Document:

Converted by FileMerlin

ATTN:

The Bank of New York, not in its individual capacity but solely as securities administrator on behalf of the J.P. Morgan Mortgage Acquisition Trust 2006-CH1 supplemental interest trust

Pei Yan Huang Fax: 212-623-5858

C.J. De Santis

Fax: 203-629-8907

FROM:

Carmine Pilla

JPMorgan Chase Bank, N.A.

RE:

Interest Rate Swap Confirmation

YOUR REF:

OUR REF:

6900028120815 / 0050010198

DATE SENT:

13 November 2006

NO OF PAGES:

7 (Including Cover)

URGENT: PLEASE SIGN AND FAX THIS CONFIRMATION TO (001) 8888033606

Interest Rate Swap Transaction

The purpose of this letter agreement is to confirm the terms and conditions of the Transaction entered into between:

JPMORGAN CHASE BANK, N.A.

("JPMorgan")

and

The Bank of New York, not in its individual capacity but solely as securities administrator on behalf of the

J.P. Morgan Mortgage Acquisition Trust 2006-CH1 supplemental interest trust

(the "Counterparty")

on the Trade Date and identified by the JPMorgan Deal Number specified below (the "Transaction"). This letter agreement constitutes a "Confirmation" as referred to in the Master Agreement specified below, and supersedes any previous confirmation or other writing with respect to the transaction described below.

The definitions and provisions contained in the 2000 ISDA Definitions (the "Definitions"), as published by the International Swaps and Derivatives Association, Inc. are incorporated into this Confirmation. In the event of any inconsistency between those definitions and provisions and this Confirmation, this Confirmation will govern.

This Confirmation supplements, forms part of, and is subject to, the ISDA Master Agreement dated as of 14 November 2006, as amended and supplemented from time to time (the "Agreement"), between JPMORGAN CHASE BANK, N.A. ("JPMorgan") and The Bank of New York, not in its individual capacity but solely as securities administrator on behalf of the J.P. Morgan Mortgage Acquisition Trust 2006-CH1 supplemental interest trust (the "Counterparty"). All provisions contained in the Agreement govern this Confirmation except as expressly modified below.

The terms of the particular Interest Rate Swap Transaction to which this Confirmation relates are as follows:

A. TRANSACTION DETAILS

JPMorgan Deal Number(s):

6900028120815 / 0050010198

Notional Amount:

Per attached schedule in Exhibit A

Trade Date:

23 October 2006

Effective Date:

14 November 2006

Termination Date:

25 October 2010 subject to adjustment in accordance with the Modified Following Business Day Convention

Fixed Amounts:

Fixed Rate Payer:

Counterparty 

Fixed Rate Payer Period End Dates:

The 25th of each month in each year commencing with 25 November 2006 to and including the Termination Date, subject to adjustment in accordance with the Modified Following Business Day Convention

Fixed Rate Payer Payment Dates:

The Fixed Rate Payer Period End Date.

Fixed Rate:

5.3785 percent

Fixed Rate Day Count Fraction:

30/360

Business Days:

New York, London 

Floating Amounts:

Floating Rate Payer:

JPMorgan

Floating Rate Payer Period End Dates:

The 25th of each month in each year commencing with 25 November 2006 to and including the Termination Date, subject to adjustment in accordance with the Modified Following Business Day Convention

Floating Rate for initial Calculation Period:

5.30750 percent 

Floating Rate Payer Payment Dates:

Two (2) Business days preceding each Floating Rate Payer Period End Date.

Floating Rate Option: 

 USD-LIBOR-BBA

Designated Maturity:

1 Month

Spread: 

None 

Floating Rate Day Count Fraction: 

Actual/360

Reset Dates:

The first day of each Calculation Period.

Compounding:

Inapplicable

Business Days: 

New York, London

Calculation Agent:

JPMorgan, unless otherwise stated in the Agreement

B. ACCOUNT DETAILS 

Payments to JPMorgan in USD:

JPMORGAN CHASE BANK NA 

JPMORGAN CHASE BANK NA 

BIC: CHASUS33XXX 

ABA: 021000021 

AC No: 099997979

Ref: # 6900028120815 / 0050010198

Payments to Counterparty in USD:

JPMorgan Chase Bank, NA ABA 021000021 Account No. 507947541 FFC: 10228092.3 Ref. JPMAC 2006-CH1

C. OFFICES

JPMorgan: 

NEW YORK 

Counterparty: 

NEW YORK 

D. RELATIONSHIP BETWEEN PARTIES

Each party will be deemed to represent to the other party on the date on which it enters into a Transaction that (absent a written agreement between the parties that expressly imposes affirmative obligations to the contrary for that Transaction):

(a) Non-Reliance. It is acting for its own account, and it has made its own independent decisions to enter into that Transaction and as to whether that Transaction is appropriate or proper for it based upon its own judgment and upon advice from such advisers as it has deemed necessary. It is not relying on any communication (written or oral) of the other party as investment advice or as a recommendation to enter into that Transaction; it being understood that information and explanations related to the terms and conditions of a Transaction shall not be considered investment advice or a recommendation to enter into that Transaction. No communication (written or oral) received from the other party shall be deemed to be an assurance or guarantee as to the expected results of that Transaction.

(b) Assessment and Understanding. It is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of that Transaction. It is capable of assuming, and assumes the risks of that Transaction.

(c) Status of Parties. The other party is not acting as a fiduciary for or an adviser to it in respect of that Transaction.

E. SECURITIES ADMINISTRATOR CAPACITY

It is expressly understood and agreed by the parties hereto that insofar as this Confirmation is executed by the Securities Administrator (i) this Confirmation is executed and delivered by The Bank of New York, not in its individual capacity but solely as Securities Administrator under the Pooling and Servicing Agreement, dated as of October 1, 2006 (the “Pooling and Servicing Agreement”), among J.P. Morgan Acceptance Corporation I, as depositor, J.P. Morgan Mortgage Acquisition Corp., as seller, U.S. Bank National Association, as trustee, Pentalpha Surveillance LLC, as trust oversight manager and the Securities Administrator, JPMorgan Chase Bank National Association as servicer, in the exercise of the powers and authority conferred and vested in it thereunder, (ii) under no circumstances shall The Bank of New York in its individual capacity be personally liable for the payment of any indebtedness or expenses or be personally liable for the breach or failure of any obligation, representation, warranty or covenant made or undertaken under this Confirmation, and (iii) each of the representations, undertakings and agreements herein made on behalf of the Counterparty is made and intended not as personal representations, undertakings and agreements of the Counterparty.

Please confirm that the foregoing correctly sets forth the terms of our agreement by executing a copy of this Confirmation and returning it to us or by sending to us a letter, telex or facsimile substantially similar to this letter, which letter, telex or facsimile sets forth the material terms of the Transaction to which this Confirmation relates and indicates agreement to those terms. When referring to this Confirmation, please indicate: JPMorgan Deal Number(s): # 6900028120815 / 0050010198

JPMorgan Chase Bank, N.A.

/s/ Carmine Pilla

Name: Carmine Pilla

Title:

Vice President

Accepted and confirmed as of the date first above written:

The Bank of New York, not in its individual capacity but solely as securities adminisrtator on behalf of the J.P. Morgan Mortgage Acquisition Trust 2006-CH1 supplemental interest trust

/s/ Pei Huang

Name: Pei Huang

Title:

Assistant Vice President

Your reference number: _________________

Exhibit A

	period start

	period end

	notional

	11/14/06

	11/25/06

	574,943,000.00

	11/25/06

	12/25/06

	559,104,000.00

	12/25/06

	01/25/07

	541,424,000.00

	01/25/07

	02/25/07

	522,217,000.00

	02/25/07

	03/25/07

	501,825,000.00

	03/25/07

	04/25/07

	480,430,000.00

	04/25/07

	05/25/07

	468,033,000.00

	05/25/07

	06/25/07

	448,114,000.00

	06/25/07

	07/25/07

	429,032,000.00

	07/25/07

	08/25/07

	410,753,000.00

	08/25/07

	09/25/07

	393,241,000.00

	09/25/07

	10/25/07

	376,464,000.00

	10/25/07

	11/25/07

	360,390,000.00

	11/25/07

	12/25/07

	344,990,000.00

	12/25/07

	01/25/08

	330,235,000.00

	01/25/08

	02/25/08

	316,097,000.00

	02/25/08

	03/25/08

	301,626,000.00

	03/25/08

	04/25/08

	177,522,000.00

	04/25/08

	05/25/08

	140,668,000.00

	05/25/08

	06/25/08

	127,799,000.00

	06/25/08

	07/25/08

	116,926,000.00

	07/25/08

	08/25/08

	110,639,000.00

	08/25/08

	09/25/08

	105,361,000.00

	09/25/08

	10/25/08

	100,329,000.00

	10/25/08

	11/25/08

	95,531,000.00

	11/25/08

	12/25/08

	90,955,000.00

	12/25/08

	01/25/09

	86,590,000.00

	01/25/09

	02/25/09

	82,425,000.00

	02/25/09

	03/25/09

	78,449,000.00

	03/25/09

	04/25/09

	54,477,000.00

	04/25/09

	05/25/09

	48,348,000.00

	05/25/09

	06/25/09

	51,984,000.00

	06/25/09

	07/25/09

	54,501,000.00

	07/25/09

	08/25/09

	52,842,000.00

	08/25/09

	09/25/09

	51,233,000.00

	09/25/09

	10/25/09

	49,674,000.00

	10/25/09

	11/25/09

	48,163,000.00

	11/25/09

	12/25/09

	46,698,000.00

	12/25/09

	01/25/10

	45,277,000.00

	01/25/10

	02/25/10

	43,900,000.00

	02/25/10

	03/25/10

	42,565,000.00

	03/25/10

	04/25/10

	41,271,000.00

	04/25/10

	05/25/10

	40,016,000.00

	05/25/10

	06/25/10

	38,799,000.00

	06/25/10

	07/25/10

	37,620,000.00

	07/25/10

	08/25/10

	36,476,000.00

	08/25/10

	09/25/10

	35,368,000.00

	09/25/10

	10/25/10

	34,293,000.00

Client Service Group

All queries regarding confirmations should be sent to:

JPMorgan Chase Bank, N.A.

Contacts

JPMorgan Contact

Telephone Number

Client Service Group

(001 ) 3026344960

Group E-mail address:

Facsimile:

(001 ) 8888033606

Telex:

Cable:

Please quote the JPMorgan deal number(s): 6900028120815 / 0050010198Exhibit 10.1

                         MINERAL RIGHTS OPTION AGREEMENT

     THIS AGREEMENT dated for reference June 3, 2005.

BETWEEN:

     , an individual under the laws of the Mexico and having an office at;

                  Jorge Alberto Almarez ("Mr. Almarez")
                  157 Calle Federico
                  Rosarito, BC Mexico

OF THE FIRST PART

AND:

     , a body corporate, duly incorporated under the laws of the state of Nevada
and having an office at ;

         Placer Del Mar, Ltd. ("PLACER")
         3707 Fifth Ave. 35 San Diego, CA 92103-4221

                                                              OF THE SECOND PART

W H E R E A S :

A.  [Mr.  Almarez]  is the  registered  and  beneficial  owner of those  mineral
property concession interests located in , known as the claims/property~,  which
are more  particularly  described in Schedule  "A" which is attached  hereto and
which forms a material part hereof (collectively, the "PROPERTY");

B. [Mr. Almarez] has agreed to grant to [Placer] the right, privilege and option
to  explore  the  Property  together  with the  right,  privilege  and option to
purchase the Property upon terms and conditions hereinafter set forth;

                  NOW THEREFORE THIS AGREEMENT  WITNESSETH that in consideration
of the mutual covenants and provisos herein contained,  THE PARTIES HERETO AGREE
AS FOLLOWS:

1. DEFINITIONS

     For the purposes of this Agreement,  except as otherwise expressly provided
or unless the context otherwise requires,  the following words and phrases shall
have the following meanings:

(a)  "AGREEMENT"  means this Mineral  Property Option  Agreement as entered into
     between [Mr.  Almarez] and [Placer]  herein,  together  with any  Schedules
     attached hereto;
<PAGE>
                                       2

(b)  "AREA OF INFLUENCE" has the meaning as set forth in paragraph 5.2 herein;

(c)  "COMMERCIAL  PRODUCTION" means the operation of the Property or any portion
     thereof as a producing  mine and the  production of mineral  products there
     from  (excluding  bulk  sampling or pilot plant  operations,  if any) for a
     period of 30 consecutive  days at not less than 60% of the plant's  initial
     rated capacity;

(d)  "CONCESSIONS" means all mineral concessions located on the Property;

(e)  "DELIVERY" has the meaning as set forth in paragraph 6 herein;

(f)  "EFFECTIVE  DATE"  means  five  days  following  the date of final  written
     approval to the terms and  conditions  of this  Agreement and any amendment
     thereto;

(g)  "ESCROW HOLDER" has the meaning as set forth in paragraph 15 herein;

(i)  "EXPENDITURES"  means all cash,  expenses,  obligations  and liabilities of
     whatever  kind or nature spent or incurred  directly or  indirectly  by the
     Operator  and  [Placer] up to and  including  the date of  commencement  of
     Commercial Production in connection with the exploration and development of
     the Property, the acquisition of Other Tenements,  and the equipping of the
     Property  for  Commercial  Production,   including,  without  limiting  the
     generality of the foregoing, monies expended in maintaining the Property in
     good standing by doing and filing  assessment  work, in doing  geophysical,
     geochemical and geological  surveys,  drilling,  assaying and metallurgical
     testing,  in acquiring  facilities,  in paying the fees,  wages,  salaries,
     travelling  expenses,  and fringe benefits (whether or not required by law)
     of all  persons  engaged in work in  respect to and for the  benefit of the
     Property,  in paying for the food,  lodging and other  reasonable  needs of
     such men, and in  supervision  and management of all work done with respect
     to and for the benefit of the Property, plus an amount not to exceed 15% of
     such Operating  Costs and  Expenditures  as  compensation  for overhead and
     other similar expenses which [Placer] will incur but cannot be specifically
     allocated;  and  sufficient  initial  working  capital to finance the first
     three  months of  production  as in the opinion of [Placer] is required for
     the Operation of the Property as a Mine;

(j)  "EXPLORATION  AND DEVELOPMENT"  means,  INTER ALIA, all direct and indirect
     Property   preparation,   analysis  (and  activities   incident   thereto),
     administration  and filing work and Expenditures  conducted and incurred by
     the Operator and [Placer], at their instruction,  or on their behalf, or by
     assignment to another party,  for the purpose of determining  the existence
     of Product on the Property;

(k)  "FEASIBILITY STUDY" has the meaning as set forth in paragraph 5 herein;

(l)  "INTEREST" has the meaning as set forth in paragraph 5.2 herein;

(m)  "MINERAL PRODUCTS" means all ores, gravel,  sand, metals, gems and minerals
     mined or  extracted  from  the  Property  or any  portion  thereof  and any
     concentrates produced there from;
<PAGE>
                                       3

(n)  "MINING   FACILITIES"  means  all  mines  and  plants,   including  without
     limitation, all pits, shafts, haulage ways, 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, on or outside the  Property  and relating to
     the Operation of the Property as a Mine;

(o)  "NET  SMELTER  RETURNS"  means the net amount  shown due by the  smelter or
     other place of sale from the sale of Mineral Products,  as indicated by its
     returns or settlement sheets, after payment of (1) all freight charges from
     the  shipping  point to the smelter or other  place of sale,  (2) all other
     proper  treatment or other  charges at such smelter or other place of sale,
     and (3) provincial or federal  royalties due and payable on production,  if
     any;

(p)  "OPERATING COSTS" means, for any period, all costs, expenses,  obligations,
     liabilities   and  charges  of  whatsoever  kind  and  nature  incurred  or
     chargeable,  directly or  indirectly  by [Placer],  after  commencement  of
     Commercial Production in connection with the Operation of the Property as a
     Mine during the period, which costs, expenses, obligations, liabilities and
     charges shall  include,  without  limiting the generality of the foregoing,
     the following:

(i)  all costs of or related to the Operation of the Property as a Mine;

(ii) all costs of or related to the processing and marketing of Mineral Products
     including,  without limitation,  transportation,  storage,  commissions and
     discounts;

(iii)all costs of acquiring  Other Tenements and maintaining in good standing or
     renewing  from  time to time the  Property  including  the  payment  of all
     royalties and taxes of any nature whatsoever in connection therewith;

(iv) all costs of or related to providing and/or operating employee  facilities,
     including housing;

(v)  all duties,  charges,  levies,  royalties,  taxes and other payments of any
     kind  whatsoever  imposed upon or in connection with Operating the Property
     as a Mine  by any  government  or  municipality  or  department  or  agency
     thereof;

(vi) all actual costs of [Placer] for  providing  technical,  management  and/or
     supervisory services (the intent being that [Placer] will neither realize a
     profit nor suffer a loss as a result of its management activity);

(vii) all costs of consulting, legal, accounting, insurance and other services;

(viii) all interest  expenditures  incurred  after  commencement  of  Commercial
     Production;

(ix) all costs of construction,  equipment, mine development, after commencement
     of Commercial Production;
<PAGE>
                                       4

(x)  all costs for  pollution  control,  reclamation  or any other similar costs
     incurred or to be incurred by [Placer];

(xi) a charge for [Placer]'s  Expenditures and Postproduction  Capital Expenses;
     and

(xii)any  costs  or  expenses  incurred  or  to  be  incurred  relating  to  the
     termination  of the  Operation  of the  Property  as a Mine;  except  where
     specific  provision  is  made  otherwise,  all  Operating  Costs  shall  be
     determined in accordance  with  generally  accepted  accounting  principles
     consistently applied;

(q)  "OPERATING  THE  PROPERTY AS A  MINE/OPERATION  OF THE  PROPERTY AS A MINE"
     means the extraction or production or minerals or metals from the Property,
     the milling,  smelting,  refining,  beneficiating,  and other processing of
     such minerals and metals and the marketing of Mineral Products;

(r)  "OPERATOR" means that person,  company or companies acting as such pursuant
     to this Agreement as described in paragraphs 12 through 14 hereof;

(s)  "OPTION" means the Option to earn a one hundred  percent  (100%)  undivided
     interest in and to the Property as provided for in paragraph 4 herein;

(t)  "OTHER  TENEMENTS"  means all surface  rights of and to any lands within or
     outside the Property  including  surface rights held in fee or under lease,
     licence,  easement,  right of way or  other  rights  of any  kind  (and all
     renewals,  extensions and amendments  thereof)  acquired by or on behalf of
     [Placer] with respect to the Property;

(u)  "PARTY"  or  "PARTIES"  means  [Mr.  Almarez]  and/or  [Placer]  and  their
     respective successors and permitted assigns;

(v)  "POSTPRODUCTION CAPITAL EXPENSES" means all such costs expended or incurred
     by [Placer] after commencement of Commercial  Production in connection with
     a major improvement,  expansion, modernization or replacement of the Mining
     Facilities;

(w)  "PROGRAMS" means plans,  including budgets,  for every kind of work done or
     in respect of the Property by or under the  direction of or on behalf of or
     for the benefit of a Party,  and,  without  limiting the  generality of the
     foregoing,  includes the Exploration and Development work, assessment work,
     geophysical,  geochemical,  and geological surveying,  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 Mineral Products,
     surveying  and bringing any mineral  claims to lease or patent,  reporting,
     and all other  work  usually  considered  to be  prospecting,  exploration,
     development and mining work;

(x)  "PROPERTY"  means  the  mineral  property  concession  interests  and  real
     property  interest  described in Schedule "A" which is attached  hereto and
     which forms a material  part  hereof,  and the  interest  of [Mr.  Almarez]
     thereto,  and any  other  claim  or  property  interests  of [Mr.  Almarez]
     incorporated into the Property by the terms of this Agreement;
<PAGE>
                                       5

(y)  "PROPERTY   RIGHTS"  means  all  mineral  licenses,   permits,   easements,
     rights-of-way,  certificates and other approvals  obtained by either of the
     Parties either before or after the date of this Agreement and necessary for
     the exploration and development of the Property;

(z)  "TRANSFER DOCUMENTS" has the meaning as set forth in paragraph 15 herein.

2. [Mr. Almarez]'S REPRESENTATIONS

2.1  [Mr. Almarez] represents and warrants to [Placer] that:

(a)  [Mr. Almarez] is the registered and beneficial owner of each of the mineral
     interests  comprising  the Property and holds the sole right to explore and
     develop the Property;

(b)  [Mr.  Almarez],  as registered and beneficial owner of the Property,  holds
     all of the Concessions  free and clear of all liens,  charges and claims of
     others,  and [Mr.  Almarez] has free and  unimpeded  right of access to the
     Property and has use of the Property surface for the herein purposes;

(c)  The  Concessions  have been duly and validly located and recorded in a good
     and  miner-like  manner  pursuant to the laws of  [Mexico]  and are in good
     standing in [Mexico] as of the Effective Date of this Agreement;

(d)  There are no adverse  claims or  challenges  against or to [Mr.  Almarez]'s
     ownership of or title to any of the Concessions nor to the knowledge of the
     [Mr.  Almarez] is there any basis  therefore,  and there are no outstanding
     agreements  or options to acquire or purchase  the  Property or any portion
     thereof;

(e)  [Mr. Almarez] has the full right, authority and capacity to enter into this
     Agreement  without first  obtaining the consent of any other person or body
     corporate and the consummation of the transaction herein  contemplated will
     not conflict  with or result in any breach of any  covenants or  agreements
     contained in, or constitute a default  under,  or result in the creation of
     any  encumbrance  under the provisions of any  shareholders'  or directors'
     resolution,  indenture,  agreement or other instrument  whatsoever to which
     [Mr. Almarez] is a party or by which it is bound or to which it is subject;
     and

(g)  No proceedings  are pending for, and [Mr.  Almarez] is unaware of any basis
     for, the institution of any proceedings  which could lead to the placing of
     [Mr. Almarez] in bankruptcy, or in any position similar to bankruptcy.

2.2 The representations and warranties of [Mr. Almarez] set out in paragraph 2.1
above form a part of this Agreement and are  conditions  upon which [Placer] has
relied in entering into this Agreement and shall survive the  acquisition of any
interest in the Property by [Placer].

2.3 [Mr.  Almarez]  will  indemnify  and save  [Placer]  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 it and
contained in this Agreement.
<PAGE>
                                       6

2.4 [Mr.  Almarez]  acknowledges  and agrees that [Placer] has entered into this
Agreement  relying on the  warranties  and  representations  and other terms and
conditions of this Agreement and that no information which is now known or which
may hereafter  become known to [Placer]  shall limit or extinguish  the right to
indemnity  hereunder,  and,  in  addition  to any other  remedies it may pursue,
[Placer]  may  deduct  the  amount of any such loss or damage  from any  amounts
payable by it to [Mr. Almarez] hereunder.

3. [PLACER]'S REPRESENTATIONS

[Placer]  warrants and represents to [Mr.  Almarez] that it is a body corporate,
duly incorporated under the laws of Nevada with full power and absolute capacity
to enter  into this  Agreement  and that the terms of this  Agreement  have been
authorized by all necessary  corporate acts and deeds in order to give effect to
the terms hereof.

4. GRANT OF OPTION

[Mr.  Almarez]  hereby gives and grants to [Placer] the sole and exclusive right
and option to acquire a l00% undivided  right,  title and interest in and to the
Property (the "OPTION"),  subject to a 10% Net Smelter Returns royalty  reserved
in favor of [Mr. Almarez],  by performing the acts and deeds and paying the sums
provided for in paragraph 5.

5. CONSIDERATION FOR THE GRANT OF OPTION

5.1 In order to keep the right and Option  granted to [Placer] in respect of the
Property in good standing and in force and effect,  [Placer]  shall be obligated
to:

     (a)  CASH PAYMENTS

          Pay to [Mr. Almarez] as follows:

          (i)  $2000 upon execution of this Agreement;

     (b)  PROPERTY PAYMENTS AND ASSESSMENT WORK

          Pay,  or cause to be paid,  to [Mr.  Almarez],  or on [Mr.  Almarez]'s
          behalf as [Placer] may determine, all Property payments and assessment
          work required to keep the Concessions and this Option in good standing
          during the term of this Agreement.

5.2 AREA OF INFLUENCE.  For the purpose of this  Agreement,  the area covered by
the Property shall include an area of influence  surrounding the outer perimeter
of the Property to a maximum of  kilometres  (the "AREA OF  INFLUENCE")  and all
mineral   concessions,   interests  or  rights   acquired   (collectively,   the
"INTERESTS"),  directly or  indirectly,  within the Area of Influence  before or
<PAGE>
                                       7

after the date of signing of this Agreement by [Mr. Almarez] during the currency
of this Agreement shall become part of this Agreement.

6. CONDITIONS PRECEDENT

It is mutually  understood and agreed by and between the parties hereto that the
terms of this Agreement will be subject to an Effective Date being determined on
or before,  failing  which,  this  Agreement  shall be null and void unless this
condition  precedent is waived by [Placer] by delivering  written  notice of the
waiver to [Mr.  Almarez] before (the  "DELIVERY"),  in which case, the Effective
Date of the Agreement is 10 calendar days after Delivery.

7. RIGHT TO ABANDON PROPERTY INTERESTS

Should  [Placer],  in its  sole  discretion,  determine  that  any  part  of the
Concessions no longer warrant further Exploration and Development, then [Placer]
may abandon such interests without affecting its rights or obligations under the
Agreement, so long as [Placer] provides [Mr. Almarez] with 30 days notice of its
intention to do so. Upon receipt of such notice,  [Mr. Almarez] may request that
[Placer]  retransfer  title to such  interests  to [Mr.  Almarez],  and [Placer]
hereby  agrees to do so,  and upon  expiry of the 30 days,  or upon the  earlier
transfer thereof, such interests shall cease to be part of the Property.

8. TERMINATION OF OPTION

8.1 The Option shall terminate upon 30 calendar days' written notice being first
provided by [Mr.  Almarez] to  [Placer] if [Placer]  fails to make the  required
cash payments,  and fails to complete the  expenditures  and assessment  work in
accordance with paragraph 5.1.

8.2 If [Placer]  shall be in default of any  requirement  set forth in paragraph
5.1 herein,  [Mr. Almarez] shall give written notice to [Placer]  specifying the
default and [Placer]  shall not lose any rights  granted  under this  Agreement,
unless  within 30 days after the  giving of notice of default by [Mr.  Almarez],
[Placer]  has  failed  to take  reasonable  steps  to cure  the  default  by the
appropriate performance.

8.3 If the  Option is  terminated  in  accordance  with  paragraphs  7.1 and 7.2
herein,  [Placer]  shall  have  no  interest  in or to  the  Property,  and  all
expenditures and payments made, or caused to be made, or incurred by [Placer] to
or on behalf of [Mr.  Almarez] under this Agreement shall be  non-refundable  by
[Mr. Almarez] to [Placer] for which [Placer] shall have no recourse.

9. ACQUISITION OF INTERESTS IN THE PROPERTY

At such time as [Placer] has made all of the required  expenditures and currency
and other  payments  in  accordance  with  paragraph  5 herein,  within the time
periods  specified  therein,  then the  Option  shall  be  deemed  to have  been
exercised by [Placer], and [Placer] shall have
<PAGE>
                                       8

thereby,  without any further act, acquired an undivided 100% interest in and to
the Property.

10. RIGHT OF ENTRY

For so long as the Option  continues  in full force and  effect,  [Placer],  its
employees,  agents and independent contractors shall have the sole and exclusive
right and option to:

(a)  enter upon the Property;

(b)  have exclusive and quiet possession of the Property;

(c)  incur Expenditures;

(d)  bring upon and erect upon the Property  such mining  facilities as [Placer]
     may consider advisable and operate the property as a mine; and

(e)  remove from the Property and sell or otherwise dispose of mineral products.

11. NET SMELTER RETURNS ROYALTY

11.1 On the date [Placer] commences Commercial Production on the Property,  [Mr.
Almarez]  shall be entitled to receive and [Placer]  shall pay to [Mr.  Almarez]
10% of Net Smelter Returns annually.

11.2 If, as and when  [Pacer]  has paid [Mr.  Almarez]  $1,000,000  from the Net
Smelter  Returns in a twelve month period,  all  obligations  to pay further Net
Smelter Returns royalties to [Mr. Almarez] shall cease and be at an end for that
period.

11.3 [Placer] may, at any time,  purchase of [Mr. Almarez]'s net smelter returns
royalty for a one-time payment of $ 5,000,000.

11.4 [Placer] shall be under no obligation whatsoever to place the Property into
Commercial Production and in the event it is placed into Commercial  Production,
[Placer]  shall  have the  right,  at any  time,  to  curtail  or  suspend  such
production as it, in its absolute discretion, may determine.

11.5 Net Smelter  Returns and the payments  payable to [Mr.  Almarez]  hereunder
shall be adjusted and paid  quarterly,  and within 90 days after the end of each
fiscal year during which the Property was in Commercial Production,  the records
relating to the calculation of Net Smelter Returns during that fiscal year shall
be  audited  and any  adjustments  shall  be  made  forthwith,  and the  audited
statements  shall be  delivered  to [Mr.  Almarez]  who shall have 60 days after
receipt of such  statements  to question in writing  their  accuracy and failing
such question, the statements shall be deemed correct.

11.6 For the purposes of paragraph  11.5, [Mr.  Almarez] or its  representatives
duly  appointed in writing shall have the right at all  reasonable  times,  upon
<PAGE>
                                       9

written request, to inspect those books and financial records of [Placer] as are
relevant to the  determination  of Net Smelter  Returns,  and, at the expense of
[Mr. Almarez], to make copies thereof.

12. OPERATOR

After the execution of this Agreement,  [Placer],  or at [Placer]'s  option, its
respective  associate or nominee will act as the Operator of the Property  under
this Agreement. [Placer], if Operator, may resign as the Operator at any time by
giving 30 calendar days prior written notice to [Mr.  Almarez],  and within such
30 day period,  [Placer] may appoint  another  party who covenants to act as the
Operator of the Property upon such terms as [Placer] sees fit.

13. POWER AND AUTHORITY OF THE OPERATOR

After the execution of this Agreement, the Operator shall have full right, power
and  authority to do everything  necessary or desirable in  connection  with the
exploration  and  development  of the Property  and to  determine  the manner of
operation  of the  Property  as a  mine  including,  and  without  limiting  the
generality of the foregoing, the right, power and authority to:

(a)  Regulate  access to the  Property  subject only to the right of the parties
     hereto  to have  access to the  Property  at all  reasonable  times for the
     purpose of  inspecting  work being done  thereon  but at their own risk and
     expense; and

(b)  Employ and engage such employees,  agents and independent contractors as it
     may consider necessary or advisable to carry out its duties and obligations
     hereunder  and in this  connection to delegate any of its powers and rights
     to perform its duties and obligations hereunder, but the Operator shall not
     enter into contractual  relationships  with an associated company except on
     terms which are commercially competitive.

14. DUTIES AND OBLIGATIONS OF THE OPERATOR

After the execution of this  Agreement  the Operator  shall have such duties and
obligations  as the parties  hereto may from time to time  determine  including,
without  limiting the  generality of the  foregoing,  the  following  duties and
obligations:

(a)  To implement Programs;

(b)  To manage,  direct and control all  exploration,  development and producing
     operations in and under the Property, in a prudent and workman-like manner,
     and in compliance with all applicable laws, rules, orders and regulations;

(c)  To prepare and deliver to the Parties  during  periods of active field work
     monthly progress reports of the work in progress and  comprehensive  annual
     reports  on or  before  March  31 of every  year  covering  the  activities
     hereunder  and the  results  obtained  during the  calendar  year ending on
     December 31 immediately preceding;

(d)  Subject to the terms and conditions of this Agreement, to keep the Property
     in good standing free of liens, charges and encumbrances of every character
     arising  from  operations,  (except  liens  for  taxes  not yet due,  other
<PAGE>
                                       10

     inchoate liens and liens  contested in good faith by the Operator),  and to
     proceed with all diligence to contest or discharge any lien that is filed;

(e)  To maintain  true and correct  books,  accounts  and records of  operations
     hereunder;

(f)  To permit the Parties,  at their own expense,  to inspect,  take  abstracts
     from or audit any or all of the records and accounts during normal business
     hours;

(g)  To obtain and maintain, or cause any contractor engaged hereunder to obtain
     and  maintain,  during  any  period in which  active  work is  carried  out
     hereunder, adequate insurance;

(h)  To permit the Parties or their  representatives so appointed,  at their own
     expense and risk, access to the Property and all data derived from carrying
     out work thereon;

(i)  To arrange for and maintain  worker's  compensation or equivalent  coverage
     for all eligible employees engaged by the Operator in accordance with local
     statutory requirements;

(j)  To perform  its duties and  obligations  in a manner  consistent  with good
     exploration and mining practices;

(k)  To   transact,   undertake   and  perform  all   transactions,   contracts,
     employments, purchases, operations, negotiations with third Parties and any
     other matter or thing undertaken on behalf of the Parties in the Operator's
     name.

15. REGISTRATION AND TRANSFER OF PROPERTY INTERESTS

15.1 RECORD AGREEMENT.  Upon the request of [Placer], [Mr. Almarez] shall assist
[Placer] to record this Agreement with the appropriate mining recorder and, when
required,  [Mr.  Almarez] shall further  provide  [Placer] with such  recordable
documents as [Placer] and its counsel  shall  require to record its due interest
in respect of the Property.

15.2  TRANSFER.  As soon as  conveniently  possible  after the execution of this
Agreement,  [Mr. Almarez] shall execute such transfer  documents as [Placer] and
its counsel may  reasonably  deem  necessary  to assign,  transfer and assure to
[Placer]  good,  safe holding and  marketable  title to an undivided one hundred
percent  (100%)  interest in and to the  Property,  and as soon as  conveniently
possible  after the  execution of this  Agreement,  [Placer]  shall execute such
transfer or discharge  documents as [Mr. Almarez] and its counsel may reasonably
deem necessary to both discharge  this  Agreement  with the  appropriate  mining
recorder's  office and assign and  transfer  back to [Mr.  Almarez]  good,  safe
holding and marketable title to an undivided one hundred percent (100%) interest
in and to the Property (hereinafter collectively called the "TRANSFER DOCUMENTS"
and shall deposit the same with an escrow agent chosen by [Placer]  (hereinafter
called the "ESCROW HOLDER"), together with a copy of this Agreement, there to be
held in escrow upon the following terms:

(a)  [Mr.  Almarez] and [Placer] do hereby instruct the Escrow Holder to deliver
     to [Placer] the Transfer  Documents held by the Escrow Holder in respect of
     the Property upon receipt of either:
<PAGE>
                                       11

(i)  Notification  in writing from [Mr.  Almarez] that such documents  should be
     delivered to [Placer]; or

(ii) (A) A statutory declaration sworn by an officer of [Placer] certifying that
     [Placer] is entitled to delivery of the Transfer  Documents,  together with
     proof  that at least 30  calendar  days'  written  notice was given to [Mr.
     Almarez] of [Placer]'s intention to request delivery thereof; and

(B)  Proof satisfactory to the Escrow Agent that the within Option has been duly
     exercised by [Placer] in accordance with the terms of this Agreement; or

(b)  [Mr.  Almarez] and [Placer] do hereby instruct the Escrow Holder to deliver
     to [Mr.  Almarez]  the  Transfer  Documents  held by the  Escrow  Holder in
     respect of the Property upon receipt of either:

(i)  Notification  in  writing  from  [Placer]  that  such  documents  should be
     delivered to [Mr. Almarez]; or

(ii) A statutory  declaration  sworn by an officer of [Mr.  Almarez]  certifying
     that this  Agreement  has  terminated  pursuant to the  provisions  hereof,
     together with proof that at least thirty (30) calendar days written  notice
     was given to  [Placer] of [Mr.  Almarez]'s  intention  to request  delivery
     thereof; and

(c)  [Mr.  Almarez] and [Placer]  jointly and  severally  agree to indemnify and
     save  harmless  the Escrow  Holder  from all  claims,  actions  and damages
     arising out of its acting pursuant to the  instructions  herein  contained;
     and

(d)  [Placer]  shall pay to the  Escrow  Holder  all costs and  expenses  of the
     Escrow  Holder for acting  pursuant  to the  within  instructions,  and the
     Parties  agree that the Escrow  Holder shall not be  considered  as a party
     hereto where that expression is used herein.

16. POWER TO CHARGE

At any time prior to the exercise of the Option by [Placer],  [Placer] may grant
mortgages, charges or liens (each of which is herein called a "MORTGAGE") of and
upon the respective interests of [Mr. Almarez] in and to the Property,  upon any
mill or other fixed  assets  located  thereon and on any or all of the  tangible
personal property located on or used in connection with the Property,  to secure
only the  financing  of  development  of the  Property;  provided  that,  unless
otherwise agreed to by [Mr.  Almarez],  it shall be a term of each mortgage that
the mortgage or any person acquiring title to [Placer]'s  interest in and to the
Property,  or to any mill or other fixed  assets or tangible  personal  property
located on or used in  connection  with the  Property  upon  enforcement  of the
mortgage,  shall hold the same subject to the rights of [Mr. Almarez]  hereunder
as if the mortgagee or any such person had executed  this  Agreement as party of
the first part.
<PAGE>
                                       12

17. FURTHER ASSURANCES

The parties hereto agree to do or cause to be done all acts or things  necessary
to implement and carry into effect the provisions and intent of this Agreement.

18. FORCE MAJEURE

If [Placer] is prevented  from or delayed in complying  with any  provisions  of
this  Agreement  by  reasons  of  strikes,  labour  disputes,  lockouts,  labour
shortages,  power shortages,  fires, wars, acts of God, governmental regulations
restricting  normal operations or any other reason or reasons beyond the control
of [Placer],  the time limited for the performance of the various  provisions of
this  Agreement  as set out above shall be extended by a period of time equal in
length to the period of such prevention and delay,  and [Placer],  insofar as is
possible, shall promptly give written notice to [Mr. Almarez] of the particulars
of the reasons for any  prevention or delay under this  section,  and shall take
all reasonable  steps to remove the cause of such  prevention or delay and shall
give written notice to [Mr. Almarez] as soon as such cause ceases to exist.

19. CONFIDENTIAL INFORMATION

No information  furnished by [Placer] to [Mr.  Almarez]  hereunder in respect of
the activities  carried out on the Property by [Placer],  or related to the sale
of Mineral  Products  derived  from the  Property,  shall be  published  by [Mr.
Almarez]  without the prior  written  consent of  [Placer],  but such consent in
respect of the reporting of factual data shall not be unreasonably withheld, and
shall  not be  withheld  in  respect  of  information  required  to be  publicly
disclosed pursuant to applicable securities and corporation laws.

20. ENTIRE AGREEMENT

This  Agreement  constitutes  the entire  agreement  to date between the parties
hereto and supersedes  every  previous  agreement,  communication,  expectation,
negotiation,  representation or understanding,  whether oral or written, express
or implied,  statutory  or  otherwise,  between the Parties  with respect to the
subject matter of this Agreement.

21. ADDITIONAL TERMINATION

In addition to any other  termination  provisions  contained in this  Agreement,
[Placer]  shall have the right to terminate this Agreement by giving 30 calendar
days'  notice of such  termination  to [Mr.  Almarez],  and in the event of such
termination, this Agreement shall be of no further force or effect.

22. DEFAULT

Notwithstanding anything in this Agreement to the contrary, if [Placer] shall be
in default of any requirement herein set forth, [Mr. Almarez] shall give written
notice to [Placer] specifying the default and [Placer] shall not lose any rights
granted under this  Agreement,  unless within 30 days after the giving of notice
of default by [Mr.  Almarez],  [Placer] has failed to take  reasonable  steps to
cure the default by the appropriate  performance,  and if [Placer] fails to take
<PAGE>
                                       13

reasonable steps to cure any such default,  the [Mr.  Almarez] shall be entitled
to seek any remedy he may have on account of such default including  termination
of this Agreement.

23. NOTICE

23.1 Any notice  required to be given under this Agreement shall be deemed to be
well and sufficiently given if delivered, or if mailed by registered mail in San
Diego or Mexico, in the case of [Mr. Almarez] addressed as follows:

Mr. Jorge Alberto Almarez
157 Calle Federico
Rosarito, BC Mexico

and in the case of [Placer] addressed as follows:

Placer Del Mar, Ltd.
3707 Fifth Ave. 35 San Diego, CA 92103-4221

and any  notice  given as  aforesaid  shall be  deemed to have  been  given,  if
delivered,  when delivered,  or if mailed,  or sent by facsimile,  on the second
business day after the date of mailing or faxing thereof.

23.2 Either party  hereto may from time to time by notice in writing  change its
address for the purpose of this section.

24. OPTION ONLY

Until the Option is exercised, this is an option only and except as specifically
provided  otherwise,  nothing herein  contained shall be construed as obligating
[Placer] to do any acts or make any  payments  hereunder  and any act or acts or
payments made hereunder shall not be construed as obligating  [Placer] to do any
further acts or make any further payments.

25. RELATIONSHIP OF PARTIES

Nothing  contained in this Agreement  shall,  except to the extent  specifically
authorized  hereunder,  be deemed to  constitute  either party hereto a partner,
agent or legal representative of the other party.

26. FURTHER ASSURANCES

The parties hereto agree to do or cause to be done all acts or things  necessary
to implement and carry into effect the provisions and intent of this Agreement.

27. TIME OF ESSENCE

Time shall be of the essence of this Agreement.
<PAGE>
                                       14

28. TITLES

The titles to the respective  sections hereof shall not be deemed a part of this
Agreement but shall be regarded as having been used for convenience only.

29. CURRENCY

All  funds  referred  to  under  the  terms  of this  Agreement  shall  be funds
designated in the lawful currency of.

30. NONSEVERABILITY

This Agreement shall be considered and construed as a single  instrument and the
failure to  perform  any of the terms and  conditions  in this  Agreement  shall
constitute  a violation  or breach of the entire  instrument  or  Agreement  and
shall,  subject to paragraphs  and,  constitute  the basis for  cancellation  or
termination.

31. APPLICABLE LAW

The situs of the Agreement is Nevada,  and for all purposes this  Agreement will
be governed  exclusively  by and construed  and enforced in accordance  with the
laws  prevailing  in  the  Nevada.   [Mr.  Almarez]  agrees  to  attorn  to  the
jurisdiction of Nevada.

32. ENUREMENT

This  Agreement  shall enure to the  benefit of and be binding  upon the Parties
hereto and their respective successors and assigns.

IN WITNESS WHEREOF this Agreement has been executed as of the day and year first
above written.

SIGNED, SEALED,
AND DELIVERED by
[Mr. Almarez]
in the   presence of:

Signature /s/ Jorge Almarez      (Jorge Alberto Almarez)  Date 6/3/05
         -----------------------                              ---------

157 Calle Federico #157 Rosarito,
BC Mexico
<PAGE>
                                       15

THE CORPORATE SEAL of [PLACER] was hereunto affixed in the presence of:

Signature /s/ Humberto Bravo     (Humberto Bravo)         Date 6/3/05
         -----------------------                              ---------

Placer Del Mar, Ltd.
3707 Fifth Ave. 35 San Diego, CA
92103-4221

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