JOINT VENTURE
OPTION AGREEMENT
THIS AGREEMENT MADE
EFFECTIVE AS OF THE _ 31 st _ DAY OF _
OCTOBER __, 2006 (the "Effective
Date").
BETWEEN:
WORLD FORTUNE
ENTERPRISE INC. , a private corporation with offices
at 870 East 54 th Ave, Vancouver, British
Columbia, V5X 1L7, Canada;
(“World
Fortune”)
AND:
ASIAN DRAGON
GROUP INC., a publicly traded corporation with
offices at suite 1100 – 475 Howe Street, Vancouver, British
Columbia, V6C 2B3;
(“Asian
Dragon”)
WHEREAS
World Fortune is a
private British Columbia corporation established to source and
assess opportunities in the precious metals industry in
China;
AND
WHEREAS World
Fortune has entered into an agreement (the “JV
Agreement”) for the establishment of a Sino-Foreign Joint
Venture (the “JV”) with the People’s Republic of
China (“PRC”) and in particular the Gold Bureau of the
PRC, through which World Fortune will hold a 70% equity position in
the JV named Luoyang Canadian United Mining Ltd.
(“Luoyang”);
AND
WHEREAS Luoyang is the owner of certain
assets known as the Jinjishan Gold Mine in the Xiaoqinling Region
of China (the “Assets”) of which World Fortune holds a
70% equity interest (the “Rights”);
AND
WHEREAS the
Rights, optioned herein to Asian Dragon by World Fortune, entitle
Asian Dragon to administer the Assets and hold a 70% equity
interest in the Assets in exchange for total investment of
US$2,500,000 and a grant of Asian Dragon common shares to World
Fortune.
AND
WHEREAS World
Fortune wishes to option to Asian Dragon and Asian Dragon wishes to
option from World Fortune, World Fortune’s Rights to the
Assets (the “Option”) and upon execution of this
Agreement, World Fortune will register this Option with the PRC and
Luoyang.
NOW THEREFORE THIS
AGREEMENT WITNESSES that in consideration of the
covenants and agreements herein contained, the parties hereto do
covenant and agree (the "Agreement") each with the other as
follows:
1.
Representations
and Warranties of World Fortune
1.1
In order to induce Asian
Dragon to enter into this Agreement and complete the transactions
contemplated under this Agreement, World Fortune represents and
warrants to Asian Dragon that:
(a)
World Fortune is, and
will remain during the term of this Agreement, the registered and
beneficial owner of Rights pursuant to the JV and such Rights
are free and clear of all transfer, assignment or other
restrictions, liens, charges and encumbrances of any kind
whatsoever;
(b)
World Fortune has good
and sufficient right and authority to enter into this Agreement and
carry out its obligations hereunder; and
(c)
World Fortune has, and
will have at the time the Option is exercised, good and sufficient
right and authority to transfer its legal and beneficial title and
ownership of the Rights to Asian Dragon.
1.2
The representations and
warranties of World Fortune contained in this Agreement shall be
true at the time of closing as though such representations and
warranties were made at the time of closing.
2.
Representations
and Warranties of Asian Dragon
2.1
In order to induce World
Fortune to enter into this Agreement and complete the transactions
contemplated under this Agreement, Asian Dragon r
