OPTION AGREEMENT

(a)

"Exploration and Development" means any and all activities comprising or undertaken in connection with the exploration and development of the Property, the construction of a mine and mining facilities on or in proximity to the Property and placing the Property into commercial production;

(b)

"Exploration Expenditures” means all reasonable and necessary monies expended on or in connection with Exploration and Development as determined in accordance with generally accepted accounting principles including, without limiting the generality of the foregoing:

(i)

the cost of entering upon, surveying, prospecting and drilling on the Property;

(ii)

the cost of any geophysical, geochemical and geological reports or surveys relating to the Property;

(iii)

all filing and other fees and charges necessary or advisable to keep the Property in good standing with any regulatory authorities having jurisdiction;

(iv)

all rentals, royalties, taxes (exclusive of all income taxes and mining taxes based on income and which are or may be assessed against any of the parties hereto) and any assessments whatsoever, whether the same constitute charges on the Property or arise as a result of the operation thereon;

(v)

the cost, including rent and finance charges, of all buildings, machinery, tools, appliances and equipment and related capital items that may be erected, installed and used from time to time in connection with Exploration and Development;

(vi)

the cost of construction and maintenance of camps required for Exploration and Development;

(vii)

the cost of transporting persons, supplies, machinery and equipment in connection with Exploration and Development;

(viii)

all wages and salaries of persons engaged in Exploration and Development and any assessments or levies made under the authority of any regulatory body having jurisdiction with respect to such persons or supplying food, lodging and other reasonable needs for such persons;

(ix)

all costs of consulting and other engineering services including report preparation;

(x)

the cost of compliance with all statutes, orders and regulations respecting environmental reclamation, restoration and other like work required as a result of conducting Exploration and Development; and

(xi)

all costs of searching for, digging, working, sampling, transporting, mining and procuring diamonds, other minerals, ores, and metals from and out of the Property;

(c)

“Mineral Claim” means the mineral claim described in Schedule A to this Agreement, including: (i) any replacement or successor claims; and (ii) all mining leases and other mining interests derived from any such claims;

(d)

"Option" means the option to acquire a 60% undivided interest in and to the Property as provided in this Agreement;

(e)

"Option Period" means the period from the date of this Agreement to and including the date of exercise or termination of the Option;

(f)

"Property" means the Mineral Claim and the Property Rights; and

(g)

"Property Rights" means all licenses, permits, easements, rights-of-way, certificates and other approvals obtained by either of the parties either before or after the date of this Agreement in connection with the Mineral Claim and necessary for the exploration of the Mineral Claim.

(a)

The Option shall be exercised by the Optionee:

(i)

paying the Optionor $500 CDN on the execution of this Agreement, the receipt of which is hereby acknowledged by the Optionor;

(ii)

paying the Optionor $15,000 CDN as follows:

(A)

$2,000 CDN on or before the date that is three months after the Effective Date;

(B)

an additional $3,000 CDN on or before the date that is six months after the Effective Date; and

(C)

an additional $10,000 CDN on or before the first anniversary of the Effective Date.

(iii)

incurring Exploration Expenditures of $160,000 CDN on the Property as follows;

(A)

$10,000 CDN on or before the date that is six months after the Effective Date; and

(B)

a further $150,000 CDN on or before the second anniversary of the Effective Date.

(iv)

Issuing shares of the Optionee’s common stock (the “Shares”) to the Optionor as follows:

(A)

2,000 Shares on or before the date that is three months after the Effective Date;

(B)

an additional 3,000 Shares on or before the date that is six months after the Effective Date; and

(C)

an additional 10,000 Shares on or before the first anniversary of the Effective Date.

(collectively referred to as the “Option Shares”)

(b)

In the event that the Optionee spends, in any of the above periods, less than the specified sum, it may pay to the Optionor the difference between the amount it actually spent and the specified sum before the expiry of that period in full satisfaction of the Exploration Expenditures to be incurred. In the event that the Optionee spends, in any period, more than the specified sum, the excess shall be carried forward and applied to the Exploration Expenditures to be incurred in succeeding periods.

(c)

Upon exercise of the Option, a 60% undivided right, title and interest in and to the Property shall vest in the Optionee free and clear of all charges, encumbrances and claims.

(a)

the Optionee shall keep the Property clear of all liens, encumbrances and other charges;

(b)

the Optionee shall carry on all operations on the Property in a good and workmanlike manner and in compliance with all applicable governmental regulations and restrictions including but not limited to the posting of any reclamation bonds as may be required by any governmental regulations or regulatory authorities;

(c)

the Optionee shall pay or cause to be paid any rates, taxes, duties, royalties, workers’ compensation or other assessments or fees levied with respect to its operations thereon;

(d)

the Optionee shall pay the yearly claim maintenance payments necessary to maintain the claims in good standing;

(e)

the Optionee shall maintain books of account in respect of its expenditures and operations on the Property and, upon reasonable notice, shall make such books available for inspection by representatives of the Optionor;

(f)

the Optionee shall allow any duly authorised agent or representative of the Optionor to inspect the Property at reasonable times and intervals and upon reasonable notice given to the Optionee;

(g)

the Optionee shall allow the Optionor access at reasonable times to all maps, reports, sample results and other technical data prepared or obtained by the Optionee in c