AGREEMENT

 

                 MINING OPTION AGREEMENT OF CHIQUERITOS, MEXICO

 

 

THIS AGREEMENT dated for reference the 12th day of March, 2005

 

 

AMONG:

 

                  Chiqueritos,   Mining Inc.a company duly incorporated   pursuant

                  to the laws of the   State of   Wyoming,   and   having a   mailing

                  address of 612 110th Ave North, Naples, Florida 34108.

 

                  (hereinafter referred to as "CMI")

 

                                                    OF THE FIRST PART

 

AND:

 

                   Minera Holmex S.A. de C.V., a company duly incorporated

                  pursuant to the laws of the State of

                  Sinaloa, Republic of Mexico, and having office at Ave. Hidalgo

                   373 Oriente #4-1, Colonia

                   Central, Culiacan, Sinoloa, CP 8000, Mexico.

 

                  (hereinafter referred to as "Minera Holmex")

 

AND:

 

                  International   American Resources Inc., a company incorporated

                  in   Colorado   having   its   address   at   6373 S.   Yates   Court,

                  Littleton, Colorado 80123.

 

                                                        OF THE SECOND PART

 

WHEREAS:

 

(A)       The Optionees hold a valid   agreement to acquire a one hundred   percent

         (100%)   undivided   interest in the Chiqueritos gold project situated in

         the Tamazula   District   near the village of   Chiqueritos,   Mexico.   The

         Optionees'   respective   legal   description and location of these mining

         claims    (hereinafter    referred   to   as   the    "Property")    are   more

         particularly described in Exhibit "A" attached hereto; and,

 

(The   Optionees   have agreed to grant to CMI an exclusive   option to acquire all

      of the   Optionees'   right,   title   and   interest   in and to the   Property,

      subject to the terms and conditions hereafter set out;

 

  NOW THEREFORE,   THIS AGREEMENT   WITNESSES that for and in consideration of such

  good and valuable   consideration now paid by CMI to the Optionees,   the receipt

  and sufficiency   whereof is hereby   acknowledged by the Optionees,   the parties

  agree as follows:

 

 

 

                           ARTICLE 1 - INTERPRETATION

 

1.1       Interpretation

 

In this Agreement, unless otherwise provided:

 

(a)       "Business Day" means a day, other than a Saturday or a Sunday, on which

         the   main   branch   of the US Bank in   Denver,   Colorado   is open to the

         public for the transaction of business;

 

(b)        "Option" means the option to acquire all right, title and interest of

  the Optionees in and to the

          Property as provided in ARTICLE 3; and,

 

(c)       "Property" means the mining claims described in Exhibit "A" hereto, and

         shall   include any renewal   thereof and any other form of   successor or

          substitute title therefor and shall also include all data,   reports and

         geological information in the possession of the Optionees; and,

 

(d)        "Royalty Interest" means payments to be made to Sr. Modesto Rivas

  Beltran as described in ARTICLE 3 and

          Exhibit B attached hereto

 

 

1.2       Currency

 

All dollar   amounts   expressed   herein shall be currency of the United States of

America.

 

 

1.3       Schedules

 

         Exhibit            Description

              A   Description   of   Property   (plus claim   location   map) B 3% Net

              Smelter Returns Royalty.

 

 

 

         ARTICLE 2   -   REPRESENTATIONS AND WARRANTIES

 

2.1       Mutual Representations and Warranties

 

Each of CMI and Optionees   represents   and warrants to one another and the other

parties hereto that:

 

(a)       it is a body corporate duly incorporated or continued, organized and

validly subsisting under the laws

         of its incorporating or continued jurisdiction; and,

 

(b)       it has full power and authority to carry on its business and to enter

  into this Agreement and any

         agreement or instrument referred to or contemplated by this Agreement;

  and,

 

(c)        all corporate authorizations have been obtained for the execution of

this Agreement and for the

          performance of its obligations hereunder; and,

 

         (d)        no proceedings are pending for and it is unaware of any basis

  for the institution of any

         proceedings leading to its dissolution or winding-up.

 

 

2.2       Optionees' Representations and Warranties

 

The Optionees represent and warrant to CMI that:

 

(a)        to the best of the Optionees'   knowledge,   information   and belief the

          mining   claims   comprising   the Property are   accurately   described in

          Exhibit A, have been properly and legally staked, recorded and tagged,

          are presently in good standing under the laws of the   jurisdiction   in

          which they are located,   and are free and clear of all liens,   charges

          and   encumbrances   except the mineral   property taxes in arrears since

          2000;

 

(b)        the Optionee has the exclusive right to enter into this Agreement and

to dispose of an interest in the

          Property in accordance with the terms of this Agreement;

 

(c)       the Optionees are the legal and beneficial Optionees of the Property

  described in Exhibit A;

 

(d)        there is no adverse claim or challenge   against or to the ownership of

          or title to any of the mining claims   comprising the Property,   nor to

          the knowledge of the Optionees is there any basis therefor or interest

          therein, and there are no outstanding agreements or options to acquire

          or purchase the Property or any portion   thereof,   and no person other

           than CMI, pursuant to the provisions   hereof, has any royalty or other

          interest   whatsoever   in   production   from   any of the   mining   claims

          comprising the Property;

 

(e)        no   proceedings   are pending for and the   Optionees are unaware of any

          basis for the institution of any proceedings leading to the placing of

          the Optionees   into   bankruptcy or subject to any other laws governing

          the affairs of insolvent persons;

 

(f)       to the best of the Optionees' knowledge,   the Property and its existing

         and prior uses   comply   and have at all times   complied   with,   and the

         Optionees are not in violation of, and has not violated,   in connection

         with the Optioneeship,   use,   maintenance or operation of the Property,

         any    applicable    federal,    provincial,    municipal   or   local   laws,

         regulations,   orders or   approvals   relating to its   operations   on the

         Property and environmental or similar matters;

 

  (g)      there are no orders or directions   relating to environmental or similar

         matters    requiring   any   work,    repairs,    construction    or   capital

         expenditures   with   respect   to the   Property   and the   conduct   of the

         business related thereto, nor have the Optionees received any notice of

         such;

 

(h)       no hazardous or toxic materials, substances,   pollutants,   contaminants

         or wastes   have   been   released   into the   environment,   or   deposited,

         discharged,   placed or   disposed   of at, on or near the   Property   as a

         result of the Optionees'   operations carried out on the Property,   nor,

         to the best of the Optionees' knowledge, have any of the above occurred

         nor has the Property been used at any time by any person as a person as

         a landfill or waste disposal site;

 

(i)       to the best of the Optionees' knowledge

 

         (i)       no notices of any violation or apparent violation of any of

  the matters referred   to in

        subparagraphs (g) and (h) relating to the Property or its use have been

       received by the Optionees; and,

 

         (ii)      there   are   no   writs,    injunctions,    orders   or    judgments

                  outstanding,     no    law    suits,     claims    proceedings    or

                  investigations   pending or   threatened,   relating   to the use,

                  maintenance or operation of the Property,   whether   related to

                  environmental   or similar matters,   or otherwise,   nor, to the

                  knowledge   of the   Optionees,   is there any basis for such law

                  suits, claims,   proceedings or investigations being instituted

                  or filed.

 

 

2.3         Survival of Representations and Warranties

 

The representations   and warranties   contained in this ARTICLE are conditions on

which the parties have relied in entering into this   Agreement and shall survive

the execution   hereof and the acquisition of any interest in the Property by CMI

hereunder   and each party will   indemnify   and save the other   harmless from all

loss, damage,   costs, actions and suits arising out of or in connection with any

breach of any representation, warranty, covenant, agreement or condition made by

them   and   contained   in   this   Agreement.    A   party   may   waive   any   of   such

representations,   warranties, covenants, agreements or conditions in whole or in

part at any time   without   prejudice of its right in respect of any other breach

of the   same or any   other   representation,   warranty,   covenant,   agreement   or

condition.

 

 

 

                   ARTICLE 3 - OPTION TO ACQUIRE THE PROPERTY

 

3.1       Grant of Option

 

Subject as hereinafter provided,   the Optionees hereby grant to CMI the sole and

exclusive   right and   option to   acquire   an   undivided   100%   right,   title and

interest in and to the Property free and clear of all charges,   encumbrances and

claims, save for the NSR royalty interest (more fully described in Exhibit B).

 

 

3.2       Initial Payment

 

At the signing of acceptance of this Agreement,   in consideration of the Option,

CMI shall pay to the Optionee, via certified check, bank draft or wire transfer,

the sum of one   thousand   dollars   (US$10,000),   followed by another   payment of

$5,000   within 30 days to   International   American   Resources Inc (" the initial

payment").

 

Upon receipt of the Initial   Payment,   Minera Holmex shall deliver to CMI a copy

of all   geologic   reports,   technical   data and maps   specific   to the   Property

(collectively, the "Data") in the possession of the Optionees.

 

Failure   to make   the   Initial   Payment   or   provide   a copy of the   Data   shall

constitute an   irrevocable   breach of this   Agreement and render the   provisions

thereof   null   and   void;   except   that CMI   shall   be bound by any   outstanding

obligations provided for herein.

 

 

3.3        Remaining Property Payments

 

In order to keep the Option in good standing and complete its purchase of a 100%

undivided    interest   in   the    Property,    CMI   shall   make   cash   payments   to

International   American   Resources or Minera   Holmex   according to the following

schedule:

 

                  Payment Due Date                Cash

                  -----------------------------------

                  November 1, 2005                         US$25,000

                  February 10, 2006               US$25,000

                  August 10, 2006                       US$30,000

                  February 10, 2007                    US$30,000

                  August 10, 2007                        US$40,000

                  February 10, 2008           US$40,000

                  August 10, 2008                       US$50,000

                  February 10, 2009                    US$50,000

                  August 10, 2009                       US$60,000

                  February 10, 2010                    US$60,000

                  Auguat 10, 2010                       US$65,000

                        The total would be                    US$500,000

A final payment of three hundred five thousand   dollars   ($305,000) shall be due

and payable on the 10th of February,   2011, to be paid in cash. There is a grace

period of 5 working days after which this agreement is automatically terminated.

 

CMI shall have the right,   but not the   obligation   to   accelerate   the   payment

schedule outlined herein.

 

 

3.4        Interest in Property & Royalty Interest

 

So long as CMI makes the payments as described in ARTICLE 3,   Sections 3.2, 3.3,

and keeps the Property in good standing as provided in Section 3.7, and fulfills

all other   obligations   provided   for by this   Agreement;   CMI shall have a 100%

right,   title and interest in and to the   Property   (subject to the 3% NSR) free

and clear of all charges, encumbrances and claims.

 

Upon   completion   of the   payments as detailed   in Section   3.3,   CMI shall have

earned a 100%   undivided   interest in the Property   (subject to the 3% NSR),   at

which point,   the Optionees shall   immediately   arrange for transfer of title to

the   Property   into the name of CMI (or its   designee /   assignee)   pursuant   to

Section 3.6 herein.

 

 

3.5        Right of Entry During the Option

 

Throughout the term of the Agreement,   the Directors and Officers of CMI and its

agents and   contractors,   shall have the sole and exclusive   right in respect of

the Property to:

 

(a)        enter thereon;

 

(b)        have exclusive and quiet possession thereof;

 

(c)       do such prospecting,   exploration,   development,   drilling and/or other

         mining work thereon and   thereunder as CMI in its sole   discretion   may

         determine   advisable and including,   without   limitation the removal of

         ores, minerals and metals from the Property but only for the purpose of

         testing;   and with a minimum   expenditure   of $70,000 per year starting

          one month after signing this agreement;

 

(d)       bring upon and erect upon the Property buildings,   plant, machinery and

         equipment as CMI may deem advisable,   so long as such   improvements are

         in compliance with applicable County, State, and Federal regulations.

 

 

3.6        Transfer of Property

 

Upon CMI fulfilling all of its obligations   under this Agreement,   the Optionees

Representative   shall deliver to CMI (or its   associated   Mexican   company) duly

executed   transfers   of the   Property   in   favor of   CMI's   Mexican   Associates'

Company, which CMI may record at its cost with the appropriate government office

to effect legal transfer of the Property into the name of its associated Mexican

company, it being understood that the transfer of legal title is contingent upon

and subject to CMI fulfilling all of its obligations under this Agreement.

 

Additionally, subsequent to signing, the parties understand that CMI will assign

its rights, interests, duties,   responsibilities and obligations (related to the

Property and this Agreement) to a Mexican subsidiary which is in the formation /

registration stages. All parties to this Agreement pledge to execute any and all

such   documentation   as may be   necessary   to   facilitate   the   transfer of this

Agreement to CMI's Mexican subsidiary.

 

 

3.7        Obligations of InterAmerican Resources and Minera Holmex During the

Option Period

 

During the term of this Option Agreement, the Optionees shall:

 

(a)       maintain in good standing the mining   claims   comprised in the Property

         by the payment of annual   assessment fees,   taxes and rentals,   and the

         performance   of all other actions which may be necessary in that regard

         and in order to keep such mining claims free and clear of all liens and

         other charges arising from CMI's   activities   thereon,   save and except

         for liens in respect   of taxes not yet due,   other   inchoate   liens and

         liens   contested   in good faith by   International   American   and Minera

         Holmex   and on behalf   of and for cost of CMI   stake at 1 Km   perimeter

         area   around   the   Gavilanes   claim,   near the   hamlet   of   Chiqueritos

         immediately after signing this agreement;

 

(b)       permit the directors, officers, employees and designated consultants of

         the   Optionees,   at their   own   risk,   access   to the   Property   at all

         reasonable   times,   provided   that the   Optionees   shall   indemnify CMI

         against and save it harmless from all costs,   claims,   liabilities   and

         expenses   that   CMI may   incur or   suffer   as a   result   of any   injury

         (including injury causing death) to any director,   officer, employee or

         designated   consultant of the Optionees while on the Property   provided

         however   that CMI will not be   indemnified   nor held   harmless   for any

         costs, claims, liabilities or expenses resulting from CMI's negligence,

         gross negligence or misconduct;

 

(c)       deliver to the Optionees,   on a regular basis,   copies of all technical

         work carried out on the   property   (limited to factual   matters   only),

         including,   but not limited to,   up-to-date   geological,   sampling   and

         drill hole location maps, drill logs, assays,   copies of all permitting

         documents and other factual   technical   data   describing the results of

         work done by CMI on the Property in the last completed option year;

 

(d)       do all work on the   Property,   including   any   reclamation   work,   in a

         careful and   miner-like   manner and in compliance   with all   applicable

         laws,   rules,   regulations,   orders and ordinances of any   governmental

         authority    and   will    promptly    carry   out,   at   its   own    expense,

         environmental clean-up required by any state or federal regulatory body

         as a consequence of its exploration or mining activities carried out on

         the Property; and,

 

(e)       Indemnify   and hold the Optionees   harmless   from any claims,   demands,

         liabilities   or   laborer's,   mechanic's   or other liens   arising out of

         CMI's activities on the Property.

 

 

3.8        The Operator

 

During the term of the Option,   CMI or its   permitted   assigns   shall act as the

operator of operations   on the   Property,   and will conduct its operation on the

Property at its sole discretion.

 

3.9        Termination of Option

 

Notwithstanding   any other