Document:

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                                                                    EXHIBIT 4.40

                                SHARE OPTION PLAN

                                OPTION COMMITMENT
                                   (DIRECTOR)

Notice is hereby given that, effective this 24th day of September, 2004 (the
"Effective Date") Pine Valley Mining Corporation (the "Company") has granted to
Mark T. Smith (the "Service Provider"), an Option to acquire 950,000 Common
Shares ("Optioned Shares") up to 5:00 p.m. Vancouver Time on the 24th day of
September, 2009 (the "Expiry Date") at a Exercise Price of CAD $2.30 per share.

At the date of grant of the Option, the Company is classified as a Tier 1
company under TSX Venture Policies.

Subject to Section 4.8 of the Executive Employment Agreement between the Company
and the Service Provider, the Optioned Shares will vest and may be exercised as
follows:

(a)  310,000 shares on the date of grant, namely September 24, 2004; and

(b)  80,000 additional shares on each of November 30, 2004, February 28, 2005,
     May 31, 2005, August 31, 2005, November 30, 2005, February 28, 2006, May
     31, 2006 and August 31, 2006.

The grant of the Option evidenced hereby is made subject to the terms and
conditions of the Company's Share Option Plan, the terms and conditions of which
are hereby incorporated herein.

To exercise your Option, deliver a written notice specifying the number of
Optioned Shares you wish to acquire, together with cash or a certified cheque
payable to the Company for the aggregate Exercise Price, to the Company. A
certificate for the Optioned Shares so acquired will be issued by the transfer
agent as soon as practicable thereafter and will bear a minimum four month
non-transferability legend from the date of this Option Commitment.

PINE VALLEY MINING CORPORATION

Per: /s/ Mark T. Smith
     -----------------------------------
     Mark T. Smith
Its: Director<PAGE>
                                                                    EXHIBIT 4.41

                            CREDIT FACILITY AGREEMENT

THIS AGREEMENT dated as of the 26th day of November, 2004

BETWEEN:

          PINE VALLEY MINING CORPORATION, a company incorporated under the laws
          of British Columbia having its registered office at Suite 3000 - 1055
          West Georgia Street Vancouver, BC V6E 3R3 ("PINE VALLEY")

AND:

          FALLS MOUNTAIN COAL INC., a company incorporated under the laws of
          British Columbia having its registered office at Suite 3000 - 1055
          West Georgia Street Vancouver, BC V6E 3R3 ("FALLS MOUNTAIN")

AND:

          PINE VALLEY COAL LTD., an Alberta corporation having its principal
          business office at Suite 501 - 535 Thurlow Street, Vancouver, BC V6E
          3L2 ("PVC")

AND:

          THE ROCKSIDE FOUNDATION, an Ohio non-profit corporation having an
          office at 524 North Avenue, Suite 203, New Rochelle, NY 10801-3410
          ("ROCKSIDE")

WHEREAS:

A. Pine Valley is a public mining company with its Common shares listed for
trading on the TSX Venture Exchange and the NASD OTC Bulletin Board;

B. Falls Mountain is a wholly-owned subsidiary of Pine Valley and holds Pine
Valley's coal mining interests;

C. PVC is a wholly-owned subsidiary of Falls Mountain and holds and operates its
principal asset, the Willow Creek Project (as defined below);

D. Pine Valley requires additional financing to further develop the Willow Creek
Project and for working capital purposes; and

E. Rockside is prepared to make available to Pine Valley and its affiliates a
credit facility on the basis set out in this Agreement.

NOW THEREFORE, IN CONSIDERATION of the covenants and agreements in this
Agreement, the Parties agree as follows:
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1.   INTERPRETATION

1.1  DEFINED TERMS

In this Agreement:

     (a)  "AGREEMENT" means this agreement including any recitals and Schedules
          to this agreement, as amended, supplemented or restated from time to
          time;

     (b)  "BUSINESS DAY" means a day other than a Saturday or Sunday on which
          banks are open for general banking business in Vancouver, B.C.;

     (c)  "CLOSING" and "CLOSING DATE" will have the meanings set out in Section
          10.1;

     (d)  "CLOSING DATE BONUS SHARES" has the meaning given to it in Section 6;

     (e)  "CREDIT FACILITY" means the credit facility made available by Rockside
          to Falls Mountain pursuant to Section 2.1;

     (f)  "FALLS MOUNTAIN SECURITY AGREEMENT" means the Security Agreement dated
          November 26, 2004 among Falls Mountain and PVC as debtors and Rockside
          as secured party;

     (g)  "GOVERNMENTAL AUTHORITY" means any domestic or foreign government,
          including any federal, provincial, state, territorial or municipal
          government, and any government agency, tribunal, commission or other
          authority exercising executive, legislative, judicial, regulatory or
          administrative functions of, or pertaining to, government;

     (h)  "INTEREST" has the meaning given to it in Section 2.2;

     (i)  "LIENS" means any mortgage, lien, charge, hypothec or encumbrance,
          whether fixed or floating, on, or any security interest in, any
          property, whether real, personal or mixed, tangible or intangible, any
          pledge or hypothecation of any property, any deposit arrangement
          priority, conditional sale agreement, other title retention agreement
          or equipment trust, capital lease or other security arrangements of
          any kind;

     (j)  "MARKET VALUE" means the weighted average share price over the ten
          trading days on the TSX Venture Exchange (or the TSX, if applicable)
          immediately preceding the date of the advance of Tranche No. 1,
          Tranche No. 2 or Tranche No. 3, as applicable;

     (k)  "MARUBENI" means Marubeni Corporation, a corporation incorporated
          under the laws of Japan and having a business at 4-2, 1 Chome,
          Chiyoda-Ku, Tokyo, Japan;

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     (l)  "MITSUI" means Mitsui Matsushima Co., Ltd., a company incorporated
          under the laws of Japan and having its principal office at 1-12,
          Otemon 1-chome, Chuo-ku, Fukuoka-shi, Fukuoka Prefecture, Japan;

     (m)  "MITSUI CANADA" means Mitsui Matsushima Canada Ltd., a company
          incorporated under the laws of British Columbia having its registered
          office at Suite 1600 - 777 Dunsmuir Street, Vancouver, BC V7Y 1K7, and
          a subsidiary of Mitsui;

     (n)  "PARTIES" means the parties to this Agreement and "PARTY" means any
          one of them;

     (o)  "PERMITTED LIENS" means: (i) the security interests granted to Mitsui
          Canada by any of the Pine Valley Group; (ii) the security interests
          granted to Marubeni by any of the Pine Valley Group; (iii) Liens in
          favour of the British Columbia Ministry of Energy and Mines over
          reclamation security deposits required in connection with the permits
          for the Willow Creek Project; and (iv) any other Liens permitted under
          the Falls Mountain Security Agreement;

     (p)  "PERSON" means any natural person, sole proprietorship, partnership,
          corporation, trust, joint venture, any Governmental Authority or any
          incorporated or unincorporated entity or association of any nature;

     (q)  "PINE VALLEY GROUP" means Pine Valley, Falls Mountain and PVC;

     (r)  "PROJECT INFORMATION" means all information and data relating to the
          Willow Creek Project and this Agreement;

     (s)  "SECURITIES ACT" has the meaning given to it in Section 8.2;

     (t)  "STATE ACTS" has the meaning given to it in Section 8.2;

     (u)  "TRANCHE NO. 1" means the first advance in the principal amount of
          $3,750,000 referred to in Section 2.1;

     (v)  "TRANCHE NO. 2" means the second advance in the principal amount of
          $1,250,000 referred to in Section 2.1;

     (w)  "TRANCHE NO. 3" means the third advance in the principal amount of
          $2,000,000 referred to in Section 2.1; and

     (x)  "WILLOW CREEK PROJECT" means the exploration, development and
          commercial exploitation of coal properties held by the Pine Valley
          Group in north-eastern British Columbia.

1.2  GOVERNING LAW

This Agreement and each of the documents contemplated by or delivered under or
in connection with this Agreement are governed exclusively by, and are to be
enforced, construed and

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interpreted exclusively in accordance with, the laws of British Columbia and the
laws of Canada applicable in British Columbia which will be deemed to be the
proper law of this Agreement.

1.3  SEVERABILITY

Each provision of this Agreement is intended to be severable and accordingly:

     (a)  the unenforceability or invalidity of any particular provision under
          any applicable law or in any jurisdiction, as determined by a court
          having jurisdiction, an arbitrator or arbitrators appointed under this
          Agreement, or other authority having jurisdiction, will not affect the
          validity or enforceability of any other provision, except that if the
          other provision is expressly stated to be, or if, on a proper
          construction of this Agreement as a whole, it is reasonable to
          conclude that the Parties intended the other provision to be,
          dependent on the validity and enforceability of the particular
          provision, the other provision will also be invalid or unenforceable;
          and

     (b)  if any provision of this Agreement is determined to be invalid or
          unenforceable as aforesaid or is invalid or unenforceable pursuant to
          subparagraph (a), the balance of this Agreement will be construed and
          enforced as if all invalid or unenforceable provisions were not
          contained herein.

If, as a result of a determination that any part of this Agreement is
unenforceable or invalid as aforesaid, and as a result of or despite the
operation of this section, the expectations of the Parties, as determined on a
proper construction of this Agreement as a whole, are substantially frustrated,
the Parties will negotiate in good faith such amendments and additions to this
Agreement as are reasonable and necessary to realize the original expectations
to the greatest extent possible under the circumstances.

1.4  NUMBER AND GENDER

Unless otherwise specified, words importing the singular include the plural and
vice versa and words importing gender include all genders.

1.5  TIME OF DAY

Unless otherwise specified, references to time of day or date mean the local
time or date in Vancouver, British Columbia.

1.6  TIME OF ESSENCE

Time is of the essence of this Agreement.

1.7  CURRENCY

Except as otherwise expressly provided, all references to amounts of money mean
lawful currency of the United States of America.

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1.8  SCHEDULES

The schedules attached to this Agreement, will, for all purposes, form an
integral part of the Agreement.

2.   CREDIT FACILITY

2.1  CREDIT FACILITY

Subject to the terms and conditions of this Agreement, Rockside hereby
establishes for Falls Mountain the following credit facility:

     (a)  Tranche No. 1 in the principal amount of $3,750,000, to be advanced on
          the Closing Date;

     (b)  Tranche No. 2 in the principal amount of $1,250,000, to be advanced
          between December 27, 2004 and February 19, 2005; and

     (c)  Tranche No. 3 in the principal amount of $2,000,000, to be advanced
          between June 1, 2005 and July 31, 2005,

provided that Rockside will only advance Tranche No. 2 and Tranche No. 3 at the
sole option of, and if requested to so by, Falls Mountain, and nothing herein
will obligate any of the Pine Valley Group to draw down any of the Credit
Facility except for Tranche No. 1. If it elects to do so, Falls Mountain will
request the advance of Tranche No. 2 and Tranche No. 3 by delivering not less
than 7 days' written notice to Rockside. All advances will be made by Rockside
by wire transfer to such account as Falls Mountain may designate.

2.2  INTEREST

Subject to adjustment in accordance with Section 2.4, the outstanding principal
amount of the Credit Facility will bear simple interest (the "INTEREST") at an
annual interest rate of 10% and the amount of interest accrued on the
outstanding principal amount of the Credit Facility each month will be paid by
Falls Mountain to Rockside in arrears on the last Business Day of each month.

2.3  DUE DATE

Subject to the early repayment provisions in Sections 2.5 and 2.7, Falls
Mountain hereby agrees to pay to Rockside the entire outstanding amount of the
Credit Facility and any and all accrued and unpaid Interest on or before
November 29, 2005.

2.4  WITHHOLDING TAXES

     (a)  All payments in respect of interest, structuring fees and other
          amounts owing under this Agreement will be made free and clear without
          deduction for any taxes, duties, fees or other charges unless those
          deductions are required by law.

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     (b)  If Falls Mountain determines that it is compelled by law to make any
          such deduction, then Falls Mountain and Rockside will bear the cost of
          such deduction equally, and Falls Mountain will pay, by way of an
          adjustment to the interest payable pursuant to Section 2.2, such
          additional amounts as will result in receipt by Rockside of the full
          amount which would have been paid had one-half of such deduction not
          been made.

     (c)  Falls Mountain will use reasonable commercial efforts to provide, as
          soon as possible after a deduction or withholding is made, official
          receipts or other official documentation to Rockside evidencing
          payment of the taxes, duties, fees or other charges.

     (d)  If, following the imposition of taxes, duties, fees or other charges
          referred to above upon any such payment, Rockside is granted a credit
          or refund in respect of those taxes for any tax payable, Rockside
          (subject to Falls Mountain having paid an additional amount in
          accordance with this paragraph), to the extent that it is satisfied
          that it can do so without prejudice to the retention of the amount of
          the credit or refund, will reimburse Falls Mountain for that amount
          which Rockside certifies to be the proportion of the credit or refund
          as will leave Rockside (after the reimbursement) in no worse or better
          position than it would have been in if there had been no taxes imposed
          upon the payment by Falls Mountain referred to above, and that
          reimbursement will be made immediately upon the credit or refund being
          granted to Rockside. Rockside will use reasonable commercial efforts
          to realize any such refunds or credits.

2.5  PREPAYMENT

Falls Mountain will have the right, at its option, to pay the outstanding amount
of the Credit Facility plus any Interest owing thereon, in whole or in part, at
any time and from time to time, without notice, bonus or penalty.

2.6  LEGAL FEES AND EXPENSES

Falls Mountain will compensate Rockside for all its reasonable legal fees and
other out of pocket expenses incurred in connection with the negotiation and
preparation of the Credit Facility documentation at the Closing, provided that
Falls Mountain has then received from Rockside or its advisors a statement of
account itemizing such fees and expenses.

2.7  SALE OF THE PROJECT OR FINANCING

If the Pine Valley Group sells, assigns or transfers to a third party an
interest of greater than 50% of the Willow Creek Project or obtains debt
financing in an amount sufficient to permit it to do so, then the Pine Valley
Group will make it a condition of any such transaction that the outstanding
principal amount of the Credit Facility and accrued Interest will be repaid in
full out of the transaction proceeds.

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3.   USE OF PROCEEDS

3.1  USE OF PROCEEDS

The Credit Facility proceeds will be used by the Pine Valley Group to further
develop the Willow Creek Project and for working capital purposes.

3.2  INSPECTION AND AUDIT

The Pine Valley Group will maintain complete and accurate records relating to
the use of the Credit Facility proceeds. For so long as any of the Credit
Facility remains outstanding, Rockside or its representatives may, upon
reasonable notice to the Pine Valley Group and during normal business hours,
inspect and take copies of such records. In addition, Rockside will have the
right, for so long as any of the Credit Facility remains outstanding, to have
such records audited by a firm of internationally recognized chartered
accountants. Such audit will be carried out during reasonable business hours and
on reasonable notice to the Pine Valley Group.

4.   SECURITY

4.1  GENERAL SECURITY AGREEMENT

Falls Mountain's obligation to repay the Credit Facility and the Interest will
be secured by the Falls Mountain Security Agreement, and the security interests
arising thereunder will rank subsequent in priority and be subordinate in all
respects to: (a) the security interests presently held by Mitsui Canada and
arising under a General Security Agreement made January 6, 2004 between Falls
Mountain and PVC as debtors and Mitsui Canada; and (b) the security interests
presently held by Marubeni and arising under a General Security Agreement made
May 13, 2004 between Falls Mountain and PVC as debtors and Marubeni.

4.2  RELEASE OF SECURITY

Upon the repayment in full of the Credit Facility and accrued Interest thereon,
the Falls Mountain Security Agreement will terminate, and Rockside will
irrevocably release and discharge the Falls Mountain Security Agreement and the
guarantee of Pine Valley expressed in Section 5.1.

4.3  PROJECT MANAGEMENT

Notwithstanding the Falls Mountain Security Agreement, the Willow Creek Project
will be developed and operated by and under the control of the Pine Valley Group
and the contractors and agents engaged by the Pine Valley Group.

5.   GUARANTEES AND INDEMNITIES

5.1  GUARANTEE OF PINE VALLEY

Rockside is willing to proceed with this Agreement and the transactions
contemplated hereby only with the participation of Pine Valley as set forth in
this Section 5. In consideration of the

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payment of $20 and other good and valuable consideration paid and given by
Rockside to Pine Valley (the receipt and sufficiency of which are hereby
acknowledged), Pine Valley hereby guarantees the performance by Falls Mountain
of the respective covenants, agreements and obligations of Falls Mountain under
this Agreement and guarantees payment by Falls Mountain to Rockside of any and
all loss, damage, expense, liability, claim or demand suffered or incurred by
Rockside arising out of any breach of any covenant, agreement, representation or
warranty of this Agreement by Falls Mountain or any misrepresentation on the
part of Falls Mountain.

5.2  ABILITY TO DEAL

Pine Valley acknowledges and agrees that none of the following will release Pine
Valley of any of its obligations under this Section 5:

     (a)  any modification, amendment or change to the rights or obligations of
          Falls Mountain under this Agreement in any manner whatsoever,
          regardless of the magnitude or materiality of such change and
          regardless of whether Pine Valley has consented to or approved such
          change;

     (b)  the granting of any time, renewals, extensions or indulgences to Falls
          Mountain with respect to its obligations under this Agreement;

     (c)  the taking of any securities (which word as herein used includes other
          guarantees) for the performance by Falls Mountain of its obligations
          under this Agreement; abstaining from taking or perfecting such
          securities; accepting compositions from, exchanging, enforcing,
          waiving or releasing any such securities; or otherwise dealing with
          such securities as Rockside may see fit, and, Rockside may apply all
          monies at any time received from such securities or Falls Mountain or
          others to such part of the liabilities of Falls Mountain as Rockside
          deems best and change such application in whole or in part from time
          to time as Rockside sees fit;

and Pine Valley further waives presentment, demand, protest and all notices and
any right to require Rockside to proceed against Falls Mountain or to proceed
against or exhaust any security or pursue any other remedy available to Rockside
as a condition to enforcement of Pine Valley's obligations under this Agreement.

5.3 INDEMNIFICATION FROM PINE VALLEY

Pine Valley will indemnify and save harmless Rockside from and against all
suits, claims, demands, liabilities, losses and expenses which Rockside may
suffer, incur or sustain resulting or arising from any non-fulfilment of any
covenant or agreement or any breach of or incorrectness in any representation or
warranty by or of Pine Valley or any other member of the Pine Valley Group
contained in this Agreement or the Falls Mountain Security Agreement.

Every indemnity and exemption from liability, limitation and condition contained
in this Agreement for the benefit of Rockside and every defence and immunity of
whatsoever nature applicable to Rockside or to which Rockside is entitled under
this Agreement will also be

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available and extend to protect every director, officer, employee, agent or
independent contractor from time to time of Rockside.

5.4  INDEMNIFICATION FROM PVC

PVC will indemnify and save harmless Rockside from and against all suits,
claims, demands, liabilities, losses and expenses which Rockside may suffer,
incur or sustain resulting or arising from any non-fulfilment of any covenant or
agreement or any breach of or incorrectness in any representation or warranty by
or of PVC or any other member of the Pine Valley Group contained in this
Agreement or the Falls Mountain Security Agreement.

Every indemnity and exemption from liability, limitation and condition contained
in this Agreement for the benefit of Rockside and every defence and immunity of
whatsoever nature applicable to Rockside or to which Rockside is entitled under
this Agreement will also be available and extend to protect every director,
officer, employee, agent or independent contractor from time to time of
Rockside.

5.5  INDEMNIFICATION FROM ROCKSIDE

Rockside will indemnify and save harmless each and every member of the Pine
Valley Group from and against all suits, claims, demands, liabilities, losses
and expenses which any member of the Pine Valley Group may suffer, incur or
sustain resulting or arising from any failure or refusal by Rockside to advance
any part of the Credit Facility in breach of its obligations under this
Agreement.

Every indemnity and exemption from liability, limitation and condition contained
in this Agreement for the benefit of the Pine Valley Group and every defence and
immunity of whatsoever nature applicable to any member of the Pine Valley Group
or to any member of the Pine Valley Group is entitled under this Agreement will
also be available and extend to protect every director, officer, employee, agent
or independent contractor from time to time of any member of the Pine Valley
Group.

6.   BONUS SHARES

Pine Valley will issue to Rockside as additional consideration for the Credit
Facility, a bonus payment equal to that number of common shares in the capital
of Pine Valley having a Market Value equivalent to 10% of the principal amount
of: (a) Tranche No. 1, to be issued as soon as is reasonably practicable after
the advance of Tranche No. 1 (the "CLOSING DATE BONUS SHARES"); (b) Tranche No.
2, to be issued as soon as is reasonably possible after the advance, if any, of
Tranche No. 2; and (c) Tranche No. 3, to be issued as soon as is reasonably
possible after the advance, if any, of Tranche No. 3; each of which advances
will be converted into Canadian Dollars at the exchange rate published by the
Bank of Canada at the close of business on the day immediately preceding the
date of such advance.

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7.   REPRESENTATIONS AND WARRANTIES OF THE PINE VALLEY GROUP

7.1  REPRESENTATIONS AND WARRANTIES OF FALLS MOUNTAIN

Falls Mountain represents and warrants as follows and acknowledges and confirms
that Rockside is relying upon such representations and warranties in entering
into this Agreement:

     (a)  Falls Mountain is a valid and subsisting company duly incorporated
          under the laws of the Province of British Columbia and has all
          necessary corporate power and authority to enter into this Agreement
          and perform its obligations hereunder;

     (b)  this Agreement has been duly authorized, executed and delivered by
          Falls Mountain and is a legal, valid and binding obligation of Falls
          Mountain, enforceable against Falls Mountain in accordance with its
          terms except as enforcement may be limited by bankruptcy, insolvency
          and other laws affecting creditors' rights generally and subject to
          the qualification that specific performance and injunction, as
          equitable remedies, may only be granted in the discretion of a court
          of competent jurisdiction;

     (c)  the making of this Agreement and the completion of the transactions
          contemplated hereby and the performance of and compliance with the
          terms hereof does not conflict with or result in the breach of, or the
          acceleration of, any terms, provisions or conditions of or constitute
          a default under: (i) the constating documents of Falls Mountain; (ii)
          any indenture, mortgage, deed of trust, agreement, lease, franchise,
          certificate or other instrument to which Falls Mountain is a party or
          is bound, except as set out in the agreements with Marubeni and Mitsui
          or Mitsui Canada; or (iii) any term or provision of any licenses,
          registrations or qualifications of Falls Mountain or any order of any
          governmental authority or any applicable law;

     (d)  no litigation or administrative proceedings before any court or
          governmental authority are presently pending, or have been threatened
          in writing against Falls Mountain or any of its assets which could
          have a material adverse effect on its business or assets;

     (e)  Falls Mountain has conducted and is conducting, in all material
          respects, its business in compliance with all applicable laws,
          by-laws, rules and regulations of each jurisdiction in which the
          Willow Creek Project is carried on and it holds all licences,
          registrations, permits, consents or qualifications (whether
          governmental, regulatory or otherwise) required in order to enable the
          Willow Creek Project to be carried on as now conducted, and all such
          licences, registrations, permits, consents and qualifications are
          valid and subsisting and in good standing, in all material respects,
          and Falls Mountain has not received any notice of proceedings relating
          to the revocation or modification of any such licence, registration,
          permit, consent or qualification which, if subject to an unfavourable
          decision, ruling or finding, would materially adversely affect the
          business or assets of Falls Mountain;

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     (f)  Falls Mountain is the legal and beneficial owner of all of the issued
          and outstanding shares in the capital of PVC, free and clear of any
          Liens other than Permitted Liens; and

     (g)  except for those Willow Creek Project assets registered in the name of
          PVC, Falls Mountain owns all of the Willow Creek Project assets,
          licences, and permits required to carry on the Willow Creek Project in
          its current state of development free and clear of any Liens other
          than Permitted Liens.

The representations set out in this Section are continuous in nature and will
continue in effect as representations and warranties of Falls Mountain repeated
on a daily basis during the currency of this Agreement.

7.2  REPRESENTATIONS AND WARRANTIES OF PINE VALLEY

Pine Valley represents and warrants as follows and acknowledges and confirms
that Rockside is relying upon such representations and warranties in entering
into this Agreement:

     (a)  Pine Valley is a valid and subsisting company duly incorporated under
          the laws of the Province of British Columbia and has all necessary
          corporate power and authority to enter into this Agreement and perform
          its obligations hereunder;

     (b)  this Agreement has been duly authorized, executed and delivered by
          Pine Valley and is a legal, valid and binding obligation of Pine
          Valley, enforceable against Pine Valley in accordance with its terms
          except as enforcement may be limited by bankruptcy, insolvency and
          other laws affecting creditors' rights generally and subject to the
          qualification that specific performance and injunction, as equitable
          remedies, may only be granted in the discretion of a court of
          competent jurisdiction;

     (c)  the making of this Agreement and the completion of the transactions
          contemplated hereby and the performance of and compliance with the
          terms hereof does not conflict with or result in the breach of, or the
          acceleration of, any terms, provisions or conditions of or constitute
          a default under: (i) the constating documents of Pine Valley; (ii) any
          indenture, mortgage, deed of trust, agreement, lease, franchise,
          certificate or other instrument to which Pine Valley is a party or is
          bound, except as set out in the agreements with Marubeni and Mitsui or
          Mitsui Canada; or (iii) any term or provision of any licenses,
          registrations or qualifications of Pine Valley or any order of any
          governmental authority or any applicable law;

     (d)  no litigation or administrative proceedings before any court or
          governmental authority are presently pending, or have been threatened
          in writing against Pine Valley or any of its assets which could have a
          material adverse effect on its business or assets;

     (e)  Pine Valley has conducted and is conducting, in all material respects,
          its business in compliance with all applicable laws, by-laws, rules
          and regulations of

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          each jurisdiction in which its business is carried on and it holds all
          licences, registrations, permits, consents or qualifications (whether
          governmental, regulatory or otherwise) required in order to enable its
          business to be carried on as now conducted, and all such licences,
          registrations, permits, consents and qualifications are valid and
          subsisting and in good standing, in all material respects, and Pine
          Valley has not received any notice of proceedings relating to the
          revocation or modification of any such licence, registration, permit,
          consent or qualification which, if subject to an unfavourable
          decision, ruling or finding, would materially adversely affect the
          business or assets of Pine Valley; and

     (f)  Pine Valley is the legal and beneficial owner of all of the issued and
          outstanding shares in the capital of Falls Mountain, free and clear of
          any Liens other than Permitted Liens.

The representations set out in this Section are continuous in nature and will
continue in effect as representations and warranties of Pine Valley repeated on
a daily basis during the currency of this Agreement.

7.3  REPRESENTATIONS AND WARRANTIES OF PVC

PVC represents and warrants as follows and acknowledges and confirms that
Rockside is relying upon such representations and warranties in entering into
this Agreement:

     (a)  PVC is a valid and subsisting corporation duly incorporated under the
          laws of the Province of Alberta and has all necessary corporate power
          and authority to enter into this Agreement and perform its obligations
          hereunder;

     (b)  this Agreement has been duly authorized, executed and delivered by PVC
          and is a legal, valid and binding obligation of PVC, enforceable
          against PVC in accordance with its terms except as enforcement may be
          limited by bankruptcy, insolvency and other laws affecting creditors'
          rights generally and subject to the qualification that specific
          performance and injunction, as equitable remedies, may only be granted
          in the discretion of a court of competent jurisdiction;

     (c)  the making of this Agreement and the completion of the transactions
          contemplated hereby and the performance of and compliance with the
          terms hereof does not conflict with or result in the breach of, or the
          acceleration of, any terms, provisions or conditions of or constitute
          a default under: (i) the constating documents of PVC; (ii) any
          indenture, mortgage, deed of trust, agreement, lease, franchise,
          certificate or other instrument to which PVC is a party or is bound,
          except as set out in the agreements with Marubeni and Mitsui or Mitsui
          Canada; or (iii) any term or provision of any licenses, registrations
          or qualifications of PVC or any order of any governmental authority or
          any applicable law;

     (d)  no litigation or administrative proceedings before any court or
          governmental authority are presently pending, or have been threatened
          in writing against PVC or any of its assets which could have a
          material adverse effect on its business or assets;

                                       12
<PAGE>
     (e)  PVC has conducted and is conducting, in all material respects, its
          business in compliance with all applicable laws, by-laws, rules and
          regulations of each jurisdiction in which its business is carried on
          and it holds all licences, registrations, permits, consents or
          qualifications (whether governmental, regulatory or otherwise)
          required in order to enable its business to be carried on as now
          conducted, and all such licences, registrations, permits, consents and
          qualifications are valid and subsisting and in good standing, in all
          material respects, and PVC has not received any notice of proceedings
          relating to the revocation or modification of any such licence,
          registration, permit, consent or qualification which, if subject to an
          unfavourable decision, ruling or finding, would materially adversely
          affect the business or assets of PVC; and

     (f)  except for those Willow Creek Project assets owned by Falls Mountain,
          PVC owns all of the Willow Creek Project assets, licences, and permits
          required to carry on the Willow Creek Project in its current state of
          development free and clear of any Liens other than Permitted Liens.

The representations set out in this Section are continuous in nature and will
continue in effect as representations and warranties of PVC repeated on a daily
basis during the currency of this Agreement.

8.   REPRESENTATIONS AND WARRANTIES OF ROCKSIDE

8.1  GENERAL REPRESENTATIONS AND WARRANTIES

Rockside hereby represents and warrants as follows and acknowledges and confirms
that the Pine Valley Group is relying upon such representations and warranties
in entering into this Agreement:

     (a)  Rockside is a valid and subsisting corporation duly incorporated under
          the laws of its jurisdiction of incorporation and has all necessary
          corporate power and authority to enter into this Agreement and perform
          its obligations hereunder;

     (b)  this Agreement has been duly executed and delivered by Rockside and is
          a legal, valid and binding obligation of Rockside, enforceable against
          Rockside in accordance with its terms except as enforcement may be
          limited by bankruptcy, insolvency and other laws affecting creditors'
          rights generally and subject to the qualification that specific
          performance and injunction, as equitable remedies, may only be granted
          in the discretion of a court of competent jurisdiction;

     (c)  the making of this Agreement and the completion of the transactions
          contemplated hereby and the performance of and compliance with the
          terms hereof does not conflict with or result in the breach of, or the
          acceleration of, any terms, provisions or conditions of or constitute
          a default under: (i) the constating documents of Rockside; (ii) any
          indenture, mortgage, deed of trust, agreement, lease, franchise,
          certificate or other instrument to which Rockside is a party or is
          bound; or (iii) any term or provision of any licenses, registrations
          or qualifications of Rockside or any order of any governmental
          authority or any applicable law;

                                       13
<PAGE>
     (d)  there is not now pending or threatened against Rockside, nor has
          Rockside received notice in respect of any material claim, nor is
          Rockside aware of any facts that could give rise to any claim, which
          could lead to, any litigation, action, suit or other proceeding by or
          before any court, tribunal or other competent governmental agency or
          authority or regulatory body which if determined adversely to Rockside
          would materially affect the application of this Agreement or the
          Parties; and

     (e)  Rockside is a non-resident of Canada within the meaning of Section 116
          of the Income Tax Act (Canada).

The representations and warranties set out in this Section are continuous in
nature and will continue in effect as representations and warranties of Rockside
repeated on a daily basis during the currency of this Agreement.

8.2  SECURITIES LAW REPRESENTATIONS AND WARRANTIES

Rockside hereby further represents and warrants as follows and acknowledges and
confirms that the Pine Valley Group is relying upon such representations and
warranties in entering into this Agreement:

     (a)  Rockside acknowledges that it has had the opportunity to review all
          reports, information and other documents filed by Pine Valley with
          U.S. and Canadian securities authorities and to obtain additional
          information from, and to ask questions of, Pine Valley or its
          representatives concerning Pine Valley and its present and proposed
          business, results of operations and financial condition, and has had
          all such questions answered to its satisfaction and has been supplied
          with all additional information requested;

     (b)  Rockside has such knowledge and experience in business and financial
          matters that it is capable of evaluating the merits and risks of
          investing in Pine Valley. Rockside has sufficient liquid assets or
          other sources of income to provide for its current needs and
          contingencies with no need for liquidity of the investment in Pine
          Valley and has the ability to suffer a complete loss of the
          investment. Rockside is familiar with the type of investment which the
          securities being issued by Pine Valley constitutes and has reviewed
          the investment in Pine Valley with its own tax and legal advisors and
          investment representatives to the extent deemed advisable;

     (c)  Rockside understands that (i) the securities have not been registered
          under the U.S. Securities Act of 1933, as amended (the "SECURITIES
          ACT"), or any state securities or "blue sky" laws (the "STATE ACTS")
          and are being issued and sold in reliance upon certain exemptions
          contained in the Securities Act and the State Acts, and the
          representations and warranties contained herein are essential to the
          claim of exemption by Pine Valley under the Securities Act and the
          State Acts, (ii) the securities are "restricted securities" as that
          term is defined in Rule 144 promulgated under the Securities Act,
          (iii) the securities cannot be sold or

                                       14
<PAGE>
          transferred without registration under the Securities Act and any
          applicable State Acts, unless the holder establishes to the
          satisfaction of Pine Valley that such registration is not necessary,
          (iv) any certificates which may be issued to evidence the securities
          shall bear the following legend, in addition to any other legend
          required by law or otherwise:

          "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
          REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
          "SECURITIES ACT"), AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
          DISPOSED OF UNLESS A REGISTRATION STATEMENT UNDER THE SECURITIES ACT
          WITH RESPECT TO SUCH SECURITIES HAS BECOME EFFECTIVE OR UNLESS THE
          HOLDER ESTABLISHES TO THE SATISFACTION OF THE CORPORATION THAT AN
          EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE."

          (v) only Pine Valley can register the securities under the Securities
          Act and any of the State Acts, (vi) Pine Valley has not made any
          representations to Rockside that Pine Valley will register the
          securities under the Securities Act or any of the State Acts, or with
          respect to compliance with any exemption therefrom, (vii) there are
          stringent conditions for obtaining an exemption for the resale of the
          securities under the Securities Act and any State Acts, and (viii)
          Pine Valley may from time to time make stop transfer notations in its
          transfer records to ensure compliance with the Securities Act and any
          State Acts;

     (d)  Rockside represents and warrants that (i) it is acquiring the
          securities for its own account and not on behalf of any other person,
          (ii) it is acquiring the securities for investment and not with a view
          to or for sale in connection with any distribution of the securities
          or with the intent to divide its participation with others or resell
          or otherwise participate in a distribution of the securities, directly
          or indirectly, and (iii) neither it nor anyone acting omits behalf has
          paid or will pay any commission or other remuneration to any person in
          connection with the acquisition of the securities; and

     (e)  Rockside is an "accredited investor" within the meaning of Rule 501(a)
          of Regulation D promulgated under the Securities Act because it is an
          organization described in Section 501(c)(3) of the Internal Revenue
          Code, not formed for the specific purpose of acquiring the securities
          offered, with total assets in excess of $5,000,000.

The representations and warranties set out in this Section are continuous in
nature and will continue in effect as representations and warranties of Rockside
repeated on a daily basis during the currency of this Agreement.

9.   COVENANT ON RESALES OF SECURITIES

Rockside hereby covenants with Pine Valley not to make any sale of the
securities: (i) without registration under the Securities Act and the applicable
State Acts, unless it is established to the

                                       15
<PAGE>
satisfaction of Pine Valley that such registration is not necessary; or (ii)
without compliance with any restrictions imposed by the Securities Act or any
applicable State Acts.

10.  CLOSING

10.1 CLOSING DATE

The closing of the advance of Tranche No. 1 (the "CLOSING") will take place at
the offices of the Pine Valley Group's Vancouver legal counsel at 11:00 a.m.
(Vancouver time) on November 26, 2004, or such other date as may be agreed to by
the Parties (the "CLOSING DATE").

10.2 PINE VALLEY GROUP CLOSING AND POST-CLOSING DOCUMENTS

At the Closing, the Pine Valley Group will table and, in accordance with the
other provisions of Section 10, will deliver to Rockside:

     (a)  this Agreement duly executed by each member of the Pine Valley Group;

     (b)  a certificate of a senior officer of each member of the Pine Valley
          Group directed to the truth and accuracy of the representations and
          warranties of that member of the Pine Valley Group made in this
          Agreement and the performance by that member of the Pine Valley Group
          of the covenants to be performed by it at or before the Closing and
          providing particulars of any inaccuracy or non-performance;

     (c)  certified copies of resolutions of the directors of each member of the
          Pine Valley Group authorizing the execution and delivery by each such
          member of this Agreement and the performance of each such member's
          obligations hereunder;

     (d)  the Falls Mountain Security Agreement duly executed by Falls Mountain
          and PVC;

     (e)  a certified cheque, bank draft or wire transfer made payable to
          Rockside in connection with Falls Mountain's obligation to pay the
          amount owing, if any, pursuant to Section 2.6;

     (f)  a certified copy of resolution of the directors of Pine Valley
          authorizing the allotment and issuance of the Closing Date Bonus
          Shares; and

     (g)  all other documents as Rockside or its solicitors may reasonably
          request pursuant to the terms and conditions of this Agreement.

As soon as is reasonably possible after the Closing Date, Pine Valley will
deliver to Rockside a share certificate duly and validly registered in the name
of Rockside representing the Closing Date Bonus Shares.

                                       16
<PAGE>
10.3 ROCKSIDE'S CLOSING DOCUMENTS

At the Closing Rockside will table and, in accordance with the other provisions
in Section 10, will deliver to the Pine Valley Group:

     (a)  this Agreement duly executed by Rockside;

     (b)  a certificate signed by a senior officer of Rockside:

          (1)  directed to the truth and accuracy of the representations and
               warranties of Rockside in this Agreement and the performance by
               Rockside of the covenants to be performed at or before the
               Closing and providing particulars of any inaccuracy or
               non-performance; and

          (2)  confirming that the execution and delivery of this Agreement by
               Rockside and the performance by Rockside of its obligations
               hereunder have been authorized by all necessary procedures;

     (c)  a wire transfer in the amount of $3,750,000 representing the advance
          of Tranche No. 1;

     (d)  a statement of account evidencing the amount owing, if any, pursuant
          to Section 2.6; and

     (e)  all other documents as the Pine Valley Group may reasonably request
          pursuant to the terms and conditions of this Agreement.

10.4 CONDITIONS PRECEDENT

The obligation of Rockside to complete the Closing is subject to the conditions
that Rockside will have received confirmation of the registration of the Falls
Mountain Security Agreement in the personal property security registries of
British Columbia and Alberta, and the recording of the Falls Mountain Security
Agreement on the title records of the Willow Creek Project coal licenses and
coal leases maintained at the office of the British Columbia Coal Administrator.
The foregoing condition is for the exclusive benefit of Rockside and may be
waived by Rockside. Each of Rockside and Falls Mountain will use reasonable
commercial efforts to fulfill the foregoing condition promptly following the
execution and delivery of this Agreement.

11.  DEFAULT

11.1 EVENT OF DEFAULT

An "EVENT OF DEFAULT" means the occurrence of any of the following events:

     (a)  Falls Mountain defaults in any payment when the same is due under this
          Agreement;

     (b)  any member of the Pine Valley Group becomes insolvent or makes a
          general assignment for the benefit of its creditors, or if an order is
          made or effective

                                       17
<PAGE>
          resolutions are passed for the winding-up, of a member of the Pine
          Valley Group or if any member of the Pine Valley Group is declared
          bankrupt or if a custodian or receiver is appointed for a member of
          the Pine Valley Group under any bankruptcy legislation, or if a
          compromise or arrangement is proposed by any member of the Pine Valley
          Group to its creditors or any class of its creditors, or if a receiver
          or other officer with like powers is appointed for a member of the
          Pine Valley Group;

     (c)  the Pine Valley Group uses the Credit Facility proceeds for purposes
          other than those permitted by Section 3.1 of this Agreement;

     (d)  Pine Valley pays any dividends or makes any other cash distributions
          to shareholders, or makes any payment towards an amount of $600,000
          which Pine Valley has disclosed in the notes to its annual financial
          statements as owing to the estate of Pine Valley's former Chairman;

     (e)  Falls Mountain pays any cash dividends or makes any other cash
          distributions to its shareholder, other than by paying expenses of its
          shareholder that it is otherwise permitted to pay under this
          Agreement, which payments may be accounted for as dividends by Falls
          Mountain;

     (f)  the Pine Valley Group forfeits or abandons any of the coal licenses or
          coal leases listed in Schedule 11.1(f), or cause any conditions of its
          mining permits to be changed or amended such that the Pine Valley
          Group would have to cease mining operations on the Willow Creek
          Project for a period of greater than thirty consecutive days;

     (g)  the Pine Valley Group sells or otherwise disposes of any assets
          without the prior written consent of Rockside, excluding assets sold
          or otherwise disposed of in the normal course of business such as coal
          and equipment sales;

     (h)  a member of the Pine Valley Group is in material breach of any
          agreements with a third party and such material breach is reasonably
          likely to have a material impact on the ownership of the Willow Creek;
          or

     (i)  a member of the Pine Valley Group is in material breach of any
          provision of this Agreement.

11.2 CONSEQUENCES OF DEFAULT

If any Event of a Default occurs and is continuing for a period of 30 days after
written notice has been given by Rockside to the Pine Valley Group, and acts or
omissions of Rockside have not materially contributed to such a default, then
Rockside may declare the outstanding amount of the Credit Facility plus accrued
and unpaid Interest to be immediately due and payable and may exercise all of
its rights and remedies available to it at law, including under the Falls
Mountain Security Agreement. Notwithstanding the foregoing, the provisions of
this Section 11.2 will not in any way relieve the obligation of Falls Mountain
to repay the entire outstanding amount of the

                                       18
<PAGE>
Credit Facility and any and all accrued and unpaid Interest in accordance with
the repayment deadline prescribed in Section 2.3.

11.3 NOTICE OF DEFAULT

Upon becoming aware of the occurrence of an Event of a Default or an event
which, with the passage of time, will become an Event of Default, Falls Mountain
will give written notice of such event to Rockside.

11.4 USE OF PROCEEDS ASSUMPTION

Unless Rockside is able to prove otherwise, the Pine Valley Group will be
assumed to have used the Credit Facility proceeds in accordance with Article 3
of this Agreement.

12.  FORCE MAJEURE

If any Party is delayed in the performance of its obligations under this
Agreement or its operations are suspended by strikes, lockouts or other labour
unrest or disturbances, fire, flood, insurrection, riots, acts of the enemy,
acts of the government including governmental agencies or other bodies, acts of
God, or by any other similar causes reasonably beyond the control of the
affected Party (such an event being herein referred to as "FORCE MAJEURE"), then
the obligations of the Party, insofar as its obligations are affected by the
Force Majeure, will be suspended, while, but only for so long as, the Force
Majeure continues to prevent the performance of the said obligations. The Party
claiming suspension of its obligations as aforesaid will give the other Party
written notice of the Force Majeure within 10 days of its commencement including
reasonably full particulars in respect thereof, which particulars will include
the commencement date of the Force Majeure. The affected Party will promptly
take steps to remedy the cause and effect of the Force Majeure described in the
aforesaid notice insofar as it is reasonably able so to do; provided that the
terms of settlement of any strike, lockout, or other labour unrest or
disturbance will be wholly in the discretion of the Party so affected and that
Party will not be required to accede to the demands of its opponents in any
strike, lockout or other labour unrest or disturbance solely to remedy promptly
the Force Majeure thereby constituted.

Notwithstanding the foregoing, the provisions of this Section 12 will not in any
way relieve the obligation of Falls Mountain to repay the entire outstanding
amount of the Credit Facility and any and all accrued and unpaid Interest in
accordance with the repayment deadline prescribed in Section 2.3.

13.  GENERAL

13.1 INDEPENDENT LEGAL ADVICE

Rockside acknowledges and agrees that the Pine Valley Group and their counsel,
Bull, Housser & Tupper, have recommended that it obtain independent legal advice
with respect to the subject matter of this Agreement and Rockside hereby
represents and warrants to each of the Pine Valley Group and Bull, Housser &
Tupper that Rockside has sought independent legal advice or waives such advice.

                                       19
<PAGE>
13.2 ARBITRATION

All disputes between the parties arising out of or in connection with this
Agreement which cannot be settled by them will be referred to a single
arbitrator under the Commercial Arbitration Act then in effect in British
Columbia whose decision thereon will be final, binding and conclusive. All
arbitration proceedings will be conducted, unless the Parties otherwise agree,
in Vancouver, British Columbia. Any matter, issue or dispute referred to
arbitration will be dealt with on an expeditious basis with the parties using
all commercially reasonable efforts to obtain and implement a timely decision of
the arbitration panel.

13.3 FURTHER ASSURANCES

Before, at, and after the Closing Date, each Party will promptly execute and
deliver all further documents and take all further action reasonably necessary
or appropriate to give effect to the provisions and intent of this Agreement and
to complete the transactions contemplated by this Agreement.

13.4 ENTIRE AGREEMENT

This Agreement, together with the agreements and other documents delivered
pursuant hereto, constitutes the entire agreement between the Parties pertaining
to the subject matter hereof and supersedes all prior agreements,
understandings, negotiations and discussions, whether oral or written, express
or implied, statutory or otherwise between the Parties hereto and there are no
warranties, representations or other agreements between the Parties in
connection with the subject matter hereof except as specifically set forth
herein and therein.

13.5 NOTICE

Any notice or other communication required or permitted to be given under this
Agreement must be in writing and delivered personally or sent by facsimile,
addressed as follows:

     IF TO ANY MEMBER OF THE PINE VALLEY GROUP:

     #501 - 535 Thurlow Street
     Vancouver, BC V6E 3L2
     Attention: President
     Fax: (604) 682-4698

     WITH A COPY TO:

     Bull, Housser & Tupper
     3000 - 1055 W. Georgia St.
     Vancouver, B.C.
     V6E 3R3
     Attention: Grant Weaver
     Fax: (604) 646-2514

                                       20
<PAGE>
     AND IF TO ROCKSIDE:

     524 North Avenue, Suite 203
     New Rochelle, NY 10801-3410
     Attention: President
     Fax: 914-632-5502

or to such other address or facsimile number as a party may specify by notice in
writing given hereunder.

Each notice to a Party given pursuant to or in connection with this Agreement
must be given in writing and will be validly given if delivered on a Business
Day to an individual at the address for the Party designated in accordance with
this Section, or, if transmitted on a Business Day by fax to the fax number for
that the Party designated in accordance with this Section. Any notice:

     (a)  if validly delivered, will be deemed to have been given when
          delivered;

     (b)  if validly transmitted by fax before 3:00 p.m. (local time at the
          place of receipt) on a Business Day, will be deemed to have been given
          on that Business Day; and

     (c)  if validly transmitted by fax after 3:00 p.m. (local time at the place
          of receipt) on a Business day, will be deemed to have been given on
          the first Business Day after the date of the transmission.

For greater certainty, for all purposes under this Agreement, any notice,
delivery, payment, approval, or direction to be made or given by Rockside to or
to the benefit of any member of the Pine Valley Group will be effected by a
notice, delivery, payment, approval, or direction by Rockside to Pine Valley as
the duly authorized representative for each and every member of the Pine Valley
Group.

13.6 ASSIGNMENT

Except as expressly provided for herein, which may occur without consent
provided that Rockside is not released from its obligations as a result of such
assignment, this Agreement may not be assigned by any Party without the prior
written consent of the other Parties. This Agreement will enure to the benefit
of and be binding upon the each of the Parties and their successors and
permitted assigns.

13.7 CONFIDENTIALITY

Rockside will hold all Project Information in confidence, taking reasonable
security precautions (at least as great as the precautions it takes to protect
its own confidential information) to keep confidential the Project Information,
except for Project Information which:

     (a)  is or becomes generally available to the public other than as a result
          of a disclosure by Rockside, its representatives or anyone to whom
          Rockside or its representatives have transmitted any Project
          Information;

                                       21
<PAGE>
     (b)  is or becomes available or known to Rockside on a non-confidential
          basis and not in contravention of applicable law from a source other
          than the Pine Valley Group, provided that Rockside does not have
          reason to believe that such source is bound by a confidentiality
          agreement with the Pine Valley Group or is otherwise prohibited from
          transmitting the Project Information to Rockside;

     (c)  was known to Rockside on a non-confidential basis prior to the date of
          this Agreement, provided that such Project Information is not subject
          to another confidentiality agreement with, or other obligation of
          secrecy to, any member of the Pine Valley Group or another party; or

     (d)  is information which Rockside is or becomes legally obligated to
          disclose pursuant to an order of a court or other governmental entity
          having jurisdiction over such disclosure.

13.8 PUBLIC DISCLOSURE OBLIGATIONS

Rockside acknowledges that Pine Valley is a reporting issuer in British Columbia
and Alberta and has certain of its securities listed for trading on the TSX
Venture Exchange, and agrees that where Pine Valley, in its reasonable opinion,
is required to publicly disclose Project Information in order to comply with its
obligations to the TSX Venture Exchange, or any other exchange, quotation and
trade reporting system on which Pine Valley's securities are listed for trading,
or securities laws applicable to Pine Valley, then Pine Valley will be
permitted, in its sole discretion, to make such disclosure, provided that Pine
Valley provides Rockside with advance notice of any disclosure relating directly
or indirectly to Rockside.

13.9 COUNTERPARTS

This Agreement and all documents contemplated by or delivered under or in
connection with this Agreement may be executed and delivered in any number of
counterparts with the same effect as if all Parties had all signed and delivered
the same document and all counterparts will be construed together to be an
original and will constitute one and the same agreement.

13.10 DELIVERY BY FAX

Any Party may deliver an executed copy of this Agreement by fax but that Party
will immediately dispatch by delivery in person to the other Parties an
originally executed copy of this Agreement.

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

                                       22
<PAGE>
PINE VALLEY MINING CORPORATION

Per: /s/ Mark Fields
     --------------------------------
     Authorized Signatory
     I have authority to bind
     PINE VALLEY MINING CORPORATION

FALLS MOUNTAIN COAL INC.

Per: /s/ Mark Fields
     --------------------------------
     Authorized Signatory
     I have authority to bind
     FALLS MOUNTAIN COAL INC.

PINE VALLEY COAL LTD.

Per: /s/ Mark Fields
     --------------------------------
     Authorized Signatory
     I have authority to bind
     PINE VALLEY COAL LTD.

THE ROCKSIDE FOUNDATION

Per: /s/ Michael A. Coan
     --------------------------------
     Authorized Signatory
     I have the authority to bind
     THE ROCKSIDE FOUNDATION

                                       23
<PAGE>
                                SCHEDULE 11.1(F)
                            COAL LICENSES AND LEASES

I.   LICENSOR

     British Columbia Provincial Crown

II.  LICENSES AND LEASES

A.   Pine Valley Coal Ltd.

<TABLE>
<CAPTION>
           COAL
       LICENSE NO./                                 WORK              STATUS
      TENURE NUMBER   TENURE NO.   MAP NUMBER   RECORDED TO   (G.S. - GOOD STANDING)   AREA (HA)
      -------------   ----------   ----------   -----------   ----------------------   ---------
<S>   <C>             <C>          <C>          <C>           <C>                      <C>
1.        8574          327312       093O09W     2005.03.31       G.S. 2005.03.31          293
2.        8575          327313       093O09W     2005.03.31       G.S. 2005.03.31          293
3.        8576          327314       093O09E     2005.03.31       G.S. 2005.03.31          293
4.        8577          327316       093O09W     2005.03.31       G.S. 2005.03.31          293
5.        8578          327318       093O09W     2005.03.31       G.S. 2005.03.31          293
6.        8579          327320       093O09W     2005.03.31       G.S. 2005.03.31          293
7.        8580          327321       093O09W     2005.03.31       G.S. 2005.03.31          293
8.        347214        347214       093O09W     2005.03.31       G.S. 2005.03.31          292
9.        347215        347215       093O09E     2005.03.31       G.S. 2005.03.31          293
10.       347216        347216       093O09E     2005.03.31       G.S. 2005.03.31          293
11.       347217        347217       093O09E     2005.03.31       G.S. 2005.03.31          293
12.       347218        347218       093O09E     2005.03.31       G.S. 2005.03.31          293
13.       389294        389294       093O09E     2005.03.31       G.S. 2005.03.31         6151
</TABLE>

B.   Falls Mountain Coal Inc.

<TABLE>
<CAPTION>
           COAL
       LICENSE NO./                                 WORK              STATUS
      TENURE NUMBER   TENURE NO.   MAP NUMBER   RECORDED TO   (G.S. - GOOD STANDING)   AREA (HA)
      -------------   ----------   ----------   -----------   ----------------------   ---------
<S>   <C>             <C>          <C>          <C>           <C>                      <C>
1.        409343        409343       093O09W     2005.04.07       G.S. 2005.04.07         293
2.        409344        409344       093O09W     2005.04.07       G.S. 2005.04.07         293
3.        409345        409345       093O09W     2005.04.07       G.S. 2005.04.07         293
4.        409346        409346       093O09W     2005.04.07       G.S. 2005.04.07         293
5.        409347        409347       093O09W     2005.04.07       G.S. 2005.04.07         293
6.        409348        409348       093O09W     2005.04.07       G.S. 2005.04.07         293
7.        409349        409349       093O09W     2005.04.07       G.S. 2005.04.07         293
8.        409350        409350       093O09W     2005.04.07       G.S. 2005.04.07         293
9.        409351        409351       093O09W     2005.04.07       G.S. 2005.04.07         293
10.       409352        409352       093O09W     2005.04.07       G.S. 2005.04.07         292
</TABLE>

Together with any other coal licenses or coal leases acquired after the date
hereof by Pine Valley Coal Ltd. or Falls Mountain Coal Inc.

                                       24

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