EXHIBIT 10.8 JOINT VENTURE AGREEMENT

 

                                                                 EXHIBIT 10.8

 

 

                             JOINT VENTURE AGREEMENT

 

      THIS  AGREEMENT  mired into this the 11th day of May, 2004, by and between

U.S. Canadian Minerals, Inc. ("U.S.  Canadian"),  of Las Vegas, state of Nevada,

and El Capitan  Precious  Metals,  Inc. (El  Capitan),  of  Englewood,  state of

Nevada.

 

      WITNESSETH:

 

      WHEREAS, (U.S. Canadian) is in the business of

 

      Acquiring and Funding Mining Property                            , and

 

      WHEREAS, (El Capitan) is in the business of:

 

      Operating Mining Property                                        , and

 

      WHEREAS, both parties desire to work together for the purpose of

 

      Developing the COD Mining Claim

 

      NOW THEREFORE,,  for good and valuable consideration,  receipt of which is

hereby  acknowledged,  and the mutual promises and benefits to be derived by the

parties, they do hereby agree to the following terms and conditions:

 

                                   ARTICLE I

 

                                   FORMATION

 

SECTION 1.1    Formation and Name.

 

        1.1.1  FORMATION. The Joint Venturers hereby confirm that they have

formed a Joint Venture for the purposes and scope set forth in this agreement.

 

        1.1.2  NAME. The name of the Joint  Venture is and shall  continue to be

CanEll  ("CanEl").  The  business  and  affairs  of the Joint  Venture  shall be

conducted  solely under that name and under no other unless  modified in writing

by addendum to this agreement:

 

SECTION 1.2    PURPOSES and Scope of the Joint Venture.

 

        The purpose of the Joint Venture is to:

 

        Explore, operate and otherwise utilize the COD Mining Claim.

 

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SECTION 1.3    PRINCIPAL Place of Business.

 

         The principal place of business of the Joint Venture shall be Initially

located at:

 

4955 S. Durango, #216, Las Vegas, NV 89113.

 

SECTION 1.4    TERM.

 

         The term of the Joint Venture shall commence on the first above written

day, and shall  continue,  unless sooner  terminated  in  accordance  with other

provisions of this Agreement, until May 11, 2020.

 

SECTION 1.5    No Partition.

 

         No Joint Venturer  shall have the right and each Joint Venturer  hereby

agrees  not to  withdraw  from the Joint  Venture  nor to  dissolve,  terminate,

partition,   or  liquidate,   or  to  petition  a  court  for  the  dissolution,

termination,  partition,  or  liquidation  of the Joint  Venture or its  assets,

except as  provided  for in this  Agreement,  and no Joint  Venturer at any time

shall have the right to petition or to take any action to subject the  operation

of the  Project  or any part  thereof  or the Joint  Venture  assets or any part

thereof to the authority of any court of bankruptcy,  insolvency,  receivership,

or similar proceeding.

 

                                   ARTICLE II

 

                    CAPITAL CONTRIBUTIONS, RESERVES, VOTING,

                          FINANCING, AND DISTRIBUTIONS

 

SECTION 2.1    Joint VENTURE Percentage Interest.

 

U.S.  Canadian shall receive 80% of the interest in the mining claims designated

as the  COD  Mining  Claim,  currently  owned  by El  Capitan  and  whose  legal

description is attached as Exhibit A in exchange for 720,000 newly issued shares

of U.S.  Canadian.  The items in this  paragraph are property of the parties and

not the joint  venture  and are not  subject to  termination  or sale to satisfy

liabilities of the Joint Venture.

 

El Capitan  shall  operate the  operations  as they relate to the  tailings  and

settlement pond and contribute the equipment  needed for such  operations.  U.S.

Canadian shall  contribute to the operating  capital for 90 days which shall not

exceed the wages for 3 or 4 workers,  fuel and equipment repair and maintenance,

and necessary equipment for operation approved by J.V. Partners.  The net profit

from the tailings and settlement pond operations  shall be split 50-50 among the

parties.

 

SECTION 2.2    ADJUSTMENTS and Interest.

 

         Unless otherwise approved by the Joint Venturers,  no adjustment to the

Percentage  Interest of any Joint  Venturer  shall be made  except as  otherwise

provided herein or as a result of a transfer of a Joint Venturer's Joint Venture

interest or a portion thereof.

 

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SECTION 2.3    CAPITAL Accounts.

 

2.3.1  GENERAL.  As used  herein,  the term Capital  Account  shall refer to the

capital  account  of each  Joint  Venturer  reflecting  the value of each  Joint

Venturer's  relative  interest  in the capital of the Joint  Venture.  A Capital

Account,  as defined  herein,  shall be maintained  for each Joint  Venturer and

shall be subject to adjustment as provided in subsection 2.3.3.

 

2.3.2 INITIAL CAPITAL  CONTRIBUTION AND INITIAL  CAPITAL.  Upon the execution of

this Agreement,  the parties shall make contributions as stated in paragraph 2.1

of this Agreement.

 

SECTION 2.4    Allocations of Profits and Losses to Joint Venturers.

 

         All profits shall be retailed by U. S, Canadian other than as disclosed

in 2.1.

 

SECTION 2.5    Time LIMIT for Approval

 

         Where an issue arises  needing a vote,  such vote shall be given within

five (5)  calendar  days of a written  request  by the  other  party for a vote.

Should a response not be returned  within the stated period,  then the vote will

be considered in the affirmative.

 

                                  ARTICLE III

 

                                   MANAGEMENT

 

SECTION 3.1    JOINT Venture Manger.

 

U.S.  Canadian  is hereby  appointed  Manager  or  Venture  Manager of the Joint

Venture and shall be responsible for the internal operation of the venture.  Any

direct cost incurred shall be paid out of Joint Venture funds.

 

SECTION 3.2    Other BUSINESS Activities.

 

         Nothing  herein is to be  construed  as giving any party an interest in

other  business of the  parties  except  those  construed  specifically  by this

Agreement or incorporated by an amendment hereto.

 

         The parties  mutually  acknowledge  that each is involved in additional

businesses  and are not  restricted to  participating  with each other except as

stated in the first right of refusal for additional projects.

 

                                   ARTICLE IV

 

                                   ACCOUNTING

 

SECTION 4.1    Books, RECORDS, and Fiscal Year.

 

4.1.1  GENERAL.  The  Joint  Ventures  books and  records  of  account  shall be

maintained  in  accordance  with  generally   accepted   accounting   principles

consistently  applied on the cash  basis and shall be  adequate  to provide  any

 

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Joint  Venturer  with all  financial  information  as may be needed by any Joint

Venturer or any Affiliate of any Joint  Venturer for purposes of satisfying  the

financial  reporting  obligations of any Joint Venturer or his or its respective

affiliate  or  affiliates.  The fiscal  year of the Joint  Venture  shall end on

December 31 of each year. The books and records shall be maintained at the Joint

Ventures' principal place of business.

 

SECTION 4.2    Other ACCOUNTING Decisions.

 

         All accounting decisions and tax elections for the Joint Venture (other

than those specifically  provided for in other Sections of this Agreement) shall

be made from time to time as required and approved by the Venture Manager.

 

                                   ARTICLE V

 

                           SALE, TRANSFER, OR MORTGAGE

 

SECTION 5.1    GENERAL.

 

         Except as expressly  permitted  herein,  no Joint  Venturer shall sell,

sign, transfer,  mortgage,  charge, or otherwise encumber,  or permit any of the

foregoing,  whether  voluntarily  or  by  operation  of  law  (herein  sometimes

collectively  called a  transfer),  any part or all of his or its Joint  Venture

interest without the prior written  approval of the other Joint  Venturers,  and

any attempt to do so shall be void.

 

5.1.1   PERMITTED TRANSFERS

 

        (a) Any Joint Venturer may transfer or assign his or its interest in the

Joint Venture to any  corporation or general  partnership  that is controlled by

such Joint Venturer,  or to any limited  partnership in which the Joint Venturer

would be the general  partner,  and such transfers or  assignments  shall not be

subject to this SUBSECTION,,  but the transferee thereof shall be subject to all

the terms and conditions of this Agreem