exhibit10_16.htm


    Exhibit
10.16

    


    


    




    
      
         


      

      
        Exhibit
10.16 - 1

        
          

        

      

      
         


      

    


    EXPLORATION
CONTRACT WITH AN OPTION TO BUY

    


    In the
City of Hermosillo, State of Sonora, Mexico, on the twenty-fifth day of
September 2007, for one part the company, ATZEK MINERAL SA DE CV., represented
by FABIO MONTANARI as its Sole Administrator hereinafter referred to as the
INVESTOR and for the other part, Mr. LUIS ENRIQUE FIERROS HERNANDEZ, Mrs.
ROSSINA HERNANDEZ BALDENEBRO, Mr. LUIGI MEGLIOLI and Mr. DAGOBERTO GOMEZ Y
HOYUELA, hereinafter referred to as LINCENSEES, agree to abide by this document,
the first to perform the exploration of the LINCENSEES’ mining lands and its
eventual purchase according to the terms and figures established in the clauses
of this contract, and the LICENSEES promise to sell to the INVESTOR, the mining
concessions mentioned in the following statements:

    


    STATEMENTS

    


    The
INVESTOR states that it is a mercantile company legally organized, as it is
established on Deed number 2506 of Book 1 of Mercantile Companies, granted
before Salomon Griego Garcia, Attorney at Law, Notary Public Number 1 of the
State of Sonora, and according to its corporative object it is a mining company,
that will be dedicated to exploring and exploiting mining basins, as well as to
Benefit from these, among other things.

    


    Mr. Luis
Enrique Fierros Hernandez states to be Mexican by birth, single, Forty Eight
years old, miner, with address at No. 103, Lopez del Castillo Street, Colonia
Olivares, City of Hermosillo, State of Sonora, Mexico, and fully capable and apt
to hire and to commit, and being one of the mining basins LICENSEES’ mentioned
further ahead.

    


    Mrs.
Rossina Hernandez Baldenebro states to be widow, housewife, with address at No.
103, Lopez del Castillo Street, Colonia Olivares, City of Hermosillo, State of
Sonora, Mexico, being legal heir to all properties and rights of her late
husband Mr. José Ramon Anguiano. She also declares to be fully capable and apt
to hire and to commit, and being one of the mining basins LICENSEES’ mentioned
herein.

     

    
      
         

      

      
        Exhibit
10.16 - 2

        
          

        

      

      
         

      

    

    


    Mr. Luigi
Meglioli states to be Italian by birth and Mexican, with Date of Birth on
February 3rd, 1946,
with address at No. 9799 Paseo de los Heroes Avenue, City of Tijuana, Baja
California, Mexico, with Mexican Passport No. F5930562, being one of the mining
basins LICENSEES’ mentioned herein and to be fully capable and apt to hire and
to commit.

    


    Mr.
Dagoberto Gomez y Hoyuela states to be Mexican by birth, of occupation
geological engineer and mining exploration, 67 years old, with address at No.
twelve, Alameda Street, Colonia Villa Satelite, City of Hermosillo, State of
Sonora, Mexico, and being one of the mining basins LICENSEES’ mentioned further
ahead and fully capable and apt to hire and to commit.

    


    The
LICENSEES also state to be holders of the following mining basins (hereinafter
MINING CONCESSION) registered in the Mining Public Registry and to be holding
and current with all payments and mining duties:

    


    “Real de
Cananea” with 181.5 hectares, title number 222691 registered to Dagoberto Gomez
y Hoyuela (34%), José Ramon Anguiano (deceased) (33%) and Luis Enrique Fierros
Hernandez (33%);

    


    “Real de
Cananea I” with 200 hectares, title number 224946 registered to José Ramon
Anguiano (deceased) (50%) and Dagoberto Gomez y Hoyuela (50%);

    


    “El
Fenix” with 648, 5000 hectares, title number 082/30504 registered to Luigi
Meglioli (50%) and Luis Enrique Fierros Hernandez (50%).

    


    With the
existing interest by the INVESTOR in obtaining exclusive rights from the
LINCENSEES to explore MINING LINCENSE, with the option to exclusively purchase
it, the INVESTOR and the LICENSEES agree to celebrate this Contract, subject to
the following articles.

    


    
      
         

      

      
        Exhibit
10.16 - 3

        
          

        

      

      
         

      

    

    


    


    1.     ACKNOWLEDGEMENTS
AND GUARANTEES

    


    1.1 The
LICENSEES acknowledge and guarantee to the INVESTOR that:

    


    a)                      They
have the exclusive right to celebrate and carry on this Contract, which abides
them and is executable according with its terms.

    b)                      They
have the proper title and it is negotiable as a whole MINING CONCESSION, and
that they are free from encumbrances, mortgages, attachments or impositions
providing proof that whole MINING PROPERTY is current in all legal and taxing
aspects.

    


    c)                      There
is no claim or law suits, for any commitment regarding the MINING CONCESSIONS
title; nor, knowingly, any base for such claims.

    


    d)                      There
are no other agreements or related options to explore or exploit the MINING
CONCESSION

    


    e)                      To
their knowledge, information and belief there are no pending legal actions nor
to be initiated, nor lawsuits, claims or disputes relating the MINING CONCESSION
or that could affect its possession.

    


    d)                      The
MINING LINCENSE has not been explored nor exploited with mechanical equipment
that could have caused environmental damage or could potentially cause
environmental damage in the future, such as draining acid rocks.  In
order to have proof of this matter, within what is lawful, an environmental
minute will be done with a representative of the Secretary of Environment and
Natural Resources (hereinafter SEMARNAT) and the other parties.

    


    1.2            The
acknowledgements and guarantees established in the previous clause 1.1 have been
weighed by the parties as conditions for this Contract and will be valid for the
whole term and after the purchase of the MINING CONCESSION by the INVESTOR,
therefore each party agrees to compensate and free the other party from loss,
harm, cost or legal action that can result from one of the previous
acknowledgements and guarantees not being true:

    


    
      
         

      

      
        Exhibit
10.16 - 4

        
          

        

      

      
         

      

    

    


    2.     
TERM

    


    The valid
term of this Contract will begin as of March 19th, 2007
according to previous agreement. Having understood that exploration could start
in the month of September, 2007 and will subsist for five years until the
completion of the Mining concession exploration and with total payment agreed to
the LICENSEES in this contract is finished, as well as to what is established in
article NINETEENTH.

    


    


    3.     
EVALUATION
AND EXPLORATION

    


    The
LICENSEES grant to the INVESTOR the exclusive possession of the MINING
CONCESSION for the term of this contract, authorize this to execute all the
mining rights belonging to the LICENSEES, which includes the exclusive right to
evaluate the MINING CONCESSION and conduct all exploration operations, as well
as, any other task related to this activity, according to the method, form and
extent the INVESTOR deems to its sole criteria.

    


    


    4.      EXPLORATORY
ACTIVITIES:

    


    4.1           In
this act the LICENSEES deliver to the INVESTOR all the geological,
administrative and legal information that they have regarding the MINING
CONCESSION object of this Contract.

    


    
      
         

      

      
        Exhibit
10.16 - 5

        
          

        

      

      
         



    

    4.2 During
the term of this Contract the INVESTOR, its dependents and representatives will
have the right to conduct in the MINING CONCESSION all the exploratory
activities that the LICENSEES have the right to conduct according to the Mexican
Mining Code.

    


    4.3 The
LICENSEES authorize the INVESTOR to perform topographic, geological, and
geophysical studies, drilling, trenches and wells or any other type of related
mining exploration tasks at the MINING CONCESSION.  The INVESTOR can
extract, analyze and process samples, geochemical as well as metallurgical,
including industrial size, send them to labs or research centres and send
samples in the necessary volume for testing by prospect buyers.

    


    4.4 The
INVESTOR, its representatives, agents or its own workers or from its contractors
will have the right to access the MINING CONCESSION without any limitation and
can enter all machines, tools, and equipments that they deem necessary or
convenient.  At the end of this Contract, for any cause, the INVESTOR
can within the following one hundred and twenty (120) days running from the date
finishing this Contract, withdraw at his own expense such
machinery,

    tools,
and equipments.

    


    4.5 The
LINCENSEES or its representatives will have the right to access the MINING
CONCESSION at all times to perform exploration works. The INVESTOR will not be
held responsible for any damage or harm that can occur to the LICENSEES or its
representatives during their visits or their work at the MINING CONCESSION,
except those caused by fault negligence of the INVESTOR or its representatives
or employees.

    


    5   
RESPONSIBILITY

    


    5.1 The
INVESTOR will be responsible for hiring the necessary personnel for fulfilling
its contractual commitment and must, regarding these personnel, provide and
strictly follow all current legal provisions regarding labour law.

     

    
      
         

      

      
        Exhibit
10.16 - 6

        
          

        

      

      
         

      

    

    


    5.2 The
INVESTOR is obligated to acquire a Civil Liability Insurance policy; in order to
be covered by events occurred as consequence of the activities performed by the
INVESTOR in the MINING CONCESSION.

    


    5.3 The
INVESTOR is obligated to keep the LICENSEES free of all responsibility, harm or
damage as a result of sentences or labour, civil, commercial or criminal claims
formulated by third parties resulting from the activity conducted by the
INVESTOR in fulfilling this Contract, as well as harm caused to third parties,
their personnel and/or subcontractors and those caused to the
environment.  In any of the above mentioned scenarios, the INVESTOR
must satisfy the costs implied by repairing damages caused and pay legal defense
fees in trial by the LICENSEES.

    


    


    6   
SIXTH:

    


    6.1 In case
that the option agreement is not executed, the INVESTOR is required to provide
to the LICENSEES all the documents, maps, sections, trial results and reports
regarding deposits or evidence of minerals discovered during the evaluation and
exploration of the MINING CONCESSION.

    


    6.2 The
INVESTOR agrees to present to the LICENSEES a quarterly report containing
technical data and detailed expenses.  Such report will be presented
within the following thirty (30) days after the end of each
quarter.  Furthermore, the INVESTOR will present to the LICENSEES a
complete annual report containing all technical data and detailed expenses
mentioned in this paragraph.

    


    6.3 The
LINCENSEES agree to complete confidentiality about all of the exploration data
and not to acknowledge anything, present documentation or any other act, or
errand, of any nature, related to the MINING CONCESSION, before the General
Director of Mines of the Mexican Republic, nor before other organizations,
except those that are necessary to abide with what is established in clause 6.4,
without prior consent from the INVESTOR.  Its breach will be cause to
rescind this Contract, upon decision of the INVESTOR, being the LICENSEES,
responsible for damages and losses to the INVESTOR as a result of the
same.

     

    
      
         

      

      
        Exhibit
10.16 - 7

        
          

        

      

      
         

      

    

    


    6.4 The
LICENSEES can conduct audits on the exploration tasks and other mining
activities the INVESTOR performs on the MINING CONCESSSION, with its own
auditors, or those that the LINCENSEES assign.

    


    6.5 The
INVESTOR will handle all the necessary paper work related to, in case it is
necessary, register before the Mines Director of the Mexican Republic the
acknowledgement of findings conducted in the area covered by the MINING
CONCESSION and any other mining right, which are registered under the LICENSEES
names.

    


    6.6 The
acknowledgements and other mining rights registered under the LICENSEES names as
a result of exploratory work performed by the INVESTOR within the MINING
CONCESSION will be automatically integrated to the same and subject, therefore,
to the Purchase Option and all de other provisions of this
Contract.

    


    6.7 Except
that the Mining Agency of the State of Sonora, demands the demarcation, grouping
and registration of the MINING CONCESSION, or there is a legal imperative to do
so, the current legal figures at the date of signing of the present contract
will be kept by the LICENSEES until the INVESTOR completely executes the
Purchase Option.

    


    6.8 The
LICENSEES will do all necessary to preserve their right to use the MINING
CONCESSION therefore, in this act they commit to grant a power for
administrative related acts with the titles of the mining concession, object of
the present agreement to a representative of the INVESTOR, with the authority
for substitution, in order to intervene on its behalf, in all the necessary
matters to maintain the use of the MINING CONCESSSION, granted with all the
necessary authorities to conduct the necessary business to fulfil what is
established in clause 6.5, as well as to fulfil payment of legal
fees.

     

    
      
         

      

      
        Exhibit
10.16 - 8

        
          

        

      

      
         

      

    

    


    6.9 The
INVESTOR will be in charge of all distributions related to mining shelter and
other obligations established by the Mexican Mining Code, exploration fees,
exploitation, edict publications, measuring costs, servitudes compensations or
assumed responsibilities with tenants, as well as all the seals and repaying
services levies that are applicable according to the federation and the State of
Sonora tax, except as established in article TENTH, clause 10.3.

    


    


    7   
SEVENTH:

    


    7.1 The
LICENSEES inhibit voluntarily from conducting, during the term of this Contract,
disposition or encumbrances acts on the MINING CONCESSION, of any nature,
including but not limited to sell, transfer, mortgage, assignment, lease, hiring
and money advancements.-

    


    7.2 In this
act the LICENSEES subscribe a presentation to the Mining Director of the Mexican
Republic in which they request to register the referred inhibition in the
previous paragraph.  This inhibition will be in place during the term
of this contract; but it can be lifted unilaterally by the LICENSEES in case the
INVESTOR desists to execute the Purchase Option of this Contract in the terms of
article TENTH.

    


    7.3 In
endorsing the referred inhibition the LICENSEES will proceed to register this
Contract, at the Mining Director of the Mexican Republic and in its effect, they
authorize the INVESTOR to formalize such registration.  The expenses
incurred by these services and for all the norms related in the State of Sonora,
for the period corresponding until the complete execution of the Purchase Option
of the MINING CONCESSION, will be covered by the INVESTOR, except for the
accusations stated in article SIXTH, clause 6.9.

    


    7.4 If the
INVESTOR opts for the purchase of the MINING CONCESSION and the transfer could
not be effected due to the LICENSEES before the date ending the inhibition term,
these must request to the Mining Agency in the State of Sonora to register an
extension to such term until the transfer is formalized and in its effect
authorize the INVESTOR in irrevocable terms to request such extension on their
behalf and representation.

    


    
      
         

      

      
        Exhibit
10.16 - 9

        
          

        

      

      
         

      

    

    8   
RESCISSION

    


    8.1           During
the term of the present Contract the INVESTOR can, at any moment, unilaterally
desist to the Purchase Option and terminate this Contract even after having
executed such Purchase Option.  This decision must be communicated to
the LICENSEES in a reliable way and

    at least
with a thirty (30) consecutive days notice. This contract shall end for both
parties on the effective date of termination specified on the
notice.

    


    8.2 This
rescission will not grant the LINCENSEES the right to make any claims whether as
compensation, damages, or lost of profits and they will only have the right to
get back all the information related to the exploration performed, documentation
related to the MINING CONCESSION, payment receipts for mining duties and
information proving exploration works performed.

    


    8.3 As of the
effective of rescission the INVESTOR shall not be obligated to make the payments
foreseen in article TENTH that become due after that date.

    


    8.4 In case
that as of the date of rescission there were payments and/or mining duties due,
the INVESTOR shall cover this amount for the LICENSEES, the amounts that are due
for payment, as of the effective date of rescission of this
Contract.

    


    8.5 The
LINCENSEES can terminate this Contract in case the INVESTOR does not make the
payments established in article TENTH, after thirty (30) consecutive days have
passed since the LICENSEES had suggested this commitment in a reliable manner
and by writing according to what is written in article NINETEENTH.

    


    
      
         

      

      
        Exhibit
10.16 - 10

        
          

        

      

      
         

      

    

    


    


    


    (However, the notice period
will be prolonged to 90 days if the INVESTOR has begun exploration Works and has
made an investment of at least USD 500,000 in exploration, or once the
production has commenced.)

    


    9   
PURCHASE
OPTION

    


    During
the term of this Contract, the INVESTOR will have the exclusive option to
acquire the MINING CONCESSION, which will be understood as automatically
executed since the moment the INVESTOR completes the agreed payments in article
10.1 and 10.2.

    


    10.   
TENTH

    


    Once the
Purchase Option is in effect, the LINCENSEES must subscribe and deliver all
documents, proceed with all registration and enrolments and satisfy all the
necessary measures to formalize the transfer of the MINING CONCESSION to the
INVESTOR free of all obligations, burdens or encumbrances.

    


    On the
other side, the LINCENSEES will have right to one of the following payment
plans, as determined by the INVESTOR at the time of executing the acquisition
option.

    


    
      	
              10.1  

            	
              Payment
      Plan:

            


    

    


    LICENSEES
will receive a “Total Amount” of US$ 10,000,000.00 (Ten Million US Dollars),
deducting from this amount the payments for the option that have been made. This
amount will be paid by the following plan: after production begins:

    


    A)           One
single payment

    


    
      
         

      

      
        Exhibit
10.16 - 11

        
          

        

      

      
         

      

    

    


    


    B)           Every
6 months, an anticipated payment for US$ 1,000,000 (One Million US Dollars) will
be paid every six months until amount owed is completed.

    


    For the
first year another payment plan can be convened which will be easier for the
INVESTOR to transfer cash owed to the LINCENSEES during the beginning of
production when cash is scarce.  This will be convened before
beginning production.

    


    If total
payment for the acquisition is not made in one single payment, then 10% will be
added to the total remaining balance.

    


    10.2 Regarding
the payment plan the total price that the INVESTOR will pay to the
LICENSEES for the Exploration Rights and the Purchase Option for the MINING
CONCESSION, includes all the titles, properties and mining rights that form part
of such, consisting in the “total sum” to be effective as follows:

    


    -                On
March 12, 2008, the amount of USD$ 50.000 (fifty thousand North American
dollars). Within the term of one (1) year starting from the signing of this
contract, the INVESTOR will conduct an audit and a mining-geological inspection
of the MINING CONCESSION, in order to decide if to continue with this Purchase
Option.  If this is affirmative, an exploration plan will be presented
to the LICENSEES on an informational basis and the following payment will be
made.

    


    -                Twenty
four (24) months after the signing of this agreement, the amount of USD$ 100,000
(One hundred thousand North American dollars).

    


    -                Thirty
six (36) months after the signing of this Contract, the amount of USD$ 200,000
(Two hundred thousand North American dollars).

    


    -                Forty
eight (48) months after signing this Contract, the amount of USD$ 400,000 (Four
hundred thousand North American dollars).

    


    
      
         

      

      
        Exhibit
10.16 - 12

        
          

        

      

      
         

      

    

    -                Sixty
(60) months after signing this Contract, the amount of USD$ 9,250,000 (Nine
millions two hundred and fifty thousand US dollars).

    


    -                Fulfilling
all payments above mentioned by the INVESTOR, will imply the automatic execution
of the Purchase Option and, consequently, the acquisition of the MINING
CONCESSION with all the rights and MINING CONCESSION that form part of
such.

    


    The total
price that the INVESTOR will pay to the LICENSEES regarding the Exploration
Rights and the Purchase Option of the MINING CONCESSION, including the property
and the mining rights, consists of the “total amount” of USD$ 10,000,000(Ten
millions US Dollars).

    


    10.3 Once the
Purchase Option is executed in the established manner the transfer of ownership
of all and each one of the properties and mining rights that form part of the
MINING CONCESSION must be subscribed before Notary Public of the State of
Sonora, Mexico, which will be designated by the INVESTOR. Such transfer must be
orchestrated within the thirty (30) working days starting from the date in which
the Purchased Option is concluded.  The costs for registering, sealing
and applicable levies for such transfer and according to tax norms of the
federation and of the State of Sonora, will be paid in equal halves by the
parties.

    


    10.4 In case
that on the established date for such transfer of ownership of the MINING
CONCESSION the paper work that condition the registration of acknowledging
findings, mines or any other request or mining right that at that date form part
of the MINING CONCESSION have not been completed, the LICENSEES will transfer to
the INVESTOR the MINING CONCESSION in the legal situation in which it
is.

    


    10.5 If by
attributable cause to the INVESTOR the transfer of the MINING CONCESSION or of
any of the properties mining rights that form part of such could not be
orchestrated within the term established in clause 10.3, the LICENSEES can
consider that the INVESTOR has desisted the purchase and that has therefore lost
all its rights to acquire the MINING CONCESSION, prior suggestion that the
LICENSEES must do according to what is established in article
SEVENTEENTH.

    


    
      
         

      

      
        Exhibit
10.16 - 13

        
          

        

      

      
         

      

    

     

    10.6 All
payments will be made by the INVESTOR in 4 equal parts directly to each four
LICENSEES.

     

    10.7 If
transfer of the MINING CONCESSION could not be executed by reason reputable to
LICENSEES, the INVESTOR will have the right to file a Lawsuit for the execution
of this Contract regarding the assignment or transfer of the MINING CONCESSION
herein and to be compensated for damages, losses and profit loss caused by the
delayed execution.

    


    11. CONTRACT
TERMINATION

    


    If the
INVESTOR or the LICENSEES terminate this Contract, this will terminate for both
parties on the effective date of termination according to the respective
notification.

    


    Once
termination of the Contract is effective for the established causes in the
previous paragraph, the INVESTOR must:

    


    11.1 Return to
the LICENSEES possession of the MINING CONCESSION or of its property if it is
due to lack of payment after the execution of the Purchase
Option.  The LICENSEES will receive the possession or property of the
MINING CONCESSION, according to the case, in the physical and legal state in
which it is, without right to claim compensation for damages, losses, lost
profits or compensation of any nature.  In case the INVESTOR must
return the property of the MINING CONCESSION to the LICENSEES, the costs for
registering, sealing and other applicable levies will be its responsibility for
this transfer according to tax norms of the federation and of the State of
Sonora.

    


    11.2 Subscribe,
register and deliver to the LICENSEES all the documents that are necessary for
proving the conclusion of this Contract before the General Director of Mines of
the Mexican Republic or before third parties.

    


    11.3 Vacate
the  MINING CONCESSION within the following one hundred and twenty
(120) days starting on the effective day of conclusion of this Contract and
withdraw from this, at its own expense, all machinery, tools, equipment, goods,
and artefacts entered, in order to carry this obligation the INVESTOR can access
the MINING CONCESSION during this period.

     

    
      
         

      

      
        Exhibit
10.16 - 14

        
          

        

      

      
         

      

    

    
 

    11.4 Deliver
to LICENSEES within the following sixty (60) days from the effective of
concluding this Contract, a copy of all the maps, geological reports, tests
trials, perforation records and other technical date resulting from the
exploratory task and from the evaluation performed by the INVESTOR.

    


    12.           TWELVETH:

    


    As of the
effective day of conclusion of this Contract this will loose all validity and
effect for all the parties, except for the obligations established in the
previous article and in article THIRTEENTH of this Contract which will be valid
for a period of one (1) additional year.

    


    13.   THIRTEEN:
CONFIDENTIALITY

    


    All
knowledge and information that the LICENCEES get regarding de results of the
exploration performed by the INVESTOR, applied methods, analysis results,
metallurgical trials, perforation locations, findings made, technology or
applied inventions or as a result of all the activity performed by the INVESTOR
because of this Contract, will be kept in absolute reserve and considered
confidential by the LICENSEES, except that the INVESTOR waives in writing this
obligation from the LICENSEES or the information is required to the LICENSEES by
government organizations, legally capable for this effect.  This is
until one (1) year after its conclusion.

    


    14.   FORCE
MAJEURE

    


    


    None of
the parties will be responsible for breaching their obligations under this
Contract this due to causes out of their control, including, but without
limitation: labour conflicts, regardless of the origin and rationality of the
claim or if the parties are able to satisfy such, as long as the conflict is not
the result of breaching legal or contractual obligations by the parties; acts of
nature, laws, norms, ordinances or requirements from any state or federal
authority; sentences that prevent or alter to abide contractual obligations or
prevent, under reasonable conditions, getting some permit or license; lack of
availability or insufficient equipment and materials in the country to carry on
the tasks of this Contract; suspension of activities to remedy or prevent
present or future transgressions to federal, state or city laws or norms related
to the environment; acts of war or insurrection or rebellion, fire; explosions,
earthquakes, volcanic eruptions, storms, floods, droughts and other adverse
wheatear conditions.

     

    
      
         

      

      
        Exhibit
10.16 - 15

        
          

        

      

      
         

      

    

    


    The
affected party must notify the other party without delay about the force majeure
act and of the suspension and its estimated duration.  The affected
party must assume abiding its obligations as soon as reasonably
possible.

    


    15.   AREA OF
INFLUENCE

    


    All
property, right, or mining interest acquired by any of the parties during the
term of this Contract, in the neighbouring areas to the MINING CONCESSION will
be included to it and, consequently, will be subject to the terms and conditions
established in the present.

    


    16.   GENERAL
CLAUSES

    


    The
investments that the INVESTOR makes in complying with this Contract must be
notified to the LICENSEES together with the related proof at the address
established in this Contract to receive notices.

    


    
      
         

      

      
        Exhibit
10.16 - 16

        
          

        

      

      
         

      

    

    


    


    


    17.   APPLICABLE
LAW

    


    The
relationship between the parties will be ruled by the provisions of the present
Contract and in subsidy by the Mining Law and by the applicable Mexican
legislation.

    


    All
discrepancy in the application or interpretation of this Contract shall be
submitted to the jurisdiction of the Ordinary Courts of the City of Hermosillo,
waiving all other statute or jurisdiction.

    


    18.   EIGHTEENTH:

    


    If any of
the parties omits abiding to any of the obligations established in this Contract
the affected party by the omission will notify in writing and in a reliable
manner such omission to the party al fault and this will not loose its rights
under this Contract, unless that within the following thirty (30) days starting
from the receipt of the notice, this has not taken all measures to fix this
breaching.

    


    If the
party at fault does not take the necessary measures to fix its breach within
this period, the affected party will have the right to demand the remedy of this
breach by a court of law or by any other method deemed convenient, without
prejudice to what is established regarding Contract cancellation in article
EIGHTH.

    


    19.   NINETEENTH:

    


    This
Contract will result in benefit and will obligate the parties subscribing it, as
well as their respective heirs, executors, administrators, successors, and
rightful claimants.

    


    
      
         

      

      
        Exhibit
10.16 - 17

        
          

        

      

      
         

      

    

    


    


    


    


    20. TWENTIETH:

    


    The
INVESTOR can freely yield to third parties all its rights and obligations
emerging from this Contract and furthermore he can associate with third parties
to its fulfilment, notifying in writing the LICENSEES the substantial conditions
of such yielding or association.

    


    The
LICENSEES can only yield their respective rights and obligations with written
consent from the INVESTOR, such consent can not be denied in an unreasonable
manner.

    


    21.   TWENTY
FIRST:

    


    The
headings and titles of this Contract have the intent to facilitate the reference
to the articles that comprise it but do not affect or restrict the
interpretation of such.

    


    22.   TWENTY
SECOND: NOTIFICATIONS

    


    Any
notification related to this Contract must be made in writing and can be
delivered by hand or sent registered prepaid mail, certified mail or by fax
addressed such as the case requires:

    


    The
INVESTOR: FABIO MONTANARI, Via Il Perugino 8, 09121 CAGLIARI Italia,
Phone  +39070 5434441 or +39 347 351 8362, Fax +39 070 5489016, E-mail
fabiomontanari1@gmail.com

    


    The
LICENSEES: Luis Enrique Fierros Hernandez at number 103 Lopez del Castillo
Street  colonia Olivares, City of Hermosillo, State of Sonora, Mexico,
Telephone  +52 662 218151 +52 1662 171 6161, E-mail
luisenrique.fierro@gmail.com

    


    Mrs.
Rossina Hernandez Baldenebro, at No. 103, Lopez del Castillo Street, Colonia
Olivares, City of Hermosillo, State of Sonora, Mexico, Phone +52 662 218
1510.

    


    Mr. Luigi
Meglioli, at No. 9799 Paseo de los Heroes Avenue, City of Tijuana, Baja
California, Mexico, Phone  +52 6646849490, +52 1664 6985410 E- Mail
elcirco50@hotmail.com.

     

    
      
         

      

      
        Exhibit
10.16 - 18

        
          

        

      

      
         

      

    

    


    Mr.
Dagoberto Gomez y Hoyuela at No. 12, Alameda Street, Colonia Villa Satelite,
City of Hermosillo, State of Sonora, Mexico, Phone  +52 662 216 5716,
+52 1662 1682629 E-mail: geologodgh@yahoo.com.mx

    


    Any
notification sent by fax, will be considered as delivered and received after the
next working day it was sent by fax.

    


    Any party
can at any moment notify the other party in writing and in a reliable manner its
change of address and as of the date of deliver of such notice, the new address
specified will be considered as the address for that party to the effects of
notifications.

    


    In proof
of acceptance the parties sign eight originals of the same content and in one
effect, in the City of Hermosillo, State of Sonora, Mexico, on the 25th (twenty
sixth) day of September 2007.

    


    


    


    FABIO
MONTANARI                                                                DAGOBERTO
GOMEZ Y
HOYUELA                                          
LUIGI MEGLIOLI

    


    


    


    ROSSINA
HERNANDEZ
BALDENEBRO                                                                                                                                LUIS
ENRIQUE  FIERRO HERNANDEZ

    



    
      
         


      

      
        Exhibit
10.16 - 19