Against Perpetuities.

4. Production Royalty.Grantor shall pay to Grantee a perpetual Royalty
  in the amount of two percent (2%) of Net Smelter Returns from the sale or other
  disposition of all locatable minerals produced from the Properties determined
  in accordance with the provisions set forth in this Section 4 and, if applicable,
  Section 7.

---

4.1 For Precious
  Metals.Net Smelter Returns, in the case of gold, silver, and platinum group
  metals (Precious Metals), shall be determined by multiplying (i)
  the gross number of troy ounces of Precious Metals contained in the production
  delivered to the smelter, refiner, processor, purchaser or other recipient (including
  the operator) of such production, or an insurer as a result of casualty to such
  production (collectively, Payor) during the preceding calendar month
  by (ii) for gold, the average of the London Bullion Market, Morning Fix, spot
  prices for the preceding calendar month; for all other Precious Metals, the
  average of the New York Commodities Exchange final daily spot prices for the
  preceding calendar month, and subtracting from the product of (i) and (ii) only
  the following if actually incurred:

| | (1) | charges imposed by the Payor for refining bullion
      from the Beneficiated Precious Metals contained in such production (as used
      in this Agreement, Beneficiated Precious Metals includes only
      doré or concentrates of Precious Metals produced by Grantors
      final mill or other processing plant, but does not include raw or crushed
      ore containing Precious Metals or other preliminarily processed Precious
      Metals); and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for refining Beneficiated Precious Metals contained in such
      production.                                                                                                                                                                                                                                                                                                     

In the event the refining of bullion from the Beneficiated Precious Metals
  contained in such production is carried out in custom toll facilities owned
  or controlled, in whole or in part, by Grantor, which facilities were not constructed
  for the purpose of refining Beneficiated Precious Metals from the Property,
  then charges, costs and penalties for such refining shall mean the amount Grantor
  would have incurred if such refining were carried out at facilities not owned
  or controlled by Grantor then offering comparable services for comparable products
  on prevailing terms, but in no event greater than actual costs incurred by Grantor
  with respect to such refining.

In the event the Grantor receives insurance proceeds for loss of production,
  Grantor shall pay to Payee the Royalty percentage of any such insurance proceeds
  which are received by Grantor for such loss of production.

4.2 For Other
  Minerals.Net Smelter Returns, in the case of all metals, minerals, mineral
  substances, and the beneficiated products thereof, which are not or do not contain
  economically recoverable Precious Metals (Other Minerals), shall
  be determined by multiplying (i) the gross amount of the particular Other Mineral
  contained in the production delivered to the Payor during the preceding calendar
  month by (ii) the average of the New York Commodities Exchange final daily spot
  prices for the preceding calendar month of the appropriate Other Mineral, and
  subtracting from the product of (i) and (ii) only the following if actually
  incurred:

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| | (1) | charges imposed by the Payor for smelting, refining or processing
      Other Minerals contained in such production, but excluding any and all charges
      and costs related to Grantor mill or other processing plants constructed
      for the purpose of milling or processing Other Minerals, in whole or in
      part; and                                              
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                   
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for smelting, refining, or processing Other Minerals contained
      in such production, but excluding any and all charges and costs of or related
      to Grantor mills or other processing plants constructed for the purpose
      of milling or processing Other Minerals, in whole or in part.

In the event smelting, refining, or processing of Other Minerals are carried
  out in custom toll facilities owned or controlled, in whole or in part, by Grantor,
  which facilities were not constructed for the purpose of milling or processing
  Other Minerals, then charges, costs and penalties for such smelting, refining
  or processing shall mean the amount Grantor would have incurred if such smelting,
  refining or processing were carried out at facilities not owned or controlled
  by Grantor then offering comparable services for comparable products on prevailing
  terms, but in no event greater than actual costs incurred by Grantor with respect
  to such smelting and refining.

In the event Grantor receives insurance proceeds for loss of production, Grantor
  shall pay to Payee the Royalty percentage of any such insurance proceeds which
  are received by Grantor for such loss of production.

Notwithstanding anything contained in the foregoing, the term Other
  Minerals shall not be deemed to include Diamonds as defined
  in Schedule C to the Main Agreement, it being the intention of the parties that
  all payments of royalties in respect of Diamonds shall be governed by Schedule
  C attached to the Main Agreement.

4.3 Time and
  Manner; In-Kind or Cash Payment.At the time of making payment to or otherwise
  crediting the account of Grantor for production from the Property pursuant to
  Sections 4.1 or 4.2 (but within the time provided in Section 4.4), the smelter,
  refiner, processor, purchaser, or other user (Payor) of the Precious
  Metals or Other Minerals shall contemporaneously pay the Royalty in accordance
  with written instructions given to the Payor by Grantee as provided in Sections
  4.3.1 and 4.3.2. Once the Payor has received instructions from Grantee, such
  instructions shall remain in effect until the Payor has received different instructions
  from Grantee. All contractual or other arrangements entered into by Grantor
  with the Payor shall contain provisions implementing the terms and conditions
  of payment set forth in Sections 4.3 and 4.4 hereof and Grantor shall procure
  the written undertaking of Payor contractually binding Payor to perform in accordance
  with Sections 4.3 and 4.4 in form and substance enforceable by Grantee. Grantor
  acknowledges its primary obligation to pay the Royalty and that no undertaking
  by the Payor shall relieve Grantor of that obligation, and Grantor agrees to
  indemnify, protect and defend Grantee from and against any loss, cost

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(including attorneys fees incurred) or liability arising from the performance
  or failure of performance by Payor hereunder or under any contractual or other
  arrangements entered into by Grantor with the Payor pursuant to or for the purposes
  of complying with Sections 4.3 and 4.4 hereof. Grantee may, from time to time
  in its discretion, change the bank or account number for payment under to Sections
  4.3.1 and 4.3.2 by giving written notice thereof to Grantor and the Payor; such
  notice shall be effective upon actual receipt by the Payor, or upon the fourth
  day after deposit of such notice in the mail, first class postage prepaid, addressed
  to the Payor, whichever occurs first. All costs charged by the Payor as a result
  of complying with the payment provisions of Sections 4.3 and 4.4 shall be paid
  by Grantee, and Grantor shall have no liability or responsibility therefor.

4.3.1
  Precious Metals.The Payor shall pay the Royalty for each shipment of Precious
  Metals either (a) in the form of gold bullion (.995 + fine gold) directly to
  Payees account maintained with the Payor as directed by Payee, or (b)
  by delivery of a cheque or draft payable to Payees account with a bank
  to be designated in writing by Payee. In the event Payee instructs the Payor
  to deliver the Royalty in the form of gold bullion, the Royalty payable on silver
  or platinum group metals shall be converted to the gold equivalent of such silver
  or platinum group metals by using the average monthly spot prices for Precious
  Metals described in Section 4.1.

4.3.2
  Other Minerals.The Payor shall pay the Royalty for each shipment of Other
  Minerals by delivery of a cheque or draft payable to the Payees account
  with a bank to be designated in writing by Payee.

4.4 Payment
  Accounting; Interim Settlements; Late Charges.All credits or payments of
  the Royalty shall be accompanied by a detailed statement explaining the manner
  in which the payment was calculated together with any available settlement sheets
  from the Payor. In no event shall payment of the Royalty be made later that
  thirty (30) days after the delivery to the Payor of the Precious Metals, Beneficiated
  Precious Metals, or Other Minerals. Such payments and statements shall be deemed
  conclusively correct unless Grantee objects to them in writing within eighteen
  (18) months after receipt thereof. On those occasions when all necessary information
  is not available to the Payor within the thirty (30) day period, the Payor shall
  make an interim settlement of the Royalty for such shipment or use within the
  thirty (30) day period; such interim settlement shall provide for payment of
  not less than ninety percent (90%) of the anticipated final settlement Royalty
  as determined by the assays and quantities of the Precious Metals or Other Minerals
  received by the Payor with respect to which such interim settlement is being
  made. Final settlement of the Royalty shall be promptly made upon receipt by
  the Payor of all information necessary or appropriate to make final settlement
  for such shipment. In the event payment of any Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Royalty payment, the Grantor shall pay an additional sum
  equal to ten percent (10%) of the delinquent payment (late charge)
  plus interest on the delinquent payment and the late charge at the rate twelve
  percent (12%) per annum which shall accrue from the day

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the delinquent payment was due to the date of payment of the Royalty, late
  charge and accrued interest.

4.5 Hedging
  Transactions: Futures, Options and Other Trading.All profits and losses
  resulting from Grantor engaging in any commodity futures trading, option trading,
  or metals trading, or any combination thereof, and any other hedging transactions
  (collectively hedging transactions) are specifically excluded from
  Royalty calculations pursuant to this Agreement. All hedging transactions by
  Grantor and all profits or losses associated therewith, if any, shall be solely
  for Grantors account. The Royalty payable on Precious Metals or Other
  Minerals subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Precious Metals.The amount of Royalty to be paid on all Precious
  Metals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.1 with the understanding that the average
  monthly spot price shall be for the calendar month during which Precious Metals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.5.2
  Affecting Other Minerals. The amount of Royalty to be paid on all Other
  Minerals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.2 with the understanding that the average
  monthly spot price shall be for the calendar month during which Other Minerals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.6 Commingling.Before any Precious Metals or Other Minerals produced from the Property
  are commingled with minerals from other properties, the Precious Metals or Other
  Minerals produced from the Property shall be measured and sampled in accordance
  with sound mining and metallurgical practices for moisture, metal, commercial
  minerals and other appropriate content. Representative samples of the Precious
  Metals or Other Minerals shall be retained by Grantor and assays (including
  moisture and penalty substances) and other appropriate analyses of these samples
  shall be made before commingling to determine metal, commercial minerals, and
  other appropriate content. Detailed records shall be kept by Grantor showing
  measures, moisture, assays of metal, commercial minerals, and other appropriate
  content and penalty substances, and gross metal content of the Precious Metals
  or gross metal or mineral content of Other Minerals. From this information,
  Grantor shall determine the amount of Royalty due and payable to Payee from
  Precious Metals or Other Minerals produced from the Property commingled with
  minerals from other properties. Following the expiration of the period for objection
  described above in Section 4.4, and absent timely objection, if any, made by
  Payee, Grantor may dispose of the materials and data required to be kept and
  produced by this Section 4.6.

5. Books; Records: Inspections; Confidentiality.

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5.1 Books.Grantor shall keep true and accurate books and records of all of its operations
  and activities on the Property and under this Agreement. Such books and records
  shall be kept on the accrual basis in accordance with generally accepted accounting
  principles consistently applied. Not more frequently than annually and within
  the time provided in Section 4.4 of this Agreement, Payee may, at Payees
  sole expense, give notice to Grantor that Payee desires to perform an audit
  or other examination of all of Grantors books and records kept as required
  by this Agreement. All financial information shall conclusively be deemed correct
  for purposes of this Agreement unless Payee has given timely notice that it
  desires to audit or examine Grantors books and records in the manner and
  within the time provided in Section 4.4 of this Agreement. Payee shall promptly
  commence any such audits and shall diligently prosecute the same to conclusion.

5.2 Reports.Not later than March 1 following the end of each calendar year, Grantor
  shall provide Payee with an annual report of all activities and operations conducted
  upon or with respect to the Property during the preceding calendar year. Such
  annual report shall include estimates of proposed expenditures upon, anticipated
  production from, and estimated remaining ore reserves on the Property for the
  succeeding calendar year. Additionally, and within 30 days of the end of each
  calendar quarter, Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3 Inspections.Payee, or its authorized agents or representatives, on not less than two
  (2) days notice to Grantor, may enter upon all surface and subsurface portions
  of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4 Investor
  Tours.Upon reasonable notice to Grantor and not more frequently than semi-annually,
  Payee shall have the right to conduct an investors tour on the Property and
  facilities associated therewith; provided that such tours shall not unreasonably
  interfere with Grantors activities and operations. Such investors tours
  shall be at the sole risk of the Payee and its invitees, and Payee shall indemnify
  and hold Grantor harmless from any liability, damage, claim or demand by reason
  of injury to Payee or Grantor or any of their respective invitees, employees,
  officers, directors, agents, or representatives caused solely by Payees
  exercise of its rights under this Section.

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5.5 Confidentiality.Payee shall not, without the express written consent of Grantor, which consent
  shall not be unreasonably withheld, disclose any data or information concerning
  the Operations conducted on the Property or obtained under the Main Agreement
  or this Agreement which is not already in the public domain; provided, however,
  Payee may disclose data or information obtained under this Agreement without
  the consent of Grantor: (i) if required for compliance with applicable laws,
  rules, regulations or orders of a governmental agency or stock exchange having
  jurisdiction over Payee or its parent or affiliated corporations; (ii) to any
  of Payees consultants; (iii) to any third party to whom Payee, in good
  faith, anticipates selling or assigning Payees interest hereunder; or
  (iv) to a prospective lender to whom an interest in the Royalty payments to
  be made to Payee hereunder is proposed to be granted as security, provided that
  Grantor shall first have been provided with a confidentiality agreement executed
  by such consultant, third party or lender, which agreement shall include the
  confidentiality provisions of this Section 5.5. Payee shall not issue any press
  releases pertaining to the Property except upon giving Grantor three (3) days
  advance written notice of the contents thereof, and Payee shall make any reasonable
  changes to such proposed press releases requested by Grantor. Payee shall not,
  without Grantors consent, issue any press release that implies or infers
  that Grantor endorses or joins in Payees statements or representations
  contained in any press release.

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1 Compliance
  with Laws.Grantor shall at all times comply with all applicable present
  or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2 Reclamation,
  Environmental Obligations, and Indemnities.Grantor shall, from and after
  the date this Agreement takes effect, timely and fully perform all reclamation
  required by all governmental authorities pertaining or related to Grantors
  operations or activities on or with respect to the Property or required under
  this Agreement. Grantor, from and after the date this Agreement takes effect,
  covenants and agrees not to undertake, cause, suffer, or permit any condition
  or activity at, on or in the vicinity of the Property which constitutes a nuisance
  or which results in a violation of or liability under any present or future
  applicable federal, provincial, or local environmental laws, statutes, rules,
  regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants

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and agrees to indemnify and hold Payee harmless from any and all liabilities,
  obligations, claims (including administrative claims and claims for injunctive
  relief), demands, losses, costs, damages, expenses, attorney fees and causes
  of action asserted against Payee related to Grantors failure to comply
  with and satisfy Environmental Obligations or other obligations under this Agreement.
  The covenants and agreements of this Section 6.2 shall survive the termination
  of Grantors rights under this Agreement or to the Property.

7. Stockpiling.The rights of Grantor to stockpile, store
  or place Precious Metals or Other Minerals off of the Property pursuant to any
  of the provisions of this Agreement shall not be exercisable until Grantor has
  first secured from the property owner where such stockpiling, storage or placement
  is to occur a written agreement in recordable form which provides that Payees
  rights to the Precious Metals and Other Minerals shall be preserved. Such agreement
  shall provide,inter alia, that (i) Payees rights
  pursuant to this Agreement, insofar as they are applicable, shall continue in
  full force and effect with respect to Precious Metals and Other Minerals from
  the property; (ii) Payees rights in and to the Precious and Other Minerals
  shall be the same as if the Precious Metals and Other Minerals were situate
  on the Property; (iii) Payees rights set forth in this Section 7 shall
  have precedence over the rights to the Precious Metals and Other Minerals of
  the property owner where the Precious Metals and Other Minerals are stockpiled,
  stored or placed, as well as the creditors of the said property owner; and (iv)
  the agreement shall be irrevocable as long as the Precious Metals and Other
  Minerals from the Property, or any part thereof, remain on the property not
  part of the Property.

8. Tailings and Residues.All tailings, residues, waste rock, spoiled
  leach materials, and other materials (collectively Materials) resulting
  from Grantors operations and activities on the Property shall be the sole
  property of Grantor, but shall remain subject to the Royalty should the same
  be processed or reprocessed, as the case may be, in the future and result in
  the production of Precious Metals or Other Minerals. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Royalty payable thereon shall be determined by using the best engineering and
  technical practices then available, subject to adjustment on a pro rata basis
  where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1 Title Maintenance
  and Taxes.From the date this Agreement takes effect, Grantor shall maintain
  title to the Property, including without limitation, paying when due all taxes
  on or with respect to the Property and doing all things and making all payments
  necessary or appropriate to maintain the right, title and interest of Grantor
  and Payee, respectively, in the Property and under this Agreement.

9.2 Abandonment.In the event Grantor intends to abandon any of the lands comprising a portion
  or all of the Property (Abandonment Property), Grantor shall first
  give notice of such intention to Payee at least 70 days in advance of the proposed
  date of

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abandonment. If not later than 10 days before the proposed date of abandonment
  Grantor receives from Payee written notice that Payee desires Grantor to convey
  the Abandonment Property to Payee, Grantor shall, without additional consideration,
  convey the Abandonment Property in good standing by quit claim deed, without
  warranty, to Payee and shall thereafter have no further obligation to maintain
  the title to the Abandonment Property. If Payee does not timely give such notice
  to Grantor, Grantor may abandon the Abandonment Property and shall thereafter
  have no further obligation to maintain the title to the Abandonment Property;
  provided, however, if Grantor reacquires any of the ground covered by the Abandonment
  Property at any time within five (5) years following abandonment, the Precious
  Metals and Other Minerals previously or thereafter produced from such ground
  shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange at its own
  expense and shall keep in force at all times, directly or through the services
  of an independent contractor, insurance, including but not limited to, the following:

10.1
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

10.2
  General Liability.Comprehensive general public liability insurance against
  claims for bodily injury or death or property damage arising out of or resulting
  from Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Royalty, and
  the Property from any and all claims, liabilities and damages which may arise
  with respect to this Agreement or the Property. Payee shall be named as a co-insured.

10.3
  Self Insurance.Grantor may self insure the foregoing obligations, provided
  such self insurance is sufficient to meet the requirements of Sections 10.1
  and 10.2 above and is in compliance with applicable laws, statutes, rules and
  regulations.

11. General Provisions.

11.1The Miscellaneous Provisions set forth in Article 16 of the Main Agreement
  shall apply to this Schedule B as applicable.

11.2In this Schedule B in all matters of interpretation, whenever necessary
  to give effect to any provision of this instrument, the masculine shall include
  the feminine and neuter and vice versa, the singular shall include the plural,
  and the plural shall include the singular.

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Schedule C

GROSS OVERRIDING ROYALTY

References
  in this Schedule C to Sections and Articles in this Schedule C are so identified,
  and references in this Schedule C to Sections and Articles in the agreement
  to which this Schedule C is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule C except as otherwise expressly stated in
  this Schedule C. The Gross Overriding Royalty defined in Article 1 of the Main
  Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1 As used in this Schedule C, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-in-interest,
  including without limitation, assignees, partners, joint venture partners, lessees
  and when applicable mortgagees and affiliated companies having or claiming an
  interest in the Properties or projects.

1.2As used in this Schedule C, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in-interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Gross Overriding Royalty.Grantor
  shall pay to Grantee the royalty described in Section 4 below (the Gross
  Overriding Royalty) pursuant to the terms and provisions of this Schedule
  C.

3. Term.The term of the Gross Overriding Royalty hereby
  created shall be perpetual, it being the intent of the parties hereto that,
  to the extent allowed by law, the Gross Overriding Royalty constitutes a vested
  interest in and a covenant running with the land and affecting the Property
  and all successions thereof whether created privately or through governmental
  action. In the event a court of competent jurisdiction determines that the term
  of this Agreement violates the Rule Against Perpetuities, then the term of this
  Agreement shall automatically be revised and reformed to coincide with the maximum
  term permitted by the Rule Against Perpetuities, and this Agreement shall not
  be terminated solely as a result of a violation of the Rule Against Perpetuities.

4. Gross Overriding Royalty.Grantor shall
  pay to Grantee a perpetual Gross Overriding Royalty in the amount of two percent
  (2%) of the Average Appraised Value (as hereinafter defined) of all gems, precious
  and semi-precious stones, and gem and industrial diamonds recovered, sorted,
  and graded from the Properties (the Diamonds)



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determined in accordance with the provisions set forth in this Section 4 and,
  if applicable, Section 7.

4.1
  Average Appraised Value.Average Appraised Value means the average
  of the valuations in Canadian dollars of the Diamonds determined by two independent
  graders, one appointed by the Grantor and one appointed by the Grantee. Such
  independent graders shall be duly qualified and accredited, and shall sort,
  grade and value the Diamonds in accordance with industry standards, having regard
  to, but without limiting the generality of the foregoing, the commercial demand
  for the Diamonds. Each independent valuator shall value each particular classification
  of the Diamonds in accordance with the industry price books, standards and formulas.
  The parties acknowledge that the intention is that the Gross Overriding Royalty
  is to be paid to the Grantee on this basis, regardless of the price or proceeds
  actually received by the Grantor for or in connection with the Diamonds or the
  manner in which a sale of the Diamonds to a third party is made, and without
  deduction.

In the event the Grantor receives insurance proceeds for loss
  of production, Grantor shall pay to Payee the Gross Overriding Royalty percentage
  of any such insurance proceeds which are received by Grantor for such loss of
  production.

4.2
  Time and Manner; In Kind or Cash Payment. The Grantor will calculate and
  pay the Gross Overriding Royalty to the Grantee by delivery of a cheque or draft
  payable to the Grantee within 60 days of the end of each calendar quarter, based
  on all Diamonds from the Property which were graded in such calendar quarter.

The Grantee
  shall, at its election, have the right to take its Gross Overriding Royalty
  in kind.

4.3
  Grantors Profits and Losses. The Grantee shall not be entitled to
  participate in the profits or be obligated to share in any losses generated
  by the Grantors actual marketing or sales practices.

4.4
  Payment Accounting; Interim Settlements; Late Charges. All credits or payments
  of the Gross Overriding Royalty shall be accompanied by a detailed statement
  explaining the manner in which the payment was calculated together with any
  available settlement sheets. In no event shall payment of the Gross Overriding
  Royalty be made later that sixty (60) days after the end of each calendar quarter.
  Such payments and statements shall be deemed conclusively correct unless Grantee
  objects to them in writing within eighteen (18) months after receipt thereof.
  In the event payment of any Gross Overriding Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Gross Overriding Royalty payment, the Grantor shall pay an
  additional sum equal to ten percent (10%) of the delinquent payment (late
  charge) plus interest on the delinquent payment and the late charge at
  the rate twelve percent (12%) per annum which shall accrue from the day the
  delinquent payment

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was due to the date of payment of the Gross Overriding Royalty, late charge
  and accrued interest.

4.5
  Hedging Transactions: Futures, Options and Other Trading.All profits and
  losses resulting from Grantor engaging in any commodity futures trading, option
  trading, or diamonds trading, or any combination thereof, and any other hedging
  transactions (collectively hedging transactions) are specifically
  excluded from Gross Overriding Royalty calculations pursuant to this Agreement.
  All hedging transactions by Grantor and all profits or losses associated therewith,
  if any, shall be solely for Grantors account. The Gross Overriding Royalty
  payable on Diamonds subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Diamonds.The amount of Gross Overriding Royalty to be paid on
  all Diamonds subject to hedging transactions by Grantor shall be determined
  in the same manner as provided in this Section 4.

4.6
  Commingling.Before any Diamonds recovered from the Property are commingled
  with minerals from other properties, the Diamonds recovered from the Property
  shall be measured and sampled in accordance with this Section 4 of this Agreement.
  Detailed records shall be kept by Grantor showing the Average Appraised Value
  of the Diamonds. From this information, Grantor shall determine the amount of
  Gross Overriding Royalty due and payable to Payee from Diamonds recovered from
  the Property commingled with minerals from other properties.

5. Books; Records: Inspections; Confidentiality.

5.1
  Books.Grantor shall keep true and accurate books and records of all of
  its operations and activities on the Property and under this Agreement. Such
  books and records shall be kept on the accrual basis in accordance with generally
  accepted accounting principles consistently applied. Not more frequently than
  annually and within the time provided in Section 4.4 of this Agreement, Payee
  may, at Payees sole expense, give notice to Grantor that Payee desires
  to perform an audit or other examination of all of Grantors books and
  records kept as required by this Agreement. All financial information shall
  conclusively be deemed correct for purposes of this Agreement unless Payee has
  given timely notice that it desires to audit or examine Grantors books
  and records in the manner and within the time provided in Section 4.4 of this
  Agreement. Payee shall promptly commence any such audits and shall diligently
  prosecute the same to conclusion.

5.2
  Reports.Not later than March 1 following the end of each calendar year,
  Grantor shall provide Payee with an annual report of all activities and operations
  conducted upon or with respect to the Property during the preceding calendar
  year. Such annual report shall include estimates of proposed expenditures upon,
  anticipated production from, and estimated remaining ore reserves on the Property
  for the succeeding calendar year. Additionally, and within 30 days of the end
  of each calendar quarter,

---

Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3
  Inspections.Payee, or its authorized agents or representatives, on not
  less than two (2) days notice to Grantor, may enter upon all surface and subsurface
  portions of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4
  Investor Tours.Upon reasonable notice to Grantor and not more frequently
  than semi-annually, Payee shall have the right to conduct an investors tour
  on the Property and facilities associated therewith; provided that such tours
  shall not unreasonably interfere with Grantors activities and operations.
  Such investors tours shall be at the sole risk of the Payee and its invitees,
  and Payee shall indemnify and hold Grantor harmless from any liability, damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  invitees, employees, officers, directors, agents, or representatives caused
  solely by Payees exercise of its rights under this Section.

5.5
  Confidentiality.Payee shall not, without the express written consent of
  Grantor, which consent shall not be unreasonably withheld, disclose any data
  or information concerning the Operations conducted on the Property or obtained
  under the Main Agreement or this Agreement which is not already in the public
  domain; provided, however, Payee may disclose data or information obtained under
  this Agreement without the consent of Grantor: (i) if required for compliance
  with applicable laws, rules, regulations or orders of a governmental agency
  or stock exchange having jurisdiction over Payee or its parent or affiliated
  corporations; (ii) to any of Payees consultants; (iii) to any third party
  to whom Payee, in good faith, anticipates selling or assigning Payees
  interest hereunder; or (iv) to a prospective lender to whom an interest in the
  Gross Overriding Royalty payments to be made to Payee hereunder is proposed
  to be granted as security, provided that Grantor shall first have been provided
  with a confidentiality agreement executed by such consultant, third party or
  lender, which agreement shall include the confidentiality provisions of this
  Section 5.5. Payee shall not issue any press releases pertaining to the Property
  except upon giving Grantor three (3) days advance written notice of the contents
  thereof, and Payee shall make any reasonable changes to such proposed press
  releases requested by Grantor. Payee shall not, without Grantors consent,
  issue any press release that implies or infers that Grantor endorses or joins
  in Payees statements or representations contained in any press release.



---

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1
  Compliance with Laws.Grantor shall at all times comply with all applicable
  present or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2
  Reclamation, Environmental Obligations, and Indemnities.Grantor shall,
  from and after the date this Agreement takes effect, timely and fully perform
  all reclamation required by all governmental authorities pertaining or related
  to Grantors operations or activities on or with respect to the Property
  or required under this Agreement. Grantor, from and after the date this Agreement
  takes effect, covenants and agrees not to undertake, cause, suffer, or permit
  any condition or activity at, on or in the vicinity of the Property which constitutes
  a nuisance or which results in a violation of or liability under any present
  or future applicable federal, provincial, or local environmental laws, statutes,
  rules, regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants and agrees to indemnify and hold Payee harmless
  from any and all liabilities, obligations, claims (including administrative
  claims and claims for injunctive relief), demands, losses, costs, damages, expenses,
  attorney fees and causes of action asserted against Payee related to Grantors
  failure to comply with and satisfy Environmental Obligations or other obligations
  under this Agreement. The covenants and agreements of this Section 6.2 shall
  survive the termination of Grantors rights under this Agreement or to
  the Property.

7. Stockpiling.The rights of Grantor to stockpile,
  store or place Diamonds off of the Property pursuant to any of the provisions
  of this Agreement shall not be exercisable until Grantor has first secured from
  the property owner where such stockpiling, storage or placement is to occur
  a written agreement in recordable form which provides that Payees rights
  to the Diamonds shall be preserved. Such agreement shall provide,inter
  alia, that (i) Payees rights pursuant to this Agreement, insofar
  as they are applicable, shall continue in full force and effect with respect
  to Diamonds from the property; (ii) Payees rights in and to the Diamonds
  shall be the same as if the Diamonds were situate on the Property; (iii) Payees
  rights set forth in this Section 7 shall have precedence over the rights to
  the Diamonds of the property owner where the Diamonds are stockpiled, stored
  or placed, as well as the creditors of the said property owner; and (iv) the
  agreement shall be irrevocable as long as the Diamonds from the Property, or
  any part thereof, remain on the property not part of the Property.

---

8. Tailings and Residues.All tailings, residues, waste
  rock, spoiled leach materials, and other materials (collectively Materials)
  resulting from Grantors operations and activities on the Property shall
  be the sole property of Grantor, but shall remain subject to the Gross Overriding
  Royalty should the same be processed or reprocessed, as the case may be, in
  the future and result in the production of Diamonds. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Gross Overriding Royalty payable thereon shall be determined by using the technique
  described in Section 4 of this Agreement, subject to adjustment on a pro rata
  basis where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1
  Title Maintenance and Taxes.From the date this Agreement takes effect,
  Grantor shall maintain title to the Property, including without limitation,
  paying when due all taxes on or with respect to the Property and doing all things
  and making all payments necessary or appropriate to maintain the right, title
  and interest of Grantor and Payee, respectively, in the Property and under this
  Agreement.

9.2
  Abandonment.In the event Grantor intends to abandon any of the lands comprising
  a portion or all of the Property (Abandonment Property), Grantor
  shall first give notice of such intention to Payee at least 70 days in advance
  of the proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Diamonds previously or thereafter produced from such
  ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange at its own
  expense and shall keep in force at all times, directly or through the services
  of an independent contractor, insurance, including but not limited to, the following:

---

10.1
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

10.2
  General Liability.Comprehensive general public liability insurance against
  claims for bodily injury or death or property damage arising out of or resulting
  from Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Gross Overriding
  Royalty, and the Property from any and all claims, liabilities and damages which
  may arise with respect to this Agreement or the Property. Payee shall be named
  as a co-insured.

10.3
  Self Insurance.Grantor may self insure the foregoing obligations, provided
  such self insurance is sufficient to meet the requirements of Sections 10.1
  and 10.2 above and is in compliance with applicable laws, statutes, rules and
  regulations.

11. General Provisions.

11.1The Miscellaneous Provisions set forth in Article 16 of the Main Agreement
  shall apply to this Schedule C as applicable.

11.2In this Schedule C in all matters of interpretation, whenever necessary
  to give effect to any provision of this instrument, the masculine shall include
  the feminine and neuter and vice versa, the singular shall include the plural,
  and the plural shall include the singular.

---

AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 14thday of April, 2002.

|BETWEEN: | UBEX CAPITAL INC. and/or      |                   
|-------- | ----------------------------- | ------------------
|         | MENACE CAPITAL CORP.          |                   
|         | Suite 306  1140 Homer Street |                   
|         | Vancouver, B.C., V6B 2X6      |                   
|         |                               |                   
|         | (the Optionor)              |                   
|         |                               | OF THE FIRST PART 
|         |                               |                   
|AND:     | THRUSH INDUSTRIES INC.        |                   
|         | Suite 306  1140 Homer Street |                   
|         | Vancouver, B.C., V6B 2X6      |                   
|         |                               |                   
|         | (Thrush)                    |                   
|         |                               | OF THE SECOND PART

|WHEREAS:                                                                              
|--------------------------------------------------------------------------------------
|                                                                                      
|A.                                                                                    
|                                                                                      
|B.                                                                                    
|                                                                                      
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Agreement is amended as follows:
|                                                                                      
|1.                                                                                    

The parties hereby ratify and confirm the Agreement in all other respects.

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

---

|THE COMMON SEAL OF UBEX     | c/s
|--------------------------- | ---
|CAPITAL INC. was hereunto   |    
|affixed in the presence of: |    

*Dennis Higgs*

|THE COMMON SEAL OF MENACE         | c/s
|--------------------------------- | ---
|CAPITAL CORP.was hereunto affixed |    
|in the presence of :              |    

*Dennis Higgs*

SIGNED AND DELIVERED BY THRUSH 
  INDUSTRIES INC, and affixed in the 
  presence of:

*Aileen Lloyd*

Authorized Signatory

---

SECOND AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 29thday of May, 2002.

|BETWEEN: | UBEX CAPITAL INC. and/or          |                   
|-------- | --------------------------------- | ------------------
|         | MENACE CAPITAL CORP.              |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (the Optionor)                  |                   
|         |                                   | OF THE FIRST PART 
|         |                                   |                   
|AND:     | MIRANDA DIAMOND CORP.             |                   
|         | (Formerly Thrush Industries Inc.) |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (Thrush)                        |                   
|         |                                   | OF THE SECOND PART

|WHEREAS:                                                                                      
|----------------------------------------------------------------------------------------------
|                                                                                              
|A.                                                                                            
|                                                                                              
|B.                                                                                            
|                                                                                              
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Amended Agreement is amended as follows:
|                                                                                              
|1.                                                                                            

The parties hereby ratify and confirm the Agreement in all other respects.

IN WITNESS WHEREOF the parties hereto have executed this Second
  Amendment Agreement as of the day and year first above written.

---

|THE COMMON SEAL OF UBEX     | c/s
|--------------------------- | ---
|CAPITAL INC. was hereunto   |    
|affixed in the presence of: |    

Dennis Higgs

|THE COMMON SEAL OF MENACE         | c/s
|--------------------------------- | ---
|CAPITAL CORP.was hereunto affixed |    
|in the presence of :              |    

Dennis Higgs

SIGNED AND DELIVERED BY MIRANDA 
  DIAMOND CORP. (FORMERLY THRUSH 
  INDUSTRIES INC.), and affixed in the 
  presence of:

Aileen Lloyd

Authorized Signatory

---

THIRD AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 28th day of June, 2002.

|BETWEEN: | UBEX CAPITAL INC. and/or          |                   
|-------- | --------------------------------- | ------------------
|         | MENACE CAPITAL CORP.              |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (the Optionor)                  |                   
|         |                                   | OF THE FIRST PART 
|         |                                   |                   
|AND:     | MIRANDA DIAMOND CORP.             |                   
|         | (Formerly Thrush Industries Inc.) |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (Thrush)                        |                   
|         |                                   | OF THE SECOND PART

|WHEREAS:                                                                                      
|----------------------------------------------------------------------------------------------
|                                                                                              
|A.                                                                                            
|                                                                                              
|B.                                                                                            
|                                                                                              
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Amended Agreement is amended as follows:
|                                                                                              
|1.                                                                                            

The parties hereby ratify and confirm the Agreement in all other respects.

IN WITNESS WHEREOF the parties hereto have executed this Third
  Amendment Agreement as of the day and year first above written.

---

|THE COMMON SEAL OF UBEX     | c/s
|--------------------------- | ---
|CAPITAL INC. was hereunto   |    
|affixed in the presence of: |    

Dennis Higgs

|THE COMMON SEAL OF MENACE         | c/s
|--------------------------------- | ---
|CAPITAL CORP.was hereunto affixed |    
|in the presence of :              |    

Dennis Higgs

SIGNED AND DELIVERED BY MIRANDA 
  DIAMOND CORP. (FORMERLY THRUSH 
  INDUSTRIES INC.), and affixed in the 
  presence of:

Aileen Lloyd

Authorized Signatory

---



MINERAL PROPERTY OPTION AGREEMENT

THIS AGREEMENTis dated for reference the 30th day of January, 2002

|BETWEEN: | Ubex Capital Inc., and/or           |                   
|-------- | ----------------------------------- | ------------------
|         | Menace Capital Corp. and/or         |                   
|         | Dennis Higgs                        |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C., V6B 2X6            |                   
|         |                                     |                   
|         | (the Optionor or the Optionors) |                   
|         |                                     | OF THE FIRST PART 
|AND:     | Thrush Industries Inc.              |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (Thrush)                          |                   
|         |                                     | OF THE SECOND PART

WHEREASthe Optionor has made staking applications
  for a 100% interest in certain exploration claims in the Otish Mountains region
  of Quebec (the Lac Leran property), through the internet by way
  of the website maintained by the Province of Quebec for such purposes;

AND WHEREASsuch applications to stake claims have
  been received by the Province of Quebec, Ministere des Ressources Naturelles,
  although confirmations of title to the claims have not yet been issued;

AND WHEREASThrush is desirous of acquiring an interest
  in such exploration claims on the terms and conditions contained herein:

NOW THEREFORE THIS AGREEMENT WITNESSESthat in consideration
  of the premises and the mutual covenants and agreements hereinafter contained,
  the parties hereto agree as follows:

|1.   | DEFINITIONS       
|---- | ------------------
|     |                   
|1.01 | In this Agreement:
|     |                   
|     | (a)               
|     |                   
|     | (b)               

---

|     | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | Net Smelter Returns shall have the
      meaning ascribed by Schedule B attached hereto;                                                                                                                   
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                              
|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | "Property" means and includes:                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | (i)                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | (ii)                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                              
|2.   | ACQUISITION OF INTEREST                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                              
|2.01 | The Optionor hereby grants
        to Thrush the exclusive right and option to acquire an undivided 100%
        right, title and interest in and to the Property, subject to the Net Smelter
        Returns and Gross Overriding Royalty described in Article 4 of this Agreement,
        for total consideration consisting of the issuance of 165,000 common shares
        of Thrush and cash payments to the Optionor totalling $23,000 to be made
        as follows:                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                              
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | the payment to the Optionor of $5,000, the receipt
      of which is hereby acknowledged;                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                              
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | upon shareholder approval
        and approval of this Agreement by the Exchange, the issuance to the Optionor
        of 165,000 common shares of Thrush and the payment to the Optionor of
        $18,000.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                              
|2.02 | The cash payment and share
        issuance provided for in subparagraph 2.01 (b) shall be subject to receipt
        of title certificates for the exploration claims comprising the Property.                                                                                                                                                                                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                              
|2.03 | The cash payment and share
        issuance provided for in subparagraph 2.01 (b) shall be subject to the
        prior approval of the shareholders of Thrush, at an annual and extraordinary
        general meeting proposed to be held on March 27, 2002 (and any adjournments)
        and of the Exchange, based on the submission of engineering data satisfactory
        to the Exchange, which Thrush undertakes to use its best efforts to file
        within a reasonable period of time so as to obtain the necessary approval
        by the earliest possible date. Notwithstanding any

---

|     | other provision of this Agreement, so long as Thrush
        has filed the engineering data referred to herein with the Exchange within
        a reasonable time after receiving same, the time for making any cash payment
        or share issuance referred to in this paragraph shall be extended, where
        necessary, to the day that is five business days following the receipt
        by Thrush of the necessary Exchange approval.
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.04 | The Optionor acknowledges that the shares to be issued
        pursuant to paragraph 2.01will be issued pursuant to available exemptions
        under the Securities Act(British Columbia), the requirements of
        which may be subject to change. Thrush makes no representation as to any
        resale restrictions which may be imposed with respect to such shares from
        time to time.                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.05 | This Agreement is an option only and, subject to
        paragraph 11.02, the doing of any act or the incurrence of any share issuances
        or cash payments by Thrush shall not obligate Thrush to do any further
        acts or make any further share issuances or payments.                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|3.   | TRANSFER OF TITLE                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|3.01 | Upon execution of this Agreement Thrush shall be
        entitled to record this Agreement against title to the Property, once
        title is granted by the Province of Quebec, Ministere des Ressources Naturelles
        to the Optionor.                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|3.02 | Upon Thrush exercising the option to acquire the
        Property pursuant to article 2, the Optionor shall deliver to Thrush duly
        executed transfers for the transfer to Thrush of a 100% interest in and
        to the Property, subject to the royalty interest pursuant to Article 4.                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|4.   | ROYALTY                                                                                                                                                                                                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|4.01 | Thrush agrees that the Property shall be subject
        to a royalty in favour of the Optionor equal to 2% of Net Smelter Returns
        to be calculated and paid according to and otherwise governed by Schedule
        B hereto.                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|4.02 | Thrush agrees that the Property shall be subject
        to a royalty in favour of the Optionor equal to a 2% Gross Overriding
        Royalty to be calculated and paid according to and otherwise governed
        by Schedule C hereto.                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|4.03 | Thrush shall make a minimum annual advance royalty
        payment of $15,000 due on or before each anniversary date of this Agreement.
        This advance royalty shall be paid each year, subject to this Agreement
        being terminated pursuant to Article 11, regardless of any actual production
        or mining or procuring of diamonds, other minerals, ores, and metals from
        and out of the Property.                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|5.   | PAYMENTS AND SHARE ISSUANCES                                                                                                                                                                                                                                                                                                                                                                                                                      

---

|5.01 | The payments and share
        issuances to be made to the Optionors pursuant to section 2 and such other
        payments as are to be made to the Optionors pursuant to this Agreement
        shall be made in full to Ubex Capital Inc. (Ubex). Ubex shall
        determine with the Optionors the percentage portions of the payments to
        each of the Optionors.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                
|6.   | COVENANTS OF THRUSH                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|6.01 | Thrush covenants and agrees with the Optionor
      that during the term of this Agreement:                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (a)                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (b)                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (c)                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (d)                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (e)                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (f)                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                
|     | (g)                                                                                                                                                                                                                                                                                                                                                                            

---

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | given to Thrush, provided however that
        it is agreed and understood that any such agent or representative shall
        be at his own risk in respect of, and Thrush shall not be liable for,
        any injury incurred while on the Property, howsoever caused; and                                                                                                                                                                              
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | (h)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Thrush shall provide to the Optionor,
        semi-annually, a summary report outlining Thrushs progress on the
        Property and shall provide to Optionor, annually, a copy of all factual,
        non-interpretive data derived from Thrushs operations on the Property.                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|7.   | RIGHT OF ENTRY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|7.01 | During the currency of this
        Agreement, Thrush, its servants, agents and workmen and any persons duly
        authorized by Thrush, shall have the right of access to and from and to
        enter upon and take possession of and prospect, explore and develop the
        Property in such manner as Thrush in its sole discretion may deem advisable
        and shall have the right to remove and ship therefrom ores, minerals,
        metals, diamonds, or other products recovered in any manner therefrom.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|7.02 | Thrush shall be provided
        access to all maps, reports, assay results and other technical data in
        the possession or under the control of the Optionor with respect to the
        Property and shall be entitled to take copies thereof.                                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|8.   | REPRESENTATIONS AND WARRANTIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|8.01 | The Optionor hereby represents and warrants that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | the Optionor has made staking applications
        for a 100% interest in the exploration claims comprising the Property
        and has the right to enter into this Agreement to sell and assign an interest
        in the Property absolutely in accordance with the terms of this Agreement;                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | applications for the exploration claims
        comprising the Property have been, to the best information, knowledge,
        and belief of the Optionor, properly staked through the internet by way
        of the website maintained by the Province of Quebec for such purposes,
        and to the best information, knowledge, and belief of the Optionor there
        are no disputes over the title, staking or recording of such mineral claims;
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | if title is awarded to the Optionor,
        the mineral claims comprising the Property will be in good standing and
        free and clear of any liens, charges or encumbrances of any nature or
        kind whatsoever, to the best information, knowledge, and belief of the
        Optionor; and                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | the Optionor has not done anything whereby
        the mineral claims comprising the Property may be in any way encumbered.                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|8.02 | Thrush hereby represents and warrants that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

---

|      | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Thrush has full corporate
        power and authority to enter into this Agreement and the entering into
        of this Agreement does not conflict with any applicable laws or with the
        charter documents of Thrush or any contract or other commitment to which
        Thrush is party; and                        
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                
|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | the execution of this Agreement
        and the performance of its terms have been duly authorized by all necessary
        corporate actions including the resolution of the Board of Directors of
        Thrush.                                                                                                            
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                
|9.    | CONFIDENTIALITY OF INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                
|9.01  | The Optionor shall treat
        all data, reports, records and other information of any nature whatsoever
        relating to this Agreement and the Property as confidential. While this
        Agreement is in effect, the Optionor shall not, without the express written
        consent of Thrush, disclose to any third party any information concerning
        the Property or any operations thereon, nor shall the Optionor buy, sell
        or otherwise deal in the shares of Thrush while any material, confidential
        information in its possession relating to this Agreement or the Property
        remains undisclosed to the general public.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                
|10.   | ASSIGNMENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                
|10.01 | With the consent of the
        other party, which consent shall not be unreasonably withheld, each party
        has the right to assign all or any part of its interest in this Agreement
        and in the Property, subject to the terms and conditions of this Agreement.
        It shall be a condition precedent to any such assignment that the assignee
        of the interest being transferred agrees to be bound by the terms of this
        Agreement, insofar as they are applicable.                                                                                                                                                                 
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                
|11.   | TERMINATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                
|11.01 | This Agreement shall terminate upon the occurrence
      of one of the following events:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                
|      | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | in the event that Thrush,
        not being at the time in default under any provision of this Agreement,
        gives 30 days written notice to the Optionor of the termination
        of this Agreement;                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                
|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | in the event that Thrush
        shall fail to comply with any of the requirements to issue shares and
        make cash payments in the amounts and within the time limits set forth
        in Article 2;                                                                                                                    
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                
|      | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | in the event that Thrush
        shall fail to comply with any of its obligations hereunder, other than
        the obligations referred to in subparagraph 11.01(b), and, subject to
        paragraph 12.01, within 30 days of receipt by Thrush of written notice
        from the Optionor of such default, Thrush has not:
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (i)                                                                                                                                                                                                                                                                                                                            

---

|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   | (ii)                                                                                                                                                                                                                                                                                                                                                                                         | given the Optionor notice that it denies that such fault
      has occurred.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|In the event that Thrush
        gives notice that it denies that a default has occurred, Thrush shall
        not be deemed in default until the matter shall have been determined finally
        through such means of dispute resolution as such matter has been subjected
        to by either party.
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|11.02                                                                                                                                                                                                                                                                                                      | Upon termination of this Agreement under paragraph
      11.01, Thrush shall:                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|                                                                                                                                                                                                                                                                                                           | (a)                                                                                                                                                                                                                                                                                                                                               | if termination occurs after
        July 31 of the year in which it occurs, have completed and either recorded
        or delivered to the Optionor, in a form satisfactory for filing, sufficient
        assessment work on the Property to maintain the Property in good standing
        for a period of at least one year from the date of termination;                                
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|                                                                                                                                                                                                                                                                                                           | (b)                                                                                                                                                                                                                                                                                                                                               | have paid, as required by
        the Province of Quebec any annual maintenance fees and/or taxes necessary
        to hold all the exploration claims subject to this Agreement for the one
        year period beginning January 1 immediately following termination, and
        provided proof of such payment to the Optionor by December 15 immediately
        following termination;
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|                                                                                                                                                                                                                                                                                                           | (c)                                                                                                                                                                                                                                                                                                                                               | transfer title to the Property
        to the Optionor free and clear of all liens, charges and encumbrances
        and obligations for reclamation or detoxification;                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|                                                                                                                                                                                                                                                                                                           | (d)                                                                                                                                                                                                                                                                                                                                               | turn over to the Optionor
        copies of all non-interpretive maps, reports, sample results, contracts
        and other data and documentation in the possession of Thrush or, to the
        extent within Thrushs control, in the possession of its agents,
        employees or independent contractors, in connection with its operations
        on the Property;                 
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|                                                                                                                                                                                                                                                                                                           | (e)                                                                                                                                                                                                                                                                                                                                               | ensure that the Property
        is in a safe condition and complies with all environmental and safety
        standards including standards for reclamation and detoxification, imposed
        by any duly authorized regulatory authority; and                                                                                                                                           
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|                                                                                                                                                                                                                                                                                                           | (f)                                                                                                                                                                                                                                                                                                                                               | ensure that its covenants under subparagraphs
      6.01 (a) through (e) have been fully complied with.                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|11.03                                                                                                                                                                                                                                                                                                      | Upon the termination of
        this Agreement under paragraph 11.01, Thrush shall cease to be liable
        to the Optionor in debt, damages or otherwise save for the performance
        of those obligations in paragraph 11.02.                                                                                                            
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                              |                                                                             
|11.04                                                                                                                                                                                                                                                                                                      | Upon termination of this
        Agreement under paragraph 11.01, Thrush shall vacate the Property within
        a reasonable time after such termination, but shall have the right of
        access to the property for a period of six months thereafter for the purpose
        of removing its chattels, machinery, equipment and fixtures.

---

|12.   | FORCE MAJEURE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|12.01 | The time for performance of any act or making any
        payment or any expenditure required under this Agreement shall be extended
        by the period of any delay or inability to perform due to fire, strikes,
        labour disturbances, riots, civil commotion, wars, acts of God, any present
        or future law or governmental regulation, any shortages of labour, equipment
        or materials, or any other cause not reasonably within the control of
        the party in default, other than lack of finances.                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|13.   | REGULATORY APPROVAL                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|13.01 | This Agreement is subject to the prior approval of
        the Exchange. Thrush shall use its best efforts to obtain such approval
        as soon as reasonably possible, provided however that if such approval
        has not been received by April 15, 2002, this Agreement shall be null
        and void and of no further effect.                                                                                                                                                                                                                                                                                                                                                                                                               
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.   | AFTER-ACQUIRED PROPERTY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.01 | In the event that at any time hereafter Thrush shall
        acquire any portion of any combined group of any mining claims, any mining
        claim, lease, or other mineral right or interest within a three kilometre
        radius of the outside boundary of the Property to be described in Schedule
        A hereto, such interest shall be deemed to have been acquired on behalf
        of and for the benefit of the parties, pursuant to the terms of this Agreement
        and such after-acquired interest as aforesaid shall be included in and
        shall form a part of the definition of Property contained
        in paragraph 1.01 and shall be subject to this Agreement as if it had
        been originally so included.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.02 | In the event that at any time hereafter Thrush shall
        acquire any portion of any combined group of any mining claims, any mining
        claim, lease, or other mineral right or interest within a three kilometre
        radius of the outside boundary of the Property as constituted on the date
        of this Agreement, such interest shall be subject to the royalties in
        favour of the Optionor as described in Article 4 of this Agreement, and,
        if so requested by the Optionor, shall be transferred to the Optionor
        upon abandonment by Thrush.                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|15.   | NOTICES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|15.01 | Any notice, election, consent or other writing required
        or permitted to be given hereunder shall be deemed to be sufficiently
        given if delivered or mailed postage prepaid or if given by telegram,
        telex or telecopier, addressed as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

|In the case of the Optionor: | Ubex Capital Inc.            
|---------------------------- | -----------------------------
|                             | Suite 306  1140 Homer Street
|                             | Vancouver, B.C.              
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          

---

|In the case of Thrush: | THRUSH INDUSTRIES INC.      
|---------------------- | ----------------------------
|                       | Suite306  1140 Homer Street
|                       | Vancouver, British Columbia 
|                       | V6B 2X6                     
|                       | Fax: (604) 689-1722         

and any such notice given us aforesaid shall be deemed to
  have been given to the parties hereto if delivered, when delivered, or if mailed,
  on the third business day following the date of mailing, or, if telegraphed,
  telexed or telecopied, on the same day as the telegraphing, telexing or telecopying
  thereof provided however that during the period of any postal interruption in
  Canada or the United States any notice given hereunder by mail shall be deemed
  to have been given only as of the date of actual delivery of the same. Any party
  may from time to time by notice in writing change its address for the purposes
  of this paragraph 15.01.

16. GENERAL TERMS AND CONDITIONS

16.01 The parties hereto hereby covenant and agree that they
  will execute such further agreements, conveyances and assurances as may be requisite,
  or which counsel for the parties may deem necessary to effectually carry out
  the intent of this Agreement.

16.02 This Agreement shall constitute the entire agreement
  between the parties with respect to the Property. No representations or inducements
  have been made save as herein set forth. No changes, alterations or modifications
  of this Agreement shall be binding upon either party until and unless a memorandum
  in writing to such effect shall have been signed by all parties hereto. This
  Agreement shall supersede all previous written, oral or implied understandings
  between the parties with respect to the matters hereby.

16.03 Time shall be of the essence of this Agreement.

16.04 The titles to the articles in this Agreement shall not
  be deemed to form part of this Agreement but shall be regarded as having been
  used for convenience of reference only.

16.05 All currency references contained in this Agreement
  shall be deemed to be references to Canadian funds.

16.06 Wherever possible, each provision of this Agreement
  shall be interpreted in such manner as to be effective and valid under applicable
  law, but if any provision shall be prohibited by or be invalid under applicable
  law, such provision shall be ineffective only to the extent of such prohibition
  or invalidity, without invalidating the remainder of such provision or the remaining
  provisions of this Agreement.

16.07 The Schedules to this Agreement shall be construed with
  and as an integral part of this Agreement to the same extent as if they were
  set forth verbatim herein.

---

Defined terms contained in this Agreement shall have the same
  meanings where used in the Schedules.

16.08 This Agreement shall be governed by and interpreted
  in accordance with the laws of the Province of British Columbia and the laws
  of Canada applicable therein.

16.09 In the event that any suit, legal action, or arbitration
  proceeding is instituted to interpret or enforce the terms of this Agreement,
  including but not limited to any contest proceeding under paragraph 11.01, the
  prevailing party shall be entitled to recover from the other party such sum
  as the court or arbitrator may adjudge reasonable for attorneys fees at
  trial and on appeal of such suit, action or proceeding in addition to all other
  sums provided by law.

16.10 This Agreement shall enure to the benefit of and be
  binding upon the parties hereto and their respective heirs, executors, administrators,
  successors and assigns.

IN WITNESS WHEREOFthis Agreement has been executed
  by the parties hereto as of the day and year first above written.

|The COMMON SEAL of UBEX CAPITAL          | c/s
|---------------------------------------- | ---
|INC.was hereunto affixed in the presence |    
|of:                                      |    

Dennis Higgs

|TheCOMMON SEAL of MENACE            | c/s
|----------------------------------- | ---
|CAPITAL CORP., was hereunto affixed |    
|in the presence of:                 |    

Dennis Higgs

Dennis Higgs
  
  Dennis Higgs

SIGNED AND DELIVERED BY THRUSH 
  INDUSTRIES INC. and affixed in the presence 
  of:

Aileen Fehr
  
  Authorized Signatory

---

Schedule B

NET SMELTER RETURN ROYALTY

References in
  this Schedule B to Sections and Articles in this Schedule B are so identified,
  and references in this Schedule B to Sections and Articles in the agreement
  to which this Schedule B is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule B except as otherwise expressly stated in
  this Schedule B. The Net Smelter Returns royalty defined in Article 1 of the
  Main Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As
  used in this Schedule B, the term Grantor shall mean Optionee as
  defined in the Main Agreement, and shall include all of Optionees successors-in-interest,
  including without limitation, assignees, partners, joint venture partners, lessees
  and when applicable mortgagees and affiliated companies having or claiming an
  interest in the Properties or projects.

1.2As
  used in this Schedule B, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in-interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Production Royalty.Grantor shall pay
  to Grantee the royalty described in Section 4 below (Royalty) pursuant
  to the terms and provisions of this Schedule B.

3. Term.The term of the Royalty hereby created shall be perpetual,
  it being the intent of the parties hereto that, to the extent allowed by law,
  the Royalty constitutes a vested interest in and a covenant running with the
  land and affecting the Property and all successions thereof whether created
  privately or through governmental action. In the event a court of competent
  jurisdiction determines that the term of this Agreement violates the Rule Against
  Perpetuities, then the term of this Agreement shall automatically be revised
  and reformed to coincide with the maximum term permitted by the Rule Against
  Perpetuities, and this Agreement shall not be terminated solely as a result
  of a violation of the Rule Against Perpetuities.

4. Production Royalty.Grantor shall pay to Grantee a perpetual Royalty
  in the amount of two percent (2%) of Net Smelter Returns from the sale or other
  disposition of all locatable minerals produced from the Properties determined
  in accordance with the provisions set forth in this Section 4 and, if applicable,
  Section 7.

---

4.1 For Precious
  Metals.Net Smelter Returns, in the case of gold, silver, and platinum group
  metals (Precious Metals), shall be determined by multiplying (i)
  the gross number of troy ounces of Precious Metals contained in the production
  delivered to the smelter, refiner, processor, purchaser or other recipient (including
  the operator) of such production, or an insurer as a result of casualty to such
  production (collectively, Payor) during the preceding calendar month
  by (ii) for gold, the average of the London Bullion Market, Morning Fix, spot
  prices for the preceding calendar month; for all other Precious Metals, the
  average of the New York Commodities Exchange final daily spot prices for the
  preceding calendar month, and subtracting from the product of (i) and (ii) only
  the following if actually incurred:

| | (1) | charges imposed by the Payor for refining bullion from the
      Beneficiated Precious Metals contained in such production (as used in this
      Agreement, Beneficiated Precious Metals includes only doré
      or concentrates of Precious Metals produced by Grantors final mill
      or other processing plant, but does not include raw or crushed ore containing
      Precious Metals or other preliminarily processed Precious Metals); and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for refining Beneficiated Precious Metals contained in such
      production.                                                                                                                                                                                                                                                                                               

In the event the refining of bullion from the Beneficiated Precious Metals
  contained in such production is carried out in custom toll facilities owned
  or controlled, in whole or in part, by Grantor, which facilities were not constructed
  for the purpose of refining Beneficiated Precious Metals from the Property,
  then charges, costs and penalties for such refining shall mean the amount Grantor
  would have incurred if such refining were carried out at facilities not owned
  or controlled by Grantor then offering comparable services for comparable products
  on prevailing terms, but in no event greater than actual costs incurred by Grantor
  with respect to such refining.

In the event the Grantor receives insurance proceeds for loss of production,
  Grantor shall pay to Payee the Royalty percentage of any such insurance proceeds
  which are received by Grantor for such loss of production.

4.2 For Other
  Minerals.Net Smelter Returns, in the case of all metals, minerals, mineral
  substances, and the beneficiated products thereof, which are not or do not contain
  economically recoverable Precious Metals (Other Minerals), shall
  be determined by multiplying (i) the gross amount of the particular Other Mineral
  contained in the production delivered to the Payor during the preceding calendar
  month by (ii) the average of the New York Commodities Exchange final daily spot
  prices for the preceding calendar month of the appropriate Other Mineral, and
  subtracting from the product of (i) and (ii) only the following if actually
  incurred:

---

| | (1) | charges imposed by the Payor for smelting, refining or processing
      Other Minerals contained in such production, but excluding any and all charges
      and costs related to Grantor mill or other processing plants constructed
      for the purpose of milling or processing Other Minerals, in whole or in
      part; and                                              
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                   
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for smelting, refining, or processing Other Minerals contained
      in such production, but excluding any and all charges and costs of or related
      to Grantor mills or other processing plants constructed for the purpose
      of milling or processing Other Minerals, in whole or in part.

In the event smelting, refining, or processing of Other Minerals are carried
  out in custom toll facilities owned or controlled, in whole or in part, by Grantor,
  which facilities were not constructed for the purpose of milling or processing
  Other Minerals, then charges, costs and penalties for such smelting, refining
  or processing shall mean the amount Grantor would have incurred if such smelting,
  refining or processing were carried out at facilities not owned or controlled
  by Grantor then offering comparable services for comparable products on prevailing
  terms, but in no event greater than actual costs incurred by Grantor with respect
  to such smelting and refining.

In the event Grantor receives insurance proceeds for loss of production, Grantor
  shall pay to Payee the Royalty percentage of any such insurance proceeds which
  are received by Grantor for such loss of production.

Notwithstanding anything contained in the foregoing, the term Other
  Minerals shall not be deemed to include Diamonds as defined
  in Schedule C to the Main Agreement, it being the intention of the parties that
  all payments of royalties in respect of Diamonds shall be governed by Schedule
  C attached to the Main Agreement.

4.3 Time and
  Manner; In-Kind or Cash Payment.At the time of making payment to or otherwise
  crediting the account of Grantor for production from the Property pursuant to
  Sections 4.1 or 4.2 (but within the time provided in Section 4.4), the smelter,
  refiner, processor, purchaser, or other user (Payor) of the Precious
  Metals or Other Minerals shall contemporaneously pay the Royalty in accordance
  with written instructions given to the Payor by Grantee as provided in Sections
  4.3.1 and 4.3.2. Once the Payor has received instructions from Grantee, such
  instructions shall remain in effect until the Payor has received different instructions
  from Grantee. All contractual or other arrangements entered into by Grantor
  with the Payor shall contain provisions implementing the terms and conditions
  of payment set forth in Sections 4.3 and 4.4 hereof and Grantor shall procure
  the written undertaking of Payor contractually binding Payor to perform in accordance
  with Sections 4.3 and 4.4 in form and substance enforceable by Grantee. Grantor
  acknowledges its primary obligation to pay the Royalty and that no undertaking
  by the Payor shall relieve Grantor of that obligation, and Grantor agrees to
  indemnify, protect and defend Grantee from and against any loss, cost

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(including attorneys fees incurred) or liability arising from the performance
  or failure of performance by Payor hereunder or under any contractual or other
  arrangements entered into by Grantor with the Payor pursuant to or for the purposes
  of complying with Sections 4.3 and 4.4 hereof. Grantee may, from time to time
  in its discretion, change the bank or account number for payment under to Sections
  4.3.1 and 4.3.2 by giving written notice thereof to Grantor and the Payor; such
  notice shall be effective upon actual receipt by the Payor, or upon the fourth
  day after deposit of such notice in the mail, first class postage prepaid, addressed
  to the Payor, whichever occurs first. All costs charged by the Payor as a result
  of complying with the payment provisions of Sections 4.3 and 4.4 shall be paid
  by Grantee, and Grantor shall have no liability or responsibility therefor.

4.3.1
  Precious Metals.The Payor shall pay the Royalty for each shipment of Precious
  Metals either (a) in the form of gold bullion (.995 + fine gold) directly to
  Payees account maintained with the Payor as directed by Payee, or (b)
  by delivery of a cheque or draft payable to Payees account with a bank
  to be designated in writing by Payee. In the event Payee instructs the Payor
  to deliver the Royalty in the form of gold bullion, the Royalty payable on silver
  or platinum group metals shall be converted to the gold equivalent of such silver
  or platinum group metals by using the average monthly spot prices for Precious
  Metals described in Section 4.1.

4.3.2
  Other Minerals.The Payor shall pay the Royalty for each shipment of Other
  Minerals by delivery of a cheque or draft payable to the Payees account
  with a bank to be designated in writing by Payee.

4.4 Payment
  Accounting; Interim Settlements; Late Charges.All credits or payments of
  the Royalty shall be accompanied by a detailed statement explaining the manner
  in which the payment was calculated together with any available settlement sheets
  from the Payor. In no event shall payment of the Royalty be made later that
  thirty (30) days after the delivery to the Payor of the Precious Metals, Beneficiated
  Precious Metals, or Other Minerals. Such payments and statements shall be deemed
  conclusively correct unless Grantee objects to them in writing within eighteen
  (18) months after receipt thereof. On those occasions when all necessary information
  is not available to the Payor within the thirty (30) day period, the Payor shall
  make an interim settlement of the Royalty for such shipment or use within the
  thirty (30) day period; such interim settlement shall provide for payment of
  not less than ninety percent (90%) of the anticipated final settlement Royalty
  as determined by the assays and quantities of the Precious Metals or Other Minerals
  received by the Payor with respect to which such interim settlement is being
  made. Final settlement of the Royalty shall be promptly made upon receipt by
  the Payor of all information necessary or appropriate to make final settlement
  for such shipment. In the event payment of any Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Royalty payment, the Grantor shall pay an additional sum
  equal to ten percent (10%) of the delinquent payment (late charge)
  plus interest on the delinquent payment and the late charge at the rate twelve
  percent (12%) per annum which shall accrue from the day

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the delinquent payment was due to the date of payment of the Royalty, late
  charge and accrued interest.

4.5 Hedging
  Transactions: Futures, Options and Other Trading.All profits and losses
  resulting from Grantor engaging in any commodity futures trading, option trading,
  or metals trading, or any combination thereof, and any other hedging transactions
  (collectively hedging transactions) are specifically excluded from
  Royalty calculations pursuant to this Agreement. All hedging transactions by
  Grantor and all profits or losses associated therewith, if any, shall be solely
  for Grantors account. The Royalty payable on Precious Metals or Other
  Minerals subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Precious Metals.The amount of Royalty to be paid on all Precious
  Metals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.1 with the understanding that the average
  monthly spot price shall be for the calendar month during which Precious Metals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.5.2
  Affecting Other Minerals. The amount of Royalty to be paid on all Other
  Minerals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.2 with the understanding that the average
  monthly spot price shall be for the calendar month during which Other Minerals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.6 Commingling.Before any Precious Metals or Other Minerals produced from the Property
  are commingled with minerals from other properties, the Precious Metals or Other
  Minerals produced from the Property shall be measured and sampled in accordance
  with sound mining and metallurgical practices for moisture, metal, commercial
  minerals and other appropriate content. Representative samples of the Precious
  Metals or Other Minerals shall be retained by Grantor and assays (including
  moisture and penalty substances) and other appropriate analyses of these samples
  shall be made before commingling to determine metal, commercial minerals, and
  other appropriate content. Detailed records shall be kept by Grantor showing
  measures, moisture, assays of metal, commercial minerals, and other appropriate
  content and penalty substances, and gross metal content of the Precious Metals
  or gross metal or mineral content of Other Minerals. From this information,
  Grantor shall determine the amount of Royalty due and payable to Payee from
  Precious Metals or Other Minerals produced from the Property commingled with
  minerals from other properties. Following the expiration of the period for objection
  described above in Section 4.4, and absent timely objection, if any, made by
  Payee, Grantor may dispose of the materials and data required to be kept and
  produced by this Section 4.6.

5. Books; Records: Inspections; Confidentiality.

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5.1 Books.Grantor shall keep true and accurate books and records of all of its operations
  and activities on the Property and under this Agreement. Such books and records
  shall be kept on the accrual basis in accordance with generally accepted accounting
  principles consistently applied. Not more frequently than annually and within
  the time provided in Section 4.4 of this Agreement, Payee may, at Payees
  sole expense, give notice to Grantor that Payee desires to perform an audit
  or other examination of all of Grantors books and records kept as required
  by this Agreement. All financial information shall conclusively be deemed correct
  for purposes of this Agreement unless Payee has given timely notice that it
  desires to audit or examine Grantors books and records in the manner and
  within the time provided in Section 4.4 of this Agreement. Payee shall promptly
  commence any such audits and shall diligently prosecute the same to conclusion.

5.2 Reports.Not later than March 1 following the end of each calendar year, Grantor
  shall provide Payee with an annual report of all activities and operations conducted
  upon or with respect to the Property during the preceding calendar year. Such
  annual report shall include estimates of proposed expenditures upon, anticipated
  production from, and estimated remaining ore reserves on the Property for the
  succeeding calendar year. Additionally, and within 30 days of the end of each
  calendar quarter, Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3 Inspections.Payee, or its authorized agents or representatives, on not less than two
  (2) days notice to Grantor, may enter upon all surface and subsurface portions
  of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4 Investor
  Tours.Upon reasonable notice to Grantor and not more frequently than semi-annually,
  Payee shall have the right to conduct an investors tour on the Property and
  facilities associated therewith; provided that such tours shall not unreasonably
  interfere with Grantors activities and operations. Such investors tours
  shall be at the sole risk of the Payee and its invitees, and Payee shall indemnify
  and hold Grantor harmless from any liability, damage, claim or demand by reason
  of injury to Payee or Grantor or any of their respective invitees, employees,
  officers, directors, agents, or representatives caused solely by Payees
  exercise of its rights under this Section.

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5.5 Confidentiality.Payee shall not, without the express written consent of Grantor, which consent
  shall not be unreasonably withheld, disclose any data or information concerning
  the Operations conducted on the Property or obtained under the Main Agreement
  or this Agreement which is not already in the public domain; provided, however,
  Payee may disclose data or information obtained under this Agreement without
  the consent of Grantor: (i) if required for compliance with applicable laws,
  rules, regulations or orders of a governmental agency or stock exchange having
  jurisdiction over Payee or its parent or affiliated corporations; (ii) to any
  of Payees consultants; (iii) to any third party to whom Payee, in good
  faith, anticipates selling or assigning Payees interest hereunder; or
  (iv) to a prospective lender to whom an interest in the Royalty payments to
  be made to Payee hereunder is proposed to be granted as security, provided that
  Grantor shall first have been provided with a confidentiality agreement executed
  by such consultant, third party or lender, which agreement shall include the
  confidentiality provisions of this Section 5.5. Payee shall not issue any press
  releases pertaining to the Property except upon giving Grantor three (3) days
  advance written notice of the contents thereof, and Payee shall make any reasonable
  changes to such proposed press releases requested by Grantor. Payee shall not,
  without Grantors consent, issue any press release that implies or infers
  that Grantor endorses or joins in Payees statements or representations
  contained in any press release.

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1 Compliance
  with Laws.Grantor shall at all times comply with all applicable present
  or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2 Reclamation,
  Environmental Obligations, and Indemnities.Grantor shall, from and after
  the date this Agreement takes effect, timely and fully perform all reclamation
  required by all governmental authorities pertaining or related to Grantors
  operations or activities on or with respect to the Property or required under
  this Agreement. Grantor, from and after the date this Agreement takes effect,
  covenants and agrees not to undertake, cause, suffer, or permit any condition
  or activity at, on or in the vicinity of the Property which constitutes a nuisance
  or which results in a violation of or liability under any present or future
  applicable federal, provincial, or local environmental laws, statutes, rules,
  regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants

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and agrees to indemnify and hold Payee harmless from any and all liabilities,
  obligations, claims (including administrative claims and claims for injunctive
  relief), demands, losses, costs, damages, expenses, attorney fees and causes
  of action asserted against Payee related to Grantors failure to comply
  with and satisfy Environmental Obligations or other obligations under this Agreement.
  The covenants and agreements of this Section 6.2 shall survive the termination
  of Grantors rights under this Agreement or to the Property.

7. Stockpiling.The rights of Grantor to stockpile, store
  or place Precious Metals or Other Minerals off of the Property pursuant to any
  of the provisions of this Agreement shall not be exercisable until Grantor has
  first secured from the property owner where such stockpiling, storage or placement
  is to occur a written agreement in recordable form which provides that Payees
  rights to the Precious Metals and Other Minerals shall be preserved. Such agreement
  shall provide,inter alia, that (i) Payees rights
  pursuant to this Agreement, insofar as they are applicable, shall continue in
  full force and effect with respect to Precious Metals and Other Minerals from
  the property; (ii) Payees rights in and to the Precious and Other Minerals
  shall be the same as if the Precious Metals and Other Minerals were situate
  on the Property; (iii) Payees rights set forth in this Section 7 shall
  have precedence over the rights to the Precious Metals and Other Minerals of
  the property owner where the Precious Metals and Other Minerals are stockpiled,
  stored or placed, as well as the creditors of the said property owner; and (iv)
  the agreement shall be irrevocable as long as the Precious Metals and Other
  Minerals from the Property, or any part thereof, remain on the property not
  part of the Property.

8. Tailings and Residues.All tailings, residues, waste rock, spoiled
  leach materials, and other materials (collectively Materials) resulting
  from Grantors operations and activities on the Property shall be the sole
  property of Grantor, but shall remain subject to the Royalty should the same
  be processed or reprocessed, as the case may be, in the future and result in
  the production of Precious Metals or Other Minerals. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Royalty payable thereon shall be determined by using the best engineering and
  technical practices then available, subject to adjustment on a pro rata basis
  where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1 Title Maintenance
  and Taxes.From the date this Agreement takes effect, Grantor shall maintain
  title to the Property, including without limitation, paying when due all taxes
  on or with respect to the Property and doing all things and making all payments
  necessary or appropriate to maintain the right, title and interest of Grantor
  and Payee, respectively, in the Property and under this Agreement.

9.2 Abandonment.In the event Grantor intends to abandon any of the lands comprising a portion
  or all of the Property (Abandonment Property), Grantor shall first

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give notice of such intention to Payee at least 70 days in advance of the
  proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Precious Metals and Other Minerals previously or
  thereafter produced from such ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange at its own
  expense and shall keep in force at all times, directly or through the services
  of an independent contractor, insurance, including but not limited to, the following:

10.1 Workmans
  Compensation Insurance.Workmans Compensation Insurance or the like
  covering all persons engaged in the performance of activities or operations
  as is required or appropriate under law or local governmental bodies or agencies.

10.2 General
  Liability.Comprehensive general public liability insurance against claims
  for bodily injury or death or property damage arising out of or resulting from
  Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Royalty, and
  the Property from any and all claims, liabilities and damages which may arise
  with respect to this Agreement or the Property. Payee shall be named as a co-insured.

10.3 Self Insurance.Grantor may self insure the foregoing obligations, provided such self insurance
  is sufficient to meet the requirements of Sections 10.1 and 10.2 above and is
  in compliance with applicable laws, statutes, rules and regulations.

11. General Provisions.

11.1The
  Miscellaneous Provisions set forth in Article 16 of the Main Agreement shall
  apply to this Schedule B as applicable.

11.2In
  this Schedule B in all matters of interpretation, whenever necessary to give
  effect to any provision of this instrument, the masculine shall include the
  feminine and neuter and vice versa, the singular shall include the plural, and
  the plural shall include the singular.

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Schedule C

GROSS OVERRIDING ROYALTY

References
  in this Schedule C to Sections and Articles in this Schedule C are so identified,
  and references in this Schedule C to Sections and Articles in the agreement
  to which this Schedule C is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule C except as otherwise expressly stated in
  this Schedule C. The Gross Overriding Royalty defined in Article 1 of the Main
  Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1 As used in this Schedule C, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-in-interest,
  including without limitation, assignees, partners, joint venture partners, lessees
  and when applicable mortgagees and affiliated companies having or claiming an
  interest in the Properties or projects.

1.2As used in this Schedule C, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in-interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Gross Overriding Royalty.Grantor
  shall pay to Grantee the royalty described in Section 4 below (the Gross
  Overriding Royalty) pursuant to the terms and provisions of this Schedule
  C.

3. Term.The term of the Gross Overriding Royalty hereby
  created shall be perpetual, it being the intent of the parties hereto that,
  to the extent allowed by law, the Gross Overriding Royalty constitutes a vested
  interest in and a covenant running with the land and affecting the Property
  and all successions thereof whether created privately or through governmental
  action. In the event a court of competent jurisdiction determines that the term
  of this Agreement violates the Rule Against Perpetuities, then the term of this
  Agreement shall automatically be revised and reformed to coincide with the maximum
  term permitted by the Rule Against Perpetuities, and this Agreement shall not
  be terminated solely as a result of a violation of the Rule Against Perpetuities.

4. Gross Overriding Royalty.Grantor shall
  pay to Grantee a perpetual Gross Overriding Royalty in the amount of two percent
  (2%) of the Average Appraised Value (as hereinafter defined) of all gems, precious
  and semi-precious stones, and gem and industrial diamonds recovered, sorted,
  and graded from the Properties (the Diamonds)

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determined in accordance with the provisions set forth in
  this Section 4 and, if applicable, Section 7.

4.1
  Average Appraised Value.Average Appraised Value means the average
  of the valuations in Canadian dollars of the Diamonds determined by two independent
  graders, one appointed by the Grantor and one appointed by the Grantee. Such
  independent graders shall be duly qualified and accredited, and shall sort,
  grade and value the Diamonds in accordance with industry standards, having regard
  to, but without limiting the generality of the foregoing, the commercial demand
  for the Diamonds. Each independent valuator shall value each particular classification
  of the Diamonds in accordance with the industry price books, standards and formulas.
  The parties acknowledge that the intention is that the Gross Overriding Royalty
  is to be paid to the Grantee on this basis, regardless of the price or proceeds
  actually received by the Grantor for or in connection with the Diamonds or the
  manner in which a sale of the Diamonds to a third party is made, and without
  deduction.

In the event the Grantor receives insurance proceeds for loss
  of production, Grantor shall pay to Payee the Gross Overriding Royalty percentage
  of any such insurance proceeds which are received by Grantor for such loss of
  production.

4.2
  Time and Manner; In Kind or Cash Payment. The Grantor will calculate and
  pay the Gross Overriding Royalty to the Grantee by delivery of a cheque or draft
  payable to the Grantee within 60 days of the end of each calendar quarter, based
  on all Diamonds from the Property which were graded in such calendar quarter.

The Grantee
  shall, at its election, have the right to take its Gross Overriding Royalty
  in kind.

4.3
  Grantors Profits and Losses. The Grantee shall not be entitled to
  participate in the profits or be obligated to share in any losses generated
  by the Grantors actual marketing or sales practices.

4.4
  Payment Accounting; Interim Settlements; Late Charges. All credits or payments
  of the Gross Overriding Royalty shall be accompanied by a detailed statement
  explaining the manner in which the payment was calculated together with any
  available settlement sheets. In no event shall payment of the Gross Overriding
  Royalty be made later that sixty (60) days after the end of each calendar quarter.
  Such payments and statements shall be deemed conclusively correct unless Grantee
  objects to them in writing within eighteen (18) months after receipt thereof.
  In the event payment of any Gross Overriding Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Gross Overriding Royalty payment, the Grantor shall pay an
  additional sum equal to ten percent (10%) of the delinquent payment (late
  charge) plus interest on the delinquent payment and the late charge at
  the rate twelve percent (12%) per annum which shall accrue from the day the
  delinquent payment

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was due to the date of payment of the Gross Overriding Royalty, late charge
  and accrued interest.

4.5
  Hedging Transactions: Futures, Options and Other Trading.All profits and
  losses resulting from Grantor engaging in any commodity futures trading, option
  trading, or diamonds trading, or any combination thereof, and any other hedging
  transactions (collectively hedging transactions) are specifically
  excluded from Gross Overriding Royalty calculations pursuant to this Agreement.
  All hedging transactions by Grantor and all profits or losses associated therewith,
  if any, shall be solely for Grantors account. The Gross Overriding Royalty
  payable on Diamonds subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Diamonds.The amount of Gross Overriding Royalty to be paid on
  all Diamonds subject to hedging transactions by Grantor shall be determined
  in the same manner as provided in this Section 4.

4.6
  Commingling.Before any Diamonds recovered from the Property are commingled
  with minerals from other properties, the Diamonds recovered from the Property
  shall be measured and sampled in accordance with this Section 4 of this Agreement.
  Detailed records shall be kept by Grantor showing the Average Appraised Value
  of the Diamonds. From this information, Grantor shall determine the amount of
  Gross Overriding Royalty due and payable to Payee from Diamonds recovered from
  the Property commingled with minerals from other properties.

5. Books; Records: Inspections; Confidentiality.

5.1
  Books.Grantor shall keep true and accurate books and records of all of
  its operations and activities on the Property and under this Agreement. Such
  books and records shall be kept on the accrual basis in accordance with generally
  accepted accounting principles consistently applied. Not more frequently than
  annually and within the time provided in Section 4.4 of this Agreement, Payee
  may, at Payees sole expense, give notice to Grantor that Payee desires
  to perform an audit or other examination of all of Grantors books and
  records kept as required by this Agreement. All financial information shall
  conclusively be deemed correct for purposes of this Agreement unless Payee has
  given timely notice that it desires to audit or examine Grantors books
  and records in the manner and within the time provided in Section 4.4 of this
  Agreement. Payee shall promptly commence any such audits and shall diligently
  prosecute the same to conclusion.

5.2
  Reports.Not later than March 1 following the end of each calendar year,
  Grantor shall provide Payee with an annual report of all activities and operations
  conducted upon or with respect to the Property during the preceding calendar
  year. Such annual report shall include estimates of proposed expenditures upon,
  anticipated production from, and estimated remaining ore reserves on the Property
  for the succeeding calendar year. Additionally, and within 30 days of the end
  of each calendar quarter,

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Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3
  Inspections.Payee, or its authorized agents or representatives, on not
  less than two (2) days notice to Grantor, may enter upon all surface and subsurface
  portions of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4
  Investor Tours.Upon reasonable notice to Grantor and not more frequently
  than semi-annually, Payee shall have the right to conduct an investors tour
  on the Property and facilities associated therewith; provided that such tours
  shall not unreasonably interfere with Grantors activities and operations.
  Such investors tours shall be at the sole risk of the Payee and its invitees,
  and Payee shall indemnify and hold Grantor harmless from any liability, damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  invitees, employees, officers, directors, agents, or representatives caused
  solely by Payees exercise of its rights under this Section.

5.5
  Confidentiality.Payee shall not, without the express written consent of
  Grantor, which consent shall not be unreasonably withheld, disclose any data
  or information concerning the Operations conducted on the Property or obtained
  under the Main Agreement or this Agreement which is not already in the public
  domain; provided, however, Payee may disclose data or information obtained under
  this Agreement without the consent of Grantor: (i) if required for compliance
  with applicable laws, rules, regulations or orders of a governmental agency
  or stock exchange having jurisdiction over Payee or its parent or affiliated
  corporations; (ii) to any of Payees consultants; (iii) to any third party
  to whom Payee, in good faith, anticipates selling or assigning Payees
  interest hereunder; or (iv) to a prospective lender to whom an interest in the
  Gross Overriding Royalty payments to be made to Payee hereunder is proposed
  to be granted as security, provided that Grantor shall first have been provided
  with a confidentiality agreement executed by such consultant, third party or
  lender, which agreement shall include the confidentiality provisions of this
  Section 5.5. Payee shall not issue any press releases pertaining to the Property
  except upon giving Grantor three (3) days advance written notice of the contents
  thereof, and Payee shall make any reasonable changes to such proposed press
  releases requested by Grantor. Payee shall not, without Grantors consent,
  issue any press release that implies or infers that Grantor endorses or joins
  in Payees statements or representations contained in any press release.

---

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1
  Compliance with Laws.Grantor shall at all times comply with all applicable
  present or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2
  Reclamation, Environmental Obligations, and Indemnities.Grantor shall,
  from and after the date this Agreement takes effect, timely and fully perform
  all reclamation required by all governmental authorities pertaining or related
  to Grantors operations or activities on or with respect to the Property
  or required under this Agreement. Grantor, from and after the date this Agreement
  takes effect, covenants and agrees not to undertake, cause, suffer, or permit
  any condition or activity at, on or in the vicinity of the Property which constitutes
  a nuisance or which results in a violation of or liability under any present
  or future applicable federal, provincial, or local environmental laws, statutes,
  rules, regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants and agrees to indemnify and hold Payee harmless
  from any and all liabilities, obligations, claims (including administrative
  claims and claims for injunctive relief), demands, losses, costs, damages, expenses,
  attorney fees and causes of action asserted against Payee related to Grantors
  failure to comply with and satisfy Environmental Obligations or other obligations
  under this Agreement. The covenants and agreements of this Section 6.2 shall
  survive the termination of Grantors rights under this Agreement or to
  the Property.

7. Stockpiling.The rights of Grantor to stockpile,
  store or place Diamonds off of the Property pursuant to any of the provisions
  of this Agreement shall not be exercisable until Grantor has first secured from
  the property owner where such stockpiling, storage or placement is to occur
  a written agreement in recordable form which provides that Payees rights
  to the Diamonds shall be preserved. Such agreement shall provide,inter
  alia, that (i) Payees rights pursuant to this Agreement, insofar
  as they are applicable, shall continue in full force and effect with respect
  to Diamonds from the property; (ii) Payees rights in and to the Diamonds
  shall be the same as if the Diamonds were situate on the Property; (iii) Payees
  rights set forth in this Section 7 shall have precedence over the rights to
  the Diamonds of the property owner where the Diamonds are stockpiled, stored
  or placed, as well as the creditors of the said property owner; and (iv) the
  agreement shall be irrevocable as long as the Diamonds from the Property, or
  any part thereof, remain on the property not part of the Property.

---

8. Tailings and Residues.All tailings, residues, waste
  rock, spoiled leach materials, and other materials (collectively Materials)
  resulting from Grantors operations and activities on the Property shall
  be the sole property of Grantor, but shall remain subject to the Gross Overriding
  Royalty should the same be processed or reprocessed, as the case may be, in
  the future and result in the production of Diamonds. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Gross Overriding Royalty payable thereon shall be determined by using the technique
  described in Section 4 of this Agreement, subject to adjustment on a pro rata
  basis where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1
  Title Maintenance and Taxes.From the date this Agreement takes effect,
  Grantor shall maintain title to the Property, including without limitation,
  paying when due all taxes on or with respect to the Property and doing all things
  and making all payments necessary or appropriate to maintain the right, title
  and interest of Grantor and Payee, respectively, in the Property and under this
  Agreement.

9.2
  Abandonment.In the event Grantor intends to abandon any of the lands comprising
  a portion or all of the Property (Abandonment Property), Grantor
  shall first give notice of such intention to Payee at least 70 days in advance
  of the proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Diamonds previously or thereafter produced from such
  ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange
  at its own expense and shall keep in force at all times, directly or through
  the services of an independent contractor, insurance, including but not limited
  to, the following:

10.1
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

---

10.2
  General Liability.Comprehensive general public liability insurance against
  claims for bodily injury or death or property damage arising out of or resulting
  from Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Gross Overriding
  Royalty, and the Property from any and all claims, liabilities and damages which
  may arise with respect to this Agreement or the Property. Payee shall be named
  as a co-insured.

10.3
  Self Insurance.Grantor may self insure the foregoing obligations, provided
  such self insurance is sufficient to meet the requirements of Sections 10.1
  and 10.2 above and is in compliance with applicable laws, statutes, rules and
  regulations.

11. General Provisions.

11.1The Miscellaneous Provisions set forth in Article 16 of the Main Agreement
  shall apply to this Schedule C as applicable.

11.2In this Schedule C in all matters of interpretation, whenever necessary
  to give effect to any provision of this instrument, the masculine shall include
  the feminine and neuter and vice versa, the singular shall include the plural,
  and the plural shall include the singular.

---

AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 14thday of April, 2002.

|BETWEEN: | UBEX CAPITAL INC. and/or      |                   
|-------- | ----------------------------- | ------------------
|         | MENACE CAPITAL CORP. and/or   |                   
|         | DENNIS HIGGS                  |                   
|         | Suite 306  1140 Homer Street |                   
|         | Vancouver, B.C., V6B 2X6      |                   
|         |                               |                   
|         | (the Optionor)              |                   
|         |                               | OF THE FIRST PART 
|         |                               |                   
|         |                               |                   
|AND:     | THRUSH INDUSTRIES INC.        |                   
|         | Suite 306  1140 Homer Street |                   
|         | Vancouver, B.C., V6B 2X6      |                   
|         |                               |                   
|         | (Thrush)                    |                   
|         |                               | OF THE SECOND PART

|WHEREAS:                                                                              
|--------------------------------------------------------------------------------------
|                                                                                      
|A.                                                                                    
|                                                                                      
|B.                                                                                    
|                                                                                      
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Agreement is amended as follows:
|                                                                                      
|1.                                                                                    

The parties hereby ratify and confirm the Agreement in all other respects.

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

---

|THE COMMON SEAL OF UBEX           | c/s
|--------------------------------- | ---
|CAPITAL CORP.was hereunto affixed |    
|affixed in the presence of:       |    

Dennis Higgs

|THE COMMON SEAL OF MENACE         | c/s
|--------------------------------- | ---
|CAPITAL CORP.was hereunto affixed |    
|in the presence of:               |    

Dennis Higgs



Dennis Higgs
  
  Dennis Higgs

|SIGNED AND DELIVERED BY THRUSH     | c/s
|---------------------------------- | ---
|INDUSTRIES INC, and affixed in the |    
|presence of:                       |    

Aileen Fehr
  
  Authorized Signatory

---

SECOND AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 29th day of May, 2002.

|BETWEEN: | UBEX CAPITAL INC. and/or          |                   
|-------- | --------------------------------- | ------------------
|         | MENACE CAPITAL CORP. and/or       |                   
|         | DENNIS HIGGS                      |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (the Optionor)                  |                   
|         |                                   | OF THE FIRST PART 
|         |                                   |                   
|         |                                   |                   
|AND:     | MIRANDA DIAMOND CORP.             |                   
|         | (Formerly Thrush Industries Inc.) |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (Thrush)                        |                   
|         |                                   | OF THE SECOND PART

|WHEREAS:                                                                                      
|----------------------------------------------------------------------------------------------
|                                                                                              
|A.                                                                                            
|                                                                                              
|B.                                                                                            
|                                                                                              
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Amended Agreement is amended as follows:
|                                                                                              
|1.                                                                                            

The parties hereby ratify and confirm the Agreement in all other respects.

IN WITNESS WHEREOF the parties hereto have executed this Second Amendment
  Agreement as of the day and year first above written.

---

|THE COMMON SEAL OF UBEX           | c/s
|--------------------------------- | ---
|CAPITAL CORP.was hereunto affixed |    
|affixed in the presence of:       |    

Dennis Higgs

|THE COMMON SEAL OF MENACE         | c/s
|--------------------------------- | ---
|CAPITAL CORP.was hereunto affixed |    
|in the presence of:               |    

Dennis Higgs



Dennis HiggsDennis Higgs

|SIGNED AND DELIVERED BY MIRANDA      |    
|------------------------------------ | ---
|DIAMOND CORP. (FORMERLY THRUSH       | c/s
|INDUSTRIES INC.), and affixed in the |    
|presence of:                         |    

Aileen Lloyd
  
  Authorized Signatory

---

THIRD AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 28th day of June, 2002.

|BETWEEN: | UBEX CAPITAL INC. and/or          |                   
|-------- | --------------------------------- | ------------------
|         | MENACE CAPITAL CORP. and/or       |                   
|         | DENNIS HIGGS                      |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (the Optionor)                  |                   
|         |                                   | OF THE FIRST PART 
|         |                                   |                   
|         |                                   |                   
|AND:     | MIRANDA DIAMOND CORP.             |                   
|         | (Formerly Thrush Industries Inc.) |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (Thrush)                        |                   
|         |                                   | OF THE SECOND PART

|WHEREAS:                                                                                      
|----------------------------------------------------------------------------------------------
|                                                                                              
|A.                                                                                            
|                                                                                              
|B.                                                                                            
|                                                                                              
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Amended Agreement is amended as follows:
|                                                                                              
|1.                                                                                            

The parties hereby ratify and confirm the Agreement in all other respects.

IN WITNESS WHEREOF the parties hereto have executed this Third
  Amendment Agreement as of the day and year first above written.

---

|THE COMMON SEAL OF UBEX           | c/s
|--------------------------------- | ---
|CAPITAL CORP.was hereunto affixed |    
|affixed in the presence of:       |    

Dennis Higgs

|THE COMMON SEAL OF MENACE         | c/s
|--------------------------------- | ---
|CAPITAL CORP.was hereunto affixed |    
|in the presence of:               |    

Dennis Higgs



Dennis Higgs
  
  Dennis Higgs

|SIGNED AND DELIVERED BY MIRANDA      |    
|------------------------------------ | ---
|DIAMOND CORP. (FORMERLY THRUSH       | c/s
|INDUSTRIES INC.), and affixed in the |    
|presence of:                         |    

Aileen LloydAuthorized Signatory

---



MINERAL PROPERTY OPTION AGREEMENT

THIS AGREEMENTis dated for reference the 30th day of January, 2002

|BETWEEN: | Ubex Capital Inc.                   |                   
|-------- | ----------------------------------- | ------------------
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (the Optionor or the Optionors) |                   
|         |                                     | OF THE FIRST PART 
|AND:     | Thrush Industries Inc.              |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (Thrush)                          |                   
|         |                                     | OF THE SECOND PART

WHEREAS the Optionor has made staking applications
  for a 100% interest in certain exploration claims in the Otish Mountains region
  of Quebec (the Lac Joubert property), through the internet by way
  of the website maintained by the Province of Quebec for such purposes;

AND WHEREASsuch applications to stake claims have
  been received by the Province of Quebec, Ministere des Ressources Naturelles,
  although confirmations of title to the claims have not yet been issued;

AND WHEREASThrush is desirous of acquiring an interest
  in such exploration claims on the terms and conditions contained herein:

NOW THEREFORE THIS AGREEMENT WITNESSESthat in consideration
  of the premises and the mutual covenants and agreements hereinafter contained,
  the parties hereto agree as follows:

|1.   | DEFINITIONS       
|---- | ------------------
|     |                   
|1.01 | In this Agreement:
|     |                   
|     | (a)               
|     |                   
|     | (b)               

---

|     | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Net Smelter Returns shall have the
      meaning ascribed by Schedule B attached hereto;                                      
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                 
|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | "Property" means and includes:                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (i)                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (ii)                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                 
|2.   | ACQUISITION OF INTEREST                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                 
|2.01 | The Optionor hereby grants
        to Thrush the exclusive right and option to acquire an undivided 100%
        right, title and interest in and to the Property, subject to the Net Smelter
        Returns and Gross Overriding Royalty described in Article 4 of this Agreement,
        for total consideration consisting of cash payments to the Optionor totalling
        $4,341 to be made as follows:                                                                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                 
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | the payment to the Optionor of $1,000, the receipt
      of which is hereby acknowledged;                                       
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                 
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | upon shareholder approval
        and approval of this Agreement by the Exchange, the payment to the Optionor
        of $3,341.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                 
|2.02 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to receipt of title certificates
        for the exploration claims comprising the Property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                 
|2.03 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to the prior approval of
        the shareholders of Thrush, at an annual and extraordinary general meeting
        proposed to be held on March 27, 2002 (and any adjournments) and of the
        Exchange, based , if necessary, on the submission of engineering data
        satisfactory to the Exchange, which Thrush undertakes to use its best
        efforts to file within a reasonable period of time so as to obtain the
        necessary approval by the earliest possible date. Notwithstanding any
        other provision of this Agreement, so long as Thrush has filed the engineering
        data

---

|     | referred to herein with
        the Exchange within a reasonable time after receiving same, the time for
        making any cash payment or share issuance referred to in this paragraph
        shall be extended, where necessary, to the day that is five business days
        following the receipt by Thrush of the necessary Exchange approval.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                       
|2.04 | This Agreement is an option
        only and, subject to paragraph 11.02, the doing of any act or the incurrence
        of any cash payments by Thrush shall not obligate Thrush to do any further
        acts or make any further payments.                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                       
|3.   | TRANSFER OF TITLE                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                       
|3.01 | Upon execution of this Agreement
        Thrush shall be entitled to record this Agreement against title to the
        Property, once title is granted by the Province of Quebec, Ministere des
        Ressources Naturelles to the Optionor.                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                       
|3.02 | Upon Thrush exercising the
        option to acquire the Property pursuant to article 2, the Optionor shall
        deliver to Thrush duly executed transfers for the transfer to Thrush of
        a 100% interest in and to the Property, subject to the royalty interest
        pursuant to Article 4.                                            
|     |                                                                                                                                                                                                                                                                                                                                                       
|4.   | ROYALTY                                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                       
|4.01 | Thrush agrees that the Property
        shall be subject to a royalty in favour of the Optionor equal to 2% of
        Net Smelter Returns to be calculated and paid according to and otherwise
        governed by Schedule B hereto.                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                       
|4.02 | Thrush agrees that the Property
        shall be subject to a royalty in favour of the Optionor equal to a 2%
        Gross Overriding Royalty to be calculated and paid according to and otherwise
        governed by Schedule C hereto.                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                       
|5.   | PAYMENTS                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                       
|5.01 | The payments to be made
        to the Optionors pursuant to section 2 and such other payments as are
        to be made to the Optionors pursuant to this Agreement shall be made in
        full to Ubex Capital Inc. (Ubex). Ubex shall determine with
        the Optionors the percentage portions of the payments to each of the Optionors.   
|     |                                                                                                                                                                                                                                                                                                                                                       
|6.   | COVENANTS OF THRUSH                                                                                                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                       
|6.01 | Thrush covenants and agrees with the Optionor
      that during the term of this Agreement:                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                       
|     | (a)                                                                                                                                                                                                                                                                                                                                                   

---

|     |                                                                                                                                                                                                                                                                                                       | paid for each year and copies of receipts for such payment
      are forwarded to the Optionor for each year;                                                                                                                                                                                                                                                                                                                                                                                    
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (b)                                                                                                                                                                                                                                                                                                   | Thrush shall carry on all operations
        on the Property in a good and workmanlike manner and in compliance with
        all applicable governmental regulations and restrictions including but
        not limited to the posting of any reclamation bonds and the conduct of
        all reclamation work as may be required by any governmental regulations
        or regulatory authorities;                                                                                            
|     |                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (c)                                                                                                                                                                                                                                                                                                   | Thrush shall pay or cause to be paid
        any rates, taxes, duties, royalties, Workers Compensation or other
        assessments or fees levied with respect to the Property or Thrushs
        operations thereon;                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (d)                                                                                                                                                                                                                                                                                                   | Thrush shall hold harmless, indemnify,
        and defend the Optionor from any claims, loss, damage, judgement or expense
        for loss or damage to property and death, including environmental damages,
        or injury to persons arising out of Thrushs activities or operations
        on the Property, except to the extent that any such claim, loss, damage,
        judgement, or expense is caused by the negligence of the Optionor, its
        employees, agents or assigns;
|     |                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (e)                                                                                                                                                                                                                                                                                                   | Thrush shall ensure that, in connection
        with the entry onto the Property of any exploration contractor or other
        worker, there shall be in place, either through Thrush or such contractor
        or worker, comprehensive broad-form liability insurance covering claims
        for personal injury, death or property damage with a coverage limit of
        at least $1,000,000;                                                                                            
|     |                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (f)                                                                                                                                                                                                                                                                                                   | Thrush shall maintain books of account
        in respect of its expenditures and operations on the Property and, upon
        reasonable notice, shall make such books available for inspection by representatives
        of the Optionor;                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (g)                                                                                                                                                                                                                                                                                                   | Thrush shall allow any duly authorized
        agent or representative of the Optionor to inspect the Property at reasonable
        times and intervals and upon reasonable notice given to Thrush, provided
        however that it is agreed and understood that any such agent or representative
        shall be at his own risk in respect of, and Thrush shall not be liable
        for, any injury incurred while on the Property, howsoever caused; and                                
|     |                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (h)                                                                                                                                                                                                                                                                                                   | Thrush shall provide to the Optionor,
        semi-annually, a summary report outlining Thrushs progress on the
        Property and shall provide to Optionor, annually, a copy of all factual,
        non-interpretive data derived from Thrushs operations on the Property.                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|7.   | RIGHT OF ENTRY                                                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|7.01 | During the currency of this
        Agreement, Thrush, its servants, agents and workmen and any persons duly
        authorized by Thrush, shall have the right of access to and from and to
        enter upon and take possession of and prospect, explore and develop the
        Property in such

---

|     | manner as Thrush in its sole
        discretion may deem advisable and shall have the right to remove and ship
        therefrom ores, minerals, metals, diamonds, or other products recovered
        in any manner therefrom.                       
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                       
|7.02 | Thrush shall be provided
        access to all maps, reports, assay results and other technical data in
        the possession or under the control of the Optionor with respect to the
        Property and shall be entitled to take copies thereof.
|     |                                                                                                                                                                                                                                                       
|8.   | REPRESENTATIONS AND WARRANTIES                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                       
|8.01 | The Optionor hereby represents and warrants that:                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                       
|     | (a)                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                       
|     | (b)                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                       
|     | (c)                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                       
|     | (d)                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                       
|8.02 | Thrush hereby represents and warrants that:                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                       
|     | (a)                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                       
|     | (b)                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                       
|9.   | CONFIDENTIALITY OF INFORMATION                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                       
|9.01 | The Optionor shall treat
        all data, reports, records and other information of any nature                                                                                                                                                       

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|                                                                                                                                                                                                                                                                                                           | whatsoever relating to
        this Agreement and the Property as confidential. While this Agreement
        is in effect, the Optionor shall not, without the express written consent
        of Thrush, disclose to any third party any information concerning the
        Property or any operations thereon, nor shall the Optionor buy, sell or
        otherwise deal in the shares of Thrush while any material, confidential
        information in its possession relating to this Agreement or the Property
        remains undisclosed to the general public.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|10.                                                                                                                                                                                                                                                                                                        | ASSIGNMENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|10.01                                                                                                                                                                                                                                                                                                      | With the consent of the
        other party, which consent shall not be unreasonably withheld, each party
        has the right to assign all or any part of its interest in this Agreement
        and in the Property, subject to the terms and conditions of this Agreement.
        It shall be a condition precedent to any such assignment that the assignee
        of the interest being transferred agrees to be bound by the terms of this
        Agreement, insofar as they are applicable.                                                                 
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|11.                                                                                                                                                                                                                                                                                                        | TERMINATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|11.01                                                                                                                                                                                                                                                                                                      | This Agreement shall terminate upon the occurrence
      of one of the following events:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                           | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                           | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                           | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|In the event that Thrush
        gives notice that it denies that a default has occurred, Thrush shall
        not be deemed in default until the matter shall have been determined finally
        through such means of dispute resolution as such matter has been subjected
        to by either party.
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|11.02                                                                                                                                                                                                                                                                                                      | Upon termination of this Agreement under paragraph
      11.01, Thrush shall:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                           | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

---

|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | period of at least one year from the date of termination;                                                                                                                                                                                                                                                                                                                           
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | have paid, as required by the Province
        of Quebec any annual maintenance fees and/or taxes necessary to hold all
        the exploration claims subject to this Agreement for the one year period
        beginning January 1 immediately following termination, and provided proof
        of such payment to the Optionor by December 15 immediately following termination;
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | transfer title to the Property to the
        Optionor free and clear of all liens, charges and encumbrances and obligations
        for reclamation or detoxification;                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | turn over to the Optionor copies of
        all non-interpretive maps, reports, sample results, contracts and other
        data and documentation in the possession of Thrush or, to the extent within
        Thrushs control, in the possession of its agents, employees or independent
        contractors, in connection with its operations on the Property;                 
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | ensure that the Property is in a safe
        condition and complies with all environmental and safety standards including
        standards for reclamation and detoxification, imposed by any duly authorized
        regulatory authority; and                                                                                                                                   
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|      | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | ensure that its covenants under subparagraphs 6.01 (a) through
      (e) have been fully complied with.                                                                                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|11.03 | Upon the termination of
        this Agreement under paragraph 11.01, Thrush shall cease to be liable
        to the Optionor in debt, damages or otherwise save for the performance
        of those obligations in paragraph 11.02.                                                                                                                                                                                                                                                                                                          
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|11.04 | Upon termination of this
        Agreement under paragraph 11.01, Thrush shall vacate the Property within
        a reasonable time after such termination, but shall have the right of
        access to the property for a period of six months thereafter for the purpose
        of removing its chattels, machinery, equipment and fixtures.                                                                                                                                                                                              
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|12.   | FORCE MAJEURE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|12.01 | The time for performance
        of any act or making any payment or any expenditure required under this
        Agreement shall be extended by the period of any delay or inability to
        perform due to fire, strikes, labour disturbances, riots, civil commotion,
        wars, acts of God, any present or future law or governmental regulation,
        any shortages of labour, equipment or materials, or any other cause not
        reasonably within the control of the party in default, other than lack
        of finances.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|13.   | REGULATORY APPROVAL                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                     
|13.01 | This Agreement is subject
        to the prior approval of the Exchange. Thrush shall use its best efforts
        to obtain such approval as soon as reasonably possible, provided however
        that if                                                                                                                                                                                                                                                                                                                                    

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|      | such approval has not been received by April 15,
        2002, this Agreement shall be null and void and of no further effect.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.   | AFTER-ACQUIRED PROPERTY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.01 | In the event that at any time hereafter Thrush shall
        acquire any portion of any combined group of any mining claims, any mining
        claim, lease, or other mineral right or interest within a three kilometre
        radius of the outside boundary of the Property to be described in Schedule
        A hereto, such interest shall be deemed to have been acquired on behalf
        of and for the benefit of the parties, pursuant to the terms of this Agreement
        and such after-acquired interest as aforesaid shall be included in and
        shall form a part of the definition of Property contained
        in paragraph 1.01 and shall be subject to this Agreement as if it had
        been originally so included.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|14.02 | In the event that at any time hereafter Thrush shall
        acquire any portion of any combined group of any mining claims, any mining
        claim, lease, or other mineral right or interest within a three kilometre
        radius of the outside boundary of the Property as constituted on the date
        of this Agreement, such interest shall be subject to the royalties in
        favour of the Optionor as described in Article 4 of this Agreement, and,
        if so requested by the Optionor, shall be transferred to the Optionor
        upon abandonment by Thrush.                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|15.   | NOTICES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|15.01 | Any notice, election, consent or other writing required
        or permitted to be given hereunder shall be deemed to be sufficiently
        given if delivered or mailed postage prepaid or if given by telegram,
        telex or telecopier, addressed as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

|In the case of the Optionor: | Ubex Capital Inc.
      Suite 306  1140 Homer Street 
      Vancouver, B.C. 
      V6B 2X6 
      Fax: (604) 689-1722         
|---------------------------- | -------------------------------------------------------------------------------------------------------------------------------
|                             |                                                                                                                                
|In the case of Thrush:       | THRUSH INDUSTRIES INC.Suite306  1140 Homer Street 
      Vancouver, British Columbia 
      V6B 2X6 
      Fax: (604) 689-1722

and any such notice given us aforesaid shall be deemed to have
  been given to the parties hereto if delivered, when delivered, or if mailed,
  on the third business day following the date of mailing, or, if telegraphed,
  telexed or telecopied, on the same day as the telegraphing, telexing or telecopying
  thereof provided however that during the period of any postal interruption in
  Canada or the United States any notice given hereunder by mail shall be deemed
  to have been given only

---

as of the date of actual delivery of the same. Any party may
  from time to time by notice in writing change its address for the purposes of
  this paragraph 15.01.

16. GENERAL TERMS AND CONDITIONS

16.01 The parties hereto hereby covenant and agree that they
  will execute such further agreements, conveyances and assurances as may be requisite,
  or which counsel for the parties may deem necessary to effectually carry out
  the intent of this Agreement.

16.02 This Agreement shall constitute the entire agreement
  between the parties with respect to the Property. No representations or inducements
  have been made save as herein set forth. No changes, alterations or modifications
  of this Agreement shall be binding upon either party until and unless a memorandum
  in writing to such effect shall have been signed by all parties hereto. This
  Agreement shall supersede all previous written, oral or implied understandings
  between the parties with respect to the matters hereby.

16.03 Time shall be of the essence of this Agreement.

16.04 The titles to the articles in this Agreement shall not
  be deemed to form part of this Agreement but shall be regarded as having been
  used for convenience of reference only.

16.05 All currency references contained in this Agreement
  shall be deemed to be references to Canadian funds.

16.06 Wherever possible, each provision of this Agreement
  shall be interpreted in such manner as to be effective and valid under applicable
  law, but if any provision shall be prohibited by or be invalid under applicable
  law, such provision shall be ineffective only to the extent of such prohibition
  or invalidity, without invalidating the remainder of such provision or the remaining
  provisions of this Agreement.

16.07 The Schedules to this Agreement shall be construed with
  and as an integral part of this Agreement to the same extent as if they were
  set forth verbatim herein. Defined terms contained in this Agreement shall have
  the same meanings where used in the Schedules.

16.08 This Agreement shall be governed by and interpreted
  in accordance with the laws of the Province of British Columbia and the laws
  of Canada applicable therein.

16.09 In the event that any suit, legal action, or arbitration
  proceeding is instituted to interpret or enforce the terms of this Agreement,
  including but not limited to any contest proceeding under paragraph 11.01, the
  prevailing party shall be entitled to recover from the other party such sum
  as the

court or arbitrator may adjudge reasonable for attorneys
  fees at trial and on appeal of such suit, action or proceeding in addition to
  all other sums provided by law.

16.10 This Agreement shall enure to the benefit of and be
  binding upon the parties hereto and their respective heirs, executors, administrators,
  successors and assigns.

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IN WITNESS WHEREOFthis Agreement has been executed by the parties
  hereto as of the day and year first above written.

|The COMMON SEALof UBEX CAPITAL           | c/s
|---------------------------------------- | ---
|INC.was hereunto affixed in the presence |    
|of:                                      |    

Dennis Higgs

SIGNED AND DELIVERED BY THRUSH 
  INDUSTRIES INC. and affixed in the presence 
  of:

Aileen Fehr
  
  Authorized Signatory

---

Schedule B

NET SMELTER RETURN ROYALTY

References in
  this Schedule B to Sections and Articles in this Schedule B are so identified,
  and references in this Schedule B to Sections and Articles in the agreement
  to which this Schedule B is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule B except as otherwise expressly stated in
  this Schedule B. The Net Smelter Returns royalty defined in Article 1 of the
  Main Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As
  used in this Schedule B, the term Grantor shall mean Optionee as
  defined in the Main Agreement, and shall include all of Optionees successors-in-interest,
  including without limitation, assignees, partners, joint venture partners, lessees
  and when applicable mortgagees and affiliated companies having or claiming an
  interest in the Properties or projects.

1.2As
  used in this Schedule B, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in-interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Production Royalty.Grantor shall pay
  to Grantee the royalty described in Section 4 below (Royalty) pursuant
  to the terms and provisions of this Schedule B.

3. Term.The term of the Royalty hereby created shall be perpetual,
  it being the intent of the parties hereto that, to the extent allowed by law,
  the Royalty constitutes a vested interest in and a covenant running with the
  land and affecting the Property and all successions thereof whether created
  privately or through governmental action. In the event a court of competent
  jurisdiction determines that the term of this Agreement violates the Rule Against
  Perpetuities, then the term of this Agreement shall automatically be revised
  and reformed to coincide with the maximum term permitted by the Rule Against
  Perpetuities, and this Agreement shall not be terminated solely as a result
  of a violation of the Rule Against Perpetuities.

4. Production Royalty.Grantor shall pay to Grantee a perpetual Royalty
  in the amount of two percent (2%) of Net Smelter Returns from the sale or other
  disposition of all locatable minerals produced from the Properties determined
  in accordance with the provisions set forth in this Section 4 and, if applicable,
  Section 7.

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4.1 For Precious
  Metals.Net Smelter Returns, in the case of gold, silver, and platinum group
  metals (Precious Metals), shall be determined by multiplying (i)
  the gross number of troy ounces of Precious Metals contained in the production
  delivered to the smelter, refiner, processor, purchaser or other recipient (including
  the operator) of such production, or an insurer as a result of casualty to such
  production (collectively, Payor) during the preceding calendar month
  by (ii) for gold, the average of the London Bullion Market, Morning Fix, spot
  prices for the preceding calendar month; for all other Precious Metals, the
  average of the New York Commodities Exchange final daily spot prices for the
  preceding calendar month, and subtracting from the product of (i) and (ii) only
  the following if actually incurred:

| | (1) | charges imposed by the Payor for refining bullion from the
      Beneficiated Precious Metals contained in such production (as used in this
      Agreement, Beneficiated Precious Metals includes only doré
      or concentrates of Precious Metals produced by Grantors final mill
      or other processing plant, but does not include raw or crushed ore containing
      Precious Metals or other preliminarily processed Precious Metals); and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for refining Beneficiated Precious Metals contained in such
      production.                                                                                                                                                                                                                                                                                               

In the event the refining of bullion from the Beneficiated Precious Metals
  contained in such production is carried out in custom toll facilities owned
  or controlled, in whole or in part, by Grantor, which facilities were not constructed
  for the purpose of refining Beneficiated Precious Metals from the Property,
  then charges, costs and penalties for such refining shall mean the amount Grantor
  would have incurred if such refining were carried out at facilities not owned
  or controlled by Grantor then offering comparable services for comparable products
  on prevailing terms, but in no event greater than actual costs incurred by Grantor
  with respect to such refining.

In the event the Grantor receives insurance proceeds for loss of production,
  Grantor shall pay to Payee the Royalty percentage of any such insurance proceeds
  which are received by Grantor for such loss of production.

4.2 For Other
  Minerals.Net Smelter Returns, in the case of all metals, minerals, mineral
  substances, and the beneficiated products thereof, which are not or do not contain
  economically recoverable Precious Metals (Other Minerals), shall
  be determined by multiplying (i) the gross amount of the particular Other Mineral
  contained in the production delivered to the Payor during the preceding calendar
  month by (ii) the average of the New York Commodities Exchange final daily spot
  prices for the preceding calendar month of the appropriate Other Mineral, and
  subtracting from the product of (i) and (ii) only the following if actually
  incurred:

---

| | (1) | charges imposed by the Payor for smelting, refining or processing
      Other Minerals contained in such production, but excluding any and all charges
      and costs related to Grantor mill or other processing plants constructed
      for the purpose of milling or processing Other Minerals, in whole or in
      part; and                                              
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for smelting, refining, or processing Other Minerals contained
      in such production, but excluding any and all charges and costs of or related
      to Grantor mills or other processing plants constructed for the purpose
      of milling or processing Other Minerals, in whole or in part.

In the event smelting, refining, or processing of Other Minerals are carried
  out in custom toll facilities owned or controlled, in whole or in part, by Grantor,
  which facilities were not constructed for the purpose of milling or processing
  Other Minerals, then charges, costs and penalties for such smelting, refining
  or processing shall mean the amount Grantor would have incurred if such smelting,
  refining or processing were carried out at facilities not owned or controlled
  by Grantor then offering comparable services for comparable products on prevailing
  terms, but in no event greater than actual costs incurred by Grantor with respect
  to such smelting and refining.

In the event Grantor receives insurance proceeds for loss of production, Grantor
  shall pay to Payee the Royalty percentage of any such insurance proceeds which
  are received by Grantor for such loss of production.

Notwithstanding anything contained in the foregoing, the term Other
  Minerals shall not be deemed to include Diamonds as defined
  in Schedule C to the Main Agreement, it being the intention of the parties that
  all payments of royalties in respect of Diamonds shall be governed by Schedule
  C attached to the Main Agreement.

4.3 Time and
  Manner; In-Kind or Cash Payment.At the time of making payment to or otherwise
  crediting the account of Grantor for production from the Property pursuant to
  Sections 4.1 or 4.2 (but within the time provided in Section 4.4), the smelter,
  refiner, processor, purchaser, or other user (Payor) of the Precious
  Metals or Other Minerals shall contemporaneously pay the Royalty in accordance
  with written instructions given to the Payor by Grantee as provided in Sections
  4.3.1 and 4.3.2. Once the Payor has received instructions from Grantee, such
  instructions shall remain in effect until the Payor has received different instructions
  from Grantee. All contractual or other arrangements entered into by Grantor
  with the Payor shall contain provisions implementing the terms and conditions
  of payment set forth in Sections 4.3 and 4.4 hereof and Grantor shall procure
  the written undertaking of Payor contractually binding Payor to perform in accordance
  with Sections 4.3 and 4.4 in form and substance enforceable by Grantee. Grantor
  acknowledges its primary obligation to pay the Royalty and that no undertaking
  by the Payor shall relieve Grantor of that obligation, and Grantor agrees to
  indemnify, protect and defend Grantee from and against any loss, cost

---

(including attorneys fees incurred) or liability arising from the performance
  or failure of performance by Payor hereunder or under any contractual or other
  arrangements entered into by Grantor with the Payor pursuant to or for the purposes
  of complying with Sections 4.3 and 4.4 hereof. Grantee may, from time to time
  in its discretion, change the bank or account number for payment under to Sections
  4.3.1 and 4.3.2 by giving written notice thereof to Grantor and the Payor; such
  notice shall be effective upon actual receipt by the Payor, or upon the fourth
  day after deposit of such notice in the mail, first class postage prepaid, addressed
  to the Payor, whichever occurs first. All costs charged by the Payor as a result
  of complying with the payment provisions of Sections 4.3 and 4.4 shall be paid
  by Grantee, and Grantor shall have no liability or responsibility therefor.

4.3.1
  Precious Metals.The Payor shall pay the Royalty for each shipment of Precious
  Metals either (a) in the form of gold bullion (.995 + fine gold) directly to
  Payees account maintained with the Payor as directed by Payee, or (b)
  by delivery of a cheque or draft payable to Payees account with a bank
  to be designated in writing by Payee. In the event Payee instructs the Payor
  to deliver the Royalty in the form of gold bullion, the Royalty payable on silver
  or platinum group metals shall be converted to the gold equivalent of such silver
  or platinum group metals by using the average monthly spot prices for Precious
  Metals described in Section 4.1.

4.3.2
  Other Minerals.The Payor shall pay the Royalty for each shipment of Other
  Minerals by delivery of a cheque or draft payable to the Payees account
  with a bank to be designated in writing by Payee.

4.4 Payment
  Accounting; Interim Settlements; Late Charges.All credits or payments of
  the Royalty shall be accompanied by a detailed statement explaining the manner
  in which the payment was calculated together with any available settlement sheets
  from the Payor. In no event shall payment of the Royalty be made later that
  thirty (30) days after the delivery to the Payor of the Precious Metals, Beneficiated
  Precious Metals, or Other Minerals. Such payments and statements shall be deemed
  conclusively correct unless Grantee objects to them in writing within eighteen
  (18) months after receipt thereof. On those occasions when all necessary information
  is not available to the Payor within the thirty (30) day period, the Payor shall
  make an interim settlement of the Royalty for such shipment or use within the
  thirty (30) day period; such interim settlement shall provide for payment of
  not less than ninety percent (90%) of the anticipated final settlement Royalty
  as determined by the assays and quantities of the Precious Metals or Other Minerals
  received by the Payor with respect to which such interim settlement is being
  made. Final settlement of the Royalty shall be promptly made upon receipt by
  the Payor of all information necessary or appropriate to make final settlement
  for such shipment. In the event payment of any Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Royalty payment, the Grantor shall pay an additional sum
  equal to ten percent (10%) of the delinquent payment (late charge)
  plus interest on the delinquent payment and the late charge at the rate twelve
  percent (12%) per annum which shall accrue from the day

---

the delinquent payment was due to the date of payment of the Royalty, late
  charge and accrued interest.

4.5 Hedging
  Transactions: Futures, Options and Other Trading.All profits and losses
  resulting from Grantor engaging in any commodity futures trading, option trading,
  or metals trading, or any combination thereof, and any other hedging transactions
  (collectively hedging transactions) are specifically excluded from
  Royalty calculations pursuant to this Agreement. All hedging transactions by
  Grantor and all profits or losses associated therewith, if any, shall be solely
  for Grantors account. The Royalty payable on Precious Metals or Other
  Minerals subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Precious Metals.The amount of Royalty to be paid on all Precious
  Metals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.1 with the understanding that the average
  monthly spot price shall be for the calendar month during which Precious Metals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.5.2
  Affecting Other Minerals. The amount of Royalty to be paid on all Other
  Minerals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.2 with the understanding that the average
  monthly spot price shall be for the calendar month during which Other Minerals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.6 Commingling.Before any Precious Metals or Other Minerals produced from the Property
  are commingled with minerals from other properties, the Precious Metals or Other
  Minerals produced from the Property shall be measured and sampled in accordance
  with sound mining and metallurgical practices for moisture, metal, commercial
  minerals and other appropriate content. Representative samples of the Precious
  Metals or Other Minerals shall be retained by Grantor and assays (including
  moisture and penalty substances) and other appropriate analyses of these samples
  shall be made before commingling to determine metal, commercial minerals, and
  other appropriate content. Detailed records shall be kept by Grantor showing
  measures, moisture, assays of metal, commercial minerals, and other appropriate
  content and penalty substances, and gross metal content of the Precious Metals
  or gross metal or mineral content of Other Minerals. From this information,
  Grantor shall determine the amount of Royalty due and payable to Payee from
  Precious Metals or Other Minerals produced from the Property commingled with
  minerals from other properties. Following the expiration of the period for objection
  described above in Section 4.4, and absent timely objection, if any, made by
  Payee, Grantor may dispose of the materials and data required to be kept and
  produced by this Section 4.6.

5. Books; Records: Inspections; Confidentiality.

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5.1 Books.Grantor shall keep true and accurate books and records of all of its operations
  and activities on the Property and under this Agreement. Such books and records
  shall be kept on the accrual basis in accordance with generally accepted accounting
  principles consistently applied. Not more frequently than annually and within
  the time provided in Section 4.4 of this Agreement, Payee may, at Payees
  sole expense, give notice to Grantor that Payee desires to perform an audit
  or other examination of all of Grantors books and records kept as required
  by this Agreement. All financial information shall conclusively be deemed correct
  for purposes of this Agreement unless Payee has given timely notice that it
  desires to audit or examine Grantors books and records in the manner and
  within the time provided in Section 4.4 of this Agreement. Payee shall promptly
  commence any such audits and shall diligently prosecute the same to conclusion.

5.2 Reports.Not later than March 1 following the end of each calendar year, Grantor
  shall provide Payee with an annual report of all activities and operations conducted
  upon or with respect to the Property during the preceding calendar year. Such
  annual report shall include estimates of proposed expenditures upon, anticipated
  production from, and estimated remaining ore reserves on the Property for the
  succeeding calendar year. Additionally, and within 30 days of the end of each
  calendar quarter, Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3 Inspections.Payee, or its authorized agents or representatives, on not less than two
  (2) days notice to Grantor, may enter upon all surface and subsurface portions
  of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4 Investor
  Tours.Upon reasonable notice to Grantor and not more frequently than semi-annually,
  Payee shall have the right to conduct an investors tour on the Property and
  facilities associated therewith; provided that such tours shall not unreasonably
  interfere with Grantors activities and operations. Such investors tours
  shall be at the sole risk of the Payee and its invitees, and Payee shall indemnify
  and hold Grantor harmless from any liability, damage, claim or demand by reason
  of injury to Payee or Grantor or any of their respective invitees, employees,
  officers, directors, agents, or representatives caused solely by Payees
  exercise of its rights under this Section.

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5.5 Confidentiality.Payee shall not, without the express written consent of Grantor, which consent
  shall not be unreasonably withheld, disclose any data or information concerning
  the Operations conducted on the Property or obtained under the Main Agreement
  or this Agreement which is not already in the public domain; provided, however,
  Payee may disclose data or information obtained under this Agreement without
  the consent of Grantor: (i) if required for compliance with applicable laws,
  rules, regulations or orders of a governmental agency or stock exchange having
  jurisdiction over Payee or its parent or affiliated corporations; (ii) to any
  of Payees consultants; (iii) to any third party to whom Payee, in good
  faith, anticipates selling or assigning Payees interest hereunder; or
  (iv) to a prospective lender to whom an interest in the Royalty payments to
  be made to Payee hereunder is proposed to be granted as security, provided that
  Grantor shall first have been provided with a confidentiality agreement executed
  by such consultant, third party or lender, which agreement shall include the
  confidentiality provisions of this Section 5.5. Payee shall not issue any press
  releases pertaining to the Property except upon giving Grantor three (3) days
  advance written notice of the contents thereof, and Payee shall make any reasonable
  changes to such proposed press releases requested by Grantor. Payee shall not,
  without Grantors consent, issue any press release that implies or infers
  that Grantor endorses or joins in Payees statements or representations
  contained in any press release.

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1 Compliance
  with Laws.Grantor shall at all times comply with all applicable present
  or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2 Reclamation,
  Environmental Obligations, and Indemnities.Grantor shall, from and after
  the date this Agreement takes effect, timely and fully perform all reclamation
  required by all governmental authorities pertaining or related to Grantors
  operations or activities on or with respect to the Property or required under
  this Agreement. Grantor, from and after the date this Agreement takes effect,
  covenants and agrees not to undertake, cause, suffer, or permit any condition
  or activity at, on or in the vicinity of the Property which constitutes a nuisance
  or which results in a violation of or liability under any present or future
  applicable federal, provincial, or local environmental laws, statutes, rules,
  regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants

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and agrees to indemnify and hold Payee harmless from any and all liabilities,
  obligations, claims (including administrative claims and claims for injunctive
  relief), demands, losses, costs, damages, expenses, attorney fees and causes
  of action asserted against Payee related to Grantors failure to comply
  with and satisfy Environmental Obligations or other obligations under this Agreement.
  The covenants and agreements of this Section 6.2 shall survive the termination
  of Grantors rights under this Agreement or to the Property.

7. Stockpiling.The rights of Grantor to stockpile, store
  or place Precious Metals or Other Minerals off of the Property pursuant to any
  of the provisions of this Agreement shall not be exercisable until Grantor has
  first secured from the property owner where such stockpiling, storage or placement
  is to occur a written agreement in recordable form which provides that Payees
  rights to the Precious Metals and Other Minerals shall be preserved. Such agreement
  shall provide,inter alia, that (i) Payees rights
  pursuant to this Agreement, insofar as they are applicable, shall continue in
  full force and effect with respect to Precious Metals and Other Minerals from
  the property; (ii) Payees rights in and to the Precious and Other Minerals
  shall be the same as if the Precious Metals and Other Minerals were situate
  on the Property; (iii) Payees rights set forth in this Section 7 shall
  have precedence over the rights to the Precious Metals and Other Minerals of
  the property owner where the Precious Metals and Other Minerals are stockpiled,
  stored or placed, as well as the creditors of the said property owner; and (iv)
  the agreement shall be irrevocable as long as the Precious Metals and Other
  Minerals from the Property, or any part thereof, remain on the property not
  part of the Property.

8. Tailings and Residues.All tailings, residues, waste rock, spoiled
  leach materials, and other materials (collectively Materials) resulting
  from Grantors operations and activities on the Property shall be the sole
  property of Grantor, but shall remain subject to the Royalty should the same
  be processed or reprocessed, as the case may be, in the future and result in
  the production of Precious Metals or Other Minerals. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Royalty payable thereon shall be determined by using the best engineering and
  technical practices then available, subject to adjustment on a pro rata basis
  where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1 Title Maintenance
  and Taxes.From the date this Agreement takes effect, Grantor shall maintain
  title to the Property, including without limitation, paying when due all taxes
  on or with respect to the Property and doing all things and making all payments
  necessary or appropriate to maintain the right, title and interest of Grantor
  and Payee, respectively, in the Property and under this Agreement.

9.2 Abandonment.In the event Grantor intends to abandon any of the lands comprising a portion
  or all of the Property (Abandonment Property), Grantor shall first

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give notice of such intention to Payee at least 70 days in advance of the
  proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Precious Metals and Other Minerals previously or
  thereafter produced from such ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange at its own
  expense and shall keep in force at all times, directly or through the services
  of an independent contractor, insurance, including but not limited to, the following:

10.1 Workmans
  Compensation Insurance.Workmans Compensation Insurance or the like
  covering all persons engaged in the performance of activities or operations
  as is required or appropriate under law or local governmental bodies or agencies.

10.2 General
  Liability.Comprehensive general public liability insurance against claims
  for bodily injury or death or property damage arising out of or resulting from
  Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Royalty, and
  the Property from any and all claims, liabilities and damages which may arise
  with respect to this Agreement or the Property. Payee shall be named as a co-insured.

10.3 Self Insurance.Grantor may self insure the foregoing obligations, provided such self insurance
  is sufficient to meet the requirements of Sections 10.1 and 10.2 above and is
  in compliance with applicable laws, statutes, rules and regulations.

11. General Provisions.

11.1The
  Miscellaneous Provisions set forth in Article 16 of the Main Agreement shall
  apply to this Schedule B as applicable.

11.2In
  this Schedule B in all matters of interpretation, whenever necessary to give
  effect to any provision of this instrument, the masculine shall include the
  feminine and neuter and vice versa, the singular shall include the plural, and
  the plural shall include the singular.

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Schedule C

GROSS OVERRIDING ROYALTY

References
  in this Schedule C to Sections and Articles in this Schedule C are so identified,
  and references in this Schedule C to Sections and Articles in the agreement
  to which this Schedule C is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule C except as otherwise expressly stated in
  this Schedule C. The Gross Overriding Royalty defined in Article 1 of the Main
  Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As used in this Schedule C, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-in-interest,
  including without limitation, assignees, partners, joint venture partners, lessees
  and when applicable mortgagees and affiliated companies having or claiming an
  interest in the Properties or projects.

1.2As used in this Schedule C, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in-interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Gross Overriding Royalty.Grantor
  shall pay to Grantee the royalty described in Section 4 below (the Gross
  Overriding Royalty) pursuant to the terms and provisions of this Schedule
  C.

3. Term.The term of the Gross Overriding Royalty hereby
  created shall be perpetual, it being the intent of the parties hereto that,
  to the extent allowed by law, the Gross Overriding Royalty constitutes a vested
  interest in and a covenant running with the land and affecting the Property
  and all successions thereof whether created privately or through governmental
  action. In the event a court of competent jurisdiction determines that the term
  of this Agreement violates the Rule Against Perpetuities, then the term of this
  Agreement shall automatically be revised and reformed to coincide with the maximum
  term permitted by the Rule Against Perpetuities, and this Agreement shall not
  be terminated solely as a result of a violation of the Rule Against Perpetuities.

4. Gross Overriding Royalty.Grantor shall
  pay to Grantee a perpetual Gross Overriding Royalty in the amount of two percent
  (2%) of the Average Appraised Value (as hereinafter defined) of all gems, precious
  and semi-precious stones, and gem and industrial diamonds recovered, sorted,
  and graded from the Properties (the Diamonds)

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determined in accordance with the provisions set forth in this Section 4 and,
  if applicable, Section 7.

4.1
  Average Appraised Value.Average Appraised Value means the average
  of the valuations in Canadian dollars of the Diamonds determined by two independent
  graders, one appointed by the Grantor and one appointed by the Grantee. Such
  independent graders shall be duly qualified and accredited, and shall sort,
  grade and value the Diamonds in accordance with industry standards, having regard
  to, but without limiting the generality of the foregoing, the commercial demand
  for the Diamonds. Each independent valuator shall value each particular classification
  of the Diamonds in accordance with the industry price books, standards and formulas.
  The parties acknowledge that the intention is that the Gross Overriding Royalty
  is to be paid to the Grantee on this basis, regardless of the price or proceeds
  actually received by the Grantor for or in connection with the Diamonds or the
  manner in which a sale of the Diamonds to a third party is made, and without
  deduction.

In the event the Grantor receives insurance proceeds for loss of production,
  Grantor shall pay to Payee the Gross Overriding Royalty percentage of any such
  insurance proceeds which are received by Grantor for such loss of production.

4.2
  Time and Manner; In Kind or Cash Payment. The Grantor will calculate and
  pay the Gross Overriding Royalty to the Grantee by delivery of a cheque or draft
  payable to the Grantee within 60 days of the end of each calendar quarter, based
  on all Diamonds from the Property which were graded in such calendar quarter.

The Grantee shall,
  at its election, have the right to take its Gross Overriding Royalty in kind.

4.3
  Grantors Profits and Losses. The Grantee shall not be entitled to
  participate in the profits or be obligated to share in any losses generated
  by the Grantors actual marketing or sales practices.

4.4
  Payment Accounting; Interim Settlements; Late Charges. All credits or payments
  of the Gross Overriding Royalty shall be accompanied by a detailed statement
  explaining the manner in which the payment was calculated together with any
  available settlement sheets. In no event shall payment of the Gross Overriding
  Royalty be made later that sixty (60) days after the end of each calendar quarter.
  Such payments and statements shall be deemed conclusively correct unless Grantee
  objects to them in writing within eighteen (18) months after receipt thereof.
  In the event payment of any Gross Overriding Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Gross Overriding Royalty payment, the Grantor shall pay an
  additional sum equal to ten percent (10%) of the delinquent payment (late
  charge) plus interest on the delinquent payment and the late charge at
  the rate twelve percent (12%) per annum which shall accrue from the day the
  delinquent payment

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was due to the date of payment of the Gross Overriding Royalty, late charge
  and accrued interest.

4.5
  Hedging Transactions: Futures, Options and Other Trading.All profits and
  losses resulting from Grantor engaging in any commodity futures trading, option
  trading, or diamonds trading, or any combination thereof, and any other hedging
  transactions (collectively hedging transactions) are specifically
  excluded from Gross Overriding Royalty calculations pursuant to this Agreement.
  All hedging transactions by Grantor and all profits or losses associated therewith,
  if any, shall be solely for Grantors account. The Gross Overriding Royalty
  payable on Diamonds subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Diamonds.The amount of Gross Overriding Royalty to be paid on
  all Diamonds subject to hedging transactions by Grantor shall be determined
  in the same manner as provided in this Section 4.

4.6
  Commingling.Before any Diamonds recovered from the Property are commingled
  with minerals from other properties, the Diamonds recovered from the Property
  shall be measured and sampled in accordance with this Section 4 of this Agreement.
  Detailed records shall be kept by Grantor showing the Average Appraised Value
  of the Diamonds. From this information, Grantor shall determine the amount of
  Gross Overriding Royalty due and payable to Payee from Diamonds recovered from
  the Property commingled with minerals from other properties.

5. Books; Records: Inspections; Confidentiality.

5.1
  Books.Grantor shall keep true and accurate books and records of all of
  its operations and activities on the Property and under this Agreement. Such
  books and records shall be kept on the accrual basis in accordance with generally
  accepted accounting principles consistently applied. Not more frequently than
  annually and within the time provided in Section 4.4 of this Agreement, Payee
  may, at Payees sole expense, give notice to Grantor that Payee desires
  to perform an audit or other examination of all of Grantors books and
  records kept as required by this Agreement. All financial information shall
  conclusively be deemed correct for purposes of this Agreement unless Payee has
  given timely notice that it desires to audit or examine Grantors books
  and records in the manner and within the time provided in Section 4.4 of this
  Agreement. Payee shall promptly commence any such audits and shall diligently
  prosecute the same to conclusion.

5.2
  Reports.Not later than March 1 following the end of each calendar year,
  Grantor shall provide Payee with an annual report of all activities and operations
  conducted upon or with respect to the Property during the preceding calendar
  year. Such annual report shall include estimates of proposed expenditures upon,
  anticipated production from, and estimated remaining ore reserves on the Property
  for the succeeding calendar year. Additionally, and within 30 days of the end
  of each calendar quarter,

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Grantor shall provide Payee access to all data and information generated with
  respect to the Property during the calendar quarter just ended.

5.3
  Inspections.Payee, or its authorized agents or representatives, on not
  less than two (2) days notice to Grantor, may enter upon all surface and subsurface
  portions of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4
  Investor Tours.Upon reasonable notice to Grantor and not more frequently
  than semi-annually, Payee shall have the right to conduct an investors tour
  on the Property and facilities associated therewith; provided that such tours
  shall not unreasonably interfere with Grantors activities and operations.
  Such investors tours shall be at the sole risk of the Payee and its invitees,
  and Payee shall indemnify and hold Grantor harmless from any liability, damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  invitees, employees, officers, directors, agents, or representatives caused
  solely by Payees exercise of its rights under this Section.

5.5
  Confidentiality.Payee shall not, without the express written consent of
  Grantor, which consent shall not be unreasonably withheld, disclose any data
  or information concerning the Operations conducted on the Property or obtained
  under the Main Agreement or this Agreement which is not already in the public
  domain; provided, however, Payee may disclose data or information obtained under
  this Agreement without the consent of Grantor: (i) if required for compliance
  with applicable laws, rules, regulations or orders of a governmental agency
  or stock exchange having jurisdiction over Payee or its parent or affiliated
  corporations; (ii) to any of Payees consultants; (iii) to any third party
  to whom Payee, in good faith, anticipates selling or assigning Payees
  interest hereunder; or (iv) to a prospective lender to whom an interest in the
  Gross Overriding Royalty payments to be made to Payee hereunder is proposed
  to be granted as security, provided that Grantor shall first have been provided
  with a confidentiality agreement executed by such consultant, third party or
  lender, which agreement shall include the confidentiality provisions of this
  Section 5.5. Payee shall not issue any press releases pertaining to the Property
  except upon giving Grantor three (3) days advance written notice of the contents
  thereof, and Payee shall make any reasonable changes to such proposed press
  releases requested by Grantor. Payee shall not, without Grantors consent,
  issue any press release that implies or infers that Grantor endorses or joins
  in Payees statements or representations contained in any press release.



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6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1
  Compliance with Laws.Grantor shall at all times comply with all applicable
  present or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2
  Reclamation, Environmental Obligations, and Indemnities.Grantor shall,
  from and after the date this Agreement takes effect, timely and fully perform
  all reclamation required by all governmental authorities pertaining or related
  to Grantors operations or activities on or with respect to the Property
  or required under this Agreement. Grantor, from and after the date this Agreement
  takes effect, covenants and agrees not to undertake, cause, suffer, or permit
  any condition or activity at, on or in the vicinity of the Property which constitutes
  a nuisance or which results in a violation of or liability under any present
  or future applicable federal, provincial, or local environmental laws, statutes,
  rules, regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants and agrees to indemnify and hold Payee harmless
  from any and all liabilities, obligations, claims (including administrative
  claims and claims for injunctive relief), demands, losses, costs, damages, expenses,
  attorney fees and causes of action asserted against Payee related to Grantors
  failure to comply with and satisfy Environmental Obligations or other obligations
  under this Agreement. The covenants and agreements of this Section 6.2 shall
  survive the termination of Grantors rights under this Agreement or to
  the Property.

7. Stockpiling.The rights of Grantor to stockpile,
  store or place Diamonds off of the Property pursuant to any of the provisions
  of this Agreement shall not be exercisable until Grantor has first secured from
  the property owner where such stockpiling, storage or placement is to occur
  a written agreement in recordable form which provides that Payees rights
  to the Diamonds shall be preserved. Such agreement shall provide,inter
  alia, that (i) Payees rights pursuant to this Agreement, insofar
  as they are applicable, shall continue in full force and effect with respect
  to Diamonds from the property; (ii) Payees rights in and to the Diamonds
  shall be the same as if the Diamonds were situate on the Property; (iii) Payees
  rights set forth in this Section 7 shall have precedence over the rights to
  the Diamonds of the property owner where the Diamonds are stockpiled, stored
  or placed, as well as the creditors of the said property owner; and (iv) the
  agreement shall be irrevocable as long as the Diamonds from the Property, or
  any part thereof, remain on the property not part of the Property.

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8. Tailings and Residues.All tailings, residues, waste
  rock, spoiled leach materials, and other materials (collectively Materials)
  resulting from Grantors operations and activities on the Property shall
  be the sole property of Grantor, but shall remain subject to the Gross Overriding
  Royalty should the same be processed or reprocessed, as the case may be, in
  the future and result in the production of Diamonds. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Gross Overriding Royalty payable thereon shall be determined by using the technique
  described in Section 4 of this Agreement, subject to adjustment on a pro rata
  basis where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1
  Title Maintenance and Taxes.From the date this Agreement takes effect,
  Grantor shall maintain title to the Property, including without limitation,
  paying when due all taxes on or with respect to the Property and doing all things
  and making all payments necessary or appropriate to maintain the right, title
  and interest of Grantor and Payee, respectively, in the Property and under this
  Agreement.

9.2
  Abandonment.In the event Grantor intends to abandon any of the lands comprising
  a portion or all of the Property (Abandonment Property), Grantor
  shall first give notice of such intention to Payee at least 70 days in advance
  of the proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Diamonds previously or thereafter produced from such
  ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange at its own
  expense and shall keep in force at all times, directly or through the services
  of an independent contractor, insurance, including but not limited to, the following:

10.1
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

---

10.2
  General Liability.Comprehensive general public liability insurance against
  claims for bodily injury or death or property damage arising out of or resulting
  from Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Gross Overriding
  Royalty, and the Property from any and all claims, liabilities and damages which
  may arise with respect to this Agreement or the Property. Payee shall be named
  as a co-insured.

10.3
  Self Insurance.Grantor may self insure the foregoing obligations, provided
  such self insurance is sufficient to meet the requirements of Sections 10.1
  and 10.2 above and is in compliance with applicable laws, statutes, rules and
  regulations.

11. General Provisions.

11.1The Miscellaneous Provisions set forth in Article 16 of the Main Agreement
  shall apply to this Schedule C as applicable.

11.2In this Schedule C in all matters of interpretation, whenever necessary
  to give effect to any provision of this instrument, the masculine shall include
  the feminine and neuter and vice versa, the singular shall include the plural,
  and the plural shall include the singular.

---

AMENDMENT AGREEMENT

|THIS AGREEMENTis made as of the 14thday of April, 2002. |                              
|------------------------------------------------------- | -----------------------------
|                                                        |                              
|BETWEEN:                                                | UBEX CAPITAL INC.            
|                                                        | Suite 306  1140 Homer Street
|                                                        | Vancouver, B.C., V6B 2X6     
|                                                        |                              
|                                                        | (the Optionor)             
|                                                        |                              
|                                                        |                              
|AND:                                                    | THRUSH INDUSTRIES INC.       
|                                                        | Suite 306  1140 Homer Street
|                                                        | Vancouver, B.C., V6B 2X6     
|                                                        |                              
|                                                        | (Thrush)                   
|                                                        |                              

|WHEREAS:                                                                              
|--------------------------------------------------------------------------------------
|                                                                                      
|A.                                                                                    
|                                                                                      
|B.                                                                                    
|                                                                                      
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Agreement is amended as follows:
|                                                                                      
|1.                                                                                    

The parties hereby ratify and confirm the Agreement in all other respects.

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

|THE COMMON SEAL OF UBEX     | c/s
|--------------------------- | ---
|CAPITAL INC. was hereunto   |    
|affixed in the presence of: |    

*Dennis Higgs*

SIGNED AND DELIVERED BY THRUSH 
  INDUSTRIES INC, and 
  affixed in the presence of:

*Aileen Lloyd*
  
  Authorized Signatory

---

SECOND AMENDMENT AGREEMENT

|THIS AGREEMENTis made as of the 29thday of May, 2002. |                                  
|----------------------------------------------------- | ---------------------------------
|                                                      |                                  
|BETWEEN:                                              | UBEX CAPITAL INC.                
|                                                      | Suite 306  1140 Homer Street    
|                                                      | Vancouver, B.C., V6B 2X6         
|                                                      |                                  
|                                                      | (the Optionor)                 
|                                                      |                                  
|AND:                                                  | MIRANDA DIAMOND CORP.            
|                                                      | (FORMERLY THRUSH INDUSTRIES INC.)
|                                                      | Suite 306  1140 Homer Street    
|                                                      | Vancouver, B.C., V6B 2X6         
|                                                      |                                  
|                                                      | (Thrush)                       
|                                                      |                                  

|WHEREAS:                                                                                      
|----------------------------------------------------------------------------------------------
|                                                                                              
|A.                                                                                            
|                                                                                              
|B.                                                                                            
|                                                                                              
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Amended Agreement is amended as follows:
|                                                                                              
|1.                                                                                            

The parties hereby ratify and confirm the Agreement in all other respects.

---

IN WITNESS WHEREOF the parties hereto have executed this Second Amendment
  Agreement as of the day and year first above written.

|THE COMMON SEAL OF UBEX     | c/s
|--------------------------- | ---
|CAPITAL INC. was hereunto   |    
|affixed in the presence of: |    

*Dennis Higgs*

SIGNED AND DELIVERED BY MIRANDA 
  DIAMOND CORP. (FORMERLY THRUSH 
  INDUSTRIES INC.), and affixed in the 
  presence of:

*Aileen Lloyd*
  
  Authorized Signatory

---

THIRD AMENDMENT AGREEMENT

THIS AGREEMENTis made as of the 28thday of June, 2002.

|BETWEEN: | UBEX CAPITAL INC.                 |                   
|-------- | --------------------------------- | ------------------
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (the Optionor)                  |                   
|         |                                   | OF THE FIRST PART 
|AND:     | MIRANDA DIAMOND CORP.             |                   
|         | (FORMERLY THRUSH INDUSTRIES INC.) |                   
|         | Suite 306  1140 Homer Street     |                   
|         | Vancouver, B.C., V6B 2X6          |                   
|         |                                   |                   
|         | (Thrush)                        |                   
|         |                                   | OF THE SECOND PART

|WHEREAS:                                                                                      
|----------------------------------------------------------------------------------------------
|                                                                                              
|A.                                                                                            
|                                                                                              
|B.                                                                                            
|                                                                                              
|NOW THEREFORE THIS AGREEMENT WITNESSES that the
      Amended Agreement is amended as follows:
|                                                                                              
|1.                                                                                            

The parties hereby ratify and confirm the Agreement in all other respects.

---

IN WITNESS WHEREOF the parties hereto have executed this Third
  Amendment Agreement as of the day and year first above written.

|THE COMMON SEAL OF UBEX     | c/s
|--------------------------- | ---
|CAPITAL INC. was hereunto   |    
|affixed in the presence of: |    

*Dennis Higgs*

SIGNED AND DELIVERED BY MIRANDA DIAMOND CORP. (FORMERLY THRUSH 
  INDUSTRIES INC.), and affixed in the 
  presence of:

*Aileen Lloyd*
  
  Authorized Signatory

---



MINERAL PROPERTY OPTION AGREEMENT

THIS AGREEMENTis dated for reference the 10th day of September, 2002

|BETWEEN: | Ubex Capital Inc., and              |                   
|-------- | ----------------------------------- | ------------------
|         | Carleen Higgs                       |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (the Optionor or the Optionors) |                   
|         |                                     | OF THE FIRST PART 
|AND:     | Miranda Diamond Corp.               |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (Miranda)                         |                   
|         |                                     | OF THE SECOND PART

WHEREAS the Optionor has made staking applications
  for a 100% interest in certain exploration claims in the Otish Mountains region
  of Quebec (the Lac Taffanel property), through the internet by way
  of the website maintained by the Province of Quebec for such purposes;

AND WHEREASsuch applications to stake claims have
  been received by the Province of Quebec, Ministere des Ressources Naturelles,
  and certificates of title to the claims have been issued;

AND WHEREASMiranda is desirous of acquiring an interest
  in such exploration claims on the terms and conditions contained herein:

NOW THEREFORE THIS AGREEMENT WITNESSESthat in consideration
  of the premises and the mutual covenants and agreements hereinafter contained,
  the parties hereto agree as follows:

|1.   | DEFINITIONS       
|---- | ------------------
|     |                   
|1.01 | In this Agreement:
|     |                   
|     | (a)               
|     |                   
|     | (b)               

---

|     | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Net Smelter Returns shall have the
      meaning ascribed by Schedule B attached hereto;   
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | "Property" means and includes:                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | (i)                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | (ii)                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|2.   | ACQUISITION OF INTEREST                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|2.01 | The Optionor hereby grants
        to Miranda the exclusive right and option to acquire an undivided 100%
        right, title and interest in and to the Property, subject to the Net Smelter
        Returns and Gross Overriding Royalty described in Article 4 of this Agreement,
        for total consideration consisting of cash payments to the Optionor totalling
        $6,000 to be made as follows:                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | the payment to the Optionors of $2,000, the receipt
      of which is hereby acknowledged;   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | upon approval of this Agreement by the Exchange,
      the payment to the Optionor of $4,000.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|2.02 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to receipt of title certificates
        for the exploration claims comprising the Property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|2.03 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to the prior approval of
        the Exchange, for which Miranda undertakes to use its best efforts to
        file within a reasonable period of time so as to obtain the necessary
        approval by the earliest possible date. Notwithstanding any other provision
        of this Agreement, so long as Miranda has filed for the required approval
        referred to herein with the Exchange within a reasonable time, the time
        for making any cash payment or share issuance referred to in this paragraph
        shall be extended, where necessary, to the day that is five business days
        following the receipt by Miranda of the necessary Exchange approval.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|2.04 | This Agreement is an option
        only and, subject to paragraph 11.02, the doing of any act or the incurrence
        of any cash payments by Miranda shall not obligate Miranda to do any further
        acts or make any further payments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|3.   | TRANSFER OF TITLE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

---

|3.01 | Upon execution of this Agreement
        Miranda shall be entitled to record this Agreement against title to the
        Property.                                                                                                                                                                                                                 
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                    
|3.02 | Upon Miranda exercising
        the option to acquire the Property pursuant to article 2, the Optionor
        shall deliver to Miranda duly executed transfers for the transfer to Miranda
        of a 100% interest in and to the Property, subject to the royalty interest
        pursuant to Article 4.                                      
|     |                                                                                                                                                                                                                                                                                                                                                    
|4.   | ROYALTY                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                    
|4.01 | Miranda agrees that the
        Property shall be subject to a royalty in favour of the Optionor equal
        to 2% of Net Smelter Returns to be calculated and paid according to and
        otherwise governed by Schedule B hereto.                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                    
|4.02 | Miranda agrees that the
        Property shall be subject to a royalty in favour of the Optionor equal
        to a 2% Gross Overriding Royalty to be calculated and paid according to
        and otherwise governed by Schedule C hereto.                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                    
|5.   | PAYMENTS                                                                                                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                    
|5.01 | The payments to be made
        to the Optionors pursuant to section 2 and such other payments as are
        to be made to the Optionors pursuant to this Agreement shall be made in
        full to Ubex Capital Inc. (Ubex). Ubex shall determine with
        the Optionors the percentage portions of the payments to each of the Optionors.
|     |                                                                                                                                                                                                                                                                                                                                                    
|6.   | COVENANTS OF MIRANDA                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                    
|6.01 | Miranda covenants and agrees with the Optionor
      that during the term of this Agreement:                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                    
|     | (a)                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                    
|     | (b)                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                    
|     | (c)                                                                                                                                                                                                                                                                                                                                                

---

|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Miranda shall hold harmless, indemnify,
        and defend the Optionor from any claims, loss, damage, judgement or expense
        for loss or damage to property and death, including environmental damages,
        or injury to persons arising out of Mirandas activities or operations
        on the Property, except to the extent that any such claim, loss, damage,
        judgement, or expense is caused by the negligence of the Optionor, its
        employees, agents or assigns;
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Miranda shall ensure that, in connection
        with the entry onto the Property of any exploration contractor or other
        worker, there shall be in place, either through Miranda or such contractor
        or worker, comprehensive broad-form liability insurance covering claims
        for personal injury, death or property damage with a coverage limit of
        at least $1,000,000;                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Miranda shall maintain books of account
        in respect of its expenditures and operations on the Property and, upon
        reasonable notice, shall make such books available for inspection by representatives
        of the Optionor;                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (g)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Miranda shall allow any duly authorized
        agent or representative of the Optionor to inspect the Property at reasonable
        times and intervals and upon reasonable notice given to Miranda, provided
        however that it is agreed and understood that any such agent or representative
        shall be at his own risk in respect of, and Miranda shall not be liable
        for, any injury incurred while on the Property, howsoever caused; and                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (h)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Miranda shall provide to the Optionor,
        semi-annually, a summary report outlining Mirandas progress on the
        Property and shall provide to Optionor, annually, a copy of all factual,
        non-interpretive data derived from Mirandas operations on the Property.                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|7.   | RIGHT OF ENTRY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|7.01 | During the currency of this
        Agreement, Miranda, its servants, agents and workmen and any persons duly
        authorized by Miranda, shall have the right of access to and from and
        to enter upon and take possession of and prospect, explore and develop
        the Property in such manner as Miranda in its sole discretion may deem
        advisable and shall have the right to remove and ship therefrom ores,
        minerals, metals, diamonds, or other products recovered in any manner
        therefrom.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|7.02 | Miranda shall be provided
        access to all maps, reports, assay results and other technical data in
        the possession or under the control of the Optionor with respect to the
        Property and shall be entitled to take copies thereof.                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|8.   | REPRESENTATIONS AND WARRANTIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|8.01 | The Optionor hereby represents and warrants that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | the Optionor has made staking applications
        for a 100% interest in the exploration claims comprising the Property
        and has the right to enter into this Agreement to sell                                                                                                                                                                                                                                                                                                            

---

|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | and assign an interest in the Property absolutely in accordance
      with the terms of this Agreement;                                                                                                                                                                                                                                                                                                                                                    
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | applications for the exploration claims
        comprising the Property have been, to the best information, knowledge,
        and belief of the Optionor, properly staked through the internet by way
        of the website maintained by the Province of Quebec for such purposes,
        and to the best information, knowledge, and belief of the Optionor there
        are no disputes over the title, staking or recording of such mineral claims;
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | if title is awarded to the Optionor,
        the mineral claims comprising the Property will be in good standing and
        free and clear of any liens, charges or encumbrances of any nature or
        kind whatsoever, to the best info rmation, knowledge, and belief of the
        Optionor; and                                                                                                                                                   
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | the Optionor has not done anything whereby
        the mineral claims comprising the Property may be in any way encumbered.                                                                                                                                                                                                                                                                                                                                
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|8.02  | Miranda hereby represents and warrants that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | Miranda has full corporate power and
        authority to enter into this Agreement and the entering into of this Agreement
        does not conflict with any applicable laws or with the charter documents
        of Miranda or any contract or other commitment to which Miranda is party;
        and                                                                                                                                                 
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | the execution of this Agreement and
        the performance of its terms have been duly authorized by all necessary
        corporate actions including the resolution of the Board of Directors of
        Miranda.                                                                                                                                                                                                                                       
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|9.    | CONFIDENTIALITY OF INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|9.01  | The Optionor shall treat
        all data, reports, records and other information of any nature whatsoever
        relating to this Agreement and the Property as confidential. While this
        Agreement is in effect, the Optionor shall not, without the express written
        consent of Miranda, disclose to any third party any information concerning
        the Property or any operations thereon, nor shall the Optionor buy, sell
        or otherwise deal in the shares of Miranda while any material, confidential
        information in its possession relating to this Agreement or the Property
        remains undisclosed to the general public.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|10.   | ASSIGNMENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|10.01 | With the consent of the
        other party, which consent shall not be unreasonably withheld, each party
        has the right to assign all or any part of its interest in this Agreement
        and in the Property, subject to the terms and conditions of this Agreement.
        It shall be a condition precedent to any such assignment that the assignee
        of the interest being transferred agrees to be bound by the terms of this
        Agreement, insofar as they are applicable.                                                                                                                                                                   

---

|11.                                                                                                                                                                                                                                                                                                          | TERMINATION                                                                             
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|11.01                                                                                                                                                                                                                                                                                                        | This Agreement shall terminate upon the occurrence
      of one of the following events:
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (a)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (b)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (c)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|In the event that Miranda
        gives notice that it denies that a default has occurred, Miranda shall
        not be deemed in default until the matter shall have been determined finally
        through such means of dispute resolution as such matter has been subjected
        to by either party.
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|11.02                                                                                                                                                                                                                                                                                                        | Upon termination of this Agreement under paragraph
      11.01, Miranda shall:          
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (a)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (b)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (c)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (d)                                                                                     

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|        | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | ensure that the Property is in a safe
        condition and complies with all environmental and safety standards including
        standards for reclama tion and detoxification, imposed by any duly authorized
        regulatory authority; and
|------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                   
|        | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | ensure that its covenants under subparagraphs 6.01 (a) through
      (e) have been fully complied with.                                                                                                                                           
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                   
|11.03   | Upon the termination of
        this Agreement under paragraph 11.01, Mirand a shall cease to be liable
        to the Optionor in debt, damages or otherwise save for the performance
        of those obligations in paragraph 11.02.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                   
|11.04   | Upon termination of this
        Agreement under paragraph 11.01, Miranda shall vacate the Property within
        a reasonable time after such termination, but shall have the right of
        access to the property for a period of six months thereafter for the purpose
        of removing its chattels, machinery, equipment and fixtures.                                                                                                                                                                                                                                                                                                                                                                                                        
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                   
|12.     | FORCE MAJEURE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                   
|12.01   | The time for performance
        of any act or making any payment or any expenditure required under this
        Agreement shall be extended by the period of any delay or inability to
        perform due to fire, strikes, labour disturbances, riots, civil commotion,
        wars, acts of God, any present or future law or governmental regulation,
        any shortages of labour, equipment or materials, or any other cause not
        reasonably within the control of the party in default, other than lack
        of finances.                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                   
|13.     | REGULATORY APPROVAL                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                   
|13.01   | This Agreement is subject
        to the prior approval of the Exchange. Miranda shall use its best efforts
        to obtain such approval as soon as reasonably possible, provided however
        that if such approval has not been received by October 31, 2002, this
        Agreement shall be null and void and of no further effect.                                                                                                                                                                                                                                                                                                                                                                                                             
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                   
|**14.** | AFTER-ACQUIRED PROPERTY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                   
|14.01   | In the event that at any
        time hereafter Miranda shall acquire any portion of any combined group
        of any mining claims, any mining claim, lease, or other mineral right
        or interest within a three kilometre radius of the outside boundary of
        the Property to be described in Schedule A hereto, such interest shall
        be deemed to have been acquired on behalf of and for the benefit of the
        parties, pursuant to the terms of this Agreement and such after-acquired
        interest as aforesaid shall be included in and shall form a part of the
        definition of Property contained in paragraph 1.01 and shall
        be subject to this Agreement as if it had been originally so included.
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                   
|14.02   | In the event that at any
        time hereafter Miranda shall acquire any portion of any combined group
        of any mining claims, any mining claim, lease, or other mineral right
        or interest within a three kilometre radius of the outside boundary of
        the Property as constituted on                                                                                                                                                                                                                                                                                                                                                                                                                                               

---

|      | the date of this Agreement, such interest shall be
        subject to the royalties in favour of the Optionor as described in Article
        4 of this Agreement, and, if so requested by the Optionor, shall be transferred
        to the Optionor upon abandonment by Miranda.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                   
|15.   | NOTICES                                                                                                                                                                                                                                                                           
|      |                                                                                                                                                                                                                                                                                   
|15.01 | Any notice, election, consent or other writing required
        or permitted to be given hereunder shall be deemed to be sufficiently
        given if delivered or mailed postage prepaid or if given by telegram,
        telex or telecopier, addressed as follows:            

|In the case of the Optionor: | Ubex Capital Inc.            
|---------------------------- | -----------------------------
|                             | Suite 306  1140 Homer Street
|                             | Vancouver, B.C.              
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          
|                             |                              
|                             |                              
|In the case of Miranda:      | MIRANDA DIAMOND CORP.        
|                             | Suite 306  1140 Homer Street
|                             | Vancouver, British Columbia  
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          

and any such notice given us aforesaid shall be deemed to
  have been given to the parties hereto if delivered, when delivered, or if mailed,
  on the third business day following the date of mailing, or, if telegraphed,
  telexed or telecopied, on the same day as the telegraphing, telexing or telecopying
  thereof provided however that during the period of any postal interruption in
  Canada or the United States any notice given hereunder by mail shall be deemed
  to have been given only as of the date of actual delivery of the same. Any party
  may from time to time by notice in writing change its address for the purposes
  of this paragraph 15.01.

16. GENERAL TERMS AND CONDITIONS

16.01 The parties hereto hereby covenant and agree that they
  will execute such further agreements, conveyances and assurances as may be requisite,
  or which counsel for the parties may deem necessary to effectually carry out
  the intent of this Agreement.

16.02 This Agreement shall constitute the entire agreement
  between the parties with respect to the Property. No representations or inducements
  have been made save as herein set forth. No changes, alterations or modifications
  of this Agreement shall be binding upon either party until and unless a memorandum
  in writing to such effect shall have been signed by all parties hereto. This
  Agreement shall supersede all previous written, oral or implied understandings
  between the parties with respect to the matters hereby.

16.03 Time shall be of the essence of this Agreement.

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16.04 The titles to the articles in this Agreement shall not
  be deemed to form part of this Agreement but shall be regarded as having been
  used for convenience of reference only.

16.05 All currency references contained in this Agreement
  shall be deemed to be references to Canadian funds.

16.06 Wherever possible, each provision of this Agreement
  shall be interpreted in such manner as to be effective and valid under applicable
  law, but if any provision shall be prohibited by or be invalid under applicable
  law, such provision shall be ineffective only to the extent of such prohibition
  or invalidity, without invalidating the remainder of such provision or the remaining
  provisions of this Agreement.

16.07 The Schedules to this Agreement shall be construed with
  and as an integral part of this Agreement to the same extent as if they were
  set forth verbatim herein. Defined terms contained in this Agreement shall have
  the same meanings where used in the Schedules.

16.08 This Agreement shall be governed by and interpreted
  in accordance with the laws of the Province of British Columbia and the laws
  of Canada applicable therein.

16.09 In the event that any suit, legal action, or arbitration
  proceeding is instituted to interpret or enforce the terms of this Agreement,
  including but not limited to any contest proceeding under paragraph 11.01, the
  prevailing party shall be entitled to recover from the other party such sum
  as the court or arbitrator may adjudge reasonable for attorneys fees at
  trial and on appeal of such suit, action or proceeding in addition to all other
  sums provided by law.

16.10 This Agreement shall enure to the benefit of and be
  binding upon the parties hereto and their respective heirs, executors, administrators,
  successors and assigns.

IN WITNESS WHEREOFthis Agreement has been executed
  by the parties hereto as of the day and year first above written.

|The COMMON SEALof UBEX CAPITAL           | c/s
|---------------------------------------- | ---
|INC.was hereunto affixed in the presence |    
|of:                                      |    

Dennis Higgs

SIGNED AND DELIVERED BY Carleen Higgs:

Carleen Higgs
  
  Carleen Higgs

---

|The COMMON SEALof MIRANDA         | c/s
|--------------------------------- | ---
|DIAMOND CORP.was hereunto affixed |    
|in the presence of:               |    

Aileen Lloyd"

---

Schedule B

NET SMELTER RETURN ROYALTY

References
  in this Schedule B to Sections and Articles in this Schedule B are so identified,
  and references in this Schedule B to Sections and Articles in the agreement
  to which this Schedule B is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule B except as otherwise expressly stated in
  this Schedule B. The Net Smelter Returns royalty defined in Article 1 of the
  Main Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As used in this Schedule B, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-
  in- interest, including without limitation, assignees, partners, joint venture
  partners, lessees and when applicable mortgagees and affiliated companies having
  or claiming an interest in the Properties or projects.

1.2As used in this Schedule B, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in- interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Production Royalty.Grantor shall
  pay to Grantee the royalty described in Section 4 below (Royalty)
  pursuant to the terms and provisions of this Schedule B.

3. Term.The term of the Royalty hereby created shall
  be perpetual, it being the intent of the parties hereto that, to the extent
  allowed by law, the Royalty constitutes a vested interest in and a covenant
  running with the land and affecting the Property and all successions thereof
  whether created privately or through governmental action. In the event a court
  of competent jurisdiction determines that the term of this Agreement violates
  the Rule Against Perpetuities, then the term of this Agreement shall automa
  tically be revised and reformed to coincide with the maximum term permitted
  by the Rule Against Perpetuities, and this Agreement shall not be terminated
  solely as a result of a violation of the Rule Against Perpetuities.

4. Production Royalty.Grantor shall pay to Grantee
  a perpetual Royalty in the amount of two percent (2%) of Net Smelter Returns
  from the sale or other disposition of all locatable minerals produced from the
  Properties determined in accordance with the provisions set forth in this Section
  4 and, if applicable, Section 7.

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4.1 For Precious
  Metals.Net Smelter Returns, in the case of gold, silver, and platinum group
  metals (Precious Metals), shall be determined by multiplying (i)
  the gross number of troy ounces of Precious Metals contained in the production
  delivered to the smelter, refiner, processor, purchaser or other recipient (including
  the operator) of such production, or an insurer as a result of casualty to such
  production (collectively, Payor) during the preceding calendar month
  by (ii) for gold, the average of the London Bullion Market, Morning Fix, spot
  prices for the preceding calendar month; for all other Precious Metals, the
  average of the New York Commodities Exchange final daily spot prices for the
  preceding calendar month, and subtracting from the product of (i) and (ii) only
  the following if actually incurred:

| | (1) | charges imposed by the Payor for refining bullion from the
      Beneficiated Precious Metals contained in such production (as used in this
      Agreement, Beneficiated Precious Metals includes only doré
      or concentrates of Precious Metals produced by Grantors final mill
      or other processing plant, but does not include raw or crushed ore containing
      Precious Metals or other preliminarily processed Precious Metals); and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for refining Beneficiated Precious Metals contained in such
      production.                                                                                                                                                                                                                                                                                               

In the event the refining of bullion from the Beneficiated Precious Metals
  contained in such production is carried out in custom toll facilities owned
  or controlled, in whole or in part, by Grantor, which facilities were not constructed
  for the purpose of refining Beneficiated Precious Metals from the Property,
  then charges, costs and penalties for such refining shall mean the amount Grantor
  would have incurred if such refining were carried out at facilities not owned
  or controlled by Grantor then offering comparable services for comparable products
  on prevailing terms, but in no event greater than actual costs incurred by Grantor
  with respect to such refining.

In the event the Grantor receives insurance proceeds for loss of production,
  Grantor shall pay to Payee the Royalty percentage of any such insurance proceeds
  which are received by Grantor for such loss of production.

4.2 For Other
  Minerals.Net Smelter Returns, in the case of all metals, minerals, mineral
  substances, and the beneficiated products thereof, which are not or do not contain
  economically recoverable Precious Metals (Other Minerals), shall
  be determined by multiplying (i) the gross amount of the particular Other Mineral
  contained in the production delivered to the Payor during the preceding calendar
  month by (ii) the average of the New York Commodities Exchange final daily spot
  prices for the preceding calendar month of the appropriate Other Mineral, and
  subtracting from the product of (i) and (ii) only the following if actually
  incurred:

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| | (1) | charges imposed by the Payor for smelting, refining or processing
      Other Minerals contained in such production, but excluding any and all charges
      and costs related to Grantor mill or other processing plants constructed
      for the purpose of milling or processing Other Minerals, in whole or in
      part; and                                              
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                   
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for smelting, refining, or processing Other Minerals contained
      in such production, but excluding any and all charges and costs of or related
      to Grantor mills or other processing plants constructed for the purpose
      of milling or processing Other Minerals, in whole or in part.

In the event smelting, refining, or processing of Other Minerals are carried
  out in custom toll facilities owned or controlled, in whole or in part, by Grantor,
  which facilities were not constructed for the purpose of milling or processing
  Other Minerals, then charges, costs and penalties for such smelting, refining
  or processing shall mean the amount Grantor would have incurred if such smelting,
  refining or processing were carried out at facilities not owned or controlled
  by Grantor then offering comparable services for comparable products on prevailing
  terms, but in no event greater than actual costs incurred by Grantor with respect
  to such smelting and refining.

In the event Grantor receives insurance proceeds for loss of production, Grantor
  shall pay to Payee the Royalty percentage of any such insurance proceeds which
  are received by Grantor for such loss of production.

Notwithstanding anything contained in the foregoing, the term Other
  Minerals shall not be deemed to include Diamonds as defined
  in Schedule C to the Main Agreement, it being the intention of the parties that
  all payments of royalties in respect of Diamonds shall be governed by Schedule
  C attached to the Main Agreement.

4.3 Time and
  Manner; In-Kind or Cash Payment.At the time of making payment to or otherwise
  crediting the account of Grantor for production from the Property pursuant to
  Sections 4.1 or 4.2 (but within the time provided in Section 4.4), the smelter,
  refiner, processor, purchaser, or other user (Payor) of the Precious
  Metals or Other Minerals shall contemporaneously pay the Royalty in accordance
  with written instructions given to the Payor by Grantee as provided in Sections
  4.3.1 and 4.3.2. Once the Payor has received instructions from Grantee, such
  instructions shall remain in effect until the Payor has received different instructions
  from Grantee. All contractual or other arrangements entered into by Grantor
  with the Payor shall contain provisions implementing the terms and conditions
  of payment set forth in Sections 4.3 and 4.4 hereof and Grantor shall procure
  the written undertaking of Payor contractually binding Payor to perform in accordance
  with Sections 4.3 and 4.4 in form and substance enforceable by Grantee. Grantor
  acknowledges its primary obligation to pay the Royalty and that no undertaking
  by the Payor shall relieve Grantor of that obligation, and Grantor agrees to
  indemnify, protect and defend Grantee from and against any loss, cost

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(including attorneys fees incurred) or liability arising from the performance
  or failure of performance by Payor hereunder or under any contractual or other
  arrangements entered into by Grantor with the Payor pursuant to or for the purposes
  of complying with Sections 4.3 and 4.4 hereof. Grantee may, from time to time
  in its discretion, change the bank or account number for payment under to Sections
  4.3.1 and 4.3.2 by giving written notice thereof to Grantor and the Payor; such
  notice shall be effective upon actual receipt by the Payor, or upon the fourth
  day after deposit of such notice in the mail, first class postage prepaid, addressed
  to the Payor, whichever occurs first. All costs charged by the Payor as a result
  of complying with the payment provisions of Sections 4.3 and 4.4 shall be paid
  by Grantee, and Grantor shall have no liability or responsibility therefor.

4.3.1
  Precious Metals.The Payor shall pay the Royalty for each shipment of Precious
  Metals either (a) in the form of gold bullion (.995 + fine gold) directly to
  Payees account maintained with the Payor as directed by Payee, or (b)
  by delivery of a cheque or draft payable to Payees account with a bank
  to be designated in writing by Payee. In the event Payee instructs the Payor
  to deliver the Royalty in the form of gold bullion, the Royalty payable on silver
  or platinum group metals shall be converted to the gold equivalent of such silver
  or platinum group metals by using the average monthly spot prices for Precious
  Metals described in Section 4.1.

4.3.2
  Other Minerals.The Payor shall pay the Royalty for each shipment of Other
  Minerals by delivery of a cheque or draft payable to the Payees account
  with a bank to be designated in writing by Payee.

4.4 Payment
  Accounting; Interim Settlements; Late Charges.All credits or payments of
  the Royalty shall be accompanied by a detailed statement explaining the manner
  in which the payment was calculated together with any available settlement sheets
  from the Payor. In no event shall payment of the Royalty be made later that
  thirty (30) days after the delivery to the Payor of the Precious Metals, Beneficiated
  Precious Metals, or Other Minerals. Such payments and statements shall be deemed
  conclusively correct unless Grantee objects to them in writing within eighteen
  (18) months after receipt thereof. On those occasions when all necessary information
  is not available to the Payor within the thirty (30) day period, the Payor shall
  make an interim settlement of the Royalty for such shipment or use within the
  thirty (30) day period; such interim settlement shall provide for payment of
  not less than ninety percent (90%) of the anticipated final settlement Royalty
  as determined by the assays and quantities of the Precious Metals or Other Minerals
  received by the Payor with respect to which such interim settlement is being
  made. Final settlement of the Royalty shall be promptly made upon receipt by
  the Payor of all information necessary or appropriate to make final settlement
  for such shipment. In the event payment of any Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Royalty payment, the Grantor shall pay an additional sum
  equal to ten percent (10%) of the delinquent payment (late charge)
  plus interest on the delinquent payment and the late charge at the rate twelve
  percent (12%) per annum which shall accrue from the day

---

the delinquent payment was due to the date of payment of the Royalty, late
  charge and accrued interest.

4.5 Hedging
  Transactions: Futures, Options and Other Trading.All profits and losses
  resulting from Grantor engaging in any commodity futures trading, option trading,
  or metals trading, or any combination thereof, and any other hedging transactions
  (collectively hedging transactions) are specifically excluded from
  Royalty calculations pursuant to this Agreement. All hedging transactions by
  Grantor and all profits or losses associated therewith, if any, shall be solely
  for Grantors account. The Royalty payable on Precious Metals or Other
  Minerals subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Precious Metals.The amount of Royalty to be paid on all Precious
  Metals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.1 with the understanding that the average
  monthly spot price shall be for the calendar month during which Precious Metals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.5.2
  Affecting Other Minerals. The amount of Royalty to be paid on all Other
  Minerals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.2 with the understanding that the average
  monthly spot price shall be for the calendar month during which Other Minerals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.6 Commingling.Before any Precious Metals or Other Minerals produced from the Property
  are commingled with minerals from other properties, the Precious Metals or Other
  Minerals produced from the Property shall be measured and sampled in accordance
  with sound mining and metallurgical practices for moisture, metal, commercial
  minerals and other appropriate content. Representative samples of the Precious
  Metals or Other Minerals shall be retained by Grantor and assays (including
  moisture and penalty substances) and other appropriate analyses of these samples
  shall be made before commingling to determine metal, commercial minerals, and
  other appropriate content. Detailed records shall be kept by Grantor showing
  measures, moisture, assays of metal, commercial minerals, and other appropriate
  content and penalty substances, and gross metal content of the Precious Metals
  or gross metal or mineral content of Other Minerals. From this information,
  Grantor shall determine the amount of Royalty due and payable to Payee from
  Precious Metals or Other Minerals produced from the Property commingled with
  minerals from other properties. Following the expiration of the period for objection
  described above in Section 4.4, and absent timely objection, if any, made by
  Payee, Grantor may dispose of the materials and data required to be kept and
  produced by this Section 4.6.

5. Books; Records: Inspections; Confidentiality.

---

5.1 Books.Grantor shall keep true and accurate books and records of all of its operations
  and activities on the Property and under this Agreement. Such books and records
  shall be kept on the accrual basis in accordance with generally accepted accounting
  principles consistently applied. Not more frequently than annually and within
  the time provided in Section 4.4 of this Agreement, Payee may, at Payees
  sole expense, give notice to Grantor that Payee desires to perform an audit
  or other examination of all of Grantors books and records kept as required
  by this Agreement. All financial information shall conclusively be deemed correct
  for purposes of this Agreement unless Payee has given timely notice that it
  desires to audit or examine Grantors books and records in the manner and
  within the time provided in Section 4.4 of this Agreement. Payee shall promptly
  commence any such audits and shall diligently prosecute the same to conclusion.

5.2 Reports.Not later than March 1 following the end of each calendar year, Grantor
  shall provide Payee with an annual report of all activities and operations conducted
  upon or with respect to the Property during the preceding calendar year. Such
  annual report shall include estimates of proposed expenditures upon, anticipated
  production from, and estimated remaining ore reserves on the Property for the
  succeeding calendar year. Additionally, and within 30 days of the end of each
  calendar quarter, Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3 Inspections.Payee, or its authorized agents or representatives, on not less than two
  (2) days notice to Grantor, may enter upon all surface and subsurface portions
  of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4 Investor
  Tours.Upon reasonable notice to Grantor and not more frequently than semi-annually,
  Payee shall have the right to conduct an investors tour on the Property and
  facilities associated therewith; provided that such tours sha ll not unreasonably
  interfere with Grantors activities and operations. Such investors tours
  shall be at the sole risk of the Payee and its invitees, and Payee shall indemnify
  and hold Grantor harmless from any liability, damage, claim or demand by reason
  of injury to Payee or Grantor or any of their respective invitees, employees,
  officers, directors, agents, or representatives caused solely by Payees
  exercise of its rights under this Section.

---

5.5 Confidentiality.Payee shall not, without the express written consent of Grantor, which consent
  shall not be unreasonably withheld, disclose any data or information concerning
  the Operations conducted on the Property or obtained under the Main Agreement
  or this Agreement which is not already in the public domain; provided, however,
  Payee may disclose data or information obtained under this Agreement without
  the consent of Grantor: (i) if required for compliance with applicable laws,
  rules, regulations or orders of a governmental agency or stock exchange having
  jurisdiction over Payee or its parent or affiliated corporations; (ii) to any
  of Payees consultants; (iii) to any third party to whom Payee, in good
  faith, anticipates selling or assigning Payees interest hereunder; or
  (iv) to a prospective lender to whom an interest in the Royalty payments to
  be made to Payee hereunder is proposed to be granted as security, provided that
  Grantor shall first have been provided with a confidentiality agreement executed
  by such consultant, third party or lender, which agreement shall include the
  confidentiality provisions of this Section 5.5. Payee shall not issue any press
  releases pertaining to the Property except upon giving Grantor three (3) days
  advance written notice of the contents thereof, and Payee shall make any reasonable
  changes to such proposed press releases requested by Grantor. Payee shall not,
  without Grantors consent, issue any press release that implies or infers
  that Grantor endorses or joins in Payees statements or representations
  contained in any press release.

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1 Compliance
  with Laws.Grantor shall at all times comply with all applicable present
  or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2 Reclamation,
  Environmental Obligations, and Indemnities.Grantor shall, from and after
  the date this Agreement takes effect, timely and fully perform all reclamation
  required by all governmental authorities pertaining or related to Grantors
  operations or activities on or with respect to the Property or required under
  this Agreement. Grantor, from and after the date this Agreement takes effect,
  covenants and agrees not to undertake, cause, suffer, or permit any condition
  or activity at, on or in the vicinity of the Property which constitutes a nuisance
  or which results in a violation of or liability under any present or future
  applicable federal, provincial, or local environmental laws, statutes, rules,
  regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants

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and agrees to indemnify and hold Payee harmless from any and all liabilities,
  obligations, claims (including administrative claims and claims for injunctive
  relief), demands, losses, costs, damages, expenses, attorney fees and causes
  of action asserted against Payee related to Grantors failure to comply
  with and satisfy Environmental Obligations or other obligations under this Agreement.
  The covenants and agreements of this Section 6.2 shall survive the termination
  of Grantors rights under this Agreement or to the Property.

7. Stockpiling.The rights of Grantor to stockpile, store
  or place Precious Metals or Other Minerals off of the Property pursuant to any
  of the provisions of this Agreement shall not be exercisable until Grantor has
  first secured from the property owner where such stockpiling, storage or placement
  is to occur a written agreement in recordable form which provides that Payees
  rights to the Precious Metals and Other Minerals shall be preserved. Such agreement
  shall provide,inter alia, that (i) Payees rights
  pursuant to this Agreement, insofar as they are applicable, shall continue in
  full force and effect with respect to Precious Metals and Other Minerals from
  the property; (ii) Payees rights in and to the Precious and Other Minerals
  shall be the same as if the Precious Metals and Other Minerals were situate
  on the Property; (iii) Payees rights set forth in this Section 7 shall
  have precedence over the rights to the Precious Metals and Other Minerals of
  the property owner where the Precious Metals and Other Minerals are stockpiled,
  stored or placed, as well as the creditors of the said property owner; and (iv)
  the agreement shall be irrevocable as long as the Precious Metals and Other
  Minerals from the Property, or any part thereof, remain on the property not
  part of the Property.

8. Tailings and Residues.All tailings, residues, waste rock, spoiled
  leach materials, and other materials (collectively Materials) resulting
  from Grantors operations and activities on the Property shall be the sole
  property of Grantor, but shall remain subject to the Royalty should the same
  be processed or reprocessed, as the case may be, in the future and result in
  the production of Precious Metals or Other Minerals. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Royalty payable thereon shall be determined by using the best engineering and
  technical practices then available, subject to adjustment on a pro rata basis
  where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1 Title Maintenance
  and Taxes.From the date this Agreement takes effect, Grantor shall maintain
  title to the Property, including witho ut limitation, paying when due all taxes
  on or with respect to the Property and doing all things and making all payments
  necessary or appropriate to maintain the right, title and interest of Grantor
  and Payee, respectively, in the Property and under this Agreement.

9.2 Abandonment.In the event Grantor intends to abandon any of the
  lands comprising a portion or all of the Property (Abandonment Property),
  Grantor shall first

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give notice of such intention to Payee at least 70 days in advance of the
  proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Precious Metals and Other Minerals previously or
  thereafter produced from such ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange at its own
  expense and shall keep in force at all times, directly or through the services
  of an independent contractor, insurance, including but not limited to, the following:

10.1 Workmans
  Compensation Insurance.Workmans Compensation Insurance or the like
  covering all persons engaged in the performance of activities or operations
  as is required or appropriate under law or local governmental bodies or agencies.

10.2 General
  Liability.Comprehensive general public liability insurance against claims
  for bodily injury or death or property damage arising out of or resulting from
  Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Royalty, and
  the Property from any and all claims, liabilities and damages which may arise
  with respect to this Agreement or the Property. Payee shall be named as a co-insured.

10.3 Self Insurance.Grantor may self insure the foregoing obligations, provided such self insurance
  is sufficient to meet the requirements of Sections 10.1 and 10.2 above and is
  in compliance with applicable laws, statutes, rules and regulations.

11. General Provisions.

11.1The
  Miscellaneous Provisions set forth in Article 16 of the Main Agreement shall
  apply to this Schedule B as applicable.

11.2In
  this Schedule B in all matters of interpretation, whenever necessary to give
  effect to any provision of this instrument, the masculine shall include the
  feminine and neuter and vice versa, the singular shall include the plural, and
  the plural shall include the singular.

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Schedule C

GROSS OVERRIDING ROYALTY

References
  in this Schedule C to Sections and Articles in this Schedule C are so identified,
  and references in this Schedule C to Sections and Articles in the agreement
  to which this Schedule C is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule C except as otherwise expressly stated in
  this Schedule C. The Gross Overriding Royalty defined in Article 1 of the Main
  Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As used in this Schedule C, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-in-
  interest, including without limitation, assignees, partners, joint venture partners,
  lessees and when applicable mortgagees and affiliated companies having or claiming
  an interest in the Properties or projects.

1.2
  As used in this Schedule C, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in- interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Gross Overriding Royalty.Grantor
  shall pay to Grantee the royalty described in Section 4 below (the Gross
  Overriding Royalty) pursuant to the terms and provisions of this Schedule
  C.

3. Term.The term of the Gross Overriding Royalty hereby
  created shall be perpetual, it being the intent of the parties hereto that,
  to the extent allowed by law, the Gross Overriding Royalty constitutes a vested
  interest in and a covenant running with the land and affecting the Property
  and all successions thereof whether created privately or through governmental
  action. In the event a court of competent jurisdiction determines that the term
  of this Agreement violates the Rule Against Perpetuities, then the term of this
  Agreement shall automatically be revised and reformed to coincide with the maximum
  term permitted by the Rule Against Perpetuities, and this Agreement shall not
  be terminated solely as a result of a violation of the Rule Against Perpetuities.

4. Gross Overriding Royalty.Grantor shall pay to Grantee
  a perpetual Gross Overriding Royalty in the amount of two percent (2%) of the
  Average Appraised Value (as hereinafter defined) of all gems, precious and semi-precious
  stones, and gem and industrial diamonds recovered, sorted, and graded from the
  Properties (the Diamonds)

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determined in accordance with the provisions set forth in this Section 4 and,
  if applicable, Section 7.

4.1
  Average Appraised Value.Average Appraised Value means the average
  of the valuations in Canadian dollars of the Diamonds determined by two independent
  graders, one appointed by the Grantor and one appointed by the Grantee. Such
  independent graders shall be duly qualified and accredited, and shall sort,
  grade and value the Diamonds in accordance with industry standards, having regard
  to, but without limiting the generality of the foregoing, the commercial demand
  for the Diamonds. Each independent valuator shall value each particular classification
  of the Diamonds in accordance with the industry price books, standards and formulas.
  The parties acknowledge that the intention is that the Gross Overriding Royalty
  is to be paid to the Grantee on this basis, regardless of the price or proceeds
  actually received by the Grantor for or in connection with the Diamonds or the
  manner in which a sale of the Diamonds to a third party is made, and without
  deduction.

In the event the Grantor receives insurance proceeds for loss
  of production, Grantor shall pay to Payee the Gross Overriding Royalty percentage
  of any such insurance proceeds which are received by Grantor for such loss of
  production.

4.2
  Time and Manner; In Kind or Cash Payment. The Grantor will calculate and
  pay the Gross Overriding Royalty to the Grantee by delivery of a cheque or draft
  payable to the Grantee within 60 days of the end of each calendar quarter, based
  on all Diamonds from the Property which were graded in such calendar quarter.

The Grantee shall,
  at its election, have the right to take its Gross Overriding Royalty in kind.

4.3
  Grantors Profits and Losses. The Grantee shall not be entitled to
  participate in the profits or be obligated to share in any losses generated
  by the Grantors actual marketing or sales practices.

4.4
  Payment Accounting; Interim Settlements; Late Charges. All credits or payments
  of the Gross Overriding Royalty shall be accompanied by a detailed statementexplaining
  the manner in which the payment was calculated together with any available settlement
  sheets. In no event shall payment of the Gross Overriding Royalty be made later
  that sixty (60) days after the end of each calendar quarter. Such payments and
  statements shall be deemed conclusively correct unless Grantee objects to them
  in writing within eighteen (18) months after receipt thereof. In the event payment
  of any Gross Overriding Royalty is not made within the time set forth above,
  Grantee may give the Grantor notice in writing of such default, and unless within
  five (5) days of receipt of such notice Grantee shall have received such Gross
  Overriding Royalty payment, the Grantor shall pay an additional sum equal to
  ten percent (10%) of the delinquent payment (late charge) plus interest
  on the delinquent payment and the late charge at the rate twelve percent (12%)
  per annum which shall accrue from the day the delinquent payment

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was due to the date of payment of the Gross Overriding Royalty, late charge
  and accrued interest.

4.5
  Hedging Transactions: Futures, Options and Other Trading.All profits and
  losses resulting from Grantor engaging in any commodity futures trading, option
  trading, or diamonds trading, or any combination thereof, and any other hedging
  transactions (collectively hedging transactions) are specifically
  excluded from Gross Overriding Royalty calculations pursuant to this Agreement.
  All hedging transactions by Grantor and all profits or losses associated therewith,
  if any, shall be solely for Grantors account. The Gross Overriding Royalty
  payable on Diamonds subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Diamonds.The amount of Gross Overriding Royalty to be paid on
  all Diamonds subject to hedging transactions by Grantor shall be determined
  in the same manner as provided in this Section 4.

4.6
  Commingling.Before any Diamonds recovered from the Property are commingled
  with minerals from other properties, the Diamonds recovered from the Property
  shall be measured and sampled in accordance with this Section 4 of this Agreement.
  Detailed records shall be kept by Grantor showing the Average Appraised Value
  of the Diamonds. From this information, Grantor shall determine the amount of
  Gross Overriding Royalty due and payable to Payee from Diamonds recovered from
  the Property commingled with minerals from other properties.

5. Books; Records: Inspections; Confidentiality.

5.1
  Books.Grantor shall keep true and accurate books and records of all of
  its operations and activities on the Property and under this Agreement. Such
  books and records shall be kept on the accrual basis in accordance with generally
  accepted accounting principles consistently applied. Not more frequently than
  annually and within the time provided in Section 4.4 of this Agreement, Payee
  may, at Payees sole expense, give notice to Grantor that Payee desires
  to perform an audit or other examination of all of Grantors books and
  records kept as required by this Agreement. All financial information shall
  conclusively be deemed correct for purposes of this Agreement unless Payee has
  given timely notice that it desires to audit or examine Grantors books
  and records in the manner and within the time provided in Section 4.4 of this
  Agreement. Payee shall promptly commence any such audits and shall diligently
  prosecute the same to conclusion.

5.2
  Reports.Not later than March 1 following the end of each calendar year,
  Grantor shall provide Payee with an annual report of all activities and operations
  conducted upon or with respect to the Property during the preceding calendar
  year. Such annual report shall include estimates of proposed expenditures upon,
  anticipated production from, and estimated remaining ore reserves on the Property
  for the succeeding calendar year. Additionally, and within 30 days of the end
  of each calendar quarter,

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Grantor shall provide Payee access to all data and information
  ge nerated with respect to the Property during the calendar quarter just ended.

5.3
  Inspections.Payee, or its authorized agents or representatives, on not
  less than two (2) days notice to Grantor, may enter upon all surface and subsurface
  portions of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4
  Investor Tours.Upon reasonable notice to Grantor and not more frequently
  than semi-annually, Payee shall have the right to conduct an investors tour
  on the Property and facilities associated therewith; provided that such tours
  shall not unreasonably interfere with Grantors activities and operations.
  Such investors tours shall be at the sole risk of the Payee and its invitees,
  and Payee shall indemnify and hold Grantor harmless from any liability, damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  invitees, employees, officers, directors, agents, or representatives caused
  solely by Payees exercise of its rights under this Section.

5.5
  Confidentiality.Payee shall not, without the express written consent of
  Grantor, which consent shall not be unreasonably withheld, disclose any data
  or information concerning the Operations conducted on the Property or obtained
  under the Main Agreement or this Agreement which is not already in the public
  domain; provided, however, Payee may disclose data or information obtained under
  this Agreement without the consent of Grantor: (i) if required for compliance
  with applicable laws, rules, regulations or orders of a governmental agency
  or stock exchange having jurisdiction over Payee or its parent or affiliated
  corporations; (ii) to any of Payees consultants; (iii) to any third party
  to whom Payee, in good faith, anticipates selling or assigning Payees
  interest hereunder; or (iv) to a prospective lender to whom an interest in the
  Gross Overriding Royalty payments to be made to Payee hereunder is proposed
  to be granted as security, provided that Grantor shall first have been provided
  with a confidentiality agreement executed by such consultant, third party or
  lender, which agreement shall include the confidentiality provisions of this
  Section 5.5. Payee shall not issue any press releases pertaining to the Property
  except upon giving Grantor three (3) days advance written notice of the contents
  thereof, and Payee shall make any reasonable changes to such proposed press
  releases requested by Grantor. Payee shall not, without Grantors consent,
  issue any press release that implies or infers that Grantor endorses or joins
  in Payees statements or representations contained in any press release.

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6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1
  Compliance with Laws.Grantor shall at all times comply with all applicable
  present or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2
  Reclamation, Environmental Obligations, and Indemnities.Grantor shall,
  from and after the date this Agreement takes effect, timely and fully perform
  all reclamation required by all governmental authorities pertaining or related
  to Grantors operations or activities on or with respect to the Property
  or required under this Agreement. Grantor, from and after the date this Agreement
  takes effect, covenants and agrees not to undertake, cause, suffer, or permit
  any condition or activity at, on or in the vicinity of the Property which constitutes
  a nuisance or which results in a violation of or liability under any present
  or future applicable federal, provincial, or local environmental laws, statutes,
  rules, regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants and agrees to indemnify and hold Payee harmless
  from any and all liabilities, obligations, claims (including administrative
  claims and claims for injunctive relief), demands, losses, costs, damages, expenses,
  attorney fees and causes of action asserted against Payee related to Grantors
  failure to comply with and satisfy Environmental Obligations or other obligations
  under this Agreement. The covenants and agreements of this Section 6.2 shall
  survive the termination of Grantors rights under this Agreement or to
  the Property.

7. Stockpiling.The rights of Grantor to
  stockpile, store or place Diamonds off of the Property pursuant to any of the
  provisions of this Agreement shall not be exercisable until Grantor has first
  secured from the property owner where such stockpiling, storage or placement
  is to occur a written agreement in recordable form which provides that Payees
  rights to the Diamonds shall be preserved. Such agreement shall provide,inter alia, that (i) Payees rights pursuant to this
  Agreement, insofar as they are applicable, shall continue in full force and
  effect with respect to Diamonds from the property; (ii) Payees rights
  in and to the Diamonds shall be the same as if the Diamonds were situate on
  the Property; (iii) Payees rights set forth in this Section 7 shall have
  precedence over the rights to the Diamonds of the property owner where the Diamonds
  are stockpiled, stored or placed, as well as the creditors of the said property
  owner; and (iv) the agreement shall be irrevocable as long as the Diamonds from
  the Property, or any part thereof, remain on the property not part of the Property.

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8. Tailings and Residues.All tailings, residues, waste
  rock, spoiled leach materials, and other materials (collectively Materials)
  resulting from Grantors operations and activities on the Property sha
  ll be the sole property of Grantor, but shall remain subject to the Gross Overriding
  Royalty should the same be processed or reprocessed, as the case may be, in
  the future and result in the production of Diamonds. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Gross Overriding Royalty payable thereon shall be determined by using the technique
  described in Section 4 of this Agreement, subject to adjustment on a pro rata
  basis where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1
  Title Maintenance and Taxes.From the date this Agreement takes effect,
  Grantor shall maintain title to the Property, including without limitation,
  paying when due all taxes on or with respect to the Property and doing all things
  and making all payments necessary or appropriate to maintain the right, title
  and interest of Grantor and Payee, respectively, in the Property and under this
  Agreement.

9.2
  Abandonment.In the event Grantor intends to abandon any of the lands comprising
  a portion or all of the Property (Abandonment Property), Grantor
  shall first give notice of such intention to Payee at least 70 days in advance
  of the proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice tha t Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Diamonds previously or thereafter produced from such
  ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange
  at its own expense and shall keep in force at all times, directly or through
  the services of an independent contractor, insurance, including but not limited
  to, the following:

10.1
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

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10.2
  General Liability.Comprehe nsive general public liability insurance against
  claims for bodily injury or death or property damage arising out of or resulting
  from Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Gross Overriding
  Royalty, and the Property from any and all claims, liabilities and damages which
  may arise with respect to this Agreement or the Property. Payee shall be named
  as a co-insured.

10.3
  Self Insurance.Grantor may self insure the foregoing obligations, provided
  such self insurance is sufficient to meet the requirements of Sections 10.1
  and 10.2 above and is in compliance with applicable laws, statutes, rules and
  regulations.

11. General Provisions.

11.1The Miscellaneous Provisions set forth in Article 16 of the Main Agreement
  shall apply to this Schedule C as applicable.

11.2In this Schedule C in all matters of interpretation, whenever necessary
  to give effect to any provision of this instrument, the masculine shall include
  the feminine and neuter and vice versa, the singular shall include the plural,
  and the plural shall include the singular.



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MINERAL PROPERTY OPTION AGREEMENT

THIS AGREEMENTis dated for reference the 10th day of September, 2002

|BETWEEN: | Ubex Capital Inc., and              |                   
|-------- | ----------------------------------- | ------------------
|         | Carleen Higgs                       |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (the Optionor or the Optionors) |                   
|         |                                     | OF THE FIRST PART 
|AND:     | Miranda Diamond Corp.               |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (Miranda)                         |                   
|         |                                     | OF THE SECOND PART

WHEREAS the Optionor has made staking applications
  for a 100% interest in certain exploration claims in the Otish Mountains region
  of Quebec (the Lac Square Rock property), through the internet by
  way of the website maintained by the Province of Quebec for such purposes;

AND WHEREASsuch applications to stake claims have
  been received by the Province of Quebec, Ministere des Ressources Naturelles,
  and certificates of title to the claims have been issued;

AND WHEREASMiranda is desirous of acquiring an interest
  in such exploration claims on the terms and conditions contained herein:

NOW THEREFORE THIS AGREEMENT WITNESSESthat in consideration
  of the premises and the mutual covenants and agreements hereinafter contained,
  the parties hereto agree as follows:

|1.   | DEFINITIONS       
|---- | ------------------
|     |                   
|1.01 | In this Agreement:
|     |                   
|     | (a)               
|     |                   
|     | (b)               

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|     | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Net Smelter Returns shall have the
      meaning ascribed by Schedule B attached hereto;   
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | "Property" means and includes:                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | (i)                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | (ii)                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|2.   | ACQUISITION OF INTEREST                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|2.01 | The Optionor hereby grants
        to Miranda the exclusive right and option to acquire an undivided 100%
        right, title and interest in and to the Property, subject to the Net Smelter
        Returns and Gross Overriding Royalty described in Article 4 of this Agreement,
        for total consideration consisting of cash payments to the Optionor totalling
        $7,500 to be made as follows:                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | the payment to the Optionors of $2,000, the receipt
      of which is hereby acknowledged;   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | upon approval of this Agreement by the Exchange,
      the payment to the Optionor of $5,500.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|2.02 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to receipt of title certificates
        for the exploration claims comprising the Property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|2.03 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to the prior approval of
        the Exchange, for which Miranda undertakes to use its best efforts to
        file within a reasonable period of time so as to obtain the necessary
        approval by the earliest possible date. Notwithstanding any other provision
        of this Agreement, so long as Miranda has filed for the required approval
        referred to herein with the Exchange within a reasonable time, the time
        for making any cash payment or share issuance referred to in this paragraph
        shall be extended, where necessary, to the day that is five business days
        following the receipt by Miranda of the necessary Exchange approval.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|2.04 | This Agreement is an option
        only and, subject to paragraph 11.02, the doing of any act or the incurrence
        of any cash payments by Miranda shall not obligate Miranda to do any further
        acts or make any further payments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                              
|3.   | TRANSFER OF TITLE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

---

|3.01 | Upon execution of this Agreement Miranda shall be entitled
      to record this Agreement against title to the Property.                                                                                                                                                                                                                           
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                    
|3.02 | Upon Miranda exercising the option to
        acquire the Property pursuant to article 2, the Optionor shall deliver
        to Miranda duly executed transfers for the transfer to Miranda of a 100%
        interest in and to the Property, subject to the royalty interest pursuant
        to Article 4.                                      
|     |                                                                                                                                                                                                                                                                                                                                                    
|4.   | ROYALTY                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                    
|4.01 | Miranda agrees that the
        Property shall be subject to a royalty in favour of the Optionor equal
        to 2% of Net Smelter Returns to be calculated and paid according to and
        otherwise governed by Schedule B hereto.                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                    
|4.02 | Miranda agrees that the
        Property shall be subject to a royalty in favour of the Optionor equal
        to a 2% Gross Overriding Royalty to be calculated and paid according to
        and otherwise governed by Schedule C hereto.                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                    
|5.   | PAYMENTS                                                                                                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                    
|5.01 | The payments to be made
        to the Optionors pursuant to section 2 and such other payments as are
        to be made to the Optionors pursuant to this Agreement shall be made in
        full to Ubex Capital Inc. (Ubex). Ubex shall determine with
        the Optionors the percentage portions of the payments to each of the Optionors.
|     |                                                                                                                                                                                                                                                                                                                                                    
|6.   | COVENANTS OF MIRANDA                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                    
|6.01 | Miranda covenants and agrees with the Optionor
      that during the term of this Agreement:                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                    
|     | (a)                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                    
|     | (b)                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                    
|     | (c)                                                                                                                                                                                                                                                                                                                                                

---

|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Miranda shall hold harmless, indemnify,
        and defend the Optionor from any claims, loss, damage, judgement or expense
        for loss or damage to property and death, including environmental damages,
        or injury to persons arising out of Mirandas activities or operations
        on the Property, except to the extent that any such claim, loss, damage,
        judgement, or expense is caused by the negligence of the Optionor, its
        employees, agents or assigns;
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Miranda shall ensure that, in connection
        with the entry onto the Property of any exploration contractor or other
        worker, there shall be in place, either through Miranda or such contractor
        or worker, comprehensive broad-form liability insurance covering claims
        for personal injury, death or property damage with a coverage limit of
        at least $1,000,000;                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Miranda shall maintain books of account
        in respect of its expenditures and operations on the Property and, upon
        reasonable notice, shall make such books available for inspection by representatives
        of the Optionor;                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (g)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Miranda shall allow any duly authorized
        agent or representative of the Optionor to inspect the Property at reasonable
        times and intervals and upon reasonable notice given to Miranda, provided
        however that it is agreed and understood that any such agent or representative
        shall be at his own risk in respect of, and Miranda shall not be liable
        for, any injury incurred while on the Property, howsoever caused; and                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (h)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Miranda shall provide to the Optionor, semi-annually, a summary
      report outlining Mirandas progress on the Property and shall provide
      to Optionor, annually, a copy of all factual, non-interpretive data derived
      from Mirandas operations on the Property.                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|7.   | RIGHT OF ENTRY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|7.01 | During the currency of this
        Agreement, Miranda, its servants, agents and workmen and any persons duly
        authorized by Miranda, shall have the right of access to and from and
        to enter upon and take possession of and prospect, explore and develop
        the Property in such manner as Miranda in its sole discretion may deem
        advisable and shall have the right to remove and ship therefrom ores,
        minerals, me tals, diamonds, or other products recovered in any manner
        therefrom.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|7.02 | Miranda shall be provided
        access to all maps, reports, assay results and other technical data in
        the possession or under the control of the Optionor with respect to the
        Property and shall be entitled to take copies thereof.                                                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|8.   | REPRESENTATIONS AND WARRANTIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|8.01 | The Optionor hereby represents and warrants that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | the Optionor has made staking applications
        for a 100% interest in the exploration claims comprising the Property
        and has the right to enter into this Agreement to sell                                                                                                                                                                                                                                                                                                            

---

|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | and assign an interest in the Property absolutely in accordance
      with the terms of this Agreement;                                                                                                                                                                                                                                                                                                                                                    
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | applications for the exploration claims
        comprising the Property have been, to the best information, knowledge,
        and belief of the Optionor, properly staked through the internet by way
        of the website maintained by the Province of Quebec for such purposes,
        and to the best information, knowledge, and belief of the Optionor there
        are no disputes over the title, staking or recording of such mineral claims;
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | if title is awarded to the Optionor,
        the mineral claims comprising the Property will be in good standing and
        free and clear of any liens, charges or encumbrances of any nature or
        kind whatsoever, to the best nformation,knowledge, and belief
        of the Optionor; and                                                                                                                                                      
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | the Optionor has not done anything whereby
        the mineral claims comprising the Property may be in any way encumbered.                                                                                                                                                                                                                                                                                                                                
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|8.02  | Miranda hereby represents and warrants that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Miranda has full corporate power and
        authority to enter into this Agreement and the entering into of this Agreement
        does not conflict with any applicable laws or with the charter documents
        of Miranda or any contract or other commitment to which Miranda is party;
        and                                                                                                                                                 
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | the execution of this Agreement and
        the performance of its terms have been duly authorized by all necessary
        corporate actions including the resolution of the Board of Directors of
        Miranda.                                                                                                                                                                                                                                       
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|9.    | CONFIDENTIALITY OF INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|9.01  | The Optionor shall treat
        all data, reports, records and other information of any nature whatsoever
        relating to this Agreement and the Property as confidential. While this
        Agreement is in effect, the Optionor shall not, without the express written
        consent of Miranda, disclose to any third party any information concerning
        the Property or any operations thereon, nor shall the Optionor buy, sell
        or otherwise deal in the shares of Miranda while any material, confidential
        information in its possession relating to this Agreement or the Property
        remains und isclosed to the general public.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|10.   | ASSIGNMENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|10.01 | With the consent of the
        other party, which consent shall not be unreasonably withheld, each party
        has the right to assign all or any part of its interest in this Agreement
        and in the Property, subject to the terms and conditions of this Agreement.
        It shall be a condition precedent to any such assignment that the assignee
        of the interest being transferred agrees to be bound by the terms of this
        Agreement, insofar as they are applicable.                                                                                                                                                                    

---

|11.                                                                                                                                                                                                                                                                                                          | TERMINATION                                                                             
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|11.01                                                                                                                                                                                                                                                                                                        | This Agreement shall terminate upon the occurrence
      of one of the following events:
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (a)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (b)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (c)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|In the event that Miranda
        gives notice that it denies that a default has occurred, Miranda shall
        not be deemed in default until the matter shall have been determined finally
        through such means of dispute resolution as such matter has been subjected
        to by either party.
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|11.02                                                                                                                                                                                                                                                                                                        | Upon termination of this Agreement under paragraph
      11.01, Miranda shall:          
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (a)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (b)                                                                                     
|                                                                                                                                                                                                                                                                                                             | (c)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (d)                                                                                     

---

|      | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | ensure that the Property is in a safe
        condition and complies with all environmental and safety standards including
        standards for reclamation and detoxification, imposed by any duly authorized
        regulatory authority; and
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                  
|      | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | ensure that its covenants under subparagraphs 6.01 (a) through
      (e) have been fully complied with.                                                                                                                                          
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                  
|11.03 | Upon the termination of
        this Agreement under paragraph 11.01, Miranda shall cease to be liable
        to the Optionor in debt, damages or otherwise save for the performance
        of those obligations in paragraph 11.02.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                  
|11.04 | Upon termination of this
        Agreement under paragraph 11.01, Miranda shall vacate the Property within
        a reasonable time after such termination, but shall have the right of
        access to the property for a period of six months thereafter for the purpose
        of removing its chattels, machinery, equipment and fixtures.                                                                                                                                                                                                                                                                                                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                  
|12.   | FORCE MAJEURE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                  
|12.01 | The time for performance
        of any act or making any payment or any expenditure required under this
        Agreement shall be extended by the period of any delay or inability to
        perform due to fire, strikes, labour disturbances, riots, civil commotion,
        wars, acts of God, any present or future la w or governmental regulation,
        any shortages of labour, equipment or materials, or any other cause not
        reasonably within the control of the party in default, other than lack
        of finances.                                                                                                                                                                                                          
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                  
|13.   | REGULATORY APPROVAL                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                  
|13.01 | This Agreement is subject
        to the prior approval of the Exchange. Miranda shall use its best efforts
        to obtain such approval as soon as reasonably possible, provided however
        that if such approval has not been received by October 31, 2002, this
        Agreement shall be null and void and of no further effect.                                                                                                                                                                                                                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|14.   | AFTER-ACQUIRED PROPERTY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|14.01 | In the event that at any
        time hereafter Miranda shall acquire any portion of any combined group
        of any mining claims, any mining claim, lease, or other mineral right
        or interest within a three kilometre radius of the outside boundary of
        the Property to be described in Schedule A hereto, such interest shall
        be deemed to have been acquired on behalf of and for the benefit of the
        parties, pursuant to the terms of this Agreement and such after-acquired
        interest as aforesaid shall be included in and shall form a part of the
        definition of Property contained in paragraph 1.01 and shall
        be subject to this Agreement as if it had been originally so included.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|14.02 | In the event that at any
        time hereafter Miranda shall acquire any portion of any combined group
        of any mining claims, any mining claim, lease, or other mineral right
        or interest within a three kilometre radius of the outside boundary of
        the Property as constituted on                                                                                                                                                                                                                                                                                                                                                                                                                                               

---

|      | the date of this Agreement, such interest shall be
        subject to the royalties in favour of the Optionor as described in Article
        4 of this Agreement, and, if so requested by the Optionor, shall be transferred
        to the Optionor upon abandonment by Miranda.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                   
|15.   | NOTICES                                                                                                                                                                                                                                                                           
|      |                                                                                                                                                                                                                                                                                   
|15.01 | Any notice, election, consent or other writing required
        or permitted to be given hereunder shall be deemed to be sufficiently
        given if delivered or mailed postage prepaid or if given by telegram,
        telex or telecopier, addressed as follows:            

|In the case of the Optionor: | Ubex Capital Inc.            
|---------------------------- | -----------------------------
|                             | Suite 306  1140 Homer Street
|                             | Vancouver, B.C.              
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          
|                             |                              
|                             |                              
|In the case of Miranda:      | MIRANDA DIAMOND CORP.        
|                             | Suite 306  1140 Homer Street
|                             | Vancouver, British Columbia  
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          

and any such notice given us aforesaid shall be deemed to
  have been given to the parties hereto if delivered, when delivered, or if mailed,
  on the third business day following the date of mailing, or, if telegraphed,
  telexed or telecopied, on the same day as the telegraphing, telexing or telecopying
  thereof provided however that during the period of any postal interruption in
  Canada or the United States any notice given hereunder by mail shall be deemed
  to have been given only as of the date of actual delivery of the same. Any party
  may from time to time by notice in writing change its address for the purposes
  of this paragraph 15.01.

16. GENERAL TERMS AND CONDITIONS

16.01 The parties hereto hereby covenant and agree that they
  will execute such further agreements, conveyances and assurances as may be requisite,
  or which counsel for the parties may deem necessary to effectually carry out
  the intent of this Agreement.

16.02 This Agreement shall constitute the entire agreement
  between the parties with respect to the Property. No representations or inducements
  have been made save as herein set forth. No changes, alterations or modifications
  of this Agreement shall be binding upon either party until and unless a memorandum
  in writing to such effect shall have been signed by all parties hereto. This
  Agreement shall supersede all previous written, oral or implied understandings
  between the parties with respect to the matters hereby.

16.03 Time shall be of the essence of this Agreement.

---

16.04 The titles to the articles in this Agreement shall not
  be deemed to form part of this Agreement but shall be regarded as having been
  used for convenience of reference only.

16.05 All currency references contained in this Agreement
  shall be deemed to be references to Canadian funds.

16.06 Wherever possible, each provision of this Agreement
  shall be interpreted in such manner as to be effective and valid under applicable
  law, but if any provision shall be prohibited by or be invalid under applicable
  law, such provision shall be ineffective only to the extent of such prohibition
  or invalidity, without invalidating the remainder of such provision or the remaining
  provisions of this Agreement.

16.07 The Schedules to this Agreement shall be construed with
  and as an integral part of this Agreement to the same extent as if they were
  set forth verbatim herein. Defined terms contained in this Agreement shall have
  the same meanings where used in the Schedules.

16.08 This Agreement shall be governed by and interpreted
  in accordance with the laws of the Province of British Columbia and the laws
  of Canada applicable therein.

16.09 In the event that any suit, legal action, or arbitration
  proceeding is instituted to interpret or enforce the terms of this Agreement,
  including but not limited to any contest proceeding under paragraph 11.01, the
  prevailing party shall be entitled to recover from the other party such sum
  as the court or arbitrator may adjudge reasonable for attorneys fees at
  trial and on appeal of such suit, action or proceeding in addition to all other
  sums provided by law.

16.10 This Agreement shall enure to the benefit of and be
  binding upon the parties hereto and their respective heirs, executors, administrators,
  successors and assigns.

IN WITNESS WHEREOFthis Agreement has been executed
  by the parties hereto as of the day and year first above written.

|The COMMON SEALof UBEX CAPITAL           | c/s
|---------------------------------------- | ---
|INC.was hereunto affixed in the presence |    
|of:                                      |    

Dennis Higgs"

SIGNED AND DELIVERED BY Carleen Higgs

Carleen Higgs"
  
  Carleen Higgs

---

|The COMMON SEALof MIRANDA         | c/s
|--------------------------------- | ---
|DIAMOND CORP.was hereunto affixed |    
|in the presence of:               |    

Aileen Lloyd

---

Schedule B

NET SMELTER RETURN ROYALTY

References
  in this Schedule B to Sections and Articles in this Schedule B are so identified,
  and references in this Schedule B to Sections and Articles in the agreement
  to which this Schedule B is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule B except as otherwise expressly stated in
  this Schedule B. The Net Smelter Returns royalty defined in Article 1 of the
  Main Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As used in this Schedule B, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-
  in- interest, including without limitation, assignees, partners, joint venture
  partners, lessees and when applicable mortgagees and affiliated companies having
  or claiming an interest in the Properties or projects.

1.2As used in this Schedule B, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in- interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Production Royalty.Grantor shall
  pay to Grantee the royalty described in Section 4 below (Royalty)
  pursuant to the terms and provisions of this Schedule B.

3. Term.The term of the Royalty hereby created shall
  be perpetual, it being the intent of the parties hereto that, to the extent
  allowed by law, the Royalty constitutes a vested interest in and a covenant
  running with the land and affecting the Property and all successions thereof
  whether created privately or through governmental action. In the event a court
  of competent jurisdiction determines that the term of this Agreement violates
  the Rule Against Perpetuities, then the term of this Agreement shall automatically
  be revised and reformed to coincide with the maximum term permitted by the Rule
  Against Perpetuities, and this Agreement shall not be terminated solely as a
  result of a violation of the Rule Against Perpetuities.

4. Production Royalty.Grantor shall pay to Grantee
  a perpetual Royalty in the amount of two percent (2%) of Net Smelter Returns
  from the sale or other disposition of all locatable minerals produced from the
  Properties determined in accordance with the provisions set forth in this Section
  4 and, if applicable, Section 7.

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4.1 For Precious
  Metals.Net Smelter Returns, in the case of gold, silver, and platinum group
  metals (Precious Metals), shall be determined by multiplying (i)
  the gross number of troy ounces of Precious Metals contained in the production
  delivered to the smelter, refiner, processor, purchaser or other recipient (including
  the operator) of such production, or an insurer as a result of casualty to such
  production (collectively, Payor) during the preceding calendar month
  by (ii) for gold, the average of the London Bullion Market, Morning Fix, spot
  prices for the preceding calendar month; for all other Precious Metals, the
  average of the New York Commodities Exchange final daily spot prices for the
  preceding calendar month, and subtracting from the product of (i) and (ii) only
  the following if actually incurred:

| | (1) | charges imposed by the Payor for refining bullion from the
      Beneficiated Precious Metals contained in such production (as used in this
      Agreement, Beneficiated Precious Metals includes only doré
      or concentrates of Precious Metals produced by Grantors final mill
      or other processing plant, but does not include raw or crushed ore containing
      Precious Metals or other preliminarily processed Precious Metals); and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for refining Beneficiated Precious Metals contained in such
      production.                                                                                                                                                                                                                                                                                               

In the event the refining of bullion from the Beneficiated Precious Metals
  contained in such production is carried out in custom toll facilities owned
  or controlled, in whole or in part, by Grantor, which facilities were not constructed
  for the purpose of refining Beneficiated Precious Metals from the Property,
  then charges, costs and penalties for such refining shall mean the amount Grantor
  would have incurred if such refining were carried out at facilities not owned
  or controlled by Grantor then offering comparable services for comparable products
  on prevailing terms, but in no event greater than actual costs incurred by Grantor
  with respect to such refining.

In the event the Grantor receives insurance proceeds for loss of production,
  Grantor shall pay to Payee the Royalty percentage of any such insurance proceeds
  which are received by Grantor for such loss of production.

4.2 For Other
  Minerals.Net Smelter Returns, in the case of all metals, minerals, mineral
  substances, and the beneficiated products thereof, which are not or do not contain
  economically recoverable Precious Metals (Other Minerals), shall
  be determined by multiplying (i) the gross amount of the particular Other Mineral
  contained in the production delivered to the Payor during the preceding calendar
  month by (ii) the average of the New York Commodities Exchange final daily spot
  prices for the preceding calendar month of the appropriate Other Mineral, and
  subtracting from the product of (i) and (ii) only the following if actually
  incurred:

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| | (1) | charges imposed by the Payor for smelting, refining or processing
      Other Minerals contained in such production, but excluding any and all charges
      and costs related to Grantor mill or other processing plants constructed
      for the purpose of milling or processing Other Minerals, in whole or in
      part; and                                              
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                   
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for smelting, refining, or processing Other Minerals contained
      in such production, but excluding any and all charges and costs of or related
      to Grantor mills or other processing plants constructed for the purpose
      of milling or processing Other Minerals, in whole or in part.

In the event smelting, refining, or processing of Other Minerals are carried
  out in custom toll facilities owned or controlled, in whole or in part, by Grantor,
  which facilities were not constructed for the purpose of milling or processing
  Other Minerals, then charges, costs and penalties for such smelting, refining
  or processing shall mean the amount Grantor would have incurred if such smelting,
  refining or processing were carried out at facilities not owned or controlled
  by Grantor then offering comparable services for comparable products on prevailing
  terms, but in no event greater than actual costs incurred by Grantor with respect
  to such smelting and refining.

In the event Grantor receives insurance proceeds for loss of production, Grantor
  shall pay to Payee the Royalty percentage of any such insurance proceeds which
  are received by Grantor for such loss of production.

Notwithstanding anything contained in the foregoing, the term Other
  Minerals shall not be deemed to include Diamonds as defined
  in Schedule C to the Main Agreement, it being the intention of the parties that
  all payments of royalties in respect of Diamonds shall be governed by Schedule
  C attached to the Main Agreement.

4.3 Time and
  Manner; In-Kind or Cash Payment.At the time of making payment to or otherwise
  crediting the account of Grantor for production from the Property pursuant to
  Sections 4.1 or 4.2 (but within the time provided in Section 4.4), the smelter,
  refiner, processor, purchaser, or other user (Payor) of the Precious
  Metals or Other Minerals shall contemporaneously pay the Royalty in accordance
  with written instructions given to the Payor by Grantee as provided in Sections
  4.3.1 and 4.3.2. Once the Payor has received instructions from Grantee, such
  instructions shall remain in effect until the Payor has received different instructions
  from Grantee. All contractual or other arrangements entered into by Grantor
  with the Payor shall contain provisions implementing the terms and conditions
  of payment set forth in Sections 4.3 and 4.4 hereof and Grantor shall procure
  the written undertaking of Payor contractually binding Payor to perform in accordance
  with Sections 4.3 and 4.4 in form and substance enforceable by Grantee. Grantor
  acknowledges its primary obligation to pay the Royalty and that no undertaking
  by the Payor shall relieve Grantor of that obligation, and Grantor agrees to
  indemnify, protect and defend Grantee from and against any loss, cost

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(including attorneys fees incurred) or liability arising from the performance
  or failure of performance by Payor hereunder or under any contractual or other
  arrangements entered into by Grantor with the Payor pursuant to or for the purposes
  of complying with Sections 4.3 and 4.4 hereof. Grantee may, from time to time
  in its discretion, change the bank or account number for payment under to Sections
  4.3.1 and 4.3.2 by giving written notice thereof to Grantor and the Payor; such
  notice shall be effective upon actual receipt by the Payor, or upon the fourth
  day after deposit of such notice in the mail, first class postage prepaid, addressed
  to the Payor, whichever occurs first. All costs charged by the Payor as a result
  of complying with the payment provisions of Sections 4.3 and 4.4 shall be paid
  by Grantee, and Grantor shall have no liability or responsibility therefor.

4.3.1
  Precious Metals.The Payor shall pay the Royalty for each shipment of Precious
  Metals either (a) in the form of gold bullion (.995 + fine gold) directly to
  Payees account ma intained with the Payor as directed by Payee, or (b)
  by delivery of a cheque or draft payable to Payees account with a bank
  to be designated in writing by Payee. In the event Payee instructs the Payor
  to deliver the Royalty in the form of gold bullion, the Royalty payable on silver
  or platinum group metals shall be converted to the gold equivalent of such silver
  or platinum group metals by using the average monthly spot prices for Precious
  Metals described in Section 4.1.

4.3.2
  Other Minerals.The Payor shall pay the Royalty for each shipment of Other
  Minerals by delivery of a cheque or draft payable to the Payees account
  with a bank to be designated in writing by Payee.

4.4 Payment
  Accounting; Interim Settlements; Late Charges.All credits or payments of
  the Royalty shall be accompanied by a detailed statement explaining the manner
  in which the payment was calculated together with any available settlement sheets
  from the Payor. In no event shall payment of the Royalty be made later that
  thirty (30) days after the delivery to the Payor of the Precious Metals, Beneficiated
  Precious Metals, or Other Minerals. Such payments and statements shall be deemed
  conclusively correct unless Grantee objects to them in writing within eighteen
  (18) months after receipt thereof. On those occasions when all necessary information
  is not available to the Payor within the thirty (30) day period, the Payor shall
  make an interim settlement of the Royalty for such shipment or use within the
  thirty (30) day period; such interim settlement shall provide for payment of
  not less than ninety percent (90%) of the anticipated final settlement Royalty
  as determined by the assays and quantities of the Precious Metals or Other Minerals
  received by the Payor with respect to which such interim settlement is being
  made. Final settlement of the Royalty shall be promptly made upon receipt by
  the Payor of all information necessary or appropriate to make final settlement
  for such shipment. In the event payment of any Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Royalty payment, the Grantor shall pay an additional sum
  equal to ten percent (10%) of the delinquent payment (late charge)
  plus interest on the delinquent payment and the late charge at the rate twelve
  percent (12%) per annum which shall accrue from the day

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the delinquent payment was due to the date of payment of the Royalty, late
  charge and accrued interest.

4.5 Hedging
  Transactions: Futures, Options and Other Trading.All profits and losses
  resulting from Grantor engaging in any commodity futures trading, option trading,
  or metals trading, or any combination thereof, and any other hedging transactions
  (collectively hedging transactions) are specifically excluded from
  Royalty calculations pursuant to this Agreement. All hedging transactions by
  Grantor and all profits or losses associated therewith, if any, shall be solely
  for Grantors account. The Royalty payable on Precious Metals or Other
  Minerals subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Precious Metals.The amount of Royalty to be paid on all Precious
  Metals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.1 with the understanding that the average
  monthly spot price shall be for the calendar month during which Precious Metals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.5.2
  Affecting Other Minerals. The amount of Royalty to be paid on all Other
  Minerals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.2 with the understanding that the average
  monthly spot price shall be for the calendar month during which Other Minerals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.6 Commingling.Before any Precious Metals or Other Minerals produced from the Property
  are commingled with minerals from other properties, the Precious Metals or Other
  Minerals produced from the Property shall be measured and sampled in accordance
  with sound mining and metallurgical practices for moisture, metal, commercial
  minerals and other appropriate content. Representative samples of the Precious
  Metals or Other Minerals shall be retained by Grantor and assays (including
  moisture and penalty substances) and other appropriate analyses of these samples
  shall be made before commingling to determine metal, commercial minerals, and
  other appropriate content. Detailed records shall be kept by Grantor showing
  measures, moisture, assays of metal, commercial minerals, and other appropriate
  content and penalty substances, and gross metal content of the Precious Metals
  or gross metal or mineral content of Other Minerals. From this information,
  Grantor shall determine the amount of Royalty due and payable to Payee from
  Precious Metals or Other Minerals produced from the Property commingled with
  minerals from other properties. Following the expiration of the period for objection
  described above in Section 4.4, and absent timely objection, if any, made by
  Payee, Grantor may dispose of the materials and data required to be kept and
  produced by this Section 4.6.

5. Books; Records: Inspections; Confidentiality.

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5.1 Books.Grantor shall keep true and accurate books and records of all of its operations
  and activities on the Property and under this Agreement. Such books and records
  shall be kept on the accrual basis in accordance with generally accepted accounting
  principles consistently applied. Not more frequently than annually and within
  the time provided in Section 4.4 of this Agreement, Payee may, at Payees
  sole expense, give notice to Grantor that Payee desires to perform an audit
  or other examination of all of Grantors books and records kept as required
  by this Agreement. All financial information shall conclusively be deemed correct
  for purposes of this Agreement unless Payee has given timely notice that it
  desires to audit or examine Grantors books and records in the manner and
  within the time provided in Section 4.4 of this Agreement. Payee shall promptly
  commence any such audits and shall diligently prosecute the same to conclusion.

5.2 Reports.Not later than March 1 following the end of each calendar year, Grantor
  shall provide Payee with an annual report of all activities and operations conducted
  upon or with respect to the Property during the preceding calendar year. Such
  annual report shall include estimates of proposed expenditures upon, anticipated
  production from, and estimated remaining ore reserves on the Property for the
  succeeding calendar year. Additionally, and within 30 days of the end of each
  calendar quarter, Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3 Inspections.Payee, or its authorized agents or representatives, on not less than two
  (2) days notice to Grantor, may enter upon all surface and subsurface portions
  of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4 Investor
  Tours.Upon reasonable notice to Grantor and not more frequently than semi-annually,
  Payee shall have the right to conduct an investors tour on the Property and
  facilities associated therewith; provided that such tours shall not unreasonably
  interfere with Grantors activities and operations. Such investors tours
  shall be at the sole risk of the Payee and its invitees, and Payee shall indemnify
  and hold Grantor harmless from any liability, damage, claim or demand by reason
  of injury to Payee or Grantor or any of their respective invitees, employees,
  officers, directors, agents, or representatives caused solely by Payees
  exercise of its rights under this Section.

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5.5 Confidentiality.Payee shall not, without the express written consent of Grantor, which consent
  shall not be unreasonably withheld, disclose any data or information concerning
  the Operations conducted on the Property or obtained under the Main Agreement
  or this Agreement which is not already in the public doma in; provided, however,
  Payee may disclose data or information obtained under this Agreement without
  the consent of Grantor: (i) if required for compliance with applicable laws,
  rules, regulations or orders of a governmental agency or stock exchange having
  jurisdiction over Payee or its parent or affiliated corporations; (ii) to any
  of Payees consultants; (iii) to any third party to whom Payee, in good
  faith, anticipates selling or assigning Payees interest hereunder; or
  (iv) to a prospective lender to who m an interest in the Royalty payments to
  be made to Payee hereunder is proposed to be granted as security, provided that
  Grantor shall first have been provided with a confidentiality agreement executed
  by such consultant, third party or lender, which agreement shall include the
  confidentiality provisions of this Section 5.5. Payee shall not issue any press
  releases pertaining to the Property except upon giving Grantor three (3) days
  advance written notice of the contents thereof, and Payee shall make any reasonable
  changes to such proposed press releases requested by Grantor. Payee shall not,
  without Grantors consent, issue any press release that implies or infers
  that Grantor endorses or joins in Payees statements or representations
  contained in any press release.

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1 Compliance
  with Laws.Grantor shall at all times comply with all applicable present
  or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2 Reclamation,
  Environmental Obligations, and Indemnities.Grantor shall, from and after
  the date this Agreement takes effect, timely and fully perform all reclamation
  required by all governmental authorities pertaining or related to Grantors
  operations or activities on or with respect to the Property or required under
  this Agreement. Grantor, from and after the date this Agreement takes effect,
  covenants and agrees not to undertake, cause, suffer, or permit any condition
  or activity at, on or in the vicinity of the Property which constitutes a nuisance
  or which results in a violation of or liability under any present or future
  applicable federal, provincial, or local environmental laws, statutes, rules,
  regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants

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and agrees to indemnify and hold Payee harmless from any and all liabilities,
  obligations, claims (including administrative claims and claims for injunctive
  relief), demands, losses, costs, damages, expenses, attorney fees and causes
  of action asserted against Payee related to Grantors failure to comply
  with and satisfy Environmental Obligations or other obligations under this Agreement.
  The covenants and agreements of this Section 6.2 shall survive the termination
  of Grantors rights under this Agreement or to the Property.

7. Stockpiling.The rights of Grantor to stockpile, store
  or place Precious Metals or Other Minerals off of the Property pursuant to any
  of the provisions of this Agreement shall not be exercisable until Grantor has
  first secured from the property owner where such stockpiling, storage or placement
  is to occur a written agreement in recordable form which provides that Payees
  rights to the Precious Metals and Other Minerals shall be preserved. Such agreement
  shall provide,inter alia, that (i) Payees rights
  pursuant to this Agreement, insofar as they are applicable, shall continue in
  full force and effect with respect to Precious Metals and Other Minerals from
  the property; (ii) Payees rights in and to the Precious and Other Minerals
  shall be the same as if the Precious Metals and Other Minerals were situate
  on the Property; (iii) Payees rights set forth in this Section 7 shall
  have precedence over the rights to the Precious Metals and Other Minerals of
  the property owner where the Precious Metals and Other Minerals are stockpiled,
  stored or placed, as well as the creditors of the said property owner; and (iv)
  the agreement shall be irrevocable as long as the Precious Metals and Other
  Minerals from the Property, or any part thereof, remain on the property not
  part of the Property.

8. Tailings and Residues.All tailings, residues, waste rock, spoiled
  leach materials, and other materials (collectively Materials) resulting
  from Grantors operations and activities on the Property shall be the sole
  property of Grantor, but shall remain subject to the Royalty should the same
  be processed or reprocessed, as the case may be, in the future and result in
  the production of Precious Metals or Other Minerals. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Royalty payable thereon shall be determined by using the best engineering and
  technical practices then available, subject to adjustment on a pro rata basis
  where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1 Title Maintenance
  and Taxes.From the date this Agreement takes effect, Grantor shall maintain
  title to the Property, including without limitation, paying when due all taxes
  on or with respect to the Property and doing all things and making all payments
  necessary or appropriate to maintain the right, title and interest of Grantor
  and Payee, respectively, in the Property and under this Agreement.

9.2 Abandonment.In the event Grantor intends to abandon any of the lands comprising a portion
  or all of the Property (Abandonment Property), Grantor shall first

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give notice of such intention to Payee at least 70 days in advance of the
  proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Precious Metals and Other Minerals previously or
  thereafter produced from such ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange at its own
  expense and shall keep in force at all times, directly or through the services
  of an independent contractor, insurance, including but not limited to, the following:

10.1 Workmans
  Compensation Insurance.Workmans Compensation Insurance or the like
  covering all persons engaged in the performance of activities or operations
  as is required or appropriate under law or local governmental bodies or agencies.

10.2 General
  Liability.Comprehensive general public liability insurance against claims
  for bodily injury or death or property damage arising out of or resulting from
  Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Royalty, and
  the Property from any and all claims, liabilities and damages whic h may arise
  with respect to this Agreement or the Property. Payee shall be named as a co-insured.

10.3 Self Insurance.Grantor may self insure the foregoing obligations, provided such self insurance
  is sufficient to meet the requirements of Sections 10.1 and 10.2 above and is
  in compliance with applicable laws, statutes, rules and regulations.

11. General Provisions.

11.1The
  Miscellaneous Provisions set forth in Article 16 of the Main Agreement shall
  apply to this Schedule B as applicable.

11.2In
  this Schedule B in all matters of interpretation, whenever necessary to give
  effect to any provision of this instrument, the masculine shall include the
  feminine and neuter and vice versa, the singular shall include the plural, and
  the plural shall include the singular.

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Schedule C

GROSS OVERRIDING ROYALTY

References
  in this Schedule C to Sections and Articles in this Schedule C are so identified,
  and references in this Schedule C to Sections and Articles in the agreement
  to which this Schedule C is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule C except as otherwise expressly stated in
  this Schedule C. The Gross Overriding Royalty defined in Article 1 of the Main
  Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As used in this Schedule C, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-in-
  interest, including without limitation, assignees, partners, joint venture partners,
  lessees and when applicable mortgagees and affiliated companies having or claiming
  an interest in the Properties or projects.

1.2
  As used in this Schedule C, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in- interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Gross Overriding Royalty.Grantor
  shall pay to Grantee the royalty described in Section 4 below (the Gross
  Overriding Royalty) pursuant to the terms and provisions of this Schedule
  C.

3. Term.The term of the Gross Overriding Royalty hereby
  created shall be perpetual, it being the intent of the parties hereto that,
  to the extent allowed by law, the Gross Overriding Royalty constitutes a vested
  interest in and a covenant running with the land and affecting the Property
  and all successions thereof whether created privately or through governmental
  action. In the event a court of competent jurisdiction determines that the term
  of this Agreement violates the Rule Against Perpetuities, then the term of this
  Agreement shall automatically be revised and reformed to coincide with the maximum
  term permitted by the Rule Against Perpetuities, and this Agreement shall not
  be terminated solely as a result of a violation of the Rule Against Perpetuities.

4. Gross Overriding Royalty.Grantor shall pay to Grantee
  a perpetual Gross Overriding Royalty in the amount of two percent (2%) of the
  Average Appraised Value (as hereinafter defined) of all gems, precious and semi-precious
  stones, and gem and industrial diamonds recovered, sorted, and graded from the
  Properties (the Diamonds)

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determined in accordance with the provisions set forth in this Section 4 and,
  if applicable, Section 7.

4.1
  Average Appraised Value.Average Appraised Value means the average
  of the valuations in Canadian dollars of the Diamonds determined by two independent
  graders, one appointed by the Grantor and one appointed by the Grantee. Such
  independent graders shall be duly qualified and accredited, and shall sort,
  grade and value the Diamonds in accordance with industry standards, having regard
  to, but without limiting the generality of the foregoing, the commercial demand
  for the Diamonds. Each independent valuator shall value each particular classification
  of the Diamonds in accordance with the industry price books, standards and formulas.
  The parties acknowledge that the intention is that the Gross Overriding Royalty
  is to be paid to the Grantee on this basis, regardless of the price or proceeds
  actually received by the Grantor for or in connection with the Diamonds or the
  manner in which a sale of the Diamonds to a third party is made, and without
  deduction.

In the event the Grantor receives insurance proceeds for loss
  of production, Grantor shall pay to Payee the Gross Overriding Royalty percentage
  of any such insurance proceeds which are received by Grantor for such loss of
  production.

4.2
  Time and Manner; In Kind or Cash Payment. The Grantor will calculate and
  pay the Gross Overriding Royalty to the Grantee by delivery of a cheque or draft
  payable to the Grantee within 60 days of the end of each calendar quarter, based
  on all Diamonds from the Property which were graded in such calendar quarter.

The Grantee shall,
  at its election, have the right to take its Gross Overriding Royalty in kind.

4.3
  Grantors Profits and Losses. The Grantee shall not be entitled to
  participate in the profits or be obligated to share in any losses generated
  by the Grantors actual marketing or sales practices.

4.4
  Payment Accounting; Interim Settlements; Late Charges. All credits or payments
  of the Gross Overriding Royalty shall be accompanied by a detailed statement
  explaining the manner in which the payment was calculated together with any
  available settlement sheets. In no event shall payment of the Gross Overriding
  Royalty be made later that sixty (60) days after the end of each calendar quarter.
  Such payments and statements shall be deemed conclusively correct unless Grantee
  objects to them in writing within eighteen (18) months after receipt thereof.
  In the event payment of any Gross Overriding Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Gross Overriding Royalty payment, the Grantor shall pay an
  additional sum equal to ten percent (10%) of the delinquent payment (late
  charge) plus interest on the delinquent payment and the late charge at
  the rate twelve percent (12%) per annum which shall accrue from the day the
  delinquent payment

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was due to the date of payment of the Gross Overriding Royalty, late charge
  and accrued interest.

4.5
  Hedging Transactions: Futures, Options and Other Trading.All profits and
  losses resulting from Grantor engaging in any commodity futures trading, option
  trading, or diamonds trading, or any combination thereof, and any other hedging
  transactions (collectively hedging transactions) are specifically
  excluded from Gross Overriding Royalty calculations pursuant to this Agreement.
  All hedging transactions by Grantor and all profits or losses associated therewith,
  if any, shall be solely for Grantors account. The Gross Overriding Royalty
  payable on Diamonds subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Diamonds.The amount of Gross Overriding Royalty to be paid on
  all Diamonds subject to hedging transactions by Grantor shall be determined
  in the same manner as provided in this Section 4.

4.6
  Commingling.Before any Diamonds recovered from the Property are commingled
  with minerals from other properties, the Diamonds recovered from the Property
  shall be measured and sampled in accordance with this Section 4 of this Agreement.
  Detailed records shall be kept by Grantor showing the Average Appraised Value
  of the Diamonds. From this information, Grantor shall determine the amount of
  Gross Overriding Royalty due and payable to Payee from Diamonds recovered from
  the Property commingled with minerals from other properties.

5. Books; Records: Inspections; Confidentiality.

5.1
  Books.Grantor shall keep true and accurate books and records of all of
  its operations and activities on the Property and under this Agreement. Such
  books and records shall be kept on the accrual basis in accordance with generally
  accepted accounting principles consistently applied. Not more frequently than
  annually and within the time provided in Section 4.4 of this Agreement, Payee
  may, at Payees sole expense, give notice to Grantor that Payee desires
  to perform an audit or other examination of all of Grantors books and
  records kept as required by this Agreement. All financial information shall
  conclusively be deemed correct for purposes of this Agreement unless Payee has
  given timely notice that it desires to audit or examine Grantors books
  and records in the manner and within the time provided in Section 4.4 of this
  Agreement. Payee shall promptly commence any such audits and shall diligently
  prosecute the same to conclusion.

5.2
  Reports.Not later than March 1 following the end of each calendar year,
  Grantor shall provide Payee with an annual report of all activities and operations
  conducted upon or with respect to the Property during the preceding calendar
  year. Such annual report shall include estimates of proposed expenditures upon,
  anticipated production from, and estimated remaining ore reserves on the Property
  for the succeeding calendar year. Additionally, and within 30 days of the end
  of each calendar quarter,

---

Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3
  Inspections.Payee, or its authorized agents or representatives, on not
  less than two (2) days notice to Grantor, may enter upon all surface and subsurface
  portions of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4
  Investor Tours.Upon reasonable notice to Grantor and not more frequently
  than semi-annually, Payee shall have the right to conduct an investors tour
  on the Property and facilities associated therewith; provided that such tours
  shall not unreasonably interfere with Grantors activities and operations.
  Such investors tours shall be at the sole risk of the Payee and its invitees,
  and Payee shall indemnify and hold Grantor harmless from any liability, damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  invitees, employees, officers, directors, agents, or representatives caused
  solely by Payees exercise of its rights under this Section.

5.5
  Confidentiality.Payee shall not, without the express written consent of
  Grantor, which consent shall not be unreasonably withheld, disclose any data
  or information concerning the Operations conducted on the Property or obtained
  under the Main Agreement or this Agreement which is not already in the public
  domain; provided, however, Payee may disclose data or information obtained under
  this Agreement without the consent of Grantor: (i) if required for compliance
  with applicable laws, rules, regulations or orders of a governmental agency
  or stock exchange having jurisdiction over Payee or its parent or affiliated
  corporations; (ii) to any of Payees consultants; (iii) to any third party
  to whom Payee, in good faith, anticipates selling or assigning Payees
  interest hereunder; or (iv) to a prospective lender to whom an interest in the
  Gross Overriding Royalty payments to be made to Payee hereunder is proposed
  to be granted as security, provided that Grantor shall first have been provided
  with a confidentiality agreement executed by such consultant, third party or
  lender, which agreement shall include the confidentiality provisions of this
  Section 5.5. Payee shall not issue any press releases pertaining to the Property
  except upon giving Grantor three (3) days advance written notice of the contents
  thereof, and Payee shall make any reasonable changes to such proposed press
  releases requested by Grantor. Payee shall not, without Grantors consent,
  issue any press release that implies or infers that Grantor endorses or joins
  in Payees statements or representations contained in any press release.

---

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1
  Compliance with Laws.Grantor shall at all times comply with all applicable
  present or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2
  Reclamation, Environmental Obligations, and Indemnities.Grantor shall,
  from and after the date this Agreement takes effect, timely and fully perform
  all reclamation required by all governmental authorities pertaining or related
  to Grantors operations or activities on or with respect to the Property
  or required under this Agreement. Grantor, from and after the date this Agreement
  takes effect, covenants and agrees not to undertake, cause, suffer, or permit
  any condition or activity at, on or in the vicinity of the Property which constitutes
  a nuisance or which results in a violation of or liability under any present
  or future applicable federal, provincial, or local environmental laws, statutes,
  rules, regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants and agrees to indemnify and ho ld Payee harmless
  from any and all liabilities, obligations, claims (including administrative
  claims and claims for injunctive relief), demands, losses, costs, damages, expenses,
  attorney fees and causes of action asserted against Payee related to Grantors
  failure to comply with and satisfy Environmental Obligations or other obligations
  under this Agreement. The covenants and agreements of this Section 6.2 shall
  survive the termination of Grantors rights under this Agreement or to
  the Property.

7. Stockpiling.The rights of Grantor to
  stockpile, store or place Diamonds off of the Property pursuant to any of the
  provisions of this Agreement shall not be exercisable until Grantor has first
  secured from the property owner where such stockpiling, storage or placement
  is to occur a written agreement in recordable form which provides that Payees
  rights to the Diamonds shall be preserved. Such agreement shall provide,inter alia, that (i) Payees rights pursuant to this
  Agreement, insofar as they are applicable, shall continue in full force and
  effect with respect to Diamonds from the property; (ii) Payees rights
  in and to the Diamonds shall be the same as if the Diamonds were situate on
  the Property; (iii) Payees rights set forth in this Section 7 shall ha
  ve precedence over the rights to the Diamonds of the property owner where the
  Diamonds are stockpiled, stored or placed, as well as the creditors of the said
  property owner; and (iv) the agreement shall be irrevocable as long as the Diamonds
  from the Property, or any part thereof, remain on the property not part of the
  Property.

---

8. Tailings and Residues.All tailings, residues,
  waste rock, spoiled leach materials, and other materials (collectively Materials)
  resulting from Grantors operations and activities on the Property shall
  be the sole property of Grantor, but shall remain subject to the Gross Overriding
  Royalty should the same be processed or reprocessed, as the case may be, in
  the future and result in the production of Diamonds. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Gross Overriding Royalty payable thereon shall be determined by using the technique
  described in Section 4 of this Agreement, subject to adjustment on a pro rata
  basis where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonme nt.

9.1
  Title Maintenance and Taxes.From the date this Agreement takes effect,
  Grantor shall maintain title to the Property, including without limitation,
  paying when due all taxes on or with respect to the Property and doing all things
  and making all payments necessary or appropriate to maintain the right, title
  and interest of Grantor and Payee, respectively, in the Property and under this
  Agreement.

9.2
  Abandonment.In the event Grantor intends to abandon any of the lands comprising
  a portion or all of the Property (Abandonment Property), Grantor
  shall first give notice of such intention to Payee at least 70 days in advance
  of the proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Diamonds previously or thereafter produced from such
  ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange
  at its own expense and shall keep in force at all times, directly or through
  the services of an independent contractor, insurance, including but not limited
  to, the following:

10.1
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

---

10.2
  General Liability.Comprehensive general public liability insurance against
  claims for bodily injury or death or property damage arising out of or resulting
  from Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Gross Overriding
  Royalty, and the Property from any and all claims, liabilities and damages which
  may arise with respect to this Agreement or the Property. Payee shall be named
  as a co-insured.

10.3
  Self Insurance.Grantor may self insure the foregoing obligations, provided
  such self insurance is sufficient to meet the requirements of Sections 10.1
  and 10.2 above and is in compliance with applicable laws, statutes, rules and
  regulations.

11. General Provisions.

11.1The Miscellaneous Provisions set forth in Article 16 of the Main Agreement
  shall apply to this Schedule C as applicable.

11.2In this Schedule C in all matters of interpretation, whenever necessary
  to give effect to any provision of this instrument, the masculine shall include
  the feminine and neuter and vice versa, the singular shall include the plural,
  and the plural shall include the singular.

---

MINERAL PROPERTY OPTION AGREEMENT

THIS AGREEMENTis dated for reference the 10th day of September, 2002

|BETWEEN: | Ubex Capital Inc., and              |                   
|-------- | ----------------------------------- | ------------------
|         | Monaco Investment Corp.             |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (the Optionor or the Optionors) |                   
|         |                                     | OF THE FIRST PART 
|AND:     | Miranda Diamond Corp.               |                   
|         | Suite 306  1140 Homer Street       |                   
|         | Vancouver, B.C.                     |                   
|         | V6B 2X6                             |                   
|         |                                     |                   
|         | (Miranda)                         |                   
|         |                                     | OF THE SECOND PART

WHEREAS the Optionor has made staking applications
  for a 100% interest in certain exploration claims in the Otish Mountains region
  of Quebec (the Lac Herve property), through the internet by way
  of the website maintained by the Province of Quebec for such purposes;

AND WHEREASsuch applications to stake claims have
  been received by the Province of Quebec, Ministere des Ressources Naturelles,
  and certificates of title to the claims have been issued;

AND WHEREASMiranda is desirous of acquiring an interest
  in such exploration claims on the terms and conditions contained herein:

NOW THEREFORE THIS AGREEMENT WITNESSESthat in consideration
  of the premises and the mutual covenants and agreements hereinafter contained,
  the parties hereto agree as follows:

|1.   | DEFINITIONS       
|---- | ------------------
|     |                   
|1.01 | In this Agreement:
|     |                   
|     | (a)               
|     |                   
|     | (b)               
|     |                   
|     | (c)               

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|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | attached hereto;                                                                              
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                               
|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | "Property" means and includes:                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | (i)                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | (ii)                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                               
|2.   | ACQUISITION OF INTEREST                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                               
|2.01 | The Optionor hereby grants
        to Miranda the exclusive right and option to acquire an undivided 100%
        right, title and interest in and to the Property, subject to the Net Smelter
        Returns and Gross Overriding Royalty described in Article 4 of this Agreement,
        for total consideration consisting of cash payments to the Optionor totalling
        $27,700 to be made as follows:                                                                                                                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                               
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | the payment to the Optionors of $5,000, the receipt
      of which is hereby acknowledged;    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                               
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | upon approval of this Agreement by the Exchange,
      the payment to the Optionor of $22,700.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                               
|2.02 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to receipt of title certificates
        for the exploration claims comprising the Property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                               
|2.03 | The cash payment provided
        for in subparagraph 2.01 (b) shall be subject to the prior approval of
        the Exchange, for which Miranda undertakes to use its best efforts to
        file within a reasonable period of time so as to obtain the necessary
        approval by the earliest possible date. Notwithstanding any other provision
        of this Agreement, so long as Miranda has filed for the required approval
        referred to herein with the Exchange within a reasonable time, the time
        for making any cash payment or share issuance referred to in this paragraph
        shall be extended, where necessary, to the day that is five business days
        following the receipt by Miranda of the necessary Exchange approval.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                               
|2.04 | This Agreement is an option
        only and, subject to paragraph 11.02, the doing of any act or the incurrence
        of any cash payments by Miranda shall not obligate Miranda to do any further
        acts or make any further payments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                               
|3.   | TRANSFER OF TITLE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

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|3.01 | Upon execution of this Agreement
        Miranda shall be entitled to record this Agreement against title to the
        Property.                                                                                                                                                                                                                 
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                    
|3.02 | Upon Miranda exercising
        the option to acquire the Property pursuant to article 2, the Optionor
        shall deliver to Miranda duly executed transfers for the transfer to Miranda
        of a 100% interest in and to the Property, subject to the royalty interest
        pursuant to Article 4.                                      
|     |                                                                                                                                                                                                                                                                                                                                                    
|4.   | ROYALTY                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                    
|4.01 | Miranda agrees that the
        Property shall be subject to a royalty in favour of the Optionor equal
        to 2% of Net Smelter Returns to be calculated and paid according to and
        otherwise governed by Schedule B hereto.                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                    
|4.02 | Miranda agrees that the
        Property shall be subject to a royalty in favour of the Optionor equal
        to a 2% Gross Overriding Royalty to be calculated and paid according to
        and otherwise governed by Schedule C hereto.                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                    
|5.   | PAYMENTS                                                                                                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                    
|5.01 | The payments to be made
        to the Optionors pursuant to section 2 and such other payments as are
        to be made to the Optionors pursuant to this Agreement shall be made in
        full to Ubex Capital Inc. (Ubex). Ubex shall determine with
        the Optionors the percentage portions of the payments to each of the Optionors.
|     |                                                                                                                                                                                                                                                                                                                                                    
|6.   | COVENANTS OF MIRANDA                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                    
|6.01 | Miranda covenants and agrees with the Optionor
      that during the term of this Agreement:                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                    
|     | (a)                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                    
|     | (b)                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                    
|     | (c)                                                                                                                                                                                                                                                                                                                                                

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|     | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Miranda shall hold harmless, indemnify,
        and defend the Optionor from any claims, loss, damage, judgement or expense
        for loss or damage to property and death, including environmental damages,
        or injury to persons arising out of Mirandas activities or operations
        on the Property, except to the extent that any such claim, loss, damage,
        judgement, or expense is caused by the negligence of the Optionor, its
        employees, agents or assigns;
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Miranda shall ensure that, in connection
        with the entry onto the Property of any exploration contractor or other
        worker, there shall be in place, either through Miranda or such contractor
        or worker, comprehensive broad-form liability insurance covering claims
        for personal injury, death or property damage with a coverage limit of
        at least $1,000,000;                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Miranda shall maintain books of account
        in respect of its expenditures and operations on the Property and, upon
        reasonable notice, shall make such books available for inspection by representatives
        of the Optionor;                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (g)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Miranda shall allow any duly authorized
        agent or representative of the Optionor to inspect the Property at reasonable
        times and intervals and upon reasonable notice given to Miranda, provided
        however that it is agreed and understood that any such agent or representative
        shall be at his own risk in respect of, and Miranda shall not be liable
        for, any injury incurred while on the Property, howsoever caused; and                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (h)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Miranda shall provide to the Optionor,
        semi-annually, a summary report outlining Mirandas progress on the
        Property and shall provide to Optionor, annually, a copy of all factual,
        non-interpretive data derived from Mirandas operations on the Property.                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|7.   | RIGHT OF ENTRY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|7.01 | During the currency of this
        Agreement, Miranda, its servants, agents and workmen and any persons duly
        authorized by Miranda, shall have the right of access to and from and
        to enter upon and take possession of and prospect, explore and develop
        the Property in such manner as Miranda in its sole discretion may deem
        advisable and shall have the right to remove and ship therefrom ores,
        minerals, metals, diamonds, or other products recovered in any manner
        therefrom.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|7.02 | Miranda shall be provided
        access to all maps, reports, assay results and other technical data in
        the possession or under the control of the Optionor with respect to the
        Property and shall be entitled to take copies thereof.                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|8.   | REPRESENTATIONS AND WARRANTIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|8.01 | The Optionor hereby represents and warrants that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | the Optionor has made staking applications
        for a 100% interest in the exploration claims comprising the Property
        and has the right to enter into this Agreement to sell                                                                                                                                                                                                                                                                                                            

---

|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | and assign an interest in the Property absolutely in accordance
      with the terms of this Agreement;                                                                                                                                                                                                                                                                                                                                          
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | applications for the exploration claims comprising the Property
      have been, to the best information, knowledge, and belief of the Optionor,
      properly staked through the internet by way of the website maintained by
      the Province of Quebec for such purposes, and to the best information, knowledge,
      and belief of the Optionor there are no disputes over the title, staking
      or recording of such mineral claims;
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | if title is awarded to the Optionor, the mineral claims comprising
      the Property will be in good standing and free and clear of any liens, charges
      or encumbrances of any nature or kind whatsoever, to the best information,
      knowledge, and belief of the Optionor; and                                                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | the Optionor has not done anything whereby the mineral claims
      comprising the Property may be in any way encumbered.                                                                                                                                                                                                                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|8.02  | Miranda hereby represents and warrants that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | Miranda has full corporate power and
        authority to enter into this Agreement and the entering into of this Agreement
        does not conflict with any applicable laws or with the charter documents
        of Miranda or any contract or other commitment to which Miranda is party;
        and                                                                                                                                       
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | the execution of this Agreement and
        the performance of its terms have been duly authorized by all necessary
        corporate actions including the resolution of the Board of Directors of
        Miranda.                                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|9.    | CONFIDENTIALITY OF INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|9.01  | The Optionor shall treat
        all data, reports, records and other information of any nature whatsoever
        relating to this Agreement and the Property as confidential. While this
        Agreement is in effect, the Optionor shall not, without the express written
        consent of Miranda, disclose to any third party any information concerning
        the Property or any operations thereon, nor shall the Optionor buy, sell
        or otherwise deal in the shares of Miranda while any material, confidential
        information in its possession relating to this Agreement or the Property
        remains undisclosed to the general public.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|10.   | ASSIGNMENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|10.01 | With the consent of the
        other party, which consent shall not be unreasonably withheld, each party
        has the right to assign all or any part of its interest in this Agreement
        and in the Property, subject to the terms and conditions of this Agreement.
        It shall be a condition precedent to any such assignment that the assignee
        of the interest being transferred agrees to be bound by the terms of this
        Agreement, insofar as they are applicable.                                                                                                                                                                   

---

|11.                                                                                                                                                                                                                                                                                                          | TERMINATION                                                                             
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|11.01                                                                                                                                                                                                                                                                                                        | This Agreement shall terminate upon the occurrence
      of one of the following events:
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (a)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (b)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (c)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|In the event that Miranda
        gives notice that it denies that a default has occurred, Miranda shall
        not be deemed in default until the matter shall have been determined finally
        through such means of dispute resolution as such matter has been subjected
        to by either party.
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|11.02                                                                                                                                                                                                                                                                                                        | Upon termination of this Agreement under paragraph
      11.01, Miranda shall:          
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (a)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (b)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (c)                                                                                     
|                                                                                                                                                                                                                                                                                                             |                                                                                         
|                                                                                                                                                                                                                                                                                                             | (d)                                                                                     

---

|      | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | ensure that the Property is in a safe
        condition and complies with all environmental and safety standards including
        standards for reclamation and detoxification, imposed by any duly authorized
        regulatory authority; and
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                  
|      | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | ensure that its covenants under subparagraphs 6.01 (a) through
      (e) have been fully complied with.                                                                                                                                          
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                  
|11.03 | Upon the termination of
        this Agreement under paragraph 11.01, Miranda shall cease to be liable
        to the Optionor in debt, damages or otherwise save for the performance
        of those obligations in paragraph 11.02.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                  
|11.04 | Upon termination of this
        Agreement under paragraph 11.01, Miranda shall vacate the Property within
        a reasonable time after such termination, but shall have the right of
        access to the property for a period of six months thereafter for the purpose
        of removing its chattels, machinery, equipment and fixtures.                                                                                                                                                                                                                                                                                                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                  
|12.   | FORCE MAJEURE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                  
|12.01 | The time for performance
        of any act or making any payment or any expenditure required under this
        Agreement shall be extended by the period of any delay or inability to
        perform due to fire, strikes, labour disturbances, riots, civil commotion,
        wars, acts of God, any present or future law or governmental regulation,
        any shortages of labour, equipment or materials, or any other cause not
        reasonably within the control of the party in default, other than lack
        of finances.                                                                                                                                                                                                           
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|13.   | REGULATORY APPROVAL                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|13.01 | This Agreement is subject
        to the prior approval of the Exchange. Miranda shall use its best efforts
        to obtain such approval as soon as reasonably possible, provided however
        that if such approval has not been received by October 31, 2002, this
        Agreement shall be null and void and of no further effect.                                                                                                                                                                                                                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|14.   | AFTER-ACQUIRED PROPERTY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|14.01 | In the event that at any
        time hereafter Miranda shall acquire any portion of any combined group
        of any mining claims, any mining claim, lease, or other mineral right
        or interest within a three kilometre radius of the outside boundary of
        the Property to be described in Schedule A hereto, such interest shall
        be deemed to have been acquired on behalf of and for the benefit of the
        parties, pursuant to the terms of this Agreement and such after-acquired
        interest as aforesaid shall be included in and shall form a part of the
        definition of Property contained in paragraph 1.01 and shall
        be subject to this Agreement as if it had been originally so included.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|14.02 | In the event that at any
        time hereafter Miranda shall acquire any portion of any combined group
        of any mining claims, any mining claim, lease, or other mineral right
        or interest within a three kilometre radius of the outside boundary of
        the Property as constituted on                                                                                                                                                                                                                                                                                                                                                                                                                                               

---

|      | the date of this Agreement, such interest shall be
        subject to the royalties in favour of the Optionor as described in Article
        4 of this Agreement, and, if so requested by the Optionor, shall be transferred
        to the Optionor upon abandonment by Miranda.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                   
|15.   | NOTICES                                                                                                                                                                                                                                                                           
|      |                                                                                                                                                                                                                                                                                   
|15.01 | Any notice, election, consent or other writing required
        or permitted to be given hereunder shall be deemed to be sufficiently
        given if delivered or mailed postage prepaid or if given by telegram,
        telex or telecopier, addressed as follows:            

|In the case of the Optionor: | Ubex Capital Inc.            
|---------------------------- | -----------------------------
|                             | Suite 306  1140 Homer Street
|                             | Vancouver, B.C.              
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          
|                             |                              
|                             |                              
|In the case of Miranda:      | MIRANDA DIAMOND CORP.        
|                             | Suite 306  1140 Homer Street
|                             | Vancouver, British Columbia  
|                             | V6B 2X6                      
|                             | Fax: (604) 689-1722          

and any such notice given us aforesaid shall be deemed to
  have been given to the parties hereto if delivered, when delivered, or if mailed,
  on the third business day following the date of mailing, or, if telegraphed,
  telexed or telecopied, on the same day as the telegraphing, telexing or telecopying
  thereof provided however that during the period of any postal interruption in
  Canada or the United States any notice given hereunder by mail shall be deemed
  to have been given only as of the date of actual delivery of the same. Any party
  may from time to time by notice in writing change its address for the purposes
  of this paragraph 15.01.

16. GENERAL TERMS AND CONDITIONS

16.01 The parties hereto hereby covenant and agree that they
  will execute such further agreements, conveyances and assurances as may be requisite,
  or which counsel for the parties may deem necessary to effectually carry out
  the intent of this Agreement.

16.02 This Agreement shall constitute the ent ire agreement
  between the parties with respect to the Property. No representations or inducements
  have been made save as herein set forth. No changes, alterations or modifications
  of this Agreement shall be binding upon either party until and unless a memorandum
  in writing to such effect shall have been signed by all parties hereto. This
  Agreement shall supersede all previous written, oral or implied understandings
  between the parties with respect to the matters hereby.

16.03 Time shall be of the essence of this Agreement.

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16.04 The titles to the articles in this Agreement shall not
  be deemed to form part of this Agreement but shall be regarded as having been
  used for convenience of reference only.

16.05 All currency references contained in this Agreement
  shall be deemed to be references to Canadian funds.

16.06 Wherever possible, each provision of this Agreement
  shall be interpreted in such manner as to be effective and valid under applicable
  law, but if any provision shall be prohibited by or be invalid under applicable
  law, such provision shall be ineffective only to the extent of such prohibition
  or invalidity, without invalidating the remainder of such provision or the remaining
  provisions of this Agreement.

16.07 The Schedules to this Agreement shall be construed with
  and as an integral part of this Agreement to the same extent as if they were
  set forth verbatim herein. Defined terms contained in this Agreement shall have
  the same meanings where used in the Schedules.

16.08 This Agreement shall be governed by and interpreted
  in accordance with the laws of the Province of British Columbia and the laws
  of Canada applicable therein.

16.09 In the event that any suit, legal action, or arbitration
  proceeding is instituted to interpret or enforce the terms of this Agreement,
  including but not limited to any contest proceeding under paragraph 11.01, the
  prevailing party shall be entitled to recover from the other party such sum
  as the court or arbitrator may adjudge reasonable for attorneys fees at
  trial and on appeal of such suit, action or proceeding in addition to all other
  sums provided by law.

16.10 This Agreement shall enure to the benefit of and be
  binding upon the parties hereto and their respective heirs, executors, administrators,
  successors and assigns.

IN WITNESS WHEREOFthis Agreement has been executed
  by the parties hereto as of the day and year first above written.

|The COMMON SEALof UBEX CAPITAL           | c/s
|---------------------------------------- | ---
|INC.was hereunto affixed in the presence |    
|of:                                      |    

Dennis Higgs

|The COMMON SEALof MONACO              | c/s
|------------------------------------- | ---
|INVESTMENT CORP.,was hereunto affixed |    
|in the presence of:                   |    

Dennis Higgs

---

|SIGNED AND DELIVERED BY MIRANDA           | c/s
|----------------------------------------- | ---
|DIAMOND CORP. and affixed in the presence |    
|of:                                       |    

Aileen Lloyd
  
  Authorized Signatory

---

Schedule B

NET SMELTER RETURN ROYALTY

References in
  this Schedule B to Sections and Articles in this Schedule B are so identified,
  and references in this Schedule B to Sections and Articles in the agreement
  to which this Schedule B is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule B except as otherwise expressly stated in
  this Schedule B. The Net Smelter Returns royalty defined in Article 1 of the
  Main Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As
  used in this Schedule B, the term Grantor shall mean Optionee as
  defined in the Main Agreement, and shall include all of Optionees successors-
  in- interest, including without limitation, assignees, partners, joint venture
  partners, lessees and when applicable mortgagees and affiliated companies having
  or claiming an interest in the Properties or projects.

1.2As
  used in this Schedule B, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in- interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Production Royalty.Grantor shall pay to Grantee
  the royalty described in Section 4 below (Royalty) pursuant to the
  terms and provisions of this Schedule B.

3. Term.The term of the Royalty hereby created shall be perpetual,
  it being the intent of the parties hereto that, to the extent allowed by law,
  the Royalty constitutes a vested interest in and a covenant running with the
  land and affecting the Property and all successions thereof whether created
  privately or through governmental action. In the event a court of competent
  jurisdiction determines that the term of this Agreement violates the Rule Against
  Perpetuities, then the term of this Agreement shall automatically be revised
  and reformed to coincide with the maximum term permitted by the Rule Against
  Perpetuities, and this Agreement shall not be terminated solely as a result
  of a violation of the Rule Against Perpetuities.

4. Production Royalty.Grantor shall pay to Grantee a perpetual Royalty
  in the amount of two percent (2%) of Net Smelter Returns from the sale or other
  disposition of all locatable minerals produced from the Properties determined
  in accordance with the provisions set forth in this Section 4 and, if applicable,
  Section 7.

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4.1 For Precious
  Metals.Net Smelter Returns, in the case of gold, silver, and platinum group
  metals (Precious Metals), shall be determined by multiplying (i)
  the gross number of troy ounces of Precious Metals contained in the production
  delivered to the smelter, refiner, processor, purchaser or other recipient (including
  the operator) of such production, or an insurer as a result of casualty to such
  production (collectively, Payor) during the preceding calendar month
  by (ii) for gold, the average of the London Bullion Market, Morning Fix, spot
  prices for the preceding calendar month; for all other Precious Metals, the
  average of the New York Commodities Exchange final daily spot prices for the
  preceding calendar month, and subtracting from the product of (i) and (ii) only
  the following if actually incurred:

| | (1) | charges imposed by the Payor for refining bullion from the
      Beneficiated Precious Metals contained in such production (as used in this
      Agreement, Beneficiated Precious Metals includes only doré
      or concentrates of Precious Metals produced by Grantors final mill
      or other processing plant, but does not include raw or crushed ore containing
      Precious Metals or other preliminarily processed Precious Metals); and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for refining Beneficiated Precious Metals contained in such
      production.                                                                                                                                                                                                                                                                                               

In the event the refining of bullion from the Beneficiated Precious Metals
  contained in such production is carried out in custom toll facilities owned
  or controlled, in whole or in part, by Grantor, which facilities were not constructed
  for the purpose of refining Beneficiated Precio us Metals from the Property,
  then charges, costs and penalties for such refining shall mean the amount Grantor
  would have incurred if such refining were carried out at facilities not owned
  or controlled by Grantor then offering comparable services for comparable products
  on prevailing terms, but in no event greater than actual costs incurred by Grantor
  with respect to such refining.

In the event the Grantor receives insurance proceeds for loss of production,
  Grantor shall pay to Payee the Royalty percentage of any such insurance proceeds
  which are received by Grantor for such loss of production.

4.2 For Other
  Minerals.Net Smelter Returns, in the case of all metals, minerals, mineral
  substances, and the beneficiated products thereof, which are not or do not contain
  economically recoverable Precious Metals (Other Minerals), shall
  be determined by multiplying (i) the gross amount of the particular Other Mineral
  contained in the production delivered to the Payor during the preceding calendar
  month by (ii) the average of the New York Commodities Exchange final daily spot
  prices for the preceding calendar month of the appropriate Other Mineral, and
  subtracting from the product of (i) and (ii) only the following if actually
  incurred:

---

| | (1) | charges imposed by the Payor for smelting, refining or processing
      Other Minerals contained in such production, but excluding any and all charges
      and costs related to Grantor mill or other processing plants constructed
      for the purpose of milling or processing Other Minerals, in whole or in
      part; and                                              
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                   
| | (2) | penalty substance, assaying, and sampling charges imposed
      by the Payor for smelting, refining, or processing Other Minerals contained
      in such production, but excluding any and all charges and costs of or related
      to Grantor mills or other processing plants constructed for the purpose
      of milling or processing Other Minerals, in whole or in part.

In the event smelting, refining, or processing of Other Minerals are carried
  out in custom toll facilities owned or controlled, in whole or in part, by Grantor,
  which facilities were not constructed for the purpose of milling or processing
  Other Minerals, then charges, costs and penalties for such smelting, refining
  or processing shall mean the amount Grantor would have incurred if such smelting,
  refining or processing were carried out at facilities not owned or controlled
  by Grantor then offering comparable services for comparable products on prevailing
  terms, but in no event greater than actual costs incurred by Grantor with respect
  to such smelting and refining.

In the event Grantor receives insurance proceeds for loss of production, Grantor
  shall pay to Payee the Royalty percentage of any such insurance proceeds which
  are received by Grantor for such loss of production.

Notwithstanding anything contained in the foregoing, the term Other
  Minerals shall not be deemed to include Diamonds as defined
  in Schedule C to the Main Agreement, it being the intention of the parties that
  all payments of royalties in respect of Diamonds shall be go verned by Schedule
  C attached to the Main Agreement.

4.3 Time and
  Manner; In-Kind or Cash Payment.At the time of making payment to or otherwise
  crediting the account of Grantor for production from the Property pursuant to
  Sections 4.1 or 4.2 (but within the time provided in Section 4.4), the smelter,
  refiner, processor, purchaser, or other user (Payor) of the Precious
  Metals or Other Minerals shall contemporaneously pay the Royalty in accordance
  with written instructions given to the Payor by Grantee as provided in Sections
  4.3.1 and 4.3.2. Once the Payor has received instructions from Grantee, such
  instructions shall remain in effect until the Payor has received different instructions
  from Grantee. All contractual or other arrangements entered into by Grantor
  with the Payor shall contain provisions implementing the terms and conditions
  of payment set forth in Sections 4.3 and 4.4 hereof and Grantor shall procure
  the written undertaking of Payor contractually binding Payor to perform in accordance
  with Sections 4.3 and 4.4 in form and substance enforceable by Grantee. Grantor
  acknowledges its primary obligation to pay the Royalty and that no undertaking
  by the Payor shall relieve Grantor of that obligation, and Grantor agrees to
  indemnify, protect and defend Grantee from and against any loss, cost

---

(including attorneys fees incurred) or liability arising from the performance
  or failure of performance by Payor hereunder or under any contractual or other
  arrangements entered into by Grantor with the Payor pursuant to or for the purposes
  of complying with Sections 4.3 and 4.4 hereof. Grantee may, from time to time
  in its discretion, change the bank or account number for payment under to Sections
  4.3.1 and 4.3.2 by giving written notice thereof to Grantor and the Payor; such
  notice shall be effective upon actual receipt by the Payor, or upon the fourth
  day after deposit of such notice in the mail, first class postage prepaid, addressed
  to the Payor, whichever occurs first. All costs charged by the Payor as a result
  of complying with the payment provisions of Sections 4.3 and 4.4 shall be paid
  by Grantee, and Grantor shall have no liability or responsibility therefor.

4.3.1
  Precious Metals.The Payor shall pay the Royalty for each shipment of Precious
  Metals either (a) in the form of gold bullion (.995 + fine gold) directly to
  Payees account maintained with the Payor as directed by Payee, or (b)
  by delivery of a cheque or draft payable to Payees account with a bank
  to be designated in writing by Payee. In the event Payee instructs the Payor
  to deliver the Royalty in the form of gold bullion, the Royalty payable on silver
  or platinum group metals shall be converted to the gold equivalent of such silver
  or platinum group metals by using the average monthly spot prices for Precious
  Metals described in Section 4.1.

4.3.2
  Other Minerals.The Payor shall pay the Royalty for each shipment of Other
  Minerals by delivery of a cheque or draft payable to the Payees account
  with a bank to be designated in writing by Payee.

4.4 Payment
  Accounting; Interim Settlements; Late Charges.All credits or payments of
  the Royalty shall be accompanied by a detailed statement explaining the manner
  in which the payment was calculated together with any available settlement sheets
  from the Payor. In no event shall payment of the Royalty be made later that
  thirty (30) days after the delivery to the Payor of the Precious Metals, Beneficiated
  Precious Metals, or Other Minerals. Such payments and statements shall be deemed
  conclusively correct unless Grantee objects to them in writing within eighteen
  (18) months after receipt thereof. On those occasions when all necessary information
  is not available to the Payor within the thirty (30) day period, the Payor shall
  make an interim settlement of the Royalty for such shipment or use within the
  thirty (30) day period; such interim settlement shall provide for payment of
  not less than ninety percent (90%) of the anticipated final settlement Royalty
  as determined by the assays and quantities of the Precious Metals or Other Minerals
  received by the Payor with respect to which such interim settlement is being
  made. Final settlement of the Royalty shall be promptly made upon receipt by
  the Payor of all information necessary or appropriate to make final settlement
  for such shipment. In the event payment of any Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Royalty payment, the Grantor shall pay an additional sum
  equal to ten percent (10%) of the delinquent payment (late charge)
  plus interest on the delinquent payment and the late charge at the rate twelve
  percent (12%) per annum which shall accrue from the day

---

the delinquent payment was due to the date of payment of the Royalty, late
  charge and accrued interest.

4.5 Hedging
  Transactions: Futures, Options and Other Trading.All profits and losses
  resulting from Grantor engaging in any commodity futures trading, option trading,
  or metals trading, or any combination thereof, and any other hedging transactions
  (collectively hedging transactions) are specifically excluded from
  Royalty calculations pursuant to this Agreement. All hedging transactions by
  Grantor and all profits or losses associated therewith, if any, shall be solely
  for Grantors account. The Royalty payable on Precious Metals or Other
  Minerals subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Precious Metals.The amount of Royalty to be paid on all Precious
  Metals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.1 with the understanding that the average
  monthly spot price shall be for the calendar month during which Precious Metals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.5.2
  Affecting Other Minerals. The amount of Royalty to be paid on all Other
  Minerals subject to hedging transactions by Grantor shall be determined in the
  same manner as provided in Section 4.2 with the understanding that the average
  monthly spot price shall be for the calendar month during which Other Minerals
  subject to hedging transactions are delivered to the Payor or credited to the
  account or benefit of Grantor, whichever first occurs, by the Payor.

4.6 Commingling.Before any Precious Metals or Other Minerals produced from the Property
  are commingled with minerals from other properties, the Precious Metals or Other
  Minerals produced from the Property shall be measured and sampled in accordance
  with sound mining and metallurgical practices for moisture, metal, commercial
  minerals and other appropriate content. Representative samples of the Precious
  Metals or Other Minerals shall be retained by Grantor and assays (including
  moisture and penalty substances) and other appropriate analyses of these samples
  shall be made before commingling to determine metal, commercial minerals, and
  other appropriate content. Detailed records shall be kept by Grantor showing
  measures, moisture, assays of metal, commercial minerals, and other appropriate
  content and penalty substances, and gross metal content of the Precious Metals
  or gross metal or mineral content of Other Minerals. From this information,
  Grantor shall determine the amount of Royalty due and payable to Payee from
  Precious Metals or Other Minerals produced from the Property commingled with
  minerals from other properties. Following the expiration of the period for objection
  described above in Section 4.4, and absent timely objection, if any, made by
  Payee, Grantor may dispose of the materials and data required to be kept and
  produced by this Section 4.6.

5. Books; Records: Inspections; Confidentiality.

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5.1 Books.Grantor shall keep true and accurate books and records of all of its operations
  and activities on the Property and under this Agreement. Such books and records
  shall be kept on the accrual basis in accordance with generally accepted accounting
  principles consistently applied. Not more frequently than annually and within
  the time provided in Section 4.4 of this Agreement, Payee may, at Payees
  sole expense, give notice to Grantor that Payee desires to perform an audit
  or other examination of all of Grantors books and records kept as required
  by this Agreement. All financial information shall conclusively be deemed correct
  for purposes of this Agreement unless Payee has given timely notice that it
  desires to audit or examine Grantors books and records in the manner and
  within the time provided in Section 4.4 of this Agreement. Payee shall promptly
  commence any such audits and shall diligently prosecute the same to conclusion.

5.2 Reports.Not later than March 1 following the end of each calendar year, Grantor
  shall provide Payee with an annual report of all activities and operations conducted
  upon or with respect to the Property during the preceding calendar year. Such
  annual report shall include estimates of proposed expenditures upon, anticipated
  production from, and estimated remaining ore reserves on the Property for the
  succeeding calendar year. Additionally, and within 30 days of the end of each
  calendar quarter, Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3 Inspections.Payee, or its authorized agents or representatives, on not less than two
  (2) days notice to Grantor, may enter upon all surface and subsurface portions
  of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4 Investor
  Tours.Upon reasonable notice to Grantor and not more frequently than semi-annually,
  Payee shall have the right to conduct an investors tour on the Property and
  facilities associated therewith; provided that such tours shall not unreasonably
  interfere with Grantors activities and operations. Such investors tours
  shall be at the sole risk of the Payee and its invitees, and Payee shall indemnify
  and hold Grantor harmless from any liability, damage, claim or demand by reason
  of injury to Payee or Grantor or any of their respective invitees, employees,
  officers, directors, agents, or representatives caused solely by Payees
  exercise of its rights under this Section.

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5.5 Confidentiality.Payee shall not, without the express written consent of Grantor, which consent
  shall not be unreasonably withheld, disclose any data or information concerning
  the Operations conducted on the Property or obtained under the Main Agreement
  or this Agreement which is not already in the public domain; provided, however,
  Payee may disclose data or information obtained under this Agreement without
  the consent of Grantor: (i) if required for compliance with applicable laws,
  rules, regulations or orders of a governmental agency or stock exchange having
  jurisdiction over Payee or its parent or affiliated corporations; (ii) to any
  of Payees consultants; (iii) to any third party to whom Payee, in good
  faith, anticipates selling or assigning Payees interest hereunder; or
  (iv) to a prospective lender to whom an interest in the Royalty payments to
  be made to Payee hereunder is proposed to be granted as security, provided that
  Grantor shall first have been provided with a confidentiality agreement executed
  by such consultant, third party or lender, which agreement shall include the
  confidentiality provisions of this Section 5.5. Payee shall not issue any press
  releases pertaining to the Property except upon giving Grantor three (3) days
  advance written notice of the contents thereof, and Payee shall make any reasonable
  changes to such proposed press releases requested by Grantor. Payee shall not,
  without Grantors consent, issue any press release that implies or infers
  that Grantor endorses or joins in Payees statements or representations
  contained in any press release.

6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1 Compliance
  with Laws.Grantor shall at all times comply with all applicable present
  or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2 Reclamation,
  Environmental Obligations, and Indemnities.Grantor shall, from and after
  the date this Agreement takes effect, timely and fully perform all reclamation
  required by all governmental authorities pertaining or related to Grantors
  operations or activities on or with respect to the Property or required under
  this Agreement. Grantor, from and after the date this Agreement takes effect,
  covenants and agrees not to undertake, cause, suffer, or permit any condition
  or activity at, on or in the vicinity of the Property which constitutes a nuisance
  or which results in a violation of or liability under any present or future
  applicable federal, provincial, or local environmental laws, statutes, rules,
  regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants

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and agrees to indemnify and hold Payee harmless from any and all liabilities,
  obligations, claims (including administrative claims and claims for injunctive
  relief), demands, losses, costs, damages, expenses, attorney fees and causes
  of action asserted against Payee related to Grantors failure to comply
  with and satisfy Environmental Obligations or other obligations under this Agreement.
  The covenants and agreements of this Section 6.2 shall survive the termination
  of Grantors rights under this Agreement or to the Property.

7. Stockpiling.The rights of Grantor to stockpile, store
  or place Precious Metals or Other Minerals off of the Property pursuant to any
  of the provisions of this Agreement shall not be exercisable until Grantor has
  first secured from the property owner where such stockpiling, storage or placement
  is to occur a written agreement in recordable form which provides that Payees
  rights to the Precious Metals and Other Minerals shall be preserved. Such agreement
  shall provide,inter alia, that (i) Payees rights
  pursuant to this Agreement, insofar as they are applicable, shall continue in
  full force and effect with respect to Precious Metals and Other Minerals from
  the property; (ii) Payees rights in and to the Precious and Other Minerals
  shall be the same as if the Precious Metals and Other Minerals were situate
  on the Property; (iii) Payees rights set forth in this Section 7 shall
  have precedence over the rights to the Precious Metals and Other Minerals of
  the property owner where the Precious Metals and Other Minerals are stockpiled,
  stored or placed, as well as the creditors of the said property owner; and (iv)
  the agreement shall be irrevocable as long as the Precious Metals and Other
  Minerals from the Property, or any part thereof, remain on the property no t
  part of the Property.

8. Tailings and Residues.All tailings, residues, waste rock, spoiled
  leach materials, and other materials (collectively Materials) resulting
  from Grantors operations and activities on the Property shall be the sole
  property of Grantor, but shall remain subject to the Royalty should the same
  be processed or reprocessed, as the case may be, in the future and result in
  the production of Precious Metals or Other Minerals. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Royalty payable thereon shall be determined by using the best engineering and
  technical practices then available, subject to adjustment on a pro rata basis
  where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1 Title Maintenance
  and Taxes.From the date this Agreement takes effect, Grantor shall maintain
  title to the Property, including without limitation, paying when due all taxes
  on or with respect to the Property and doing all things and making all payments
  necessary or appropriate to maintain the right, title and interest of Grantor
  and Payee, respectively, in the Property and under this Agreement.

9.2 Abandonment.In the event Grantor intends to abandon any of the lands comprising a portion
  or all of the Property (Abandonment Property), Grantor shall first

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give notice of such intention to Payee at least 70 days in advance of the
  proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Precious Metals and Other Minerals previously or
  thereafter produced from such ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange at its own
  expense and shall keep in force at all times, directly or through the services
  of an independent contractor, insurance, including but not limited to, the following:

10.1 Workmans
  Compensation Insurance.Workmans Compensation Insurance or the like
  covering all persons engaged in the performance of activities or operations
  as is required or appropriate under law or local governmental bodies or agencies.

10.2 General
  Liability.Comprehens ive general public liability insurance against claims
  for bodily injury or death or property damage arising out of or resulting from
  Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Royalty, and
  the Property from any and all claims, liabilities and damages which may arise
  with respect to this Agreement or the Property. Payee shall be named as a co-insured.

10.3 Self Insurance.Grantor may self insure the foregoing obligations, provided such self insurance
  is sufficient to meet the requirements of Sections 10.1 and 10.2 above and is
  in compliance with applicable laws, statutes, rules and regulations.

11. General Provisions.

11.1The
  Miscellaneous Provisions set forth in Article 16 of the Main Agreement shall
  apply to this Schedule B as applicable.

11.2In
  this Schedule B in all matters of interpretation, whenever necessary to give
  effect to any provision of this instrument, the masculine shall include the
  feminine and neuter and vice versa, the singular shall include the plural, and
  the plural shall include the singular.

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Schedule C

GROSS OVERRIDING ROYALTY

References
  in this Schedule C to Sections and Articles in this Schedule C are so identified,
  and references in this Schedule C to Sections and Articles in the agreement
  to which this Schedule C is attached ( the Main Agreement) are so
  identified. The defined words used in the Main Agreement shall have the same
  meaning when used in this Schedule C except as otherwise expressly stated in
  this Schedule C. The Gross Overriding Royalty defined in Article 1 of the Main
  Agreement shall be determined and governed as follows:

1. Meaning of Terms.

1.1As used in this Schedule C, the term Grantor shall mean Optionee
  as defined in the Main Agreement, and shall include all of Optionees successors-in-
  interest, including without limitation, assignees, partners, joint venture partners,
  lessees and when applicable mortgagees and affiliated companies having or claiming
  an interest in the Properties or projects.

1.2
  As used in this Schedule C, the term Grantee and/or Payee
  shall mean the Optionor as defined in the Main Agreement, and shall include
  all of the Optionors successors-in- interest, including without limitation
  assignees, partners, joint venture partners, lessees and when applicable mortgagees
  and affiliated companies having or claiming an interest in the Properties or
  projects or the participating interest of the Grantee.

2. Establishment of Gross Overriding Royalty.Grantor
  shall pay to Grantee the royalty described in Section 4 below (the Gross
  Overriding Royalty) pursuant to the terms and provisions of this Schedule
  C.

3. Term.The term of the Gross Overriding Royalty hereby
  created shall be perpetual, it being the intent of the parties hereto that,
  to the extent allowed by law, the Gross Overriding Royalty constitut es a vested
  interest in and a covenant running with the land and affecting the Property
  and all successions thereof whether created privately or through governmental
  action. In the event a court of competent jurisdiction determines that the term
  of this Agreement violates the Rule Against Perpetuities, then the term of this
  Agreement shall automatically be revised and reformed to coincide with the maximum
  term permitted by the Rule Against Perpetuities, and this Agreement shall not
  be terminated solely as a result of a violation of the Rule Against Perpetuities.

4. Gross Overriding Royalty.Grantor shall pay to Grantee
  a perpetual Gross Overriding Royalty in the amount of two percent (2%) of the
  Average Appraised Value (as hereinafter defined) of all gems, precious and semi-precious
  stones, and gem and industrial diamonds recovered, sorted, and graded from the
  Properties (the Diamonds)

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determined in accordance with the provisions set forth in this Section 4 and,
  if applicable, Section 7.

4.1
  Average Appraised Value.Average Appraised Value means the average
  of the valuations in Canadian dollars of the Diamonds determined by two independent
  graders, one appointed by the Grantor and one appointed by the Grantee. Such
  independent graders shall be duly qualified and accredited, and shall sort,
  grade and value the Diamonds in accordance with industry standards, having regard
  to, but without limiting the generality of the foregoing, the commercial demand
  for the Diamonds. Each independent valuator shall value each particular classification
  of the Diamonds in accordance with the industry price books, standards and formulas.
  The parties acknowledge that the intention is that the Gross Overriding Royalty
  is to be paid to the Grantee on this basis, regardless of the price or proceeds
  actually received by the Grantor for or in connection with the Diamonds or the
  manner in which a sale of the Diamonds to a third party is made, and without
  deduction.

In the event the Grantor receives insurance proceeds for loss
  of production, Grantor shall pay to Payee the Gross Overriding Royalty percentage
  of any such insurance proceeds which are received by Grantor for such loss of
  production.

4.2
  Time and Manner; In Kind or Cash Payment. The Grantor will calculate and
  pay the Gross Overriding Royalty to the Grantee by delivery of a cheque or draft
  payable to the Grantee within 60 days of the end of each calendar quarter, based
  on all Diamonds from the Property which were graded in such calendar quarter.

The Grantee shall,
  at its election, have the right to take its Gross Overriding Royalty in kind.

4.3
  Grantors Profits and Losses. The Grantee shall not be entitled to
  participate in the profits or be obligated to share in any losses generated
  by the Grantors actual marketing or sales practices.

4.4
  Payment Accounting; Interim Settlements; Late Charges. All credits or payments
  of the Gross Overriding Royalty shall be accompanied by a detailed statement
  explaining the manner in which the payment was calculated together with any
  available settlement sheets. In no event shall payment of the Gross Overriding
  Royalty be made later that sixty (60) days after the end of each calendar quarter.
  Such payments and statements shall be deemed conclusively correct unless Grantee
  objects to them in writing within eighteen (18) months after receipt thereof.
  In the event payment of any Gross Overriding Royalty is not made within the
  time set forth above, Grantee may give the Grantor notice in writing of such
  default, and unless within five (5) days of receipt of such notice Grantee shall
  have received such Gross Overriding Royalty payment, the Grantor shall pay an
  additional sum equal to ten percent (10%) of the delinquent payment (late
  charge) plus interest on the delinquent payment and the late charge at
  the rate twelve percent (12%) per annum which shall accrue from the day the
  delinquent payment

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was due to the date of payment of the Gross Overriding Royalty, late charge
  and accrued interest.

4.5
  Hedging Transactions: Futures, Options and Other Trading.All profits and
  losses resulting from Grantor engaging in any commodity futures trading, option
  trading, or diamonds trading, or any combination thereof, and any other hedging
  transactions (collectively hedging transactions) are specifically
  excluded from Gross Overriding Royalty calculations pursuant to this Agreement.
  All hedging transactions by Grantor and all profits or losses associated therewith,
  if any, shall be solely for Grantors account. The Gross Overriding Royalty
  payable on Diamonds subject to hedging transactions shall be determined as follows:

4.5.1
  Affecting Diamonds.The amount of Gross Overriding Royalty to be paid on
  all Diamonds subject to hedging transactions by Grantor shall be determined
  in the same manner as provided in this Section 4.

4.6
  Commingling.Before any Diamonds recovered from the Property are commingled
  with minerals from other properties, the Diamonds recovered from the Property
  shall be measured and sampled in accordance with this Section 4 of this Agreement.
  Detailed records shall be kept by Grantor showing the Average Appraised Value
  of the Diamonds. From this information, Grantor shall determine the amount of
  Gross Overriding Royalty due and payable to Payee from Diamonds recove red from
  the Property commingled with minerals from other properties.

5. Books; Records: Inspections; Confidentiality.

5.1
  Books.Grantor shall keep true and accurate books and records of all of
  its operations and activities on the Property and under this Agreement. Such
  books and records shall be kept on the accrual basis in accordance with generally
  accepted accounting principles consistently applied. Not more frequently than
  annually and within the time provided in Section 4.4 of this Agreement, Payee
  may, at Payees sole expense, give notice to Grantor that Payee desires
  to perform an audit or other examination of all of Grantors books and
  records kept as required by this Agreement. All financial information shall
  conclusively be deemed correct for purposes of this Agreement unless Payee has
  given timely notice that it desires to audit or examine Grantors books
  and records in the manner and within the time provided in Section 4.4 of this
  Agreement. Payee shall promptly commence any such audits a nd shall diligently
  prosecute the same to conclusion.

5.2
  Reports.Not later than March 1 following the end of each calendar year,
  Grantor shall provide Payee with an annual report of all activities and operations
  conducted upon or with respect to the Property during the preceding calendar
  year. Such annual report shall include estimates of proposed expenditures upon,
  anticipated production from, and estimated remaining ore reserves on the Property
  for the succeeding calendar year. Additionally, and within 30 days of the end
  of each calendar quarter,

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Grantor shall provide Payee access to all data and information
  generated with respect to the Property during the calendar quarter just ended.

5.3
  Inspections.Payee, or its authorized agents or representatives, on not
  less than two (2) days notice to Grantor, may enter upon all surface and subsurface
  portions of the Property for the purpose of inspecting the Property, all improvements
  thereto and operations thereon, as well as inspecting and copying all records
  and data, including without limitation such records and data which are maintained
  electronically, pertaining to all activities and operations on or with respect
  to the Property, improvements thereto and operations thereon. Payee, or its
  authorized agents or representatives, shall enter the Property at Payees
  own risk and expense and may not unreasonably hinder operations on or pertaining
  to the Property. Payee shall indemnify and hold Grantor harmless from any damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  employees, officers, directors, agents or representatives caused solely by Payees
  exercise of its rights herein.

5.4
  Investor Tours.Upon reasonable notice to Grantor and not more frequently
  than semi-annually, Payee shall have the right to conduct an investors tour
  on the Property and facilities associated therewith; provided that such tours
  shall not unreasonably interfere with Grantors activities and operations.
  Such investors tours shall be at the sole risk of the Payee and its invitees,
  and Payee shall indemnify and hold Grantor harmless from any liability, damage,
  claim or demand by reason of injury to Payee or Grantor or any of their respective
  invitees, employees, officers, directors, agents, or representatives caused
  solely by Payees exercise of its rights under this Section.

5.5
  Confidentiality.Payee shall not, without the express written consent of
  Grantor, which consent shall not be unreasonably withheld, disclose any data
  or information concerning the Operations conducted on the Property or obtained
  under the Main Agreement or this Agreement which is not already in the public
  domain; provided, however, Payee may disclose data or information obtained under
  this Agreement witho ut the consent of Grantor: (i) if required for compliance
  with applicable laws, rules, regulations or orders of a governmental agency
  or stock exchange having jurisdiction over Payee or its parent or affiliated
  corporations; (ii) to any of Payees consultants; (iii) to any third party
  to whom Payee, in good faith, anticipates selling or assigning Payees
  interest hereunder; or (iv) to a prospective lender to whom an interest in the
  Gross Overriding Royalty payments to be made to Payee hereunder is proposed
  to be granted as security, provided that Grantor shall first have been provided
  with a confidentiality agreement executed by such consultant, third party or
  lender, which agreement shall include the confidentiality provisions of this
  Section 5.5. Payee shall not issue any press releases pertaining to the Property
  except upon giving Grantor three (3) days advance written notice of the contents
  thereof, and Payee shall make any reasonable changes to such proposed press
  releases requested by Grantor. Payee shall not, without Grantors consent,
  issue any press release that implies or infers that Grantor endorses or joins
  in Payees statements or representations contained in any press release.

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6. Compliance with Laws; Reclamation, Environmental Obligations,
  and Indemnities.

6.1
  Compliance with Laws.Grantor shall at all times comply with all applicable
  present or future federal, provincial, and local laws, statutes, rules, regulations,
  permits, ordinances, certificates, licenses and other regulatory requirements,
  policies and guidelines relating to operations and activities on or with respect
  to the Property; provided, however, Grantor shall have the right to contest
  any of the same if such contest does not jeopardize the Property or Payees
  rights thereto or under this Agreement.

6.2
  Reclamation, Environmental Obligations, and Indemnities.Grantor shall,
  from and after the date this Agreement takes effect, timely and fully perform
  all reclamation required by all governmental authorities pertaining or related
  to Grantors operations or activities on or with respect to the Property
  or required under this Agreement. Grantor, from and after the date this Agreement
  takes effect, covenants and agrees not to undertake, cause, suffer, or permit
  any conditio n or activity at, on or in the vicinity of the Property which constitutes
  a nuisance or which results in a violation of or liability under any present
  or future applicable federal, provincial, or local environmental laws, statutes,
  rules, regulations, permits, ordinances, certificates, licenses and other regulatory
  requirements, policies and guidelines (collectively Environmental Obligations).
  Commencing with the Effective Date, in the event Grantor fails to comply with
  any Environmental Obligations, undertakes any activity giving rise to liability
  under any Environmental Obligations, or otherwise breaches any Environmental
  Obligations, Grantor shall promptly remedy and correct such failure to comply,
  satisfy such liability, cure such breach and satisfy all obligations in connection
  therewith. Grantor covenants and agrees to indemnify and hold Payee harmless
  from any and all liabilities, obligations, claims (including administrative
  claims and claims for injunctive relief), demands, losses, costs, damages, expenses,
  attorney fees and causes of action asserted against Payee related to Grantors
  failure to comply with and satisfy Environmental Obligations or other obligations
  under this Agreement. The covenants and agreements of this Section 6.2 shall
  survive the termination of Grantors rights under this Agreement or to
  the Property.

7. Stockpiling.The rights of Grantor to
  stockpile, store or place Diamonds off of the Property pursuant to any of the
  provisions of this Agreement shall not be exercisable until Grantor has first
  secured from the property owner where such stockpiling, storage or placement
  is to occur a written agreement in recordable form which provides that Payees
  rights to the Diamonds shall be preserved. Such agreement shall provide,inter alia, that (i) Payees rights pursuant to this
  Agreement, insofar as they are applicable, shall continue in full force and
  effect with respect to Diamonds from the property; (ii) Payees rights
  in and to the Diamonds shall be the same as if the Diamonds were situate on
  the Property; (iii) Payees rights set forth in this Section 7 shall have
  precedence over the rights to the Diamonds of the property owner where the Diamonds
  are stockpiled, stored or placed, as well as the creditors of the said property
  owner; and (iv) the agreement shall be irrevocable as long as the Diamonds from
  the Property, or any part thereof, remain on the property not part of the Property.

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8. Tailings and Residues.All tailings, residues,
  waste rock, spoiled leach materials, and other materials (collectively Materials)
  resulting from Grantors operations and activities on the Property shall
  be the sole property of Grantor, but shall remain subject to the Gross Overriding
  Royalty should the same be processed or reprocessed, as the case may be, in
  the future and result in the production of Diamonds. Notwithstanding the foregoing,
  Grantor shall have the right to dispose of Materials from the Property on or
  off of the Property and to commingle the same with Material from other properties.
  In the event Materials are processed or reprocessed, as the case may be, the
  Gross Overriding Royalty payable thereon shall be determined by using the technique
  described in Section 4 of this Agreement, subject to adjustment on a pro rata
  basis where commingling has occurred.

9. Title Maintenance, Maintenance, and Taxes; Abandonment.

9.1
  Title Maintenance and Taxes.From the date this Agreement takes effect,
  Grantor shall maintain title to the Property, including without limitation,
  paying when due all taxes on or with respect to the Property and doing all things
  and making all payments necessary or appropriate to maintain the right, title
  and interest of Grantor and Payee, respectively, in the Property and under this
  Agreement.

9.2
  Abandonment.In the event Grantor intends to abandon any of the lands comprising
  a portion or all of the Property (Abandonment Property), Grantor
  shall first give notice of such intention to Payee at least 70 days in advance
  of the proposed date of abandonment. If not later than 10 days before the proposed
  date of abandonment Grantor receives from Payee written notice that Payee desires
  Grantor to convey the Abandonment Property to Payee, Grantor shall, without
  additional consideration, convey the Abandonment Property in good standing by
  quit claim deed, without warranty, to Payee and shall thereafter have no further
  obligation to maintain the title to the Abandonment Property. If Payee does
  not timely give such notice to Grantor, Grantor may abandon the Abandonment
  Property and shall thereafter have no further obligation to maintain the title
  to the Abandonment Property; provided, however, if Grantor reacquires any of
  the ground covered by the Abandonment Property at any time within five (5) years
  following abandonment, the Diamonds previously or thereafter produced from such
  ground shall be subject to this Agreement.

10. InsuranceGrantor shall purchase or otherwise arrange
  at its own expense and shall keep in force at all times, directly or through
  the services of an independent contractor, insurance, including but not limited
  to, the following:

10.1
  Workmans Compensation Insurance.Workmans Compensation Insurance
  or the like covering all persons engaged in the performance of activities or
  operations as is required or appropriate under law or local governmental bodies
  or agencies.

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10.2
  General Liability.Comprehensive general public liability insurance against
  claims for bodily injury or death or property damage arising out of or resulting
  from Grantors activities or operations on or with respect to the Property,
  in such amounts as will adequately protect Grantor, Payee, the Gross Overriding
  Royalty, and the Property from any and all claims, liabilities and damages which
  may arise with respect to this Agreement or the Property. Payee shall be named
  as a co-insured.

10.3
  Self Insurance.Grantor may self insure the foregoing obligations, provided
  such self insurance is sufficient to meet the requirements of Sections 10.1
  and 10.2 above and is in compliance with applicable laws, statutes, rules and
  regulations.

11. General Provisions.

11.1The Miscellaneous Provisions set forth in Article 16 of the Main Agreement
  shall apply to this Schedule C as applicable.

11.2In this Schedule C in all matters of interpretation, whenever necessary
  to give effect to any provision of this instrument, the masculine shall include
  the feminine and neuter and vice versa, the singular shall include the plural,
  and the plural shall include the singular.

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PROPERTY OPTION AGREEMENT

THIS AGREEMENT made and entered into as of the 27th day of September,
  2002.

|BETWEEN: | MinQuest Inc.,a company having a mailing
      address at 4235 Christy
|-------- | ----------------------------------------------------------------------
|         | Way, Reno, Nevada, 89509, U.S.A.                                      
|         |                                                                       
|         | (herein called the Optionor)                                        
|         |                                                                       
|         | OF THE FIRST PART                                                     
|         |                                                                       
|         |                                                                       
|AND:     | Miranda Diamond Corp., a company having an office at
      Suite 306 
|         | 1140 Homer Street, Vancouver, B.C., V6B 2X6                           
|         |                                                                       
|         | (herein called the Optionee)                                        
|         |                                                                       
|         | OF THE SECOND PART                                                    

WHEREAS the Optionor has represented that it is the sole recorded
  and beneficial owner in and to three properties called the Hercules Project,
  the Imperial Mine Property and the Gilman Property (the Property)
  described in Schedule A attached hereto;

AND WHEREAS the Optionor, subject to the Net Smelter Royalty
  reserved to the Optionor, now wishes to grant to the Optionee the exclusive
  right and option to acquire an undivided 100% right, title and interest in and
  to the Property on the terms and conditions hereinafter set forth;

NOW THEREFORE THIS AGREEMENT WITNESSETH THAT in consideration
  of the premises, the mutual covenants herein set forth and the sum of One Dollar
  ($1.00) of lawful money of U.S. currency now paid by the Optionee to the Optionor
  (the receipt whereof is hereby acknowledged), the Parties he reto do hereby
  mutually covenant and agree as follows:

|1.                                                                                    | Definitions
|------------------------------------------------------------------------------------- | -----------
|                                                                                      |            
|The following words, phrases and expressions
      shall have the following meanings:
|                                                                                      |            
|                                                                                      | (a)        
|                                                                                      |            
|                                                                                      | (b)        

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| | (c) | Expenditures
        includes all direct or indirect expenses [net of government incentives
        and not including payments to the Optionor pursuant to section 4, paragraphs
        (a),(b),(c)(ii) and (iii), (d)(ii) and (iii), (e)(ii) and (iii), (f)(ii)
        and (iii), and (g)(ii) and (iii) hereof] of or incidental to Mining Operations.
        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; the parties hereto agree that
        Property payments and Property expenditures are separate payments as outlined
        in paragraph 4;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (d) | Facilities means
        all mines and plants, including without limitation, all pits, shafts,
        adits, haulageways, raises and other underground workings, and all buildings,
        plants, facilities and other structures, fixtures and improvements, and
        all other property, whether fixed or moveable, as the same may exist at
        any time in, or on the Property and relating to the operator of the Property
        as a mine or outside the Property if for the exclusive benefit of the
        Property only;                                                                                                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (e) | Force Majeure
        means an event beyond the reasonable control of the Optionee that prevents
        or delays it from conducting the activities contemplated by this Agreement
        other than the making of payments referred to in Section 4 herein. Such
        events shall include but not be limited to acts of God, war, insurrection,
        action of governmental agencies reflecting an instability in government
        procedures, or delay in permitting unacceptable to both Optionor and Optionee;                                                                                                                                                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (f) | Mineral Products means the commercial
      end products derived from operating the Property as a mine                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (g) | Mining Operations includes:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

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| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | separation and extraction of Mineral Products and all reclamation,
      restoration and permitting activities;                                                                                                                                     
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (h) | Net Smelter Royalty means that Net
      Smelter Royalty as defined in Schedule B attached hereto (NSR);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (i) | Option means
        the option granted by the Optionor to the Optionee to acquire, subject
        to the NSR reserved to the Optionor, an undivided 100% right, title and
        interest in and to the Property as more particularly set forth in Section
        4;                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (j) | Option Period
        means the period from the date hereof to the date at which the Optionee
        has performed its obligations to acquire its 100% interest in the Property
        as set out in Section 4 hereof, which ever shall be the lesser period;                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (k) | Property means the mineral claims
      described in Schedule A;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (l) | Warrants means
        the non-transferable share purchase warrants of the Optionee which will
        be issued upon the dates, in the amounts, and at the exercise prices outlined
        in Section 4 of this Agreement. One whole Warrant will entitle the holder,
        on exercise, to purchase one Warrant Share at the price set according
        to Section 4 of this Agreement during the 24-month exercise period of
        the Warrant. The right to purchase a Warrant Share under a Warrant may
        be exercised at any time until the close of business on the day which
        is 24 months from the date of issue of the Warrant;
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (m) | Warrant Share
        means a previously unissued common share in the capital of the Optionee,
        as presently constituted, which will be issued on exercise of the Warrants;                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (n) | Work Program
        means a program of work reasonably acceptable to both parties in respect
        of a particular Property, contained in a written document setting out
        in reasonable detail:                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                     
| |     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | An outline of the Mining Operations
        proposed to be undertaken and conducted on the Property, specifically
        stating the period of time during which the work contemplated by the proposed
        program is to be done and performed;
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                     
| |     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | The estimated cost of such Mining Operations
        including a proposed budget providing for estimated monthly cash requirements
        in advance and giving reasonable details; and                                                            

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|                                                                                                                                                                                                                                  |       | The identity and credentials
        of the person or persons undertaking the Mining Operations so proposed
        if not the Optionor, reasonably acceptable to both parties hereto.                    
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|                                                                                                                                                                                                                                  | 2.    | Headings                                                                                                                                                                                                  
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|Any heading, caption or index hereto shall not
      be used in any way in construing or interpreting any provision hereof.                                                                                                      
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|                                                                                                                                                                                                                                  | 3.    | Singular, Plural                                                                                                                                                                                          
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|Whenever the singular or
        masculine or neuter is used in this Agreement, the same shall be construed
        as meaning plural or feminine or body politic or corporate or vice versa,
        as the context so requires.
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|                                                                                                                                                                                                                                  | 4.    | Option                                                                                                                                                                                                    
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|The Optionor hereby grants
        to the Optionee the sole and exclusive right and option (the Option)
        to earn a 100% interest in the Property exercisable as follows:                                                
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|                                                                                                                                                                                                                                  | (a)   | The Optionee paying the
        sum of $ 20,000 U.S. to the Optionor by way of cash; $5000 upon signing
        of this Agreement and the balance payable within 90 days;                                 
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|                                                                                                                                                                                                                                  | (b)   | The Optionee issuing to
        the Optionor 100,000 Warrants at an exercise price of $0.25 Canadian to
        be issued within 5 business days of the date the Exchange approves this
        Agreement;
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|                                                                                                                                                                                                                                  | (c)   | On or before September 18, 2003:                                                                                                                                                                          
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|                                                                                                                                                                                                                                  |       | (i)                                                                                                                                                                                                       
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|                                                                                                                                                                                                                                  | (ii)  | The Optionee issuing to the Optionor 50,000 Warrants at an
      exercise price of $0.25 Canadian;                                                                                                        
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|                                                                                                                                                                                                                                  | (iii) | The Optionee paying $20,000 U.S. to the Optionor;                                                                                                                                                         
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|                                                                                                                                                                                                                                  | (d)   | On or before September 18, 2004:                                                                                                                                                                          
|                                                                                                                                                                                                                                  |       |                                                                                                                                                                                                           
|                                                                                                                                                                                                                                  | (i)   | The Optionee incurring Expenditures
        of $75,000 U.S. on the Property in addition to the expenditure referred
        to in clause (c)(i) hereof; and                                               

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| |     | (ii)                             | The Optionee issuing to the Optionor 50,000 Warrants at an
      exercise price of $0.25 Canadian;                                                                                       
| | --- | -------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                  |                                                                                                                                                                                          
| |     | (iii)                            | The Optionee paying $25,000 U.S. to the Optionor;                                                                                                                                        
| |     |                                 
| | (e) | On or before September 18, 2005:
| |     |                                  |                                                                                                                                                                                          
| |     | (i)                              | The Optionee incurring Expenditures
        of $150,000 U.S. on the Property in addition to the expenditures referred
        to in clauses (c)(i) and (d)(i) hereof; and                
| |     |                                  |                                                                                                                                                                                          
| |     | (ii)                             | The Optionee issuing to the Optionor 75,000 Warrants at an
      exercise price of $0.30 Canadian;                                                                                       
| |     |                                  |                                                                                                                                                                                          
| |     | (iii)                            | The Optionee paying $30,000 U.S. to the Optionor;                                                                                                                                        
| |     |                                 
| | (f) | On or before September 18, 2006:
| |     |                                  |                                                                                                                                                                                          
| |     | (i)                              | The Optionee incurring Expenditures
        of $150,000 U.S. on the Property in addition to the expenditures referred
        to in clauses (c)(i), (d)(i) and (e)(i) hereof; and        
| |     |                                  |                                                                                                                                                                                          
| |     | (ii)                             | The Optionee issuing to the Optionor 75,000 Warrants at an
      exercise price of $0.35 Canadian;                                                                                       
| |     |                                  |                                                                                                                                                                                          
| |     | (iii)                            | The Optionee paying $50,000 U.S. to the Optionor; and                                                                                                                                    
| |     |                                 
| | (g) | On or before September 18, 2007:
| |     |                                  |                                                                                                                                                                                          
| |     | (i)                              | The Optionee incurring Expenditures
        of $200,000 U.S. on the Property in addition to the expenditures referred
        to in clauses (c)(i), (d)(i), (e)(i) and (f)(i) hereof; and
| |     |                                  |                                                                                                                                                                                          
| |     | (ii)                             | The Optionee issuing to the Optionor 100,000 Warrants at
      an exercise price of $0.40 Canadian.                                                                                      
| |     |                                  |                                                                                                                                                                                          
| |     | (iii)                            | The Optionee paying $75,000 U.S. to the Optionor.                                                                                                                                        

Following which the Optionee shall be deemed to have exercised
  the Option (the Exercise Date) and shall be entitled to an undivided
  100% right, title and interest in and to the Property with the full right and
  authority to equip the Property for production and operate the Property as a
  mine subject to the rights of the Optionor to receive the NSR. The Property
  comprises three projects individually known as the Hercules Project, the Imperial
  Mine property and the Gilman property all as more particularly described in
  Schedule A. The Optionee has the one time right exercisable for
  90 days following completion of a bankable feasibility study to buy up

5

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to two thirds (66.7%) of the Optionors NSR interest (i.e.
  an amount equal to 2% NSR interest) for $2,000,000 U.S. for each project comprising
  the Property, leaving the Optionor to retain not less than a 1% NSR interest.
  The right to purchase the said NSR interest shall be exercised by the Optionee
  providing the Optionor with notice of the purchase accompanied by payment in
  the amount of $2,000,000 U.S. for each project on which the Optionee is purchasing
  the NSR.

The Optionor and Optionee understand and confirm that all
  Expenditures incurred in a particular period, including any excess in the amount
  of Expenditures required to be incurred to maintain the Option during such period,
  shall be carried over and included in the aggregate amount of Expenditures for
  the subsequent period.

Notwithstanding paragraphs (c)(i), (d)(i), (e)(i), (f)(i)
  and (g)(i) if the Optionee has not incurred the requisite Expenditures to maintain
  its option in good standing prior to September 18 of any given year, the Optionee
  may pay to the Optionor within 60 days following the expiry of such period,
  the amount of the deficiency and such amount shall thereupon be deemed to have
  been Expenditures incurred by the Optionee during such period.

| | (h) | The Warrant issuances provided for in
        this Section 4 shall in each case be subject to the prior approval of
        the Exchange, if necessary, based on the submission of engineering data
        satisfactory to the Exchange, which the Optionee undertakes to use its
        best efforts to file within a reasonable period of time so as to obtain
        the necessary approval by earliest possible date. Notwithstanding any
        other provision of this agreement, so long as the Optionee has filed the
        engineering data referred to herein with the Exchange within a reasonable
        time after receiving same, the time for making any Warrant issuance referred
        to in this Section 4 shall be extended, where necessary, to the day that
        is five business days following the receipt by the Optionee of the necessary
        Exchange approval.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | (i) | The Optionor acknowledges that the Warrant
        and Warrant Shares to be issued pursuant to this Section 4 will be issued
        pursuant to available exemptions under the Securities Act(British
        Columbia), the requirements of which may be subject to change. The Optionee
        makes no representation as to any resale restrictions which may be imposed
        with respect to such Warrant or Warrant Shares from time to time.                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | (j) | The doing of any act or the incurrence
        of any Warrant issuances or cash payments by the Optionee shall not obligate
        the Optionee to do any further acts or make any further Warrant issuances
        or payments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | (k) | The Property comprises three projects
        individually known as the Hercules Project, the Imperial Mine property
        and the Gilman property all as more                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

6

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| | particularly described in Schedule A.
        The cash consideration referred to in this Section 4 is to be prorated
        such that if one or more of the projects is terminated, the cash consideration
        by the Optionee will be reduced on a pro rata basis. The proration shall
        be the Hercules Project as to 50%, the Imperial Mine property as to 30%,
        and the Gilman property as to 20%. However, the termination of any of
        the projects does not affect the Warrant issuances or Expenditures as
        outlined in this Section 4 unless all three projects are terminated, in
        which case the Warrant issuances and Expenditures shall cease.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

5.                     Transfer
  of Title

Upon
  execution of this Agreement, the Optionor will deliver or cause to be delivered
  to the Optionees solicitors a duly executed transfer of Property in favour
  of the Optionee (the Optionee Transfer) to be held in trust by said
  solicitors subject to the terms and conditions of this Agreement. The Optionee
  shall be entitled to record the Optionee Transfer with the appropriate government
  offices to effect transfer of legal title of the Property into its own name
  upon the full and complete exercise of the Option by the Optionee. In the event
  the Optionee Transfer is recorded the Optionor shall be entitled to record notice
  of its NSR interest.

6.                     Mining
  Operations during Option

During
  the Option Period, the Optionor may provide its mineral exploration expertise
  on the Property, on a consultation basis for and on behalf of the Optionee,
  at the election of the Optionee. However, the Optionee has the exclusive right
  to determine what Expenditures and Mining Operations it will perform, when they
  will be performed, and by whom. If the Optionee elects to use the mineral expertise
  and consulting services of the Optionor, then the Optionor shall invoice for
  time for consulting services and related travel expenses from time to time and
  the prompt payment of such invoices when due shall constitute a portion of Expenditures
  by the Optionee as contemplated under Section 4 hereof.

During
  the currency of this Agreement, the Optionee, its servants, agents and workmen
  and any persons duly authorized by the Optionee, shall have the right of access
  to and from and to enter upon and take possession of and prospect, explore and
  develop the Property in such manner as the Optionee in its sole discretion may
  deem advisable and shall have the right to remove and ship therefrom ores, minerals,
  metals, or other products recovered in any manner therefrom.

7.                     Assignment

During
  the Option Term, no party shall sell, transfer, assign, mortgage, pledge or
  otherwise encumber its interest in this Agreement or its right or interest in
  the Property without the consent of the other parties, such consent to be not
  unreasonably withheld, provided that any party shall be permitted to assign
  this

7

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Agreement to an affiliate, as that term is defined
  in The Company Act (British Columbia). It will be a condition of any
  assignment under this Agreement that such assignee shall agree in writing to
  be bound by the terms of this Agreement applicable to the assignor. Notwithstanding
  that any NSR held by the Optionor after the agreement has been fulfilled in
  its entirety shall be the sole discretion of the Optionor to sell its interest
  without restriction.

|8. |     | Termination
      This Agreement shall forthwith terminate in circumstances where:                                                                                                                                                                 
|-- | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |     |                                                                                                                                                                                                                                                    
|   | (a) | The Optionee shall fail
        to comply with any of its obligations hereunder, subject to Force Majeure,
        and within 30 days of receipt by the Optionee of written notice from the
        Optionor of such default, the Optionee has not:
|   |     |                                                                                                                                                                                                                                                    
|   |     | (i)                                                                                                                                                                                                                                                
|   |     |                                                                                                                                                                                                                                                    
|   |     | (ii)                                                                                                                                                                                                                                               

In the event that the Optionee gives notice that it denies
  that a default has occurred, the Optionee shall not be deemed to be in default
  until the matter shall have been determined finally through such means of dispute
  resolution as such matter has been subjected to by either party; or

| | (b) | The Optionee gives notice of termination to the Optionor,
        which it shall be at liberty to do at any time after the execution of
        this Agreement. If and when the Optionee elects to terminate this Agreement,
        or terminate one of the projects comprising the Property, at such time
        the Property or the specific project will be returned to the Optionor
        with all claim fees paid in full for that calendar year but no later than
        July 31stof that year. For clarity, any portion of the Property
        that is terminated after July 31 and before September 1 of any year must
        have the annual claim fees paid in full for September 1 of that year.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Upon the termination of this Agreement under this Section 8,
  the Optionee shall cease to be liable to the Optionor in debt, damages or otherwise,
  other than to pay the claim fees as described in paragraph (b) of this Section
  8 and all liabilities referred to in Section 11.

Upon termination of this Agreement under this Section 8, the
  Optionee shall vacate the Property within a reasonable time after such termination,
  but shall have the right

8

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of access to the Property for a period of six months thereafter
  for the purpose of removing its chattels, machinery, equipment and fixtures.

|9. |     | Representations, Warranties and Covenants of the Optionor
      The Optionor represents, warrants and covenants to and with the Optionee
        as follows:                                                                                                                                                                                                                                                                                                                                                                                                                   
|-- | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | (a) | The Optionor is a company duly organized validly existing
      and in good standing under the laws of Nevada;                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | (b) | The Optionor has full power and authority
        to carry on its business and to enter into this Agreement and any agreement
        or instrument referred to or contemplated by this Agreement;                                                                                                                                                                                                                                                                                                                                                                             
|   |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | (c) | Neither the execution and delivery of
        this Agreement, nor any of the agreements referred to herein or contemplated
        hereby, nor the consummation of the transactions hereby contemplated conflict
        with, result in the breach of or accelerate the performance required by,
        any agreement to which it is a party;                                                                                                                                                                                                                                
|   |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | (d) | The execution and delivery of this Agreement
        and the agreements contemplated hereby will not violate or result in the
        breach of the laws of any jurisdiction applicable or pertaining thereto
        or of its constating documents;                                                                                                                                                                                                                                                                                                                          
|   |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | (e) | The Agreement constitutes a legal, valid and binding obligation
      of the Optionor;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | (f) | The Property is accurately described
        in Schedule A, is in good standing under the laws of the jurisdiction
        in which it is located and is free and clear of all liens, charges and
        encumbrances;                                                                                                                                                                                                                                                                                                                                                      
|   |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | (g) | The Optionor is the sole recorded and
        beneficial owner of the Property and has the exclusive right to enter
        into this Agreement and all necessary authority to transfer its interest
        in the Property in accordance with the terms of this Agreement;                                                                                                                                                                                                                                                                                                   
|   |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | (h) | No person, firm or corporation has any
        proprietary or possessorty interest in the Property other than the Optionor,
        and no person, firm or corporation is entitled to any royalty or other
        payment in the nature of rent or royalty on any minerals, ores, metals
        or concentrates or any other such products removed from the Property other
        than the government of the state of Nevada pursuant to statute; notwithstanding
        any Federal, State or County royalties or net proceeds tax derived from
        mining operations.

9

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|    |     | (i)                                                                                                                                                            | Upon request by the Optionee, and at
        the sole cost of the Optionee, 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. Nothing will be withheld,
        hidden, or kept from the Optionee, whether the data or information is
        held or not by the Optionor; and                                                                                                                                                                                                                                 
|--- | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |     |                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |     | (j)                                                                                                                                                            | Subject to performance by the Optionee
        of its obligations under Section 4, during the Option Period, the
        Optionor will keep the Property in good standing, free and clear of all
        liens, charges and encumbrances, will carry out all Mining Operations
        on the Property in a miner- like fashion if the Optionee elects to use
        the mining expertise and consulting services of the Optionor, will obtain
        all necessary licenses and permits as shall be necessary and will file
        all applicable work up to the legal limits as assessment work under The
        Mines and Mineral Act(Nevada).
|    |     |                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|10. |     | Representations, Warranties and Covenants
        of the Optionee
      The Optionee represents, warrants and covenants to and with the Optionor
        that:
|    |     |                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | (a) |                                                                                                                                                                | The Optionee is a company duly organized
        validly existing and in good standing under the laws of Canada;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |     |                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | (b) |                                                                                                                                                                | The Optionee has full power and authority
        to carry on its business and to enter into this Agreement and any agreement
        or instrument referred to or contemplated by this Agreement;                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |     |                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | (c) |                                                                                                                                                                | Neither the execution and delivery of
        this Agreement, nor any of the agreements referred to herein or contemplated
        hereby, nor the consummation of the transactions hereby contemplated conflict
        with, result in the breach of or accelerate the performance required by,
        any agreement to which it is a party;                                                                                                                                                                                                                                                                                                       
|    |     |                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | (e) |                                                                                                                                                                | The execution and delivery of this Agreement
        and the agreements contemplated hereby will not violate or result in the
        breach of the laws of any jurisdiction applicable or pertaining thereto
        or of its constating documents; and                                                                                                                                                                                                                                                                                                                                                                                             
|    |     |                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | (f) |                                                                                                                                                                | This Agreement constitutes a legal, valid and binding obligation
      of the Optionee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |     |                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|11. |     | Indemnity and Survival of Representation                                                                                                                      



10

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The
  representation and warranties hereinbefore set out are conditions on which the
  parties have relied in entering into this Agreement and shall survive the acquisition
  of any interest in the Property by the Optionee and each of the parties will
  indemnify and save the other harmless from all loss, damage, costs, actions
  and suits arising out of or in connection with any breach of any representation,
  warranty, covenant, agreement or condition made by them and contained in this
  Agreement.

The
  Optionor agrees to indemnify and save harmless the Optionee from any liability
  to which it may be subject arising from any Mining Operations carried out by
  the Optionor or at its direction on the Property. The Optionee agrees to indemnify
  and save harmless the Optionor from any liability to which it may be subject
  arising from any Mining Operations carried out by the Optionee or at its direction
  on the Property.

The
  Optionor agrees to indemnify and save harmless the Optionee from any liability
  arising from any and every kind of work done on or with respect to the Property
  prior to the signing of this Agreement (the Prior Operations). Without
  limiting the generality of the foregoing, Prior Operations includes all work
  capable of receiving assessment credits pursuant to The Mines and Minerals
  Act of Nevada and the work of assessment, geophysical, geochemical and geological
  surveys, studies and mapping, investigating, drilling, designing, examining
  equipping, improving, surveying, shaft sinking, raising, cross-cutting and drifting,
  searching for, digging, trucking, sampling, working and procuring minerals,
  ores and metals, in surveying and bringing any mineral claims to lease or patent,
  in doing all other work usually considered to be prospecting, exploration, development,
  a feasibility study, mining work, milling, concentration, beneficiation of ores
  and concentrates, as well as the separation and extraction of Mineral Products
  and all reclamation, restoration and permitting activities.

12.                   Confidentiality

The
  parties hereto agree to hold in confidence all information obtained in confidence
  in respect of the Property or otherwise in connection with this Agreement other
  than in circumstances where a party has an obligation to disclose such information
  in accordance with applicable securities legislation, in which case such disclosure
  shall only be made after consultation with the other party.

13.                   Notice

All
  notices, consents, demands and requests (in this Section 13 called the Communication)
  required or permitted to be given under this Agreement shall be in writing and
  may be delivered personally sent by telegram, by telex or telecopier or other
  electronic means or may be forwarded by first class prepaid registered mail
  to the parties at their addresses first above written. Any Communication delivered
  personally or sent by telegram, telex or telecopie r or other electronic means
  including

11

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email shall be deemed to have been given and received on the
  second business day next following the date of sending. Any Communication mailed
  as aforesaid shall be deemed to have been given and received on the fifth business
  day following the date it is posted, addressed to the parties at their addresses
  first above written or to such other address or addresses as either party may
  from time to time specify by notice to the other; provided, however, that if
  there shall be a mail strike, slowdown or other labour dispute which might effect
  delivery of the Communication by mail, then the Communication shall be effective
  only if actually delivered. For purposes of this agreement and as a definition
  of address the Optionors email shall be defined as rrkern@charter.net.
  and the Optionors telecopier number is 775-746-0938. The Optionees
  email shall be defined as mad@senategroup.com
  and the Optionees telecopier number is 604-689-1722. Notice will be provided
  to each party should their respective email address change.

14.Further
  Assurances

Each
  of the parties to this Agreement shall from time to time and at all times do
  all such further acts and execute and deliver all further deeds and documents
  as shall be reasonably required in order to fully perform and carry out the
  terms of this Agreement.

15.Regulatory
  Approval

This
  Agreement is subject to the prior approval of the Exchange. The Optionee shall
  use its best efforts to obtain such approval as soon as reasonably possible,
  provided however that if such approval has not been received by November 28,
  2002, this Agreement shall be null and void and of no further effect.

16.Entire
  Agreement

The
  parties hereto acknowledge that they have expressed herein the entire understanding
  and obligation of this Agreement and it is expressly understood and agreed that
  no implied covenant, condition, term or reservation, shall be read into this
  Agreement relating to or concerning any matter or operation provided for herein.

17.Proper
  Law and Arbitration

This
  Agreement will be governed by and construed in accordance with the laws of the
  State of Nevada and the laws of the United States of Ame rica applicable herein.
  The parties hereto hereby irrevocably attorn to the jurisdiction of the Courts
  of Nevada. All disputes arising out of or in connection with this Agreement,
  or in respect of any defined legal relationship associated therewith or derived
  therefrom, shall be referred to and finally resolved by a sole arbitrator by
  arbitration under the rules of The Arbitration Actof Nevada.

18.Enurement

12

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This
  Agreement will enure to the benefit of and be binding upon the parties hereto
  and their respective successors and permitted assigns.

|19 . |  | After Acquired Properties
|---- |  | -------------------------
|     |  |                          
|     |  | (i)                      
|     |  |                          
|     |  | (ii)                     

20.                   Default

Notwithstanding
  anything in this Agreement to the contrary if any party (a Defaulting
  Party) is in default of any requirement herein set forth the party affected
  by such default shall give written notice to the Defaulting Party specifying
  the default and the Defaulting Party shall not lose any rights under this Agreement,
  unless thirty (30) days after the giving of notice of default by the affected
  party the Defaulting Party has failed to take reasonable steps to cure the default
  by the appropriate performance and if the Defaulting Party fails within such
  period to take reasonable steps to cure any such default, the affected party
  shall be entitled to seek any remedy it may have on account of such default
  including, without limiting, termination of this Agreement. Notwithstanding
  the Optionee shall be responsible for claim fees to the U.S. Bureau of Land
  Management no later than July 31stof each calendar year of the agreement.
  Further, all county claim fees shall be paid by the Optionee no later than July
  31 of each calendar year.

21.Payment

All
  references to monies herein shall be in U.S. funds unless otherwise specified.
  The Optionee shall make payments for the Expenditures incurred by the Optionor
  no later than 15 days after the receipt of invoices delivered by the Optionor
  which for the purposes of this Agreement shall constitute prompt and due payment.
  All contractors will invoice the Optionee directly and any costs arising with
  respect to work performed shall be solely borne by the Optionee and not the
  Optionor.

13

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22.Option
  Only

This
  is an option only and except as herein specifically provided otherwise nothing
  herein contained shall be construed as obligating the Optionee to do any acts
  or make any payments hereunder, and any act or payment or payments as shall
  be made hereunder shall not be construed as obligating the Optionee to do any
  further act or make any further payment or payments.

23. Supersedes
  Previous Agreements

This
  Agreement supersedes and replaces all previous oral or written agreements, memoranda,
  correspondence or other communications between the parties hereto relating to
  the subject matter hereof.

IN WITNESS WHEREOF the Parties hereto have duly executed
  this Agreement effective as of the 27thday of September, 2002.

MinQuest Inc.

Per: Richard Kern"
  Richard A. Kern, President

Miranda Diamond Corp.

Per: Dennis Higgs"
  Authorized Signatory

14

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SCHEDULE A

Sections 13, 24, 25, T16N, R22E and Sections 7, 18, T16N, R23E, MDB&M,
  Lyon County, Nevada

|CLAIM NAME                                      | NMC NUMBER
|----------------------------------------------- | ----------
|Apollo 7                                        | 804993    
|Apollo 16                                       | 804994    
|Apollo 17                                       | 804995    
|Apollo 19                                       | 804996    
|Apollo 21                                       | 804997    
|Apollo 24                                       | 804998    
|Hercules 2                                      | 804978    
|Hercules 3                                      | 804979    
|Hercules 48                                     | 804984    
|Hercules 49                                     | 804985    
|Hercules 52                                     | 804987    
|Hercules 53                                     | 804988    
|Apollo 1,3, 5, 9, 11, 18, 20, 22, 23, 25        | NA        
|Hercules 1, 4-8,12-14,19, 44-47, 50, 51, 54, 55 | NA        

Sections 34-36, T4S, R40E, MDB&M, Esmeralda County, Nevada

|CLAIM NAME      | NMC NUMBER
|--------------- | ----------
|Lida 1-10       | 9717-9726 
|Helen 1-9       | NA        
|Imperial 20, 21 | NA        

Sections 17, and 18, T16N, R44E, MDB&M, Lander County, Nevada

|CLAIM NAME | NMC NUMBER
|---------- | ----------
|GILMAN 32  | 623867    
|GILMAN 33  | 623868    
|GILMAN 34  | 623869    

15

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SCHEDULE B

|Net Smelter Return
        shall mean the aggregate proceeds received by the Optionee from time to
        time from any smelter or other purchaser from the sale of any ores, concentrates,
        metals or any other material of commercial value produced by and from
        the Property after deducting from such proceeds the following charges
        only to the extent that they are not deducted by the smelter or other
        purchaser in computing the proceeds:
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

The Optionee shall reserve and pay to the Optionor a NSR equal to three (3%)
  percent of Net Smelter Return.

Payment of NSR payable to the Optionor hereunder shall be
  made quarterly within thirty (30) days after the end of each calendar quarter
  during which the Optionee receives Net Smelter Returns in U.S. dollars or in
  kind bullion at the discretion of the Optionor. Within sixty (60) days after
  the end of each calendar quarter for which the NSR are payable to the Optionor,
  the records relating to the calculation of NSR for such year shall be audited
  by the Optionee and any adjustments in the payments of NSR to the Optionor shall
  be made forthwith after completion of the audit. All payments of NSR to the
  Optionor for a calendar year shall be deemed final and in full satisfaction
  of all obligations of the Optionee in respect thereof if such payments or the
  calculations thereof are not disputed by the Optionor within sixty (60) days
  after receipt by the Optionor of the same audited statement. The Optionee shall
  maintain accurate records relevant to the determination of the NSR and the Optionor,
  or its authorized agent, shall be permitted the right to examine such records
  at all reasonable times.

16

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