20-F

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 20-F

     (Mark One)

	REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
OR
þ	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended July 31, 2002
OR
	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________________ to ________________

Commission file number: 0-31190
CANPLATS RESOURCE CORPORATION
___________________________________________________________________________ (Exact name of Registrant as specified in its charter)
British Columbia, Canada
___________________________________________________________________________ (Jurisdiction of incorporation or organization)
Suite 1180 - 999 West Hastings Street, Vancouver, British Columbia, Canada V6C 2W2
___________________________________________________________________________ (Address of principal executive offices)
Securities registered or to be registered pursuant to Section 12(b) of the Act.
Title of each class None ____________________________________ ____________________________________	Name of each exchange on which registered ____________________________________ ____________________________________
Securities registered or to be registered pursuant to Section 12(g) of the Act.
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.
None
___________________________________________________________________________ (Title of Class)
Indicate the number of outstanding shares of each of the issuer's classes of capital or common stock as of the close of the period covered by the annual report.
At July 31, 2002, the Registrant had 10,217,303 common shares outstanding
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
     Yes        No
Not Applicable
Indicate by check mark which financial statement item the registrant has elected to follow.
þ     Item 17         Item 18
As of December 9, 2002, the buying rate for Canadian dollars was US$0.6404 for Cdn$1.00.

TABLE OF CONTENTS

GLOSSARY
FORWARD LOOKING STATEMENTS
PART I
ITEM 1 - IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
A	Directors and Senior Management
B	Advisers
C	Auditors
ITEM 2 - OFFER STATISTICS AND EXPECTED TIMETABLE
ITEM 3 - KEY INFORMATION
A	Selected Financial Data
B	Capitalization and Indebtedness
C	Reasons for the Offer and Use of Proceeds
D	Risk Factors
ITEM 4 - INFORMATION ON THE COMPANY
A	History of the Company
B	Business Overview
C	Organizational Structure
D	Property, Plants and Equipment
ITEM 5 - OPERATING AND FINANCIAL REVIEW AND PROSPECTS
A	Operating Results
B	Liquidity and Capital Resources
C	Research and Development, Patents and Licenses, etc.
D	Trend Information
ITEM 6 - DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
A	Directors and Senior Management
B	Compensation
C	Board Practises
D	Employees
E	Share Ownership
ITEM 7 - MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
A	Major Shareholders
B	Related Party Transactions
C	Interests of Experts and Counsel
ITEM 8 - FINANCIAL INFORMATION
A	Consolidated Statements and Other Financial Information
B	Significant Changes
ITEM 9 - THE OFFERING AND LISTING
A	Offer and Listing Details
B	Plan of Distribution
C	Markets
ITEM 10 - ADDITIONAL INFORMATION
A	Share Capital
B	Memorandum and Articles of Association
C	Material Contracts
D	Exchange Controls
E	Taxation
F	Dividends and Paying Agents
G	Statement by Experts
H	Documents on Display
ITEM 11 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
ITEM 12 - DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
PART II
ITEM 13 - DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
ITEM 14 - MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
ITEM 15 - CONTROLS AND PROCEDURES
ITEM 16 - RESERVED
PART III
ITEM 17 - FINANCIAL STATEMENTS
ITEM 18 - FINANCIAL STATEMENTS
ITEM 19 - EXHIBITS
SIGNATURE PAGE
CERTIFICATIONS

GLOSSARY OF TERMS

The following words and phrases shall have the meanings set forth below:

“anhydrite” — a mineral of anhydrous calcium sulphate. It readily alters to gypsum;

“anomaly” — a geological feature, distinguished by geological, geophysical, or geochemical means, which is different from the general surroundings;

“Archean” — the oldest half of Precambrian time ending at 2.4 billion years old;

“augite” — a dark mineral of the pyroxene group containing roughly equal amounts of magnesium, iron and calcium;

“basalt” — a dark colored volcanic rock composed primarily of calcium-plagioclase and pyroxene; the fine grained equivalent of a gabbro;

“base metal” — any of the more common and more chemically active metals e.g. copper, lead;

“carbonate” — common rock forming minerals composed of a base unit of one carbon atom and 3 oxygen atoms combined with dominantly either calcium, iron or magnesium;

“carbonatite” — a carbonate rock of apparent magmatic origin, generally associated with kimberlites and certain intrusive rocks;

“cherty carbonate” — a carbonaceous sediment which has been weakly silicified;

“clinopyroxene” — a member of the pyroxene group of minerals with a particular crystal habit and generally contain considerable amounts of calcium;

“conglomerates” — a coarse grained sedimentary rock, composed of rounded fragments larger than 2 mm in diameter, set in a fine grained matrix of sand or silt, and commonly cemented by calcium carbonate or silica;

“diabase (dolerite) sills” — an intrusive rock consisting essentially of labradorite and pyroxene and characterised by ophitic texture. In Great Britain this rock is called dolerite;

“disseminated” — a scattered distribution of generally fine-grained minerals throughout a rock body;

“dolomite carbonate” — a common rock forming mineral composed of calcium, magnesium carbonate. A sedimentary rock in which more than 50% by weight, consists of the mineral dolomite;

“EM” — electromagnetic. A type of geophysical survey that identifies areas in the earth’s crust that have sufficient sulfides present to form a conductor;

“fault” — a fracture or fracture zone along which there has been displacement of the sides relative to one another parallel to the fracture;

“feldspar” — a group of common rock forming minerals that constitute up to 60% of the earth’s crust. They are composed of aluminium silicates in combination with lessor amounts of dominantly potassium, sodium or calcium;

“flood basalts” — basalt lavas that occur as vast composite accumulations of horizontal or subhorizontal flows, which erupted in rapid succession over great areas, and have at times flooded the earth’s crust on a regional scale.

“gabbro” — A group of dark-coloured, intrusive rocks composed principally of labradorite and augite, with or without olivine and orthopyroxene. It is the coarse grained equivalent of a basalt;

“geochemical sampling” — collection of rock, soil, sediment, vegetation or water samples to be analysed for concentrations of one or more elements;

“geological host rock” — a body of rock serving as a host for other rocks or for a mineral deposit;

“geological mapping” — preparation of a representation on a plane surface, at an established scale, of the physical or geological features of part of the earth’s surface;

“geological reconnaissance” — a general exploratory examination or survey of the geological features of a region, usually preliminary to a more detailed survey;

“grid” — a network composed of two sets of uniformly spaced parallel lines, usually intersecting at right angles and forming squares, established on the ground and/or superimposed on a map, chart or aerial photographs, to permit identification of ground locations by means of a system of co-ordinates;

“gypsum” — a widely distributed mineral consisting of hydrous calcium sulphate;

“hematization” — the process of oxidation of iron rich minerals, commonly pyrite and magnetite, to hematite;

“hornblende” — a common rock forming mineral that is generally dark green, has a stubby crystal habit, and is composed of varying amounts of calcium, sodium, magnesium, iron, aluminium and silicon;

“hornblendite” — an intrusive igneous rock composed essentially of hornblende;

“igneous” — a rock or mineral that solidified from molten or partly molten material, i.e. from a magma;

“induced polarization geophysical survey” — a geophysical survey that measures the resistivity and chargeability of the local rock formations;

“IP” — induced polarization (same as above);

“intrusive” — pertaining to intrusion, which is the process of emplacement of molten rock into pre-existing rocks. The magma cools slowly and generally develops a coarse grained texture;

“labradorite” — a feldspar mineral of the plagioclase family having approximately equal proportions of sodium and calcium;

“line” — a line on a map indicating the position of a of a profile or cross section. A line established in the field to provide a reference system of grid co-ordinates for locating the origin of data obtained by prospecting, geological mapping, geophysical or geochemical surveys;

“mafic” — an igneous rock composed chiefly of dark, iron-magnesium rich minerals; also, said of those minerals;

“magnetic geophysical survey” — a geophysical survey made with a magnetometer, on the ground or in the air, which yields local variations, or anomalies, in the magnetic field intensity;

“magnetometer” — an instrument that measures the earth's magnetic field and its changes;

“massive sulphide deposit” — any mass of unusually abundant metallic sulfide minerals;

“metamorphic” — pertaining to the process of metamorphism in which a rock is derived from pre-existing rocks, essentially in the solid state, in response to changes in temperature, pressure, and/or chemical environment;

“Mid-Continental Rift” — a long narrow continental trough bounded by faults that extend through the entire thickness of the earth’s crust;

“mineral claim unit” — a claim unit is the smallest unit of area that can be staked in Ontario, which measures 400 meters by 400 meters, covering an area of 16 hectares (40 acres). Claim units can be staked in a block of up to 16 units per claim;

“olivine” — a green to brown, iron-magnesium silicate. It is a common rock forming mineral of intrusive rocks which have low silica contents;

“olivine-tholeiite” — A basalt characterised by the presence of orthopyroxene and/or pigeonite in addition to olivine, clinopyroxene and calcium-rich plagioclase.

“ophitic texture” — a texture found in some igneous rocks in which lath shaped feldspar crystals grow inside pyroxene crystals, typically augite;

“orthopyroxene” — a sub-group of the pyroxene group of minerals that is magnesium and/or iron rich, with little or no calcium;

“outcrop” — a part of a geologic formation that appears at the surface of the earth;

“overburden” — loose or consolidated soil and rock material that overlies a geologic formation or mineral deposit;

“pigeonite” — a member of the orthopyroxene group of minerals which is iron rich and contains no aluminium;

“PGE” — platinum group elements whose major elements are platinum and palladium with minor elements, osmium, iridium, rhodium, and ruthenium;

“Proterozoic” — the more recent half of Precambrian time beginning at 2.4 billion years old;

“pyroxene” — a group of common rock forming minerals, which are generally dark green, produce long, bladed crystals, and are composed mainly of combinations of iron, magnesium, aluminium and silicon with calcium or sodium.

“resistivity survey” — a geophysical survey in which electrical resistivity of a particular formation is determined by passing an electrical current through it;

“sill” — a tabular igneous intrusion that parallels the planar structure of the surrounding rocks;

“soil sampling” — the process of collecting samples of the soil, generally between 15cm and 30cm below the surface, at regular intervals along a grid for the purposes of determining concentrations of one or more elements;

“stromatilite” — an extinct marine organism that secreted a calcareous skeleton (shell) of bulbous form;

“sulphides” — a common group of minerals that are composed of sulphur and a wide variety of metals;

“tectonic” — pertaining to the forces involved in, the resulting structures or deformational features and their relations, origin and historical evolution of the earth’s crust;

“ultramafic” — igneous rocks consisting mainly of iron-magnesium rich minerals to the exclusion of quartz and feldspar;

“volcanics” — pertaining to the activities, structures, or rock types of a volcano;

                                Conversion Table
                Metric                                      Imperial
       1.0 millimetre (mm)                =        0.039 inches (in)
       1.0 metre (m)                      =        3.28 feet (ft)
       1.0 kilometre (km)                 =        0.621 miles (mi)
       1.0 hectare (ha)                   =        2.471 acres (ac)
       1.0 gram (g)                       =        0.032 troy ounces (oz)
       1.0 metric tonne (t)               =        1.102 short tons (ton)
       1.0 g/t                            =        0.029 oz/ton

Unless otherwise indicated, all dollar amounts referred to herein are in Canadian dollars.

FORWARD LOOKING STATEMENTS

Canplats Resources Corporation (“Canplats”) cautions readers that certain important factors (including without limitation those set forth in this Form 20-F) may affect Canplats’ actual results and could cause such results to differ materially from any forward-looking statements that may be deemed to have been made in this Form 20-F registration statement, or that are otherwise made by or on behalf of Canplats. For this purpose, any statements contained in the registration statement that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as “may,” “except,” “believe,” “anticipate,” “intend,” “could,” “estimate,” or “continue,” or the negative or other variations of comparable terminology, are intended to identify forward-looking statements.

PART I

ITEM 1

A. Directors and Senior Management

This Form 20-F is being filed as an annual report under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and, as such, there is no requirement to provide any information under this item.

B. Advisors

This Form 20-F is being filed as an annual report under the Exchange Act, and, as such, there is no requirement to provide any information under this item.

C. Auditors

This Form 20-F is being filed as an annual report under the Exchange Act, and, as such, there is no requirement to provide any information under this item.

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable

ITEM 3. KEY INFORMATION

A. Selected Financial Data

The selected financial data of Canplats for each of the years in the five-year period ended July 31, 2002 was extracted from the audited financial statements of Canplats. The information contained in the selected financial data is qualified in its entirety by reference to the more detailed financial statements and related notes included in Item 17. Financial Statements, and should be read in conjunction with such financial statements and with the information appearing in Item 5. Operating and Financial Review and Prospects. Reference is made to Note 13 of the financial statements of Canplats included in Item 17. Financial Statements for a discussion of the material differences between Canadian GAAP and U.S. GAAP, and their effect on Canplats’ financial statements.

To date, Canplats has not generated sufficient cash flow from operations to fund ongoing operational requirements and cash commitments. Canplats has financed its operations principally through the sale of its equity securities. While Canplats believes it has sufficient capital and liquidity to finance current operations, nevertheless, its ability to continue operations is dependent on the ability of Canplats to obtain additional financing. See “Item 3 — Key Information — D. Risk Factors.”

Under Canadian Generally Accepted Accounting Principles (in Canadian dollars):

                                                   Year          Year          Year         Year          Year
                                                   Ended        Ended         Ended         Ended        Ended
                                                 July 31,      July 31,      July 31,     July 31,      July 31,
                                                   2002          2001          2000         1999          1998
                                                     $            $             $             $            $

Current Assets                                     160,464        200,443       120,557        4,420       148,464
Investment in Colby Gold PLC                             -              -             -            1             1
Mineral Properties                               1,478,254        986,469       462,372      166,959        39,700
Deferred Financing Costs                                 -              -        27,960            -             -
Total Assets                                     1,638,718      1,186,912       610,889      171,380       188,165
Total Liabilities                                   55,898         57,488        50,554      433,671       418,830
Net Assets (Liabilities)                         1,582,820      1,129,424       560,335     (262,291)     (230,665)
Share Capital                                    8,125,636      7,566,941     5,859,097    5,859,097     5,859,097
Deposits on Share Subscriptions                    106,000              -             -            -             -
Special Warrants                                         -              -       937,750            -             -
Deficit Accumulated                              (6,648,816)   (6,437,517)   (6,236,512)  (6,121,388)   (6,089,762)
Loss from Continuing Operations                   (211,299)      (201,005)     (115,124)     (31,626)       (4,473)
Net Loss for the Period                           (211,299)      (201,005)     (115,124)     (31,626)       (4,473)
Basic and Diluted Loss per Share                        (0.02)      (0.06)        (0.10)       (0.03)        (0.01)
Weighted Average Number of
  Common Shares Outstanding                      9,202,413      3,062,700     1,111,303    1,111,303     1,111,303

Under U.S. Generally Accepted Accounting Principles (in Canadian dollars):

                                                    Year         Year          Year         Year          Year
                                                   Ended         Ended        Ended         Ended        Ended
                                                  July 31,     July 31,      July 31,     July 31,      July 31,
                                                    2002         2001          2000         1999          1998
                                                     $             $            $             $            $

Current Assets                                     160,464        200,443       120,557        4,420       148,464
Investment in Colby Gold PLC                             -              -             -            1             1
Mineral Properties                                       -              -             -            -             -
Deferred Financing Costs                                 -              -        27,960            -             -
Total Assets                                       160,464        200,443       148,517        4,421       148,465
Total Liabilities                                   55,898         57,488        50,554      433,671       418,830
Net Assets (Liabilities)                           104,566        142,955        97,963     (429,250)     (270,365)
Share Capital                                    8,125,636      7,566,941     5,859,097    5,859,097     5,859,097
Deposits on Share Subscriptions                    106,000              -             -            -             -
Special Warrants                                         -              -       937,750            -             -
Deficit Accumulated                             (8,127,070)    (7,423,986)   (6,698,884)  (6,288,347)   (6,129,462)
Loss from Continuing Operations                   (703,084)      (725,102)     (410,537)    (158,885)      (25,473)
Net Loss for the Period                           (703,084)      (725,102)     (410,537)    (158,885)      (25,473)
Basic and Diluted Loss per Share                        (0.08)      (0.24)        (0.37)       (0.14)        (0.02)
Weighted Average Number of
  Common Shares Outstanding                      9,064,413      2,986,138     1,111,303    1,111,303     1,111,303

Dividends

No cash dividends have been declared nor are any intended to be declared. Canplats is not subject to legal restrictions respecting the payment of dividends except that they may not be paid to render Canplats insolvent. Dividend policy will be based on Canplats’ cash resources and needs and it is anticipated that all available cash will be required to further Canplats’ exploration activities for the foreseeable future.

Exchange Rates

Unless otherwise indicated, all reference to dollar amounts are in Canadian dollars. The following table sets out the exchange rates for one Canadian dollar expressed in terms of one U.S. dollar for the periods indicated. Rates of exchange are obtained from the Bank of Canada and believed by Canplats to approximate closely the noon buying rates in New York City for cable transfers as certified for customs purposes by the Federal Reserve Bank in New York.

                                  July 31,      July 31,      July 31,       July 31,      July 31,
                                  2002 (1)      2001 (1)      2000 (1)       1999 (1)      1998 (1)

Period End                        0.6318        0.6535        0.6724         0.6639        0.6618
Average (2)                       0.6371        0.6564        0.6798         0.6618        0.6977

Notes:
(1) For the year ended July 31
(2) The average rate figures are based on the average of the exchange rates on the last day of each month during the period

                          November        October        September        August          July            June
                            2002            2002           2002            2002           2002            2002

High for Month(1)          0.6283          0.6325         0.6333          0.6360         0.6447          0.6515
Low for Month(1)           0.6447          0.6354         0.6365          0.6397         0.6491          0.6546

Notes:

(1)     Figures are selected from daily exchange rates

As of December 9, 2002, the exchange rate to convert one Canadian dollar into the U.S. dollar was 0.6404.

B. Capitalization and Indebtedness

Not applicable

C. Reasons for the Offer and Use of Proceeds

Not applicable

D. Risk Factors

Canplats is subject to a number of risks due to the nature of its business and the present stage of its business development. The following factors should be considered:

Canplats’ prospects must be considered in light of the difficulties frequently encountered by companies in the early stages of mineral exploration. However, Canplats is a recently listed public company with a limited history of operations which makes evaluation of its prospects difficult.

Canplats’ common shares were listed on the TSX Venture Exchange (a predecessor of both the Vancouver Stock Exchange and the Canadian Venture Exchange) on June 21, 1972 and were delisted in April 1992 for failure to pay sustaining fees. Canplats’ common shares did not resume trading on the Canadian Venture Exchange until March 22, 2001 during which time Canplats remained mostly inactive. In November 1997, Canplats acquired an option to acquire a 100% interest in the Horseshoe Island Property, a potential gold bearing property, which was subsequently abandoned during the 2000 fiscal year. In January 1999, Canplats focused its attention on Platinum group element properties and commenced acquiring mineral claims through staking and optioning.

Canplats has had a limited operating history and is in the early stages of exploring Platinum group element properties. Canplats does not hold any known mineral reserves of any kind and therefore does not generate any revenues from production. Canplats’ success will depend largely upon its ability to locate commercially productive mineral reserves which may never happen. As a result of these factors, it is difficult to evaluate Canplats’ prospects, and its future success is more uncertain than if it had a longer or more proven history of operations.

Canplats expects to continue to incur substantial losses and may never achieve profitability, which in turn may harm the future operating performance and may cause the market price of Canplats’ stock to decline.

Canplats has incurred net losses every year since inception on February 15, 1967 and as of July 31, 2002, had an accumulated deficit of $6,648,816. Canplats incurred a net loss of $211,299 for the fiscal year ended July 31, 2002 and net losses of $201,005 and $115,124 for the 2001 and 2000 fiscal years, respectively.

Canplats anticipates significant expenditures for its mineral exploration programs, which are expensed under U.S. GAAP, and for the acquisition of further mineral property interests. Since most exploration projects do not result in the discovery of commercially productive mineral reserves and are ultimately expensed in full, Canplats expects to report substantial net losses for at least the foreseeable future.

The long-term profitability of Canplats’ operations will be in part directly related to the success of its exploration programs, which are affected by numerous factors including the cost of such programs, the amount of mineral reserves discovered and fluctuations in the price of any minerals produced. If Canplats does not become profitable within the time frame expected by its investors, which may never happen, the market price of Canplats’ stock will likely decline. If Canplats does achieve profitability, it may not be able to sustain or increase profitability in the future.

Canplats does not hold any known mineral reserves of any kind and may never be able to locate commercially productive mineral reserves. In the event such reserves are discovered, commercial production may not be possible or warranted.

All of Canplats’ mineral properties are in the exploration stage and are without known mineral reserves of any kind. Although Canplats may discover mineral reserves through its exploration programs, commercial production may not be warranted due to insufficient quantities. Development of any of Canplats’ properties will only follow upon obtaining satisfactory exploration results. However, few mineral properties that are explored are ultimately developed into producing mines.

In the event a commercially productive mineral reserve is discovered, substantial expenditures are required to establish mineral reserves through drilling, to develop metallurgical processes for extraction and to develop the mining and processing facilities and infrastructure at the production site. The marketability of any minerals discovered may be affected by numerous factors which are beyond Canplats’ control and which cannot be predicted, such as market fluctuations, the proximity and capacity of milling facilities, mineral markets and processing equipment, and such other factors as government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals, and environmental protection. Depending on the price of minerals produced, Canplats may determine that it is impractical to commence or continue commercial production.

Canplats’ title to its mineral claims is currently in good standing but its validity may be disputed in the future by aboriginals and others claiming title to all or part of such claims.

Canplats owns or has under option unpatented mining claims which constitute its property holdings. Canplats believes it has diligently investigated title to all of its mineral properties and, to the best of its knowledge, title to all properties are in good standing. However, the properties may be subject to prior unregistered agreements or transfers which may affect the validity of Canplats’ ownership of such properties.

Although Canplats has exercised the usual due diligence with respect to title to properties in which it has a material interest, title to such properties may be challenged or impugned in the future. The boundaries of Canplats’ mining properties have not been surveyed and, therefore, the precise location and area of these mining properties may be in doubt. Canplats is not aware of challenges to the location or area of its unpatented mining claims. Additionally, Canplats makes a search of mining records in accordance with mining industry practices to confirm that it has acquired satisfactory title to its properties but does not obtain title insurance with respect to such properties. The possibility exists that title to one or more of its properties, particularly title to undeveloped properties, might be defective because of errors or omissions in the chain of title, including defects in conveyances and defects in locating or maintaining such claims. Should any defect in title be discovered by or disclosed to the Registrant, all reasonable steps would be taken to perfect title to the particular claims in question. Canplats is not aware of any material defect in the title to its mineral claims.

Aboriginal rights may also be claimed on Canplats’ mineral properties. Canplats is not aware of any aboriginal land claims having been asserted or any legal actions relating to native issues having been instituted with respect to any of the mineral properties in which Canplats has an interest.

A claim on any of Canplats’ mineral properties, especially where commercially productive mineral reserves have been located, could adversely affect Canplats’ long-term profitability as it may preclude entirely the economic development of a mineral property. Also, such a claim would affect Canplats’ current operations due to the high costs of defending against such claims and its impact on senior management’s time.

Canplats depends on key personnel for critical management decisions and industry contacts but has no employment contracts or key person insurance.

Canplats is dependent on a relatively small number of key personnel, the loss of any of whom could have an adverse effect on the operations of the Registrant. The names of its key personnel are R.E. Gordon Davis, Robert A. Quartermain, Ross A. Mitchell, Linda J. Sue and Ken McNaughton. Canplats’ success is dependent to a great degree on its ability to attract and retain highly-qualified management personnel. The loss of such key personnel, through incapacity or otherwise, would require Canplats to seek and retain other qualified personnel and could compromise the pace and success of its exploration activities. Canplats does not maintain key person insurance in the event of a loss of any such key personnel. Also, certain management personnel of Canplats are officers and/or directors of other publicly- traded companies and will only devote part of their time to the Registrant.

Additionally, Canplats has relied on and is expected to continue relying upon consultants and others for exploration expertise. Canplats has entered into a management services agreement with Silver Standard Resources Inc., a related party, whereby general corporate management, administrative and technical services will be provided to the Registrant. In the event a body of commercial ore is discovered on any of Canplats’ properties, Canplats will likely require the expertise of such consultants and others for the development and operations of a producing mine.

Canplats will need to raise additional capital though the sale of its securities, resulting in dilution to the existing shareholders, and which may not be available, adversely affecting its operations.

Canplats does not generate any revenues from production and does not have sufficient financial resources to undertake by itself all of its planned exploration programs. Canplats has limited financial resources and has financed its operations primarily through the sale of securities such as common shares, flow-through common shares and special warrants. Canplats will need to continue its reliance on the sale of such securities for future financing, resulting in dilution to Canplats’ existing shareholders. The amount of additional funds required will depend largely on the success of Canplats’ exploration programs. Based on Canplats’ current plans, it is expected that Canplats’ cash balance of $142,853 as at July 31, 2002 will be sufficient to meet operating requirements to January 31, 2003.

Further exploration programs will depend on Canplats’ ability to obtain additional financing which may not be available under favorable terms, if at all. If adequate financing is not available, Canplats may not be able to commence or continue with its exploration programs or to meet minimum expenditure requirements to prevent the full or partial loss of its mineral properties. Also, failure to meet Canplats’ share of costs incurred under joint venture agreements to which it is a party may result in a reduction of its interests in mineral properties. Furthermore, if other parties to such agreements do not meet their share of such costs, Canplats may be unable to finance the cost required to complete recommended programs.

Future issuance of Canplats’ common shares will result in dilution to the existing shareholders. Additionally, future sales of Canplats’ common shares into the public market may lower the market price which may result in losses to Canplats’ shareholders.

As of July 31, 2002, Canplats had 10,217,303 common shares issued and outstanding. Also, a further 790,000 shares consisting of 540,000 flow-through shares and 250,000 common shares were issued on August 2, 2002. A further 1,040,000 common shares are issuable upon exercise of outstanding stock options and 3,401,000 share purchase warrants, all of which may be exercised in the future resulting in dilution to Canplats’ shareholders. The 3,401,000 in share purchase warrants all expired unexercised on September 30, 2002. Of these amounts, officers and directors of Canplats own, as a group, 2,646,500 common shares and stock options to acquire an additional 725,000 common shares. Canplats may issue stock options to purchase an additional 360,000 common shares remaining under its existing stock option plan. Most of these common shares, including the common shares to be issued upon exercise of the outstanding options and warrants, are freely tradable.

Sales of substantial amounts of Canplats’ common shares into the public market, or even the perception by the market that such sales may occur, may lower the market price of its common shares.

Canplats’ common shares may experience extreme price and volume volatility which may result in losses to the shareholders of the Registrant.

On October 31, 2002, Canplats’ common shares closed at a price of $0.07. Since Canplats’ common shares were listed for trading on March 22, 2001 to October 31, 2002, the high and low trading prices were $0.42 and $0.05, respectively, with a total volume of 1,452,716 shares.

Trading volume in Canplats’ common stock has historically been limited with an average daily trading volume of 8,116 for the period from March 22, 2001 to October 31, 2002. Accordingly, the trading price of Canplats’ common stock could be subject to wide fluctuations in response to a variety of factors including announcement of material events such as mineral exploration results, changes in metal prices and general and industry-specific economic conditions.

Additionally, the securities markets in the United States and Canada have recently experienced a high level of price and volume volatility, and the market price of securities of many mineral exploration companies have experienced wide fluctuations in price which have not necessarily been related to the operating performance, underlying asset values or prospects of such companies. It is expected that such fluctuations in price will continue to occur which may make it difficult for a shareholder to sell shares at a price equal to or above the price at which the shares were purchased.

Canplats’ common shares are considered “penny stock” which may have the effect of reducing the level of trading activity and make it more difficult to sell such shares.

Canplats’ shares are “penny stock” as defined by the Securities and Exchange Commission, which might affect the trading market for the shares. Penny stocks are generally equity securities with a price of less than U.S.$5.00 other than securities registered on certain national securities exchanges or quoted on the NASDAQ National Market. The Securities and Exchange Commission has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document prepared by the Securities and Exchange Commission that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer’s account. The bid and compensation information must be given to the customer orally or in writing before or with the customer’s confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from such rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for a stock that is subject to the penny stock rules, such as Canplats’ shares which are considered “penny stock”, and therefore make it more difficult to sell those shares.

Canplats has no history of paying dividends, does not intend to pay dividends in the foreseeable future and may never pay dividends.

Since incorporation, Canplats has not paid any cash or other dividends on its common stock and does not expect to pay such dividends in the foreseeable future as all available funds will be invested primarily to finance its mineral exploration programs. Canplats will need to achieve profitability prior to any dividends being declared which may never happen.

Mineral exploration is subject to numerous industry operating hazards and risks, many of which are beyond Canplats’ control and any one may have an adverse effect on its financial condition and operations.

Mineral exploration involves many risks, including the inability of Canplats to locate commercially productive mineral reserves, which even a combination of experience, knowledge and careful evaluation may not be able to overcome. The operations in which Canplats has a direct or indirect interest will be subject to all the hazards and risks normally incidental to resource companies, any of which could result in work stoppages and damage to persons or property or the environment and possible legal liability for any and all damage. Fires, power outages, labour disruptions, flooding, explosions, cave-ins, land slides and the inability to obtain suitable or adequate machinery, equipment or labour are some of the industry operating risks involved in the operation of mines and the conduct of exploration programs. Other risks include injury or loss of life, severe damage to or destruction of property, clean-up responsibilities, regulatory investigation and penalties and suspension of operations. The occurrence of any of these operating risks and hazards may have an adverse effect on Canplats’ financial condition and operations.

Although Canplats will, when appropriate, secure liability insurance in an amount which it considers adequate, the nature of these risks is such that liabilities might exceed policy limits, the liability and hazards might not be insurable, or Canplats might elect not to insure itself against such liabilities due to high premium costs or other reasons, in which event Canplats could incur significant costs that may have a material adverse effect upon its financial condition and operations.

Canplats faces substantial competition from other mineral companies with much greater resources and may not be able to effectively compete which would have an adverse effect on Canplats’ financial condition and operations.

The resource industry is intensively competitive in all of its phases, and Canplats competes with many companies possessing much greater financial and technical research resources. Competition is particularly intense with respect to the acquisition of desirable undeveloped Platinum group element properties. The principal competitive factors in the acquisition of such undeveloped properties include the staff and data necessary to identify, investigate and purchase such properties, and the financial resources necessary to acquire and develop such properties. Competition could adversely affect Canplats’ ability to acquire suitable prospects for exploration in the future.

Mineral exploration is subject to governmental regulations and may become subject to additional governmental regulations in the future. If Canplats is unable to comply with these new regulations, its operations may be adversely affected.

Mineral exploration on Canplats’ properties are affected to varying degrees by: (i) government regulations relating to such matters as environmental protection, health, safety and labour; (ii) mining law reform; (iii) restrictions on production, price controls, and tax increases; (iv) maintenance of claims; (v) tenure; and (vi) expropriation of property. Any mineral exploration activities conducted by the Registrant, including commencement of production, require permits from governmental authorities and such operations are and will be governed by laws and regulations governing prospecting, mining, production, exports, taxes, labour standards, occupation health, waste disposal, toxic substances, land use, environmental protection, mine safety and other matters.

Companies engaged in the operation of mines and related facilities generally experience increased costs, and delays in production and other schedules as a result of the need to comply with applicable laws, regulations and permits. All permits required for the conduct of mining operations, including the construction of mining facilities, may not be obtainable by Canplats on reasonable terms which would have an adverse effect on any mining project Canplats might undertake. Additionally, failure to comply with applicable laws, regulations and permitting requirements may result in enforcement actions thereunder, including orders issued by regulatory or judicial authorities causing operations to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment, or remedial actions. Parties engaged in mining operations may be required to compensate those suffering loss or damage by reason of the mining activities and may have civil or criminal fines or penalties imposed for violations of applicable laws or regulations.

To the best of Canplats’ knowledge, Canplats is and will be operating in compliance with all applicable regulations. However, amendments to current governmental laws and regulations affecting mining companies, or the more stringent application thereof, could adversely affect Canplats’ operations including the potential to curtail or cease exploration programs or to preclude entirely the economic viability of a mineral property. The extent of any future changes to governmental laws and regulations cannot be predicted or quantified, but it should be assumed that such laws and regulations will become more stringent in the future. Generally, new laws and regulations will result in increased compliance costs, including costs for obtaining permits, delays or fines resulting from loss of permits or failure to comply with the new requirements.

Canplats’ activities are subject to environmental liability, which would have an adverse effect on its financial condition and operations.

Although Canplats is not aware of any claims for damages related to any impact that its operations have had on the environment, it may become subject to such claims in the future. An environmental claim could adversely affect Canplats’ business due to the high costs of defending against such claims and its impact on senior management’s time.

Canplats conducts exploration activities primarily in the Province of Ontario, Canada. Such activities are subject to various laws, rules and regulations governing the protection of the environment, including, in some cases, posting of reclamation bonds. All phases of Canplats’ operations are subject to environmental regulation in the jurisdictions in which it operates. Environmental legislation is evolving in a manner which requires stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed properties and a heightened degree of responsibility for companies and their officers, directors and employees.

Although Canplats has adopted and is committed to an environmental policy designed to ensure compliance with all environmental regulations currently applicable, environmental hazards may exist on Canplats’ mineral properties, which hazards are not known to Canplats at present, that have been caused by previous or existing owners or operators.

Also, environmental regulations may change in the future which could adversely affect Canplats’ operations including the potential to curtail or cease exploration programs or to preclude entirely the economic development of a mineral property. The extent of any future changes to environmental regulations cannot be predicted or quantified, but it should be assumed that such regulations will become more stringent in the future. Generally, new regulations will result in increased compliance costs, including costs for obtaining permits, delays or fines resulting from loss of permits or failure to comply with the new regulations.

Metal prices have fluctuated widely in the past and are expected to continue to do so in the future which may adversely affect the amount of revenues derived from production of mineral reserves.

Although Canplats does not hold any known mineral reserves of any kind, its future revenues, if any, are expected to be in large part derived from the future mining and sale of Platinum group elements, precious metals and base metals or interests related thereto. The prices of these commodities have fluctuated widely, particularly in recent years, and is affected by numerous factors beyond Canplats’ control including international economic and political conditions, expectations of inflation, international currency exchange rates, interest rates, global or regional consumptive patterns, speculative activities, levels of supply and demand, increased production due to new mine developments and improved mining and production methods, availability and costs of metal substitutes, metal stock levels maintained by producers and others and inventory carrying costs. The effect of these factors on the price of base and precious metals, and therefore the economic viability of Canplats’ operations, cannot be accurately predicted.

Depending on the price obtained for any minerals produced, Canplats may determine that it is impractical to commence or continue commercial production.

ITEM 4. INFORMATION ON THE COMPANY

A. History of the Company

The Company was incorporated under the laws of the Province of British Columbia, Canada on February 15, 1967 under the name Colby Mines Ltd. (N.P.L.). The Company is extra-provincially registered in the Province of Ontario, Canada. On January 11, 1977, the Company changed its name to Colby Mines Ltd. and then to Colby Resources Corp. on February 11, 1980. On October 14, 1999, the Company changed its name to International Colby Resources Corporation and consolidated its shares on a five for one basis. On March 15, 2000 the Company changed its name to “Canplats Resources Corporation”.

Canplats became a reporting issuer in the Province of British Columbia upon the issuance of a receipt for a prospectus on December 11, 1967. Canplats’ common shares were listed on the Vancouver Stock Exchange (a predecessor of the Canadian Venture Exchange) on June 21, 1972. In April 1992, the common shares of Canplats were delisted by the Vancouver Stock Exchange (“VSE”) for failure to pay sustaining fees. Canplats was the subject of cease trade orders issued by the British Columbia Securities Commission on September 9, 1992 and January 11, 1993, for failure to submit statutory filings. Both of these cease trade orders were rescinded by the British Columbia Securities Commission on January 22, 1993.

Canplats’ initial public offering prospectus was filed with and receipted by the British Columbia and Alberta Securities Commissions on February 14, 2001. Effective March 22, 2001, the common shares of Canplats commenced trading on the TSX Venture Exchange under the trading symbol CPQ. See “A. Share Capital” under “Item 10. Additional Information”.

The registered and records office of Canplats is located at Suite 1180 — 999 West Hastings Street, Vancouver, British Columbia, Canada V6C 2W2. The telephone and facsimile numbers are (604) 689-3846 and (604) 689-3847, respectively.

During the fiscal year ended July 31, 2002, Canplats incurred a total of $553,169 in exploration and acquisition expenditures. The main areas of expenditures were $197,315 on the Voltaire-Johnspine property ($196,665 exploration; $650 acquisition), $177,376 on the Geikie property ($164,876 exploration; $12,500 acquisition), $103,084 on the Grand Bay property ($103,084 exploration; $nil acquisition) and $48,675 on the Posh property ($48,675 exploration; $nil acquisition).

Canplats’ principal capital expenditures during the fiscal year ended July 31, 2001 consists of $547,868 in exploration expenditures primarily on the Voltaire-Johnspine Property ($43,722 acquisition; $197,310 exploration), Grand Bay Property ($15,000 acquisition; $37,322 exploration), Posh Property ($49,920), Geikie Property ($10,850 acquisition; $105,896 exploration), Black Sturgeon Property ($31,428), Tartan Property ($20,080) and Mikinak West and East Property ($4,000 acquisition; $21,652 exploration).

Canplats has a total of 10 properties that will continue to have funds expended on them. The funds for this will come from further financings or from the exercise of stock options and warrants.

B. Business Overview

Canplats is a British Columbia junior resource company engaged in the acquisition and exploration of mineral resource properties. Where management determines that it is in the best interest of the Registrant, joint venture partners have been or may be sought to further explore certain properties. The Registrant, directly and through joint ventures, is in the process of exploring its mineral properties located in the Province of Ontario, Canada and has yet to determine whether any of these properties contain ore reserves that are economically recoverable. All of the properties in which Canplats currently holds interests are without a known body of commercial ore. Canplats is an exploration stage company and there is no assurance that a commercially viable mineral deposit exists on any of its mineral properties. Further exploration is required before a final evaluation as to the economic and legal feasibility can be determined.

Following incorporation, Canplats was a junior resource company engaged in the acquisition and exploration of mineral resource properties. Following delisting of Canplats’ common shares by the VSE in April 1992, Canplats ceased to actively engage in the acquisition and exploration of mineral resource properties.

Canplats recommenced active acquisition and exploration of mineral properties in November 1997 when it acquired an option to acquire a 100% interest in the Horseshoe Island property near Cassummit Lake in the Red Lake Mining Division of Ontario. The Horseshoe Island property had exploration potential for gold mineralization but after spending $79,412 on acquisition and exploration costs, Canplats abandoned it and focused its attention on Platinum group element (“PGE”) properties, which it commenced acquiring by staking and optioning in January 1999. Since focusing on PGE properties, Canplats has acquired other mineral claim units in the Lake Nipigon area of Ontario.

Canplats’ principal mineral properties consist of seven properties located in the Province of Ontario, namely Voltaire-Johnspine, Stucco, Geikie, Posh, Grand Bay, Black Sturgeon and Mikinak West and East. Canplats holds interests in three other mineral properties located in the Province of Ontario, namely Awl Lake, Plateau Lake and North Fintry. Refer to Item 3. Key Information — D. Property, Plants and Equipment for a description of each of these mineral properties. Canplats is able to explore year round on its various Ontario properties. Summer is the preferred time for geochemical sampling and induced polarization geophysical surveying. Work over the April to May spring breakup is usually suspended.

Plan of Operation

During fiscal 2002 drilling programs were completed on Voltaire-Johnspine, Grand Bay, Mikinak West, Geikie, Posh and Stucco properties. Specific plans for additional work on these properties is contingent on the availability of financing.

a) Voltaire-Johnspine Property

As part of the Phase I and II programs, a total of 54.0 km. of grid lines were cut. Ground geophysical EM surveys were completed on 43.6 km. and 10.4 km. were sampled as part of a soil geochemical survey. Several drill targets were developed from the interpretation of data from these surveys. A preliminary 4 hole drill program was completed in February 2001 which totalled 742 metres. No significant values were intersected by this drilling. A second, 2 hole program was completed in April 2002, which totalled 1,054 metres. No significant values were intersected by this drilling. Several drill targets remain untested.

b) Stucco Property

On September 27, 2001, Canplats entered into an option agreement whereby Platinum Group Metals Ltd. (PTG) could earn 51% interest in the project in consideration of making staged payments over 48 months, totalling $65,000 and incurring exploration expenditures of $1 million. As of July 31, 2002, PTG had made payments totalling $40,000 and incurred exploration expenditures in excess of the scheduled $125,000. Work programs included airborne and ground geophysical surveys, geological mapping and drilling. No significant values have been intersected to date. Additional geophysical studies and drilling have been planned.

c) Geikie Property

Phase I and Phase II ground geophysical programs were completed. These included cutting 43.6 km. of grid lines which were used as a base for soil sampling and geological mapping. Ground IP and EM surveys were completed totalling 32.55 km. and 7.2 km. respectively. This work identified numerous drill targets, 7 of which were tested in October, 2001. A total of 842 metres of drilling was completed which locally intersected anomalous values in copper and palladium. Several deep drill targets remain untested.

d) Posh Property

Work programs consisting of line cutting, soil sampling, geophysical studies and drilling were completed throughout the year. A total of 15 km. of grid was cut on which were run 15 km. of IP surveys, 8 km. of soil sampling and 5.8 km. of EM surveys. A two hole drill program, totaling 274 metres was completed in October, 2001. Anomalous values in copper and palladium were locally intersected. Several deep drill targets remain untested.

e) Grand Bay Property

Work on this property was carried out in several programs. A total of 21 km. of line cutting provided the grid for 19.2 km. of IP surveys, 6.1 km. of EM geophysical surveys. This work was followed-up by a single hole drill program which totaled 410 metres. No significant values were intersected by this drill hole which did not penetrate the base of the intrusive.

f) Black Sturgeon Property

A total of 12.5 km. of grid lines were cut and soil sampled. An EM geophysical survey was completed over 6 km. of the grid.

g) Tartan Lake Property

In fiscal 2002, Canplats entered into an option agreement with Redstar Resource Corp., under which Redstar would earn a 50% interest. Redstar terminated its option of the property on February 1, 2002. No additional work was completed on the property and the claims lapsed on March 8, 2002. Canplats no longer holds any interest in the property.

h) Mikinak West and East Property

A work program was undertaken in September, 2001, consisting of 13 km. of line cutting, 13 kilometers of magnetic geophysical survey and 6 km. of EM geophysical survey. Subsequent to this, Teck Cominco Limited entered into an option agreement where they could earn up to 60% interest in the project by making staged payments and incurring work expenditures of $2.25 million over six years. Teck Cominco has completed additional geophysical survey and an initial drill program. No significant values were intersected by that drill program. Subsequent to this work, Canplats received notice that Teck Cominco would be discontinuing their option on the project. Canplats is awaiting their final report and will make recommendations for additional work after reviewing the data.

C. Organizational Structure

Canplats is neither part of a group nor has interests in significant subsidiaries.

D. Property, Plants and Equipment

Mineral Properties

As at July 31, 2002, the following table summarizes all mineral properties held by or in which Canplats has an interest:

                                       Claim             Number                  Type of
   Property Name                     Units [1]         of Claims             Acquisition [3]            Interest
   ------------------------------- -------------- -- --------------- ---- ----------------------- -- ----------------
   Principal Properties
      Voltaire-Johnspine                  815                62                   Staked                    100%
      Stucco                              314                23                   Staked                    100%
      Geikie                              382                26              Purchased/Staked               100%
      Posh                                128                 8                  Optioned                    75%
      Grand Bay                            76                 5                  Optioned                    75%
      Black Sturgeon                       64                 4                   Staked                    100%
      Mikinak West and East               180                14                  Optioned                    50%
   Other Properties
      Awl Lake                             80                 5                 Purchased                   100%
      Plateau Lake [2]                     52                 4              Optioned/Staked                 50%
      North Fintry                         48                 4                   Staked                    100%
                                   --------------    ---------------

   Total                                2,139               155

                                   ============== == ===============

(1)     One claim unit covers an area of 16 hectares (40 acres).

(2)     Property under option to Prism Resources Ltd. See “Other Mineral Properties – c) Plateau Lake Property” under this section.

(3)     The various types of interests are as follows:

Staked — the Company acquired the property through direct staking which is the primary method of acquiring exploration rights from the Province of Ontario;

Optioned — the Company optioned the property held by others who previously staked the ground; and

Purchased — the Company purchased the property rights from a third party.

Canplats holds a total of 2,139 claim units, 2,039 of which are in 8 groups located within the Nipigon Plate area near Thunder Bay, Ontario. The principal properties of Canplats consist of seven properties within the Nipigon Plate area, namely Voltaire-Johnspine, Stucco, Geikie, Posh, Grand Bay, Black Sturgeon and Mikinak West and East. A principal property is selected on the basis of geophysical survey evidence of similarities to known economic deposits.

General Geology, Mineral Deposits and Reserves

The Nipigon Plate-Lake Superior area has been interpreted to potentially be a favourable setting for PGE bearing deposits. At this time, no mineral deposits or resources have been defined on any of Canplats’ properties. Canplats’ properties are without a known body of commercial ore. The Nipigon Plate is one of the largest areas of Proterozoic rocks in the world. Widespread diabase (dolerite) sills called the Logan Sills cover an area measuring 200 kilometres by 250 kilometres.

In Lake Superior, the Mid-Continental Rift occurs which extends northward through the Nipigon Plate, takes the form of the Black Sturgeon Fault. It is now apparent that this fault and a series of parallel faults are the main structures that are related to the feeder system of the mafic intrusives of the Logan Sills event as well as older and younger intrusives. The Logan Sills have intruded sediments of the Sibley Group which consist of sandstones and conglomerates.

All of Canplats’ properties in the Nipigon Plate area were either staked or optioned because they covered a discreet magnetic high which is interpreted to be the magnetic expression of a layered mafic-ultramafic body located beneath the diabase sills (Logan Sills). Exploration efforts were focussed on the definition of potential sulphide targets.

Principal Mineral Properties

The following is a description of Canplats’ principal mineral properties and its interest in such properties. The descriptions of these properties are derived from the Report on the Nipigon Plate Platinum Group Element-Nickel Copper Properties dated October 16, 2000, prepared for Canplats by R. Cavén, P.Eng. and K. Cunnison, FGAC included as an exhibit to the July 31, 2001 Form 20-F registration statement.

a) Voltaire-Johnspine Property

Acquisition Details

Canplats staked 641 of the claim units comprising the Voltaire-Johnspine Property between February 1999 and May 2000. A further 508 claim units were staked between January and July 2001, all of which Canplats has a 100% interest in. The Voltaire-Johnspine Property is comprised of five adjacent claim blocks that have been merged together: Voltaire, Johnspine, Gull River, Chief Bay and Mount Lake. Canplats has obtained a title opinion in respect of, among other properties, the Voltaire-Johnspine Property from Carrel & Partners, Barristers and Solicitors, of Thunder Bay, Ontario dated November 23, 2000. No material defects in title were reported in the title opinion. The number of claim units has been subsequently reduced by 334, to the new total of 815.

Description and Location

The Voltaire-Johnspine Property consists of 815 claim units covering an area of approximately 13,040 hectares and is located approximately five kilometres south-west of the Gull River Indian Reservation and 65 kilometres north of the Lac des Iles mine, on the Voltaire Lake and Nipigon House claim sheets, Thunder Bay Mining Division, Ontario. The property is traversed by Highway 527 that links the City of Thunder Bay, Ontario to the Town of Armstrong, Ontario. Gravel timber roads extend west of the highway through the property and branch roads reach the northern part of the property.

The number of claim units, recording dates, expiry dates and assessment work required to be incurred by Canplats (in order to maintain the claims in good standing for a period of one year after the expiry date) for the claims which comprise the Voltaire-Johnspine Property are set out below:

- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
    Number of Claims      Number of Claim Units     Recording Date           Expiry Date        Required Assessment
                                                                                                       Work
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
              2                      32          February 12, 1999      August 12, 2002 *             $12,800
              7                      96          April 26, 1999         Oct. 26, 2002 *               $30,748
             15                     187          January 5, 2001        Jan 5, 2003                   $74,800
              9                     122          February 12, 1999      Feb 12, 2003                  $45,258
              2                      31          April 19, 2001         April 19, 2003                $12,400
              1                      15          April 25, 2001         April 25, 2003                 $6,000
              3                      41          April 26, 1999         April 26, 2003                 $7,466
              1                      16          April 26, 1999         April 26, 2004                 $6,400
             16                     210          April 27, 2001         April 27, 2003                $84,000
              2                      21          May 23, 2001           May 23, 2003                   $8,400
              4                      44          July 10, 2001          July 10, 2003                 $17,600
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------

* Approval of submitted assessment work pending.

Geology

The property covers the northward extension of the Black Sturgeon Fault, which is interpreted to be the failed arm of the Mid-Continental Rift that extends from the southern United States to Lake Superior.

A series of magnetic anomaly patterns on the property are interpreted to reflect the presence of favourable host rocks and are localized along the Black Sturgeon Fault or along a major cross fault parallel to the Quetico Fault. The exploration targets are flat-lying to shallow dipping layers of disseminated to massive sulphides at the base of the large diabase sills that occur in the area of the property.

The property is mainly covered by a sand plain, however diabase outcrops were noted to the side of the magnetic anomalies seen on the airborne magnetic survey. An extensive crescent shaped aeromagnetic anomaly on the property suggests a large mafic intrusive occurs along the west side of the Black Sturgeon Fault. Parallel north trending rift faults are interpreted to occur 10 kilometres west of the Black Sturgeon Fault on the property.

b) Stucco Property

Acquisition Details

Canplats acquired the claims, which comprise the Stucco Property, by staking in late December 1999, and April 2000 and has a 100% interest in such claims. Canplats has obtained a title opinion in respect of, among other properties, the Stucco Property from Carrel+Partners, Barristers and Solicitors of Thunder Bay, Ontario dated November 23, 2000. No material defects in title were reported in the title opinion.

On September 27, 2001, the Company entered into a joint venture agreement with Platinum Group Metals Ltd. (PTG) a Canadian-based mineral exploration company. Under the agreement, PTG could earn 51% interest in the project by making cash payments to Canplats in the amount of:

$15,000 within 10 days of the date of the agreement (paid)

$ 15,000 within 1 month of the date of the agreement (paid)

$ 10,000 within 6 months of the date of the agreement (paid)

$ 10,000 within 24 months of the date of the agreement

$ 15,000 within 48 months of the date of the agreement.

for a total of $65,000, and by completing the following exploration expenditures as defined below:

$ 80,000 within 3 months of the date of the agreement (completed)

$125,000 within 12 monthsof the date of the agreement (completed)

$1,000,000 within 48 months of the date of the agreement.

PTG can earn an additional 9% in the property by completing a feasibility study of the project.

Description and Location

The Stucco Property consists of 314 claim units covering an area of approximately 5,024 hectares. The property is located on the Rightangle and Circle Lake claim maps, Thunder Bay Mining Division, Ontario and is approximately 30 kilometres east of the Lac des Iles mine and is accessed from Highway 527 by a main forestry road and several branch roads.

The number of claim units, recording dates, expiry dates and assessment work required to be incurred by Canplats (in order to maintain the claims in good standing for a period of one year after the expiry date) for the claims which comprise the Stucco Property are set out below:

- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
    Number of Claims      Number of Claim Units     Recording Date           Expiry Date        Required Assessment
                                                                                                       Work
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
             11                     162          Dec. 23, 1999          Dec. 23, 2002                 $64,446
              8                      96          April 4, 2000          April 4, 2003                 $37,673
              3                      40          Dec. 23, 1999          Dec. 23, 2003                 $15,548
              1                      16          Aug. 13, 2001          Aug. 13, 2004                  $6,400
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------

Geology

The property covers a linear magnetic high which is associated with the eastern extension of the Quetico Fault. Several lake sediment samples, taken from the lakes which overlie the magnetic feature by the Geological Survey of Canada, had anomalous nickel values.

The property is predominantly covered by diabase, although a gabbro outcrop was found to the south of Stucco Lake. Further south, sediments and volcanics were found on the property.

c) Geikie Property

Acquisition Details

Canplats acquired a 100% interest in seven claims (108 claim units) under an agreement (the “Patrie Agreement”) dated April 28, 1999 with Bryan Patrie on payment of $10,000 (paid), the granting of a 1% net smelter returns royalty and the issuance of up to 100,000 common shares. The common shares are to be issued, subject to regulatory approval, in four equal instalments of 25,000 common shares each at six-month intervals and by October 31, 2002 all shares had been issued. Canplats may purchase the net smelter returns royalty at any time on payment of $500,000. Bryan Patrie is at arm’s length to the Registrant.

In April and May 2000, Canplats staked an additional 24 claims consisting of 335 claim units in the area surrounding the claims acquired under the Patrie Agreement. An additional three claims (46 claim units) were staked in May 2001. The 27 claims staked by Canplats and seven claims acquired under the Patrie Agreement are together known as the Geikie Property.

Canplats has obtained a title opinion in respect of, among other properties, the Geikie Property from Carrel & Partners, Barristers and Solicitors of Thunder Bay, Ontario dated November 23, 2000. No material defects in title were reported in the title opinion. The number of claim units has been subsequently reduced by 107 to the new total of 382.

Description and Location

The Geikie Property consists of 382 claim units (26 claims) and covers an area of approximately 6,122 hectares. The property is located on Highway 527 on the boundary of the Cheeseman Lake, Kitchen Lake, Lunch Creek and Chief Bay claim maps, Thunder Bay Mining Division, Ontario, and is 15 km north of the road entrance to the Lac des Iles mine and 120 km north of Hwy 17-11 in Thunder Bay, Ontario.

The number of claim units, recording dates, expiry dates and assessment work required to be incurred by Canplats (in order to maintain the claims in good standing for a period of one year after the expiry date) for the claims which comprise the Geikie Property are set out below:

- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
    Number of Claims      Number of Claim Units     Recording Date           Expiry Date        Required Assessment
                                                                                                       Work
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
              2                      28          February 12, 1999      February 12, 2003              $4,848
              5                      64          April 10, 2000         April 10, 2003                $24,867
              3                      48          April 26, 1999         April 26, 2003                $19,200
              6                      96          April 26, 2000         April 26, 2003                $38,180
              5                      68          May 12, 2000           May 12, 2003                  $26,563
              3                      46          May 23, 2001           May 23, 2003                  $18,400
              2                      32          Feb. 12, 1999          Feb. 12, 2004                  $9,188
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------

Geology

The property covers an extensive east west trending magnetic anomaly which forms part of a 40 kilometre elliptical structure that may be a large cone shaped mafic intrusion. Anomalous copper and cobalt lake sediment samples occur on or near the property. The sediment samples were collected as part of a regional lake sediment program by the Geological Survey of Canada/Ontario Geological Survey in the 1980‘s and 1998.

The Geikie property is covered with occasional outcrops of diabase, however a very coarse-grained highly magnetic phase of the diabase was noted on Hwy 527 where BL 0 crosses the highway. Pyroxene crystals occur as bundles in this phase. This rock also contained two remanent magnetic directions and occurs where minor hematization and more intensive fracturing occurs suggesting a thermal event below the diabase that caused these phenomena. Beaches on the northeast shore of Cheeseman Lake contain abundant black sand which may have been derived from the weathering of mafic to ultramafic rocks. The extensive copper-cobalt-palladium geochemical anomaly on the southwest side of this claim group suggests the presence of a mineralized mafic-ultramafic intrusive beneath the thin diabase cover.

d) Posh Property

Acquisition Details

Under an agreement (the “Posh Underlying Agreement”) dated February 15, 1999 between East West and Dan Patrie, East West acquired an option to acquire a 100% interest in seven claims consisting of 112 claim units. In order to acquire its interest in the property, East West is required to pay Dan Patrie $15,000 (paid) and issue to Dan Patrie 100,000 common shares (issued) in its capital in four equal instalments of 25,000 common shares each at six-month intervals commencing following Exchange approval of the acquisition. In addition, East West granted Dan Patrie a 1% net smelter returns royalty, which can be purchased by East West for $500,000. On April 6, 1999, the Exchange approved the Posh Underlying Agreement.

In April 1999, two additional claims (consisting of 32 claim units) were staked in the area surrounding the claims acquired under the Posh Underlying Agreement. The two additional claims and seven claims acquired under the Posh Underlying Agreement are together known as the Posh Property.

Under an option agreement (the “Posh Agreement”) dated June 30, 1999 between East West and the Registrant, East West granted Canplats an option to acquire up to a 75% interest in the Posh Property. In order to earn a 50% interest in the property under the Posh Agreement, Canplats is to pay East West $1,000 (paid) on execution of the Posh Agreement and a further $29,000 (paid) on June 30, 2001 and incur exploration expenditures on the property of $40,000 on or before December 30, 2000 and a further $60,000 on or before June 30, 2001. The Posh Agreement was subsequently amended to allow completion of the initial exploration expenditures by December 31, 2001 and by this date, Canplats had met the $100,000 exploration obligation. On earning a 50% interest in the property, Canplats may earn a further 25% interest in the property by incurring exploration expenditures on the property of $400,000 on or before June 30, 2003. East West and Canplats share a common director, James W. Tutton, and are considered to be related parties.

In April 2000, Canplats staked a further two claims consisting of 28 claim units adjacent to the existing Posh claims. In September 2000, Canplats staked a further four claims consisting of 45 claim units adjacent to the existing Posh claims. Under an amending agreement dated September 30, 2000, East West and Canplats agreed to include such additional 73 claim units as part of the Posh Property under the Posh Agreement.

Canplats has obtained a title opinion in respect of, among other properties, the Posh Property from Carrel & Partners, Barristers and Solicitors of Thunder Bay, Ontario dated November 23, 2000. No material defects in title were reported in the title opinion. Subsequent to this, the Company elected to reduce the number of claims units by 89 to the new total of 128.

Description and Location

The Posh Property is a 128 claim unit property consisting of 8 claims and covering approximately 2,048 hectares. The Posh Property is located about 40 kilometres north-east of the Lac des Iles mine, half way between the Geikie Property and the Stucco Property described above. Forestry roads, which originate from Highway 527, access the property.

The number of claim units, recording dates, expiry dates and assessment work required to be incurred by Canplats (in order to maintain the claims in good standing for a period of one year after the expiry date) for the claims which comprise the Posh Property are set out below:

- ------------------------- ------------------- ------------------------- ------------------------ --------------------
    Number of Claims       Number of Claim         Recording Date             Expiry Date             Required
                                Units                                                              Assessment Work
- ------------------------- ------------------- ------------------------- ------------------------ --------------------
              7                  112          February 12, 1999         February 12, 2003               $42,936
              1                   16          April 26, 1999            April 26, 2003                   $6,400
- ------------------------- ------------------- ------------------------- ------------------------ --------------------

Geology

The claims cover a 6.4 kilometre-long magnetic anomaly, which is oriented in a north-easterly direction and is associated with a structure which extends from the Lac des Iles mine and continues to the north-east where it passes below Lake Nipigon in the vicinity of the Grand Bay property. The magnetic anomaly also sits within a larger elliptical ring or cone structure as observed in the aeromagnetic data. Therefore, the magnetic anomaly may reflect an ultramafic feeder to a larger intrusion in the area.

e) Grand Bay Property

Acquisition Details

Under an agreement dated February 15, 1999 between Canadian Golden Dragon Resources Ltd. (“Golden Dragon”) and Michael MacIsaac, Golden Dragon acquired an option to acquire a 100% interest in five claims consisting of 76 claim units and known as the Grand Bay Property. In order to acquire its interest in the property, Golden Dragon is required to pay Michael MacIsaac $10,000 (paid) and issue to Michael MacIsaac 100,000 common shares (issued) in its capital in four equal instalments of 25,000 common shares each at six-month intervals commencing following Exchange approval of the acquisition. In addition, Golden Dragon granted Michael MacIsaac a 1% net smelter returns royalty, which can be purchased by Golden Dragon for $500,000. On March 25, 1999, the Exchange approved the acquisition of the Grand Bay Property.

Under an option agreement (the “Grand Bay Agreement”) dated June 30, 1999 between Golden Dragon and the Registrant, Golden Dragon granted Canplats an option to acquire up to a 75% interest in the property. In order to earn a 50% interest in the property under the Grand Bay Agreement, Canplats is to pay Golden Dragon $1,000 (paid) on execution of the Grand Bay Agreement, $10,000 on June 30, 2000 (paid) and a further $15,000 (paid) on June 30, 2001 and incur exploration expenditures on the property of $40,000 on or before December 30, 2000 and a further $60,000 on or before June 30, 2001. The Grand Bay Agreement was subsequently amended to allow completion of the initial exploration expenditures by December 31, 2001 and by this date, Canplats had met the $100,000 exploration obligation. On earning a 50% interest in the property, Canplats may earn a further 25% interest in the property by incurring exploration expenditures on the property of $400,000 on or before June 30, 2003. Golden Dragon is at arm’s length to the Registrant.

Canplats has obtained a title opinion in respect of, among other properties, the Grand Bay Property from Carrel & Partners, Barristers and Solicitors of Thunder Bay, Ontario dated November 23, 2000. No material defects in title were reported in the title opinion.

Description and Location

The Grand Bay Property consist of 76 claim units (5 claims) covering an area of approximately 1,216 hectares. The property and is located on the west shore of Lake Nipigon near Black Sturgeon Bay.

The claims can be accessed via Hurket Road which joins Highway 527 near Kabitotikwia, Ontario with Hurkett located on Highway 17 between Dorion and Redrock, Ontario. The claims can also be accessed via the Poskokagan River from Hurkett Road.

The number of claim units, recording dates, expiry dates and assessment work required to be incurred by Canplats (in order to maintain the claims in good standing for a period of one year after the expiry date) for the claims which comprise the Grand Bay Property are set out below:

- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
    Number of Claims      Number of Claim Units     Recording Date           Expiry Date        Required Assessment
                                                                                                       Work
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
            2                     32             February 12, 1999      February 12, 2004              $4,401
            3                     44             February 12, 1999      February 12, 2005             $11,454
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------

Geology

The property covers a 2.4 kilometre-long magnetic anomaly that extends south-west from the Black Sturgeon Fault. It lies immediately north of the intersection of the Black Sturgeon Fault and an interpreted fault parallel to the Quetico Fault which is associated with the Lac des Iles mine.

The west side of the Grand Bay Property is covered by overburden, and the east side of the property contains diabase outcrops along the shore of Chief Bay.

f) Black Sturgeon Property

Acquisition Details

Canplats staked the claims, which comprise the Black Sturgeon Property, in March 1999 and April 2000 and has a 100% interest in such claims. Canplats has obtained a title opinion in respect of, among other properties, the Black Sturgeon Property from Carrel+Partners, Barristers and Solicitors of Thunder Bay, Ontario dated November 23, 2000. No material defects in title were reported in the title opinion.

Description and Location

This Black Sturgeon Property consists of 64 claim units covering an area of approximately 1,024 hectares. The property is located on the ground between Black Sturgeon Lake and Lake Nipigon, Ontario and is accessed via Hurket Road from Highway 17, which joins Highway 527 at Kabitotikwia, Ontario. The claims are also accessible by boat.

The number of claim units, recording dates, expiry dates and assessment work required to be incurred by Canplats (in order to maintain the claims in good standing for a period of one year after the expiry date) for the claims which comprise the Black Sturgeon Property are set out below:

- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
    Number of Claims      Number of Claim Units     Recording Date           Expiry Date        Required Assessment
                                                                                                       Work
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
              3                     48           March 15, 1999         March 15, 2003                $16,312
              1                     16           April 10, 2000         April 10, 2003                 $3,621
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------

Geology

This 64 claim unit property covers a magnetic anomaly adjacent to the Black Sturgeon Fault roughly 5 kilometres south of the Grand Bay anomaly. The anomaly extends eastward from the Black Sturgeon Fault and is associated with an east-west fault parallel to the Quetico Fault.

Extensive diabase outcrops cover the property.

g) Tartan Lake Property

Acquisition Details

Canplats acquired the 4 claim, 56 claim unit Tartan Lake Property by staking and held a 100% interest in such claims. Canplats has obtained a title opinion in respect of, among other properties, the Tartan Lake Property from Carrel+Partners, Barristers and Solicitors of Thunder Bay, Ontario dated November 23, 2000. No material defects in title were reported in the title opinion.

On the 20th of June, 2001, the Company entered into an agreement with Redstar Resources Corporation (RRC), whereby RRC could earn up to a 50% interest in the property by making the following stayed payments:

$ 5,000 on or before June 1, 2001 (paid)

$15,000 on or before December 1, 2001

$20,000 on or before June 1, 2003

$30,000 on or before June 1, 2004;

and by incurring exploration and development expenditures totalling $750,000 in aggregate amounts of:

$50,000 in aggregate of work on or before December 1, 2001

$ 75,000 in aggregate of work on or before June 1, 2002

$275,000 in aggregate of work on or before June 1, 2003

$500,000 in aggregate of work on or before June 1, 2004

$750,000 in aggregate of work on or before June 1, 2005

RRC did not complete any work on the property and terminated their option on February 1, 2002. Canplats elected not to renew the claims, which lapsed on March 8, 2002. The Company no longer holds any interest in the property.

Description and Location

The Tartan claim group covers an area of approximately 896 hectares and is accessed by a gravel road that extends east of Hwy 527 to Hwy 17 at a point near Dorion, Ontrario. The claim group is situated three kilometres south of Greenwich Lake on the Tartan Lake claim sheet.

h) Mikinak West and East Property

Acquisition Details

Under an option agreement dated February 12, 2000 with Ken Fenwick and Don Leishman, East West acquired an option to acquire a 100% interest in the Mikinak West and East Property on the payment of $40,000 in staged cash payments over 48 months, the issuance of 100,000 common shares of East West in installments of 25,000 shares (all of which have been issued), the granting of a 2% net smelter returns royalty and the incurring of exploration expenditures of $10,400 (incurred) on or before April 27, 2000. East West may purchase 0.8% of the net smelter returns royalty on payment of $800,000.

Under an option and joint venture agreement between Canplats and East West dated March 17, 2000, on Canplats funding a total of $20,000 in option payments to the vendors and assessment work on the property, East West and Canplats will enter into a joint venture on an equal basis in respect of the property. East West and Canplats share a common director, James W. Tutton, and are considered to be related parties.

Canplats has obtained a title opinion in respect of, among other properties, the Mikinak West and East Property from Carrel & Partners, Barristers and Solicitors of Thunder Bay, Ontario dated November 23, 2000. No material defects in title were reported in the title opinion.

On March 25, 2002, Teck Cominco Limited (TCL) entered into an option agreement whereby TCL could earn a 51% interest in the project by making the following payments and incurring cumulative exploration expenditures of:

         ------------------------------------ --------------------------------------- ----------------------------------
                                              Non-cumulative                          Cumulative
         On or before                           Cash payment                          Expenditures

         ------------------------------------ --------------------------------------- ----------------------------------
         ------------------------------------ --------------------------------------- ----------------------------------
         June 30, 2002                        $  10,000 (paid)                        $  25,000 (completed)
         ------------------------------------ --------------------------------------- ----------------------------------
         ------------------------------------ --------------------------------------- ----------------------------------
         April 30, 2003                       $  25,000                               $   75,000 (completed)
         ------------------------------------ --------------------------------------- ----------------------------------
         ------------------------------------ --------------------------------------- ----------------------------------
         April 30, 2004                       $  30,000                               $ 175,000
         ------------------------------------ --------------------------------------- ----------------------------------
         ------------------------------------ --------------------------------------- ----------------------------------
         April 30, 2005                       $  35,000                               $ 400,000
         ------------------------------------ --------------------------------------- ----------------------------------
         ------------------------------------ --------------------------------------- ----------------------------------
         April 30, 2006                               --                              $ 750,000
         ------------------------------------ --------------------------------------- ----------------------------------

TCL can acquire an additional 9% interest in the project by incurring additional exploration expenditures of $1.5 million over two years. Subsequent to fiscal 2002, TCL gave notice that it was terminating the agreement.

Description and Location

The Mikinak West and East Property is comprised of two claim blocks located 50 kilometres and 60 kilometres, respectively, east of the Lac des Iles mine. Mikinak West consists of 149 claim units (12 claims) covering approximately 2,384 hectares. Mikinak East covers an area of approximately 496 hectares and consists of 31 claim units (2 claims).

The number of claim units, recording dates, expiry dates and assessment work required to be incurred by Canplats (in order to maintain the claims in good standing for a period of one year after the expiry date) for the claims which comprise the Mikinak West and East Property are set out below:

- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
    Number of Claims      Number of Claim Units     Recording Date           Expiry Date        Required Assessment
                                                                                                       Work
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
              2                     31           April 25, 2000         April 25, 2003                $12,138
              2                     31           April 27, 1999         April 27, 2003                $12,400
              4                     52           May 12, 2000           May 12, 2003                  $20,800
              2                     17           Oct. 26, 2001          Oct. 26, 2003                  $6,800
              2                     21           Nov. 19, 2001          Nov. 19, 2003                  $8,400
              2                     28           May 12, 2000           May 12, 2004                  $11,096
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------

Geology

These two claim blocks are located 50 kilometres and 60 kilometres, respectively, east of the Lac des Iles mine. Mikinak West is contiguous to the north-east of the Circle Lake property (see “Other Mineral Properties” under this section) and covers the extension of the same geologic and geophysical trends. Mikinak East covers a magnetic high on the east side of Black Sturgeon Lake.

Exploration History

There had been no recorded exploration activity on any of the principal properties, other than regional surveys and mapping funded by both the Ontario and Federal governments. These surveys include airborne magnetic surveys, completed in 1962 and updated in 1991; regional geologic mapping between 1965 and 1991; widely spaced lake bottom geochemical sampling in 1977; and a detailed lake bottom geochemical sampling program released in May and September 2000.

Exploration activities, in the form of geologic mapping, airborne magnetic and electromagnetic (EM) surveys, and ground magnetic and induced polarization (IP)/resistivity surveys, were carried out by Canplats on certain of its properties during the summer of 1999, and in January to February 2000, at an aggregate cost of $177,231.

During the fiscal years ended July 31, 2002 and July 31, 2001, a total of $553,169 and $547,868 was spent on all Canplats’ mineral properties. The details of this work for each property are listed below.

a) Voltaire-Johnspine Property

During the summer of 1999 and in January and February 2000, a total of 37.1 kilometres of lines were cut and surveyed for total field magnetics. In addition, eight kilometres of IP/resistivity survey were completed over the northernmost target. Several weak IP anomalies occur near the magnetic high suggesting the presence of disseminated sulphides. The airborne EM survey identified numerous 12 channel responses in association with the main magnetic feature as well as several flanking responses. In the absence of any known graphitic occurrences, these indicate the possible presence of massive sulphide conductors. The total cost for this work was $65,234.

During the fiscal year ended July 31, 2001, a total of $241,032 was spent on the Voltaire-Johnspine property. A total of 23.8 kilometres of ground magnetic and 34 kilometres of electromagnetic surveys were completed over several anomalies identified in earlier airborne surveys. Three target areas that were accessible under break-up conditions were drill-tested. The first hole penetrated a diabase sill followed by Proterozoic sediments and Archean metamorphic formations. The second hole intersected 300 metres of an intrusive gabbro body containing a section anomalous in copper. The third hole went through diabase into Archean iron formation, metamorphic units and a hornblendite intrusive body. Both the gabbro and hornblendite in Holes 2 and 3 resemble intrusives in the Las des Iles palladium mine area. Geochemical surveys and mapping will be carried out to assist in prioritising drill targets, particularly in the Mount Lake area in the northern part of the property where government lake bottom sediment samples yielded anomalous copper, palladium and gold values.

During the fiscal year ended July 31, 2002, a total of $196,665 was spent on the Voltaire-Johnspine property. A two-hole drilling program was completed in April 2002, which totalled 1,054 metres. These holes tested the base of magnetic anomalies that were modeled from data derived from a high definition airborne magnetic survey completed in February 2002. No significant values were intersected by this drilling. The hole testing the Gull River anomaly did intersect olivine rich (35%) gabbros beneath 400 metres of Archean meta-sandstones, as predicted by the magnetic modeling. Several anomalies remain untested which overlie the projected extension of the Garden Lake Greenstone belt, which presumably would provide the sulphur necessary for the formation of nickel or copper sulphides.

b) Stucco Property

During the summer of 1999 and in January and February 2000, this property was covered by two flight lines of the airborne EM survey with a separation of 1600 metres at a cost of $5,702. Only weak conductors were found associated with magnetic anomaly suggesting this area would likely host a disseminated style of mineralization.

On September 27, 2001, the Company entered into an option agreement whereby Platinum Group Metals Ltd. (PTG) could earn a 51% interest in the project in consideration of making staged payments over 48 months, totalling $65,000 and incurring exploration expenditures of $1 million. As of fiscal year-end, PTG had made payments totalling $40,000 and incurred exploration expenditures in excess of the scheduled $125,000. Work programs included airborne and ground geophysical surveys, geological mapping and drilling. No significant values have been intersected to date. Additional surveys have been planned on the property and on adjoining claims where Canplats and East West Resources have interests.

c) Geikie Property

During the summer of 1999 and in January and February 2000, a total of 6.8 kilometres of magnetometer and IP surveys were completed on two north-south lines and one east-west line. Two separate anomalies were detected, one of which correlates with a very high copper-cobalt lake sediment anomaly. The airborne EM survey identified weak conductors associated with the IP anomalies supporting the potential for disseminated sulphides. The total cost for this work was $24,585.

During the fiscal year ended July 31, 2001, a total of $116,746 was spent on the Geikie property. A total of 22 kilometres of induced polarization (IP) surveys have identified a number of anomalies, both peripheral to and directly associated with magnetic anomalies. The grid has been expanded by an additional 30.7 kilometres. Magnetometer and EM surveys were completed over the entire grid. Soil samples were collected from approximately 30 kilometres of the grid. There is a close relationship between the anomalies and extensive high geochemical values in copper, palladium and gold from a previous government lake bottom sediment sampling program.

During the fiscal year ended July 31, 2002, a total of $164,876 was spent on the Geikie property. Ground IP and EM surveys were completed totalling 32.55 km and 7.2 km respectively. This work identified numerous drill targets, seven of which were tested in October 2001. A total of 842 metres of drilling was completed which locally intersected anomalous values in copper and palladium. Most of this drilling was focused on locating a near surface Lac des Iles-type target. The deeper holes were progressively becoming more olivine and magnesium-rich with depth.

A high definition airborne magnetic survey was flown in the summer of 2002. Modeling of this data has identified several deep-seated targets reflecting possible accumulations of nickel or copper sulphides at the base of a conical-shaped intrusion.

d) Posh Property

These claims were covered by 14.4 kilometres of magnetometer and IP survey. A strong north-east south-west magnetic anomaly was outlined which correlates with the flanking and central parts of the IP survey results. These are associated with weak airborne EM conductors suggesting the presence of disseminated mineralization. The cost of this work was $40,715.

During the fiscal year ended July 31, 2001, a total of $49,920 was spent on the Posh property. A total of 14.2 kilometres of IP surveys were completed and have identified anomalies coincident with the magnetic high. Further geochemical sampling of eight kilometres of the grid and mapping are underway.

During the fiscal year ended July 31, 2002, a total of $48,675 was spent on the Geikie property. A total of 15 km of grid was cut on which were run 15 km of IP survey, 8 km of soil sampling and 5.8 km of EM survey. A two-hole diamond drill program, totalling 274 metres was completed in October 2001. Anomalous values in copper and palladium were locally intersected. A detailed airborne magnetic survey was completed in the summer of 2002. Modeling of this data is suggesting the possible presence of a large mafic body having been intruded up along a regional break. These deep-seated targets remain untested.

e) Grand Bay Property

During the summer of 1999 and in January and February 2000, a total of 10.3 kilometres of lines were cut and surveyed for total field magnetics. Frozen ground conditions allowed only six kilometres of the grid to be surveyed for IP/resistivity. These surveys identified weak flanking magnetic anomalies. The airborne EM survey located strong, 12-channel responses suggesting the presence of massive sulphides. The cost of this work was $23,011.

During the fiscal year ended July 31, 2001, a total of $52,322 was spent on the Grand Bay property. A total of 13.2 kilometres of IP surveys and eight kilometres of soil sampling were completed.

During the fiscal year ended July 31, 2002, a total of $103,084 was spent on the Grand Bay property. Work on this property has been carried out in several programs. A total of 21 km of line cutting provided the grid for 19.2 km of IP survey, 6.1 km of EM geophysical survey. This work was followed-up in November 2002 by a single drill hole which totalled 410 metres. This hole intersected a series of mafic sills which were becoming olivine-rich (up to 25%) with depth. Modeling of magnetic data from a survey flown in January 2002 showed that the drill hole was on the verge of penetrating the top of the source of the magnetic anomaly. Any accumulations of nickel sulphides would be at the base of the intrusion, projected to be an additional 400 metres below the bottom of the drill hole.

f) Black Sturgeon Property

During the summer of 1999 and in January and February 2000, the property was covered by two flight lines of the airborne EM/ magnetometer survey at a cost of $31,428. Strong, 12-channel responses were identified, suggesting the presence of sulphides.

During the fiscal year ended July 31, 2001, a total of $51,647 was spent on the Black Sturgeon property. A total of 13.0 kilometres of IP surveys were completed.

During the fiscal year ended July 31, 2002, a total of $18,909 was spent on the Black Sturgeon property. A total of 12.5 km of grid lines were cut and soil-sampled. An EM geophysical survey was completed over 6 km of the grid. A detailed airborne magnetic survey flown in February delineated a series of intersecting structures along which mafic rocks have been intruded. Exploration targets exist at the intersections of the limbs of the intrusions.

g) Tartan Lake Property

Minimal exploration work has been carried out on the Tartan Lake Property by the Registrant.

During the fiscal year ended July 31, 2001, a total of $31,428 was spent on the Tartan Lake property. A total of 71.6 kilometres of line cutting and 70.0 kilometres of magnetometer surveys were completed.

During the fiscal year ended July 31, 2002, a total of $680 was spent on the Tartan Lake property. The claims were allowed to lapse and all costs relating to the property were written off.

h) Mikinak West and East Property

The Mikinak West and East claims were surveyed with induced polarization. During the fiscal year ended July 31, 2001, a total of $21,652 was incurred on the property.

During the fiscal year ended July 31, 2002, a total of $10,469 (net) was spent on the Mikinak properties by Canplats. A work program on Mikinak West was undertaken in September, 2001, consisting of 13 km of cutting, 13 km of magnetic geophysical survey and 6 km of EM geophysical survey. Subsequent to this, Teck Cominco Limited entered into an option agreement where they could earn up to 60% interest in the project by making staged payments and incurring work expenditures of $2.25 million over six years. Teck Cominco has completed an additional geophysical survey and an initial drill program of over 500 metres. No significant values were intersected by that drill program. Subsequent to this work, the Company has received notice that Teck Cominco would be discontinuing their option of the project. The Company is awaiting their final report and will make recommendations for additional work after reviewing the data.

Other Mineral Properties

a) Circle Lake

Acquisition Details

Canplats staked the claims, which comprise the Circle Lake Property, in March and May 2000 and had a 100% interest in such claims. Canplats had not obtained a title report in respect of the Circle Lake Property. The claims were allowed to lapse in fiscal 2002 and $15,382 in accumulated property costs were written off.

Description and Location

The Circle Lake Property consisted of 196 claim units (15 claims) covering an area of approximately 3,136 hectares. The property covers the north-west extension of the Stucco Property magnetic anomaly, which is also parallel to the Quetico fault.

b) Boomer Lake

Acquisition Details

Canplats staked the claims, which comprise the Boomer Lake Property, in May 2000 and has a 100% interest in such claims. Canplats has not obtained a title report in respect of the Boomer Lake Property. The claims were allowed to lapse in fiscal 2002 and $8,192 in accumulated property costs were written off.

Property Description

The Boomer Lake Property consisted of 124 claim units (10 claims) and covers an area of approximately 1,968 hectares. The property is contiguous with the Circle Lake and Mikinak West claims and covers the same geologic and geophysical trends.

c) Plateau Lake Property

Acquisition Details

Under an agreement (the “Initial Plateau Lake Agreement”) dated effective February 1, 1999, Canplats and East West agreed to stake 12 claim units, which claim units originally comprised the Plateau Lake Property. The 12 claim units are held on an equal basis. Under the February 1, 1999 agreement, Canplats and East West agreed to fund all exploration expenses and costs associated with keeping the property in good standing on an equal basis. In addition, Canplats and East West agreed to share the cost of the acquisition, exploration and holding of adjacent claims on an equal basis. East West and Canplats share a common director, James W. Tutton, and are considered to be related parties.

By an agreement (the “Initial Prism Agreement”) dated June 25, 1999 among the Registrant, East West and Prism Resources Inc. (“Prism”), Prism was granted an option to acquire up to a 60% interest in the original 12 claim units included in the property by making staged cash payments totalling $8,500 (paid) over two years and incurring exploration expenditures of $436,000 over four years.

An additional 40 claim units were optioned by East West from Stares Contracting Corp. and James Dawson under an agreement (the “Stares Agreement”) dated January 23, 2000. In order to acquire a 100% interest in such claims under the Stares Agreement, East West is required to pay $60,000 in staged cash payments over 48 months ($30,000 was paid at July 31, 2002), issue 100,000 common shares in its capital in four equal instalments of 25,000 common shares each at six-month intervals commencing following Exchange approval of the acquisition (all shares issued at July 31, 2002) and granting a 2% net smelter returns royalty on base metals and a 3% net smelter returns royalty on precious metals. East West may purchase 1% of the base metals net smelter returns royalty and 1.5% of the precious metals net smelter returns royalty on payment of $500,000 per 0.5%. In addition, East West will have a right of first refusal to acquire the base and precious metals net smelter returns royalties. East West received Exchange approval of the Stares Agreement on March 25, 2000.

Canplats and East West, under an agreement dated February 15, 2000, agreed to share the cost of the acquisition of the claims acquired by East West under the Stares Agreement and include such claims in the Plateau Lake Property. Pursuant to such agreement, East West agreed to issue the shares to be issued under the Stares Agreement and Canplats agreed to pay the initial option payments up to $15,000, thereafter the parties agreed to make all remaining option payments on an equal basis.

During March 2000, Canplats and East West staked 42 additional claim units, which are contiguous to the 12 claim units staked by Canplats and East West in February 1999 and are held by Canplats and East West on an equal basis under the Initial Plateau Lake Agreement. The 54 claim units staked by Canplats and East West and the 40 claim units optioned by East West under the Stares Agreement are together known as the Plateau Lake Property.

Under an agreement dated June 20, 2000, Prism was granted an option to acquire a 60% interest in the 40 claim units which were optioned by East West under the Stares Agreement by making staged cash payments totalling $20,000 over two years, making all cash option payments due under the Stares Agreement and incurring exploration expenditures of $450,000 over five years.

Under a further agreement dated June 20, 2000, Prism was granted an option to acquire a 60% interest in the 42 claim units which were staked by Canplats and East West in March 2000 by incurring exploration expenditures of $450,000 over five years.

Canplats has not obtained a title report in respect of the Plateau Lake Property. Net costs to July 31, 2002 expended on this property by Canplats were $7,152.

Description and Location

This 52 unit property covers a 650 metre-long pyroxenite intrusion near Plateau Lake near the north side of Highway 11 at Atikokan, Ontario. The claims are located in the North Pickerel claim map, Thunder Bay Mining Division.

The number of claim units, recording dates, expiry dates and assessment work required to be incurred by Canplats (in order to maintain the claims in good standing for a period of one year after the expiry date) for the claims which comprise the Plateau Lake Property are set out below:

- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
    Number of Claims      Number of Claim Units     Recording Date           Expiry Date        Required Assessment
                                                                                                       Work
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
              3                     40           Oct. 30, 1999          Oct. 30, 2002*                $14,808
              1                     12           Feb. 12, 1999          Feb 12, 2003                   $4,742

* These claims were cancelled after October 30, 2002.

Exploration work on the property will be funded by Prism pursuant to the terms of the June 25, 1999 and June 20, 2000 option agreements.

d) North Fintry Property

Acquisition Details

Canplats staked the claims, which comprise the North Fintry Property, in March 1999 and has a 100% interest in such claims. Canplats has not obtained a title report in respect of the North Fintry Property. Total costs to July 31, 2001 expended on this property by Canplats were $9,571 and these costs were written off in fiscal 2002.

Description and Location

This 48 unit property covers a 2.4 kilometre diameter magnetic anomaly on the north margin of the Quetico Belt which extends from the Rainy River area of north-western Ontario eastward to the Kapuskasing area. This magnetic feature is interpreted to reflect a mafic body (gabbro) on the Quetico Fault similar to other bodies in the Atikokan to Thunder Bay region that contain nickel-copper-PGE deposits.

The number of claim units, recording dates, expiry dates and assessment work required to be incurred by Canplats (in order to maintain the claims in good standing for a period of one year after the expiry date) for the claims which comprise the North Fintry Property are set out below:

Number of Claims	Number of Claim Units	Recording Date	Expiry Date	Required Assessment Work
4	48	June 1, 2001	June 1, 2003	$19,200

The area is also transected by a north-east trend of carbonatite intrusions that in one instance contain significant amounts of copper and palladium (Coldwell Complex on Lake Superior). This trend continues north of the property which is itself at the junction of the Quetico Fault and the carbonatite trend. It is speculated that this could generate an important location for PGE-bearing deposits.

Access to the property is by winter roads that connect with Highway 11 approximately 40 miles west of Hearst, Ontario. Ground follow-up with induced polarization and magnetic surveys are recommended to locate disseminated sulphide mineralization. At this time, no work is planned on the property.

e) Awl Lake Property

Acquisition Details

In August, 2001, Canplats acquired the Awl Lake property and has a 100% interest in the claims.

Description and Location

The 5 Awl Lake mineral claims total 80 units and are located in Obonga Lake area of the Thunder Bay Mining Division approximately 20 kilometres southeast of the Puddy Lake nickel-chromium-platinum prospect. The Awl Lake claims were staked to cover a significant government PGM lake sediment anomaly that coincides with a strong airborne magnetic anomaly. At this time, no work is planned on the property.

The number of claim units, recording dates, expiry dates and assessment work required to be incurred by Canplats (in order to maintain the claims in good standing for a period of one year after the expiry date) for the claims which comprise the Awl Lake Property are set out below:

- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
    Number of Claims      Number of Claim Units     Recording Date           Expiry Date        Required Assessment
                                                                                                       Work
- ------------------------- ---------------------- ---------------------- ---------------------- ----------------------
              5                     80           Jan. 5, 2001           Jan. 5, 2003                  $32,000

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following discussion of the financial condition, changes in financial condition and results of operations of Canplats for each of the years in the three-year period ended July 31, 2002, should be read in conjunction with the financial statements of Canplats included in Item 17. Financial Statements. Canplats’ financial statements are presented in Canadian dollars and have been prepared in accordance with Canadian generally accepted accounting principles (“GAAP”). Material differences between Canadian and U.S. GAAP, as applicable to the Registrant, are set forth in Note 13 to the financial statements of Canplats included in Item 17. Financial Statements.

One significant difference is that under Canadian GAAP, mineral property acquisition and exploration expenditures are capitalized until such property is placed into production, sold or abandoned. Under US GAAP, the recoverability of capitalized mineral property expenditures is generally considered insupportable until a commercial mineable deposit is determined. Accordingly, the Registrant has expensed under US GAAP all mineral property costs.

This section contains forward-looking statements involving risks and uncertainties. Canplats’ actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth under part Item 3. Key Information — D. Risk Factors.

A. Operating Results

Canplats has financed its operations principally through the sale of its equity securities. As Canplats does not have any producing mineral properties, its only revenue source is interest income earned from amounts on deposit, offsetting a portion of the administrative operating expenses. Interest income earned is dependent on the amount of funds available for deposit and changes in the interest rates. Unless Canplats is able to obtain additional funds through the sale of its equity securities, the amount of interest income earned is expected to decrease as Canplats continues exploring its mineral properties.

Fiscal year-ended July 31, 2002 Compared to year-ended July 31, 2001

During the fiscal year-ended July 31, 2002, Canplats expended $516,669 on the acquisition and exploration of mineral properties as compared to $541,618 for the fiscal year-ended July 31, 2001.

Expenses for the 2002 fiscal year decreased to $151,551 as compared to $185,353 for the 2001 fiscal year. Cost reductions were reflected in a number of areas. Consulting expenses were $Nil for the 2002 fiscal year ($17,278 for 2001). The 2001 expense included a non-recurring $15,000 cost relating to the successful registration of the company with the U.S. Securities and Exchange Commission. All other consulting work performed in fiscal 2002 related to specific properties with the respective costs allocated to mineral property costs. Legal, accounting and audit expenses for the year were $7,005 compared to $17,815 in the previous year, reflecting less work being performed outside the company. Office expenses for the year were $3,455 compared to $17,156 in the prior year. This $13,701 reduction is offset by the $13,300 increase in the management administration fee. In April, 2001, the company entered into a management services agreement with Silver Standard Resources Inc., a company in which two directors are also directors of the company. This arrangement is explained in greater detail in Note 8 of the 2002 Financial Statements. Salaries for the year were $38,738 compared to $50,022 in the prior year. The $11,284 reduction reflects less direct time being charged to the company by Silver Standard. The three main areas where the company experienced cost increases, other than the management administration fee, were insurance $6,315 ($634 in 2001), listing and filing fees $8,683 ($3,625 in 2001) and transfer agents fees $15,692 ($6,898 in 2001). In 2002, Canplats was added as a named insured under Silver Standard’s corporate liability coverage and was allocated its share of premium costs. The increase in listing and filing fees and transfer agency fees reflects the costs associated with the three private placements that were undertaken during the year and costs associated with administering a larger shareholder base. Going forward, the company will continue its efforts in containing administrative costs.

Interest income for fiscal 2002 was $1,636 compared to $6,419 in the prior year, reflecting both lower cash balances and lower interest rates.

The loss for the year was $211,299 compared to $201,005 in the 2001 fiscal year resulting in a basic loss per share of $0.02 as compared to $0.06 in the 2001 fiscal year. The reduced loss per share reflects a higher weighted average number of issued shares. The loss includes $61,384 in mineral properties written off compared to $23,771 written off in fiscal 2001. The properties written off in 2002 include Tartan ($27,240), North Fintry ($9,571), Circle Lake ($15,382), Boomer Lake ($8,191) and Kitchen Lake ($1,000).

Fiscal Year Ended July 31, 2001 Compared to Year Ended July 31, 2000

During the fiscal year ended July 31, 2001, Canplats expended $541,618 on the acquisition and exploration of mineral properties as compared to $360,952 for the fiscal year ended July 31, 2000. This increase in acquisition and exploration expenditures can be attributed to the increased activity of Canplats in acquiring and exploring PGE mineral properties following the successful completion of its $1,000,000 initial public offering in March 2001.

Expenses for the 2001 fiscal year increased to $185,353 as compared to $51,673 for the 2000 fiscal year reflecting the general increased activity of the Registrant. The increase in expenses reflected higher activity levels in Canplats following the successful completion of its financings. The increases were spread across a wide number of areas. The main areas were salaries of $50,022 ($1,646 for 2000), investor relations of $19,364 ($1,279 for 2000), office rent of $18,000 (nil for 2000), office expenses of $17,156 ($7,653 for 2000), shareholder relations of $16,918 (nil for 2000), legal, accounting and audit of $17,815 ($8,763 for 2000) and management administration fees of $10,200 (nil for 2000). Reduction in expenses occurred in general exploration of nil ($6,771 for 2000) and travel and accommodation of $3,801 ($10,585 for 2000).

Under an arrangement with Silver Standard Resources Inc., a publicly traded company with two common directors, Silver Standard provides for administrative and technical services. The salary expense of $50,022 relates to administrative and management time allocations to the company based on direct cost plus a 30% allowance for benefits. Investor relations of $19,364 is comprised of $7,813 in salary costs charged by Silver Standard for time spent on investor relations. Other significant costs in investor relations include $7,813 for a Standard and Poor’s directory listing, $1,463 for slide presentations and $830 for a web site. Legal and accounting expenses of $17,815 are comprised of $12,436 of outside accounting and audit fees and $5,379 in legal expense.

Interest income of $6,419 was earned during the 2001 fiscal year due to higher cash balances following the initial public offering compared to $2,088 for the 2000 fiscal year.

Loss for the 2001 fiscal year increased to $(201,005) as compared to $(115,124) for the 2000 fiscal year, resulting in basic and diluted loss per share of $(0.06) as compared to $(0.10), respectively. The loss includes $23,771 in mineral property costs written off ($79,412 for 2000) offset by a $1,700 gain on debt settlement ($13,874 for 2000). The mineral property costs written-off relates in 2001 relates to general costs whereas in 2000 the Horseshoe Property was abandoned by the Registrant. The weighted average number of common shares outstanding used to calculate basic and diluted loss per share was 3,062,700 shares for the 2001 and 1,111,303 shares for 2000.

Year Ended July 31, 2000 Compared to Year Ended July 31, 1999

During the fiscal year ended July 31, 2000, Canplats expended $360,952 on the acquisition and exploration of mineral properties as compared to $127,259 for the fiscal year ended July 31, 1999. This increase in acquisition and exploration expenditures can be attributed to the increased activity of Canplats in acquiring and exploring PGE mineral properties.

Expenses for the 2000 fiscal year increased to $51,673 as compared to $31,626 for the 1999 fiscal year reflecting the general increased activity level of the Registrant. The increase in expenses was due mainly to general exploration of $6,771 ($152 for 1999), geological consulting of $12,800 (nil for 1999), office expenses of $9,920 ($3,026 for 1999) and travel and accommodation of $11,243 ($5,552 for 1999). Offsetting this increase was a reduction in legal, accounting and audit for the 2000 fiscal year of $8,763 ($22,036 for 1999) reflecting the reorganization activities of Canplats during the 1999 fiscal year.

Interest income of $2,088 was earned during the 2000 fiscal year as a result of Canplats’ special warrant financing. Canplats did not have any interest income during the 1999 fiscal year.

Net loss for the 2000 fiscal year increased to $(115,124) as compared to $(31,626) for the 1999 fiscal year, resulting in basic and diluted loss per share of $(0.10) as compared to $(0.03), respectively. The net loss includes $79,412 in mineral property costs written-off offset by a $13,874 gain on debt settlement. The mineral property costs written-off relates primarily to the Horseshoe Property, which was abandoned by Canplats during the 2000 fiscal year. The weighted average number of common shares outstanding used to calculate basic and diluted loss per share was 1,111,303 shares for the 2000 and 1999 fiscal years.

B. Liquidity and Capital Resources

Canplats is presently exploring its properties for sufficient ore reserves to justify production. None of Canplats’ properties are yet in production and consequently do not produce any revenue. As a result, Canplats’ ability to conduct operations, including the acquisition and exploration of mineral properties, is based completely on its ability to raise funds, primarily from equity sources. While Canplats believes it has sufficient capital and liquidity to finance operations for the next fiscal year, its ability to continue operations beyond then and the recoverability of amounts recorded for mineral properties and deferred exploration is dependent on the discovery of economically recoverable reserves on its mineral properties, the ability of Canplats to obtain additional financing to complete its exploration and upon future profitable production or on sufficient proceeds from disposition of such properties.

Canplats will have to obtain financing in the future primarily through joint venture of its properties, equity financing, and/or debt financing. There can be no assurance that Canplats will succeed in obtaining additional financing, now or in the future. Failure to raise additional financing on a timely basis could cause Canplats to suspend its operations and eventually to forfeit or sell, at fair market value, its interest in its properties.

Over the next twelve months, the Registrant’s assessment requirements and option obligations on properties in which it has interests in total approximately $747,000. Of this amount, approximately $170,000 will be the responsibility of others through property farm out agreements. The assessment requirements to hold entire claim blocks is discretionary and it is customary to drop claims on ground following exploration and to focus on key ground targets. Similarly, work commitments under option agreements are assessed following exploration. As is customary in exploration stage companies, the Registrant, in order to meet its obligations, will continue its efforts to seek additional financings including further farm out opportunities.

For the years ended July 31, 2002, 2001 and 2000, Canplats incurred losses of $(211,299), $(201,005) and $(115,124), respectively. Canplats’ loss from operations is part of a material trend which Canplats expects will continue for the foreseeable future. Canplats’ financial success will be dependent upon the extent to which its properties are placed into production, which can take many years to complete and consequently, the certainty of resulting income is impossible to determine at this time.

Canplats had a working capital surplus of $104,566 at July 31, 2002, compared to $142,955 at July 31, 2001 and $70,003 at July 31, 2000.

For the year-ended July 31, 2002, Canplats issued, in three separate private placements, a total of 2,505,000 flow-through common shares at $0.20 per share and 150,000 common shares at $0.15 per share. Total net proceeds from these issues were $522,195. Prior to year-end, a further $106,000 in deposits on share subscriptions were received. These deposits related to a private placement consisting of 790,000 shares comprised of 540,000 flow-through shares at $0.15 per share and 250,000 common shares at $0.10 per share. The placement closed on August 2, 2002.

During the fiscal year ended July 31, 2001, Canplats closed a private placement of 1,181,000 Series “C” Special Warrants at $0.25 per special warrant for gross proceeds of $295,250. The proceeds from the private placement of Series “C” Special Warrants were received by Canplats prior to July 31, 2000. Each Series “C” Special Warrants is exchangeable, without payment of any additional consideration, for one common share and one non-transferable share purchase warrant entitling the holder thereof to acquire one additional common share at a price of $0.25 until September 30, 2001 and at a price of $0.30 until September 30, 2002. Canplats completed an initial public offering prospectus dated February 14, 2001 (the “Prospectus”) for 2,500,000 units of Canplats at a price of $0.40 per unit (the “Units”) for total gross proceeds of $1,000,000 (net proceeds of $791,196). Each Unit is comprised of one common share in the capital of Canplats and one-half of one non-transferable share purchase warrant (the “Warrant”). One whole Warrant entitles the holder thereof to purchase one additional common share of Canplats at a price of $0.50 for a one year period.

During the year ended July 31, 2000, Canplats completed a further two private placements of special warrants. The first private placement consisted of 1,600,000 Series “A” Special Warrants at $0.25 per special warrant, each Series “A” Special Warrant is exchangeable, without payment of any additional consideration, for one common share of the Registrant. The second private placement consisted of 970,000 Series “B” Special Warrants at $0.25 per special warrant. Each Series “B” Special Warrant is exchangeable, without payment of any additional consideration, for one common share and one non-transferable share purchase warrant, of which 770,000 of such common shares are flow-through common shares. Each Series “B” Warrant entitles the holder thereof to acquire one additional share of Canplats at a price of $0.30 per share until December 24, 2001. Total proceeds from the two private placements were $642,500.

At July 31, 2002, the outstanding stock options and share purchase warrants represented a total of 4,441,000 shares issuable for a maximum of $1,790,300 if these securities were exercised in full. Subsequent to year end, all the 3,401,000 share purchase warrants expired unexercised. The exercise of these securities is completely at the discretion of the holders and Canplats has had no indication that any of these securities will be exercised, if at all.

Canplats’ current working capital position of $104,566 at July 31, 2002, provides sufficient liquidity for its short-term requirements. The ability of Canplats to continue as a going-concern depends on its ability to raise additional financing. While it has been successful in the past, there can be no assurance it will be able to do so in the future.

C. Research and Development, Patents and Licenses, Etc.

Canplats’ main activity is the exploration of its mineral properties (see Item 4. Information on the Company — D. Property, Plants, and Equipment) and does not engage in conventional research and development. It has not incurred research and development expenses or adopted research and development policies within its last three fiscal years.

D. Trend Information

Canplats’ main activity is the exploration of its mineral properties and it has no production, sales, or inventory in the conventional sense. Canplats’ financial success will be dependent upon the extent to which it can discover mineralization and the economic viability of developing such properties. Such development may take years to complete and the amount of resulting income, if any, is difficult to determine with any certainty. The sales value of any mineralization discovered by Canplats is largely dependent upon factors beyond Canplats’ control such as the market value of the metals produced.

Canplats is not aware of any trends, uncertainties, demands, commitments or events which are reasonably likely to have a material effect upon Canplats’ net sales or revenues, income from continuing operations, profitability, liquidity or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating results or financial condition.

ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A. Directors and Senior Management

The members of the board of directors and senior officers of Canplats including a brief biography of each as at July 31, 2002:

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

Name and Position in the Registrant               Age   Other Principal Directorships
- ------------------------------------------------ ------ ------------------------------------------------------------
R.E. Gordon Davis (1)
Chairman, President and                           64    Silver Standard Resources Inc.
Chief Executive Officer                                 Western Prospector Group Ltd.
                                                        Northern Crown Mines Ltd.
                                                        Pacific Ridge Exploration Ltd.
- ------------------------------------------------ ------ ------------------------------------------------------------
A. Terrance MacGibbon (1)                         55    Indo Metals Inc.
Director                                                Fort Knox Gold Resources Ltd.
                                                        Foran Resources Ltd.

- ------------------------------------------------ ------ ------------------------------------------------------------
James W. Tutton (1) (2)                           63    Consolidated First Fund Capital Corporation
Director                                                Cross Lake Minerals Ltd.
                                                        East West Resource Corporation
                                                        Horseshoe Gold Mining Inc.
                                                        NovaDx International Inc.
                                                        New Nadina Explorations Limited
- ------------------------------------------------ ------ ------------------------------------------------------------
Robert A. Quartermain
Chief  Operating  Officer,  Vice  President  of   47    Silver Standard Resources Inc.
Operations and Director                                 Rapadre Capital Corp.
                                                        Western Copper Holdings Ltd.
                                                        Pacific Sapphire Company Ltd.
- ------------------------------------------------ ------ ------------------------------------------------------------
                                                  44    None
Kenneth C. McNaughton
Vice President, Finance
- ------------------------------------------------ ------ ------------------------------------------------------------
                                                  54    None
Ross A. Mitchell
Vice President, Finance
- ------------------------------------------------ ------ ------------------------------------------------------------
                                                  47
Linda J. Sue                                            None
Corporate Secretary
- ------------------------------------------------ ------ ------------------------------------------------------------

(1)     Member of audit committee
(2)     Mr. MacGibbon resigned as a Director effective December 10, 2002.

There are no familial relationships between any director or senior officer and any other director or senior officer. There are no arrangements or understandings with major shareholders, customers, suppliers or others, pursuant to which any person referred to above was selected as a director or senior officer.

The business experience of each director and senior officer, including activities performed outside the Registrant, are as follows:

R.E. Gordon Davis

Mr. Davis graduated with a Bachelor of Applied Science Degree in Geological Engineering from the University of British Columbia in 1962. He was a Director and Senior Executive with Dynasty Explorations Ltd. and its successor corporation, Cyprus Anvil Mining Corporation from 1964 to 1982. Since 1982, Mr. Davis has been the Director of a number of resource companies including Pine Point Mines Ltd., Cabre Exploration Ltd., Golden Knight Resources Inc., Silver Standard Resources Inc. and Northern Crown Mines Ltd.

A.Terrance MacGibbon

Mr. MacGibbon, is a registered professional geologist with over 33 years of experience in the mining industry. Mr. MacGibbon is President and CEO of Fort Knox Gold Resources Inc.; a Toronto based TSE junior resource company. Prior to joining Fort Knox, Mr. MacGibbon was employed for 30 years in Inco Limited’s exploration department. While at Inco, Mr. MacGibbon was responsible for directing Inco’s North American and worldwide exploration activities as Director of Exploration, North America and Director of International Exploration. Mr. MacGibbon is a former president of American Copper & Nickel Company Inc., Inco’s United States exploration company, and Dardanel Madencilik A.S., Inco’s Turkey exploration company. Mr. MacGibbon has held directorships and senior executive positions in several TSE and TSX Venture Exchange public companies and is the former chairman of High River Gold Mines Ltd. He serves as a director of Fort Knox Gold Resources Inc., Foran Mining Corporation and Indo Metals Inc.

James W. Tutton

Mr. Tutton is a self-employed business consultant and was formerly Secretary of Archon Minerals Limited. From 1968 to 1992 he was employed as Chairman, President and Director of Webb & Knapp (Canada) Ltd. following amalgamation with Wolstencroft Agencies Ltd.

Robert A. Quartermain

Mr. Quartermain graduated in 1977 from University of New Brunswick with a B.Sc. in geology, and from Queen’s University in 1981 with a M.Sc. in mineral exploration. From 1976 to 1982 he worked for the Geological Survey of Canada and in private industry on mapping and exploration programs. Mr. Quartermain also worked for Teck Corp. before becoming president of Silver Standard Resources Inc. in 1985. Since 1985, Mr. Quartermain has been involved as a director and/or officer of a number of public resource companies.

Kenneth C. McNaughton

Mr. McNaughton is Vice President, Exploration of Silver Standard Resources Inc. and has served in this capacity since July, 1991.

Mr. McNaughton earned a B.A.Sc. and M.A.Sc. in geological engineering in 1981 and 1983, respectively, from the University of Windsor. He worked as contract engineer for Oretech Engineering and worked on exploration programs for three bulk mineable gold or copper/gold deposits in Arizona and British Columbia. From 1984 to 1989, he was employed by Corona Corporation and its affiliate Mascot Gold Mines Ltd. as a project geologist and engineer for projects in British Columbia.

Ross A. Mitchell

Mr. Mitchell is the Vice President, Finance of Silver Standard Resources Inc. and has served in this capacity since January 1996.

Prior to 1996, Mr. Mitchell was employed by Westmin Resources and its predecessor Western Mines Ltd. from 1975. He held various financial positions including controller treasurer of Western Mines from 1975 to 1980 and assistant treasurer and controller of the mining division at Westmin until 1985. He was then appointed treasurer of Westmin and became vice president and treasurer in 1989, the position he held until 1995. Mr. Mitchell earned a B.Comm. from the University of British Columbia in 1971 and a C.A. from the Institute of Chartered Accountants of British Columbia in 1973.

Linda J. Sue

Ms. Sue has been employed by Silver Standard Resources Inc. since 1980 and was appointed corporate secretary in November 1985. Ms. Sue’s responsibilities include management of Silver Standard’s land titles system.

Cease Trade Orders or Bankruptcies

None of the directors, officers or promoters are, or have been within the past five years from July 25, 2001, directors, officers or promoters of other reporting companies which, during the period such position was held, were struck from the British Columbia Registrar of Companies or whose securities were the subject of a cease trading order or suspension order or order that denied the issuer access to any statutory exemptions for a period of more than 30 consecutive days, other than James W. Tutton. On December 7, 1999, NovaDx International Inc., a company of which Mr. Tutton is a director, was the subject of a temporary cease trade order under subsections 127(1) and 127(5) of the Securities Act (Ontario) issued for being in default of certain filing requirements, which temporary cease trade order was extended by an extension order dated December 21, 1999 under subsection 127(8) of the Securities Act (Ontario). On February 29, 2000, the temporary cease trade order and extension order were revoked by a revocation order under section 141 of the Securities Act (Ontario). In addition, on January 11, 2000, NovaDx International Inc. was the subject of a cease trade order under section 164(1) of the Securities Act (British Columbia) issued for failing to file required records, which cease trade order was revoked by a revocation order under section 171 of the Securities Act (British Columbia) dated January 28, 2000.

None of the directors, officer or promoters are, or have been within the past five years, directors, officers or promoters of other issuers which were declared bankrupt or made a voluntary assignment in bankruptcy, made a proposal under any legislation relating to bankruptcy or insolvency or been subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold the assets of that issuer. None of the directors, officers or promoters during the past five years were declared bankrupt or made a voluntary assignment in bankruptcy or insolvency or been subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold the assets of that person.

B. Compensation

The following table sets forth all compensation paid by Canplats to its directors and members of its administrative, supervisory or management bodies during its latest fiscal year ended July 31, 2002.

				Long Term Compensation
	Annual Compensation			Awards		Payouts
Name and Principal Position	Salary	Bonus	Other Annual Compen- sation ($)	Securities Under Options/SARs Granted (#)	Restricted Shares/Units Awarded ($)	LTIP Payouts ($)	All Other Compen- sation ($)
R.E. Gordon Davis Chairman, President & Director	Nil	Nil	Nil	180,000	Nil	Nil	Nil

Other officers of Canplats, including Mr. Robert A. Quartermain, Mr. Kenneth C. McNaughton, Mr. Ross A. Mitchell and Ms. Linda J. Sue are employees of Silver Standard Resources Inc. and allocate time to Canplats on an hourly basis for services provided. The hourly rates charged are based on direct costs plus a factor of 30% for benefits. The total compensation paid all directors and senior officers during the fiscal year-ended July 31, 2002 was $67,263.

Canplats has neither a pension, retirement fund or similar benefits plan nor other arrangement for non-cash compensation to the directors or senior officers of the Registrant, with the exception of incentive stock options.

C. Board Practices

The Board of Directors presently consists of four directors. Each director was elected at Canplats’ last annual general meeting of the shareholders held on December 13, 2001. Each director holds office until the next annual general meeting of Canplats or until his successor is elected or appointed, unless his office is earlier vacated in accordance with the Articles of the Registrant, or with the provisions of the British Columbia Company Act (the “Company Act”). R.E. Gordon Davis, A. Terrance MacGibbon and James W. Tutton have served as directors of Canplats since October 1, 1999. Robert A. Quartermain has served as a director of Canplats since March 15, 2000, Ross A. Mitchell has served as Vice President, Finance of Canplats since March 15, 2000, Kenneth C. McNaughton has served as Vice President, Exploration since December 13, 2001 and Linda J. Sue has served as Corporate Secretary since March 15, 2000. Canplats has not entered into any contracts providing for benefits to the directors or senior officers upon termination of employment.

Pursuant to Section 187 of the Company Act, Canplats is required to have an Audit Committee. As at July 31, 2002, the members of the Audit Committee are R.E. Gordon Davis, A. Terrance MacGibbon and James W. Tutton. Section 187(1) of the Company Act requires the directors of a reporting company to elect from among their number a committee composed of not fewer than three directors, of whom a majority must not be officers or employees of the company or an affiliate of the company. The election must occur at the first meeting of the directors following each annual general meeting, and those elected will hold office until the next annual general meeting. Section 187(4) provides that before a financial statement that is to be submitted to an annual general meeting is considered by the directors, it must be submitted to the audit committee for review with the auditor, and, after that, the report of the audit committee on the financial statement must be submitted to the directors. Section 187(5) provides that the auditor must be given notice of, and has the right to appear before and to be heard at, every meeting of the audit committee, and must appear before the audit committee when requested to do so by the committee. Finally, section 187(6) provides that on the request of the auditor, the chair of the audit committee must convene a meeting of the audit committee to consider any matters the auditor believes should be brought to the attention of the directors or shareholders.

Canplats does not have a remuneration committee.

D. Employees

As at July 31, 2002, 2001 and 2000, Canplats did not have any full time or part time employees.

Effective April 1, 2001, Canplats entered into a Management Services Agreement with Silver Standard Resources Inc., a widely held publicly traded mineral exploration company with no shareholders owning 10% or more of the outstanding common shares. The agreement is for a term of 24 months and may be extended by agreement of the parties. Under the agreement, Silver Standard provides general corporate management, administrative and technical services for the Registrant. For personnel, hourly rates charged were based on direct costs plus a factor of 30% for benefits. For overhead costs, office equipment usage and management services personnel which cannot reasonably be allocated to time spent on behalf of the Registrant, the management fee was $2,600 per month. An additional $1,500 per month was charged for office space and furnishings used by the Registrant. On January 1, 2002, the management fee was reduced to $1,500 per month and the amount charged for office space and furnishings was reduced to $1,000 per month.

E. Share Ownership

With respect to the persons referred to above in B. Compensation, the following table discloses the number of shares (each share possessing identical voting rights) beneficially held by those persons including the percentage of the shares outstanding as at October 31, 2002.

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

Name and Title                                No. of Shares               Percent of Shares Outstanding
- -------------------------------------------- ---------------- ------------------------------------------------------
- -------------------------------------------- ---------------- ------------------------------------------------------
                                              1,141,500 (1)                           10.3%
R.E. Gordon Davis
Chairman, President & Director

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

Notes:

(1)     Includes stock options and share purchase warrants to purchase an additional 180,000 shares. .

As at October 31, 2002, the directors and officers of the Company held, as a group, directly or indirectly, an aggregate of 2,646,500 common shares and 725,000 stock options exercisable at a price of $0.50.

Incentive Stock Options

The following table discloses the stock options beneficially held by the aforementioned persons, as at October 31, 2002. The stock options are for shares of common stock of the Registrant.

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

                                Number of Shares      Exercise
                               Subject to Issuance    Price per
       Name of Person                                   Share          Expiry Date
- ------------------------------ -------------------- -------------- --------------------
- ------------------------------ -------------------- -------------- --------------------
R.E. Gordon Davis                     180,000         $0.50           April 4, 2004
- ------------------------------ -------------------- -------------- --------------------

Canplats established an incentive stock option plan (the “Option Plan”) for its directors, senior officers, employees and consultants of Canplats or any of its subsidiaries whereby a total of 1,400,000 common shares have been reserved for issuance for the exercise of stock options. At October 31, 2002, stock options granted under the Option Plan total 1,040,000 common shares. The Option Plan and all stock options issued thereunder are subject to the requirements of TSX Venture Exchange Policy 4.4: Director, Officer and Employee Stock Options under a Tier 2 Issuer.

The Option Plan provides for the issuance of stock options to acquire up to a total of 1,400,000 common shares for a period not exceeding five years, subject to standard anti-dilution adjustments and shareholder approval. The Directors may, from time to time, appoint an administrator (the “Administrator”) for the purposes of administering the Option Plan. Initially, the Administrator will be the Secretary of the Registrant.

The price at which a stock option may be exercised shall be set forth in the stock option certificate issued in respect of such stock option and in any event shall not be less than the market value of the common shares as of the date of the grant of the stock option which will typically be the closing trading price of the common shares on the day immediately preceding the award date, or otherwise in accordance with the terms of the Option Plan. In no case will the options be exercisable at an exercise price less than the minimum prescribed under the policies of the TSX Venture Exchange..

The stock options will be non-assignable, except that they will be exercisable by the personal representative of the stock option holder in the event of the stock option holder’s death for a period of up to one year from the date of the option holder’s death. The stock options will expire not more than 30 days after the director or employee ceases to be a director or employee of Canplats or, in the alternative, if they are fired or removed from their office, as the case may be, for cause, then on the date of their termination.

Any stock options outstanding upon termination of the Option Plan will remain in effect until expiry or exercise. The Option Plan will terminate when all of the stock options have been granted or when the Option Plan is otherwise terminated by the Registrant. If a stock option expires or otherwise terminates for any reason without having been exercised in full, the number of shares in respect of which that stock option expired or terminated shall again be available for the purposes of the Option Plan.

The Option Plan provides that other terms and conditions may be attached to a particular stock option, such terms and conditions to be referred to in a schedule attached to the stock option certificate. Stock options may be granted on such terms as may be required to permit qualification as “incentive stock options” for U.S. tax purposes.

Prior to the issuance of Canplats’ common shares for any exercise of stock options, the common shares must be fully paid for. Canplats will not provide financial support to assist holders in exercising their stock options.

The Option Plan provides that it is solely within the discretion of the Directors to determine who should receive stock options and in what amounts. The Directors may from time to time amend the Option Plan and may seek shareholder approval for such amendments as required by law or under the policies of the TSX Venture Exchange. Disinterested shareholder approval must be obtained if Canplats proposes to decrease the exercise price of previously granted stock options to insiders, or if the Option Plan, together with any previously issued or proposed stock option grants, could at any time result in:

(i) the number of common shares reserved for issuance under stock options granted to insiders of Canplats exceeding 10% of the outstanding common shares;

(ii) the issuance to insiders, within a one year period, of a number of shares exceeding 10% of the outstanding common shares; or

(iii) the issuance to any one insider and such insider’s associates, within a one year period, of a number of common shares exceeding 5% of the outstanding common shares.

“Disinterested shareholders” are defined as the shareholders of Canplats other than the insiders and their associates to whom stock options may be issued under the Option Plan.

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

A. Major Shareholders

As of October 31, 2002, the following table sets forth the beneficial ownership of each major shareholder, defined as beneficial owners of 5% or more of Canplats’ issued and outstanding common shares, known to exist by the Registrant:

Identity of Person or Group	No.of Shares	Percent
CDS & Co.. (1)	6,563,269	59.4%
R.E. Gordon Davis	961,500	8.7%
589520 BC Ltd. (2)	720,000	6.5%
CEDE & Co.(1)	559,705	5.1%

Notes:

(1)     Clearing house; ultimate beneficial owners of these shares are not known to the Registrant.
(2) Private company owned by Peter de Visser, a former director of the Registrant.

The common shares held by each of the major shareholders have the same voting rights as all other shareholders of the Registrant. As of October 31, 2002, there were 1,286 shareholders of record in the United States holding a total of 935,572 (8.5%) common shares of the Registrant. To the best of Canplats’ knowledge, it is not owned or controlled, directly or indirectly, by another company, by any foreign government or by any other natural or legal person severally or jointly. To the best of Canplats’ knowledge, there are no arrangements, the operation of which at a subsequent date will result in a change in control of the Registrant.

B. Related Party Transactions

Other than as set forth below, management of Canplats is not aware of any material interest, direct or indirect, of any director or officer of the Registrant, any person beneficially owning, directly or indirectly, more than 10% of Canplats’ voting securities, or any associate or affiliate of any such person in any transaction within the three most recently completed fiscal years of Canplats and up to the date of this Form 20-F, including any proposed transaction which in either case has materially affected or will materially affect the Registrant.

In fiscal 2002, the Company acquired the Awl Lake mineral property from a company controlled by Mr. Peter de Visser, a major shareholder of Canplats. The consideration paid was $3,000 in cash and the issuance of 100,000 common shares with a value of $20,000.

Under the Posh Agreement, East West Resource Corporation (“East West”) granted Canplats an option to acquire up to a 75% interest in the Posh Property. East West is a publicly-traded company and share a common director with the Registrant, James W. Tutton. See “D. Property, Plants and Equipment under Item 4. Information on the Company”.

Under an option and joint venture agreement between East West and Canplats dated March 17, 2000, in return for Canplats’ funding of a total of $20,000 in option payments to the vendors and assessment work on the Mikinak West and East Property, East West and Canplats will enter into a joint venture on an equal basis in respect of the property. East West is a publicly-traded company and share a common director with the Registrant, James W. Tutton. See “D. Property, Plants and Equipment under Item 4. Information on the Company”.

Canplats shares an exploration office with East West in Ontario and paid or accrued $28,472 in fiscal 2002 for its share of the exploration office costs. Canplats also received or accrued $22,598 in fiscal 2002 from East West’s share of the mineral property option payments.

As at July 31, 2002, Canplats is owed $10,988 by East West for mineral property and equipment costs net of its share of exploration office costs.

Canplats has entered into a mineral property option agreement with Prism Resources Inc. (Prism) relating to the Plateau Lake property. Prism is a publicly-traded company whose president and director, James W. Tutton is a director of the Registrant. See “D” Property, Plants and Equipment under Item 4 – Information on the Company. During fiscal 2002, Canplats received $nil from Prism.

Canplats contracts for its administrative and technical services through Silver Standard Resources Inc. (“Silver Standard”), a publicly-traded company with two common directors (Robert A. Quartermain and R.E. Gordon Davis) and common officers. The services of the senior officers of the Registrant, other than R.E. Gordon Davis, are provided pursuant to an arrangement with Silver Standard. Under such arrangement, the Company reimburses Silver Standard for its expenses incurred in providing such administrative and technical services. During fiscal 2002, Canplats paid or accrued $185,529 in geological support, management and administration expenses from Silver Standard. As at July 31, 2002, Canplats owed Silver Standard $30,539 for geological and administrative services.

Compensation for technical and administrative services for the operation of Canplats have been negotiated with certain senior officers of the Registrant, to be provided as required and charged on an hourly basis. These hourly rates, including a factor of 30% for benefits, are: Robert Quartermain — $116.08; Kenneth McNaughton — $60.71; Ross Mitchell — $60.71; and Linda Sue — $42.15.

C. Interests of Experts and Counsel

Not applicable

ITEM 8. FINANCIAL INFORMATION

A. Consolidated Statements and Other Financial Information

Financial Statements

Attached hereto are the audited financial statements of Canplats for the fiscal years ended July 31, 2002, 2001 and 2000. The financial statements for the fiscal years ended July 31, 2002, 2001 and 2000 were audited by Beauchamp & Company, Chartered Accountants.

The financial statements are accompanied by auditors' reports and related notes. See "Item 17. Financial Statements".

Legal Proceedings

There are no legal or arbitration proceedings, including those relating to bankruptcy, receivership or similar proceedings and those involving any third party, which may have, or have had in the recent past, significant effects on Canplats’ financial position or profitability. There are no legal proceedings to which Canplats is a party, nor to the best of the knowledge of Canplats’ management are any legal proceedings contemplated.

Dividend Policy

Canplats has not paid dividends in the past and it has no present intention of paying dividends on its shares as it anticipates that all available funds will be invested to finance the growth of its business. The Directors of Canplats will determine if and when dividends should be declared and paid in the future based upon Canplats’ financial position at the relevant time. The common shares of Canplats are entitled to an equal share of any dividends declared and paid.

B. Significant Changes

Since July 31, 2002, the date of the most recent audited financial statements, no significant changes have occurred.

ITEM 9. THE OFFERING AND LISTING

A. Offer and Listing Details

The authorized capital of Canplats consists of 100,000,000 common shares without par value, of which 11,032,303 were issued, outstanding and fully paid for as at October 31, 2002. No common shares have been issued subject to call or assessment. There are no pre-emptive or conversion rights, and no provisions for redemption, purchase or cancellation, surrender, sinking fund or purchase fund. Provisions as to the creation, modification, amendment or variation of such rights or such provisions are contained in the British Columbia Company Act.

Effective March 22, 2001, Canplats’ common shares have been listed and traded on the TSX Venture Exchange under the symbol “CPQ”. Prior to March 22, 2001 and during the five most recent fiscal years, Canplats’ common shares were not listed or traded on any stock exchange or other regulated market. The high and low sales prices for Canplats’ common shares that traded through the TSX Venture Exchange are set out below.

- ---------------------------------------- ----------- ------------
                                            High         Low
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Year ended July 31, 1998                    N/A          N/A
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Year ended July 31, 1999                    N/A          N/A
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Year ended July 31, 2000                    N/A          N/A
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Year ended July 31, 2001                   $0.42        $0.20
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Year ended July 31, 2002                   $0.27        $0.09
- ---------------------------------------- ----------- ------------
- -----------------------------------------------------------------
                    Year Ended July 31, 2001
- -----------------------------------------------------------------
- ---------------------------------------- ----------- ------------
                                            High         Low
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Quarter ended October 31, 2000              N/A          N/A
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Quarter ended January 31, 2001              N/A          N/A
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Quarter ended April 30, 2001 (1)           $0.42        $0.34
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Quarter ended July 31, 2001                $0.40        $0.20
- ---------------------------------------- ----------- ------------
- -----------------------------------------------------------------
                    Year Ended July 31, 2002
- -----------------------------------------------------------------
- ---------------------------------------- ----------- ------------
                                            High         Low
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Quarter ended October 31, 2001             $0.26        $0.11
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Quarter ended January 31, 2002             $0.27        $0.11
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Quarter ended April 30, 2002               $0.20        $0.09
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
Quarter ended July 31,  2002               $0.15        $0.10
- ---------------------------------------- ----------- ------------
- -----------------------------------------------------------------
                    Year Ended July 31, 2003
- -----------------------------------------------------------------
- ---------------------------------------- ----------- ------------
Quarter ended October 31, 2002             $0.10        $0.05
- ---------------------------------------- ----------- ------------
- -----------------------------------------------------------------
                     Most Recent Six Months
- -----------------------------------------------------------------
- ---------------------------------------- ----------- ------------
                                            High         Low
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
June, 2002                                 $0.12        $0.10
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
July, 2002                                 $0.11        $0.10
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
August, 2002                               $0.10        $0.08
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
September, 2002                            $0.08        $0.08
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
October, 2002                              $0.08        $0.05
- ---------------------------------------- ----------- ------------
- ---------------------------------------- ----------- ------------
November, 2002                             $0.07        $0.04
- ---------------------------------------- ----------- ------------

Notes:

(1)     For the period from initial listing on March 22, 2001 to April 30, 2001

The authorized capital of Canplats consists of 100,000,000 common shares without par value, of which 10,217,303 were issued and outstanding as at July 31, 2002.

B. Plan of Distribution

Not applicable

C. Markets

Canplats’ common shares are listed for trading under the symbol “CPQ” on the TSX Venture Exchange (the “TSX”) in Vancouver, British Columbia, Canada, and have traded on the TSX since March 22, 2001. The common shares were formerly listed on the Vancouver Stock Exchange (the “VSE”) and Canadian Venture Exchange (the “CDNX”), the predecessors to the TSX, effective June 21, 1972. In April 1992, the common shares of Canplats were delisted by the VSE for failure to pay sustaining fees. Canplats was the subject of cease trade orders issued by the British Columbia Securities Commission on September 9, 1992 and January 11, 1993, for failure to submit statutory filings. Both of these cease trade orders were rescinded by the British Columbia Securities Commission on January 22, 1993.

Canplats’ initial public offering prospectus was filed with and receipted by the British Columbia and Alberta Securities Commissions on February 14, 2001. Canplats initially became a reporting issuer in the Province of British Columbia upon the issuance of a receipt for a prospectus on December 11, 1967. Canplats is a reporting issuer in the Provinces of British Columbia and Alberta.

Canplats possesses Tier 2 status on the TSX, under the classification of a “mining exploration and development” company. The TSX classifies listed companies into two different tiers based certain on standards, including historical financial performance, stage of development and financial resources. Tier 1 status is the premier tier and is reserved for the TSX’s most advanced issuers with the most significant financial resources.

Canplats’ common shares are not actively listed or quoted on any stock exchange or the over-the-counter market in the United States, and there is no public market in the United States for Canplats’ common shares.

ITEM 10. ADDITIONAL INFORMATION

A. Share Capital

This Form 20-F is being filed as an annual report under the Exchange Act, and, as such, there is no requirement to provide any information under this item.

B. Memorandum and Articles of Association.

Objects and Purposes of the Registrant

The Memorandum of Canplats places no restrictions upon Canplats’ objects and purposes.

Directors’ Powers

Section 15.1 of the Articles of Canplats (the “Articles”) provides that a director who is directly or indirectly interested in a proposed contract or transaction with the Registrant, or who holds any office or possesses any property whereby a duty or interest might be created to conflict with his duty or interest as a director shall declare the nature and extent of his interest or of the conflict in accordance with the provisions of British Columbia Company Act (the “Company Act”). Furthermore, section 15.2 provides that a director shall not vote in respect of a proposal, arrangement or contract in which the director is materially interested and if the director does vote, that vote shall not be counted, but the prohibition does not apply to:

i) a contract or transaction relating to a loan to the Registrant, which a director or a specified corporation or a specified firm in which the director has an interest has guaranteed or joined in guaranteeing the repayment of the loan or any part of the loan;

ii) any contract or transaction made or to be made with, or for the benefit of an affiliated corporation of which a director is a director or officer;

iii) any contract by a director to subscribe for or underwrite shares or debentures to be issued by Canplats or a subsidiary of the Registrant, or any contract, arrangement or transaction in which a director is, directly or indirectly, interested if all the other directors are also, directly or indirectly interested in the contract, arrangement or transaction;

iv) determining the remuneration of the directors;

v) purchasing and maintaining insurance to cover the directors against liability incurred by them as directors under section 152 of the Company Act; or

vi) the indemnification of any director by Canplats under section 152 of the Company Act.

The exceptions may from time to time be suspended or amended to any extent approved by Canplats in general meeting and permitted by the Company Act, either generally or in respect of any particular contract or transaction or for any particular period.

Section 16.6 of the Articles provides that the quorum necessary for the transaction of the business of the directors may be fixed by the directors and if not so fixed shall be two directors or, if the number of directors is fixed at one, shall be one director.

Section 12.2 of the Articles provides that the remuneration of the directors may be determined from time to time by the directors. There are no restrictions in the Articles upon the directors’ power, in the absence of an independent quorum, to vote compensation to themselves or any members of their body.

Section 8.1 of the Articles provides that the directors may from time to time on behalf of Canplats borrow money in such manner and amount, on such security, from such sources and upon such terms and conditions as them think fit. Furthermore, the directors may issue bonds, debentures and other debt obligations outright or as security for any liability or obligation of Canplats or other person. Finally, the directors may mortgage, charge, whether by way of specific or floating charge, or give other security on the undertaking, or on the whole or any part of the property and assets of the Registrant.

The borrowing powers of the directors set forth in the Articles can be varied by amending the Articles. Section 219 of the Company Act provides that a Registrant may alter its Articles by filing with the registrar of companies a certified copy of a special resolution altering the Articles. A special resolution is a resolution passed by a majority of not less than three quarters of the votes cast by those members of a company who, being entitled to do so, vote in person or by proxy at a general meeting of the company, or consented to in writing by every member of a company who would have been entitled to vote in person or by proxy at a general meeting of the company. Under the Company Act, an ordinary resolution of shareholders requires approval by a majority of the votes cast at a meeting of shareholders, present in person or represented by proxy.

Qualifications of Directors

There is no provision in the Articles imposing a requirement for retirement or non-retirement of directors under an age limit requirement.

Section 12.3 of the Articles provides that a director shall not be required to hold a share in the capital of Canplats as qualification for his office but shall be qualified as required by the Company Act, to become or act as a director. Section 114 of the Company Act provides that no person is qualified to act as a director if that person is:

(a) under the age of 18 years;

(b) found to be incapable of managing the person’s own affairs by reason of mental infirmity;

(c) a corporation;

(d) an undischarged bankrupt;

(e) unless the court orders otherwise, convicted of an offence in connection with the promotion, formation or management of a corporation, or involving fraud, unless 5 years have elapsed since the expiration of the period fixed for suspension of the passing of sentence without sentencing or since a fine was imposed, or the term of imprisonment and probation imposed, if any, was concluded, whichever is the latest, but the disability imposed by this paragraph ceases on a pardon being granted under the Criminal Records Act (Canada); or

(f) in the case of a reporting company, a person whose registration in any capacity has been cancelled under (i) the Securities Act by either the British Columbia Securities Commission or the executive director, or (ii) the Mortgage Brokers Act by either the Commercial Appeals Commission or the registrar, unless the commission, the executive director or the registrar, whichever is applicable, otherwise orders, or unless 5 years have elapsed since the cancellation of the registration.

Per section 114(3) of the Company Act, every person who acts as a director of a company and who is not qualified to act as a director of the company because of section 114(1) commits an offence.

Section 108 of the Company Act provides that every company must have at least one director, and a reporting company must have at least three directors. Section 109(1) states that the majority of the directors of every company must be persons ordinarily resident in Canada, while section 109(2) specifies that one director of every company must be ordinarily resident in British Columbia.

Section 13.8 of the Articles provides for the removal of a director. The office of a director shall be vacated if the director (i) resigns his of her office by notice in writing delivered to the registered office of the Registrant; (ii) is convicted of an indictable offence and the other directors shall have resolved to remove the director; or (iii) ceases to be qualified to act as a director pursuant to the Company Act. Section 13.9 of the Articles provides that Canplats may by special resolution remove any director before the expiration of his period of office, and may by an ordinary resolution appoint another person in his or her stead.

Share Rights

All of the authorized shares of common stock of Canplats are of the same class and, once issued, rank equally as to dividends, voting powers, and participation in assets and in all other respects, on liquidation, dissolution or winding up of the Registrant, whether voluntary or involuntary, or any other distribution of the assets of Canplats among its shareholders for the purpose of winding up its affairs after Canplats has paid out its liabilities. The issued common shares are not subject to call or assessment rights or any pre-emptive or conversion rights. The holders of common shares are entitled to one vote for each common share on all matters to be voted on by the shareholders. There are no provisions for redemption, purchase for cancellation, surrender or purchase funds.

To change the rights of holders of stock, where such rights are attached to an issued class or series of shares, section 226 of the Company Act requires the consent by a separate resolution of the holders of the class or series of shares, as the case may be, requiring a majority of 75% of the votes cast.

Meetings

The Company Act provides that Canplats must hold an annual general meeting at least once in every calendar year and not more than 13 months after the date that the last annual general meeting was held. Canplats must give to its members entitled to receive notice of a general meeting not less than 21 days’ notice of any general meeting of the Registrant, but those members may waive or reduce the period of notice for a particular meeting by unanimous consent in writing. The Company Act requires the directors of a reporting company to provide with notice of a general meeting a form of proxy for use by every member entitled to vote at such meeting as well as an information circular containing prescribed information regarding the matter to be dealt with and conduct of the general meeting. Prior to each annual general meeting of its members the directors of Canplats must place comparative financial statements, made up to a date not more than 6 months before the annual general meeting, the report of the auditor, and the report of the directors to the members.

The Company Act provides that one or more members of a company holding not less than 5% of the issued voting shares of Canplats may give notice to the directors requiring them to call and hold a general meeting.

Limitations on Ownership of Securities

There are no limitations on the right to own securities, imposed by foreign law or by the charter or other constituent document of the Registrant.

Change in Control of Registrant

No provision of Canplats’ articles of association, charter or bylaws would have the effect of delaying, deferring, or preventing a change in control of the Registrant, and operate only with respect to a merger, acquisition or corporate restructuring of Canplats or any of its subsidiaries.

Ownership Threshold

There are no bylaw provisions governing the ownership threshold above which shareholder ownership must be disclosed.

C. Material Contracts

There are no material contracts of the Registrant, other than those mentioned herein and listed under Item 19. Exhibits of this Form 20-F, to which Canplats or any member of the group is a party, for the two years immediately preceding publication of this registration statement.

D. Exchange Controls

There is no law or government decree of regulation in Canada that restricts the export or import of capital, or that affects the remittance of dividends, interest or other payments to a non-resident holder of common shares, other than withholding tax requirements. See “E. Taxation” under this Item.

There is no limitation imposed by Canadian law or by the articles or other charter documents of Canplats on the right of a non-resident to hold or vote the common shares of the Registrant, other than as provided in the Investment Canada Act, as amended (the “Investment Act”).

The Investment Act generally prohibits implementation of a reviewable investment by an individual, government or agency thereof, corporation, partnership, trust or joint venture that is a “non-Canadian” as defined in the Investment Act (a “non-Canadian”), unless, after review the Minister responsible for the Investment Act is satisfied that the investment is likely to be of net benefit to Canada. If an investment by a non-Canadian is not a reviewable investment, it nevertheless requires the filing of a short notice which may be given at any time up to 30 days after the implementation of the investment.

An investment in common shares of Canplats by a non-Canadian that is a “WTO investor” (an individual or other entity that is a national of, or has the right of permanent residence in, a member of the World Trade Organization, current members of which include the European Community, Germany, Japan, Mexico, the United Kingdom and the United States, or a WTO investor-controlled entity, as defined in the Investment Act) would be reviewable under the Investment Act if it were an investment to acquire direct control, through a purchase of assets or voting interests, of Canplats and the value of the assets of Canplats equalled or exceeded $184 million, the threshold established for 1999, as indicated on the financial statements of Canplats for its fiscal year immediately preceding the implementation of the investment. In subsequent years, such threshold amount may be increased or decreased in accordance with the provisions of the Investment Act.

An investment in common shares of Canplats by a non-Canadian, other than a WTO investor, would be reviewable under the Investment Act if it were an investment to acquire direct control of Canplats and the value of the assets were $5.0 million or more, as indicated on the financial statements of Canplats for its fiscal year immediately preceding the implementation of the investment.

A non-Canadian, whether a WTO investor or otherwise, would acquire control of Canplats for the purposes of the Investment Act if he, she or it acquired a majority of the common chares of Canplats or acquired all or substantially all of the assets used in conjunction with Canplats ‘s business. The acquisition of less than a majority, but one-third or more of the common shares of the Registrant, would be presumed to be an acquisition of control of Canplats unless it could be established that Canplats was not controlled in fact by the acquirer through the ownership of the common shares.

The Investment Act would not apply to certain transactions in relation to common shares of the Registrant, including:

(a) an acquisition of common shares of Canplats by any person if the acquisition were made in the ordinary course of that person’s business as a trader or dealer in securities;

(b) an acquisition of control of Canplats in connection with the realization of security granted for a loan or other financial assistance and not for any purpose related to the provisions of the Investment Act; and

(c) an acquisition of control of Canplats by reason of an amalgamation, merger, consolidation or corporate reorganization following which the ultimate direct or indirect control in fact of the Registrant, through the ownership of voting interests, remains unchanged.

E. Taxation

The following is a summary of the principal Canadian federal income tax considerations, as of the date hereof, generally applicable to security holders who deal at arm’s length with the Registrant, who, for purposes of the Income Tax Act (Canada) (the “Canadian Tax Act”) and any applicable tax treaty or convention, have not been and will not be resident or deemed to be resident in Canada at any time while they have held shares of the Registrant, to whom such shares are capital property, and to whom such shares are not “taxable Canadian property” (as defined in the Canadian Tax Act). This summary does not apply to a non-resident insurer.

Generally, shares of Canplats will be considered to be capital property to a holder thereof provided that the holder does not use such shares in the course of carrying on a business or has not acquired them in one or more transactions considered to be an adventure in the nature of trade. All security holders should consult their own tax advisors as to whether, as a matter of fact, they hold shares of Canplats as capital property for the purposes of the Canadian Tax Act.

Under the current provisions of the Canadian Tax Act, one-half of capital gains (“taxable capital gains”) must be included in computing the income of a holder in the year of disposition. One-half of capital losses (“allowable capital losses”) may generally be deducted against taxable capital gains for the year of disposition subject to and in accordance with the provisions of the Canadian Tax Act.

Allowable capital losses in excess of a holder’s taxable capital gains of a taxation year may generally be carried back three years and carried forward indefinitely for deduction against taxable capital gains realized in those years, to the extent and under circumstances permitted under the Canadian Tax Act.

This discussion is based on the current provisions of the Canadian Tax Act and the regulations thereunder, the current provisions of the Canada-United States Income Tax Convention (the “Tax Treaty”) and current published administrative practices of the Canada Customs and Revenue Agency. This discussion does not take into account or anticipate any changes in law, whether by legislative, administrative or judicial decision or action, nor does it take into account provincial, territorial or foreign income tax legislation or considerations, which may differ from the Canadian federal income tax considerations described herein.

Generally, shares of Canplats will not be taxable Canadian property at a particular time provided that such shares are listed on a prescribed stock exchange (which exchanges currently include the TSX Venture Exchange), the holder does not use or hold, and is not deemed to use or hold, the shares of Canplats in connection with carrying on a business in Canada and the holder, persons with whom such holder does not deal at arm’s length, or the holder and such persons, have not owned (or had under option) 25% or more of the issued shares of any class or series of the capital stock of Canplats at any time within five years preceding the particular time.

A holder of shares of Canplats that are not taxable Canadian property will not be subject to tax under the Canadian Tax Act on the sale or other disposition of shares.

Dividends paid or deemed to be paid on the shares of Canplats are subject to non-resident withholding tax under the Canadian Tax Act at the rate of 25%, although such rate may be reduced under the provisions of an applicable income tax treaty or convention. For example, under the Tax Treaty, the rate is reduced to 5% in respect of dividends paid to a company that is the beneficial owner thereof, that is resident in the United States for purposes of the Tax Treaty and that owns at least 10% of the voting stock of the Registrant. In all other cases, the rate is reduced to 15% in respect of dividends paid to the beneficial owner thereof that is resident in the United States for purposes of the Tax Treaty.

WHILE INTENDED TO ADDRESS ALL MATERIAL CANADIAN FEDERAL INCOME TAX CONSIDERATIONS, NO OPINION WAS REQUESTED BY THE REGISTRANT, OR IS PROVIDED BY ITS LEGAL COUNSEL AND/OR AUDITORS. ADDITIONALLY, THIS SUMMARY DOES NOT CONSIDER THE EFFECTS OF UNITED STATES FEDERAL, STATE, LOCAL OR FOREIGN INCOME TAX CONSEQUENCES.

F. Dividends and Paying Agents

This Form 20-F is being filed as an annual report under the Exchange Act, and, as such, there is no requirement to provide any information under this item.

G. Statement by Experts

This Form 20-F is being filed as an annual report under the Exchange Act, and, as such, there is no requirement to provide any information under this item.

H. Documents on Display

The documents described herein may be inspected at the head office of Registrant at Suite 1180 — 999 West Hastings Street, Vancouver, British Columbia, Canada V6C 2W2, during normal business hours.

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

As of October 31, 2002, there were no share purchase warrants outstanding to purchase common stock of the Registrant.

PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

Not applicable

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

Not applicable

ITEM 15. CONTROLS AND PROCEDURES

Not applicable

ITEM 16. RESERVED

Not applicable

PART III

ITEM 17. FINANCIAL STATEMENTS

The financial statements were prepared in accordance with Canadian GAAP and are presented in Canadian dollars. There are material differences between United States and Canadian GAAP. A reconciliation of the financial statements to United States GAAP is set forth in Note 13 of the notes to the financial statements.

The financial statements are in the following order:

1. Auditors’ Report;
2. Balance Sheets;
3. Statements of Loss and Deficit;
4. Statements of Cash Flows’
5. Statements of Changes in Shareholders’ Equity; and
6. Notes to the Financial Statements.

BEAUCHAMP & COMPANY
CHARTERED ACCOUNTANTS
#205 – 788 BEATTY STREET
VANCOUVER, B.C.
V6B 2M1
PHONE: 604-688-2850
FAX: 604-688-2777

AUDITORS’ REPORT

To the Shareholders of
Canplats Resources Corporation

We have audited the balance sheets of Canplats Resources Corporation as at July 31, 2002 and 2001 and the statements of loss and deficit, cash flows and changes in shareholders’ equity for the years then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audits in accordance with generally accepted auditing standards in Canada and the United States. Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.

In our opinion, these financial statements present fairly, in all material respects, the financial position of the Company as at July 31, 2002 and 2001 and the results of its operations and its cash flows for the years then ended in accordance with Canadian generally accepted accounting principles. As required by the Company Act of British Columbia, we report that, in our opinion, these principles have been applied on a consistent basis.

Canadian generally accepted accounting principles vary in certain significant respects from United States generally accepted accounting principles and practices. Application of United States generally accepted accounting principles and practices would have affected the results of operations for the year ended July 31, 2002 and the assets and shareholders’ equity as at July 31, 2002 to the extent summarized in note 13 to the financial statements.

"Beauchamp & Company"

Vancouver, Canada

October 23, 2002

Chartered Accountants

BEAUCHAMP & COMPANY
CHARTERED ACCOUNTANTS
#205 – 788 BEATTY STREET
VANCOUVER, B.C.
V6B 2M1
PHONE: 604-688-2850
FAX: 604-688-2777

COMMENTS BY AUDITORS FOR U.S. READERS
ON CANADA-U.S. REPORTING CONFLICT

In the United States, reporting standards for auditors require the addition of an explanatory paragraph (following the opinion paragraph) when the financial statements are affected by significant uncertainties and contingencies such as those referred to in note 1 to these financial statements. Our report to the shareholders dated October 23, 2002 is expressed in accordance with Canadian reporting standards which do not permit a reference to such matters in the auditors’ report when the uncertainties are adequately disclosed in the financial statements.

"Beauchamp & Company"

Vancouver, Canada

October 23, 2002

Chartered Accountants

BALANCE SHEETS

As at July 31



                                                                          2002              2001
                                                                            $                 $
- --------------------------------------------------------------------------------------------------

ASSETS
Current
Cash                                                                     35,246           183,331
Restricted cash [note 4]                                                107,607               -
Receivables                                                               6,019            13,264
Due from related parties [note 9]                                        10,988               232
Prepaid expense                                                             604             3,616
- --------------------------------------------------------------------------------------------------
Total current assets                                                    160,464           200,443

Mineral properties [note 3]                                           1,478,254           986,469
- --------------------------------------------------------------------------------------------------
Total Assets                                                          1,638,718         1,186,912
- --------------------------------------------------------------------------------------------------

LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities                                 25,359            30,960
Due to related parties [note 9]                                          30,539            26,528
- --------------------------------------------------------------------------------------------------
Total liabilities                                                        55,898            57,488
- --------------------------------------------------------------------------------------------------

Shareholders' equity
Share capital [note 5]                                                8,125,636         7,566,941
Deposits on share subscriptions [note 5]                                106,000               -
- --------------------------------------------------------------------------------------------------
                                                                      8,231,636         7,566,941

Deficit                                                              (6,648,816)       (6,437,517)
- --------------------------------------------------------------------------------------------------
Total shareholders' equity                                            1,582,820         1,129,424
- --------------------------------------------------------------------------------------------------
                                                                      1,638,718         1,186,912
- --------------------------------------------------------------------------------------------------


On behalf of the Board:




"R.E.Gordon Davis"                                            "James Tutton"

R.E. Gordon Davis, Director                                   James W. Tutton, Director

         The accompanying notes are an integral part of the financial statements.

                                                    STATEMENTS OF LOSS AND DEFICIT


Years ended July 31


                                                                         2002             2001               2000
                                                                                                               $
                                                                     $                $
  ------------------------------------------------------------------------------------------------------------------


  Expenses
  Bank charges                                                              600               391              272
  Consulting                                                                -              17,278           12,800
  General exploration                                                     3,533               -              6,771
  Insurance                                                               6,315               634              -
  Investor relations                                                     15,172            19,364            1,279
  Legal, accounting and audit                                             7,005            17,815            8,763
  Listing and filing fees                                                 8,683             3,625            1,545
  Management administration fee [note 8]                                 23,500            10,200              -
  Office                                                                  3,455            17,156            7,653
  Rent [note 8]                                                          14,500            18,000              -
  Salaries                                                               38,738            50,022            1,646
  Shareholder relations                                                  14,240            16,918              -
  Telephone                                                                 118             3,251              359
  Travel and accommodation                                                  -               3,801           10,585
  Transfer agents                                                        15,692             6,898              -
  ------------------------------------------------------------------------------------------------------------------
                                                                       (151,551)         (185,353)         (51,673)
  ------------------------------------------------------------------------------------------------------------------

  Other income (expenses)
  Interest income                                                         1,636             6,419            2,088
  Gain on debt settlement                                                   -               1,700           13,874
  Write-off of investment in Colby Gold PLC                                 -                 -                 (1)
  Write-off of mineral properties [note 3]                              (61,384)          (23,771)         (79,412)
                                                              ------------------------------------------------------
  ------------------------------------------------------------------------------------------------------------------
                                                                        (59,748)          (15,652)         (63,451)
  ------------------------------------------------------------------------------------------------------------------

  Loss for the year                                                    (211,299)         (201,005)        (115,124)

  Deficit, beginning of the year                                     (6,437,517)       (6,236,512)      (6,121,388)
  ------------------------------------------------------------------------------------------------------------------
  Deficit, end of the year                                           (6,648,816)       (6,437,517)      (6,236,512)
  ------------------------------------------------------------------------------------------------------------------

  Weighted average number of issued shares                            9,202,413         3,062,700        1,111,303
  ------------------------------------------------------------------------------------------------------------------

  Basic loss per share                                                     0.02              0.06             0.10
  ------------------------------------------------------------------------------------------------------------------

                                                       STATEMENTS OF CASH FLOWS


Years ended July 31



                                                                         2002             2001               2000
                                                                            $                 $                $
- --------------------------------------------------------------------------------------------------------------------

OPERATING ACTIVITIES
Loss for the year                                                      (211,299)         (201,005)        (115,124)
Non-cash items:
   Gain on debt settlement                                                  -                 -            (13,874)
   Write-off of mineral properties                                       61,384            23,771           79,412
    Write-off of investment in Colby Gold PLC                               -                 -                  1
- --------------------------------------------------------------------------------------------------------------------
                                                                       (149,915)         (177,234)         (49,585)
Net change in non-cash working capital items:
   Amounts receivable and prepaid expenses                               10,257             5,164          (19,101)
   Due from related parties                                             (10,756)            4,194           (3,267)
   Accounts payable and accrued liabilities                              (5,601)           (2,366)         (40,803)
   Due to related parties                                                 4,011             9,300         (342,314)
- --------------------------------------------------------------------------------------------------------------------
Cash used in operating activities                                      (152,004)         (160,942)        (455,070)
- --------------------------------------------------------------------------------------------------------------------

INVESTING ACTIVITIES
Mineral property costs                                                 (516,669)         (541,618)        (360,952)
- --------------------------------------------------------------------------------------------------------------------
Cash used in investing activities                                      (516,669)         (541,618)        (360,952)
- --------------------------------------------------------------------------------------------------------------------

FINANCING ACTIVITIES
Special warrants for cash                                                   -                 -            937,750
Shares issued for cash                                                  523,500         1,000,000              -
Deposits on share subscriptions                                         106,000
Deferred financing costs                                                 (1,305)         (208,196)         (27,960)
- --------------------------------------------------------------------------------------------------------------------
Cash provided by financing activities                                   628,195           791,804          909,790
- --------------------------------------------------------------------------------------------------------------------

Increase (decrease) in cash                                             (40,478)           89,244           93,768

Cash, beginning of year                                                 183,331            94,087              319
- --------------------------------------------------------------------------------------------------------------------
Cash, end of the year                                                   142,853           183,331           94,087
- --------------------------------------------------------------------------------------------------------------------

Supplemental cash flow information:

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

Non-cash financing activities
Shares issued for mineral property acquisitions                          36,500             6,250              -
- --------------------------------------------------------------------------------------------------------------------


                              The accompanying notes are an integral part of the financial statements.

                                             STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY


                                              Common Stock
                                                                         Special                  otal Shareholders'
                                                          Amount         Warrants       Deficit  Tquity (Deficiency)
                                    Number of Shares        $                   $             $  E        $
- ----------------------------------------------------------------------------------------------------------------------


Balance at July 31, 1999                   1,111,303       5,859,097            -      (6,121,388)       (262,291)

Issued by private placements

   Series "A" Special Warrants                  -                -           400,000        -             400,000

   Series "B" Special Warrants                  -                -           242,500        -             242,500

   Series "C" Special Warrants                  -                -           295,250        -             295,250

Loss for the year                               -                -             -         (115,124)       (115,124)
- ----------------------------------------------------------------------------------------------------------------------

Balance at July 31, 2000                   1,111,303        5,859,097        937,750   (6,236,512)        560,335

Conversion of special warrants

   Series "A" Special Warrants             1,600,000          400,000       (400,000)       -                -

   Series "B" Special Warrants               970,000          242,500       (242,500)       -                -

   Series "C" Special Warrants             1,181,000          295,250       (295,250)       -                -

For cash                                   2,500,000        1,000,000          -            -           1,000,000

For mineral properties                        25,000            6,250          -            -               6,250

Share issue costs                               -            (236,156)         -            -            (236,156)

Loss for the year                               -                -             -         (201,005)       (201,005)
- ----------------------------------------------------------------------------------------------------------------------

Balance at July 31, 2001                   7,387,303        7,566,941          -       (6,437,517)      1,129,424

For cash                                   2,655,000          523,500          -            -             523,500

For mineral properties                       175,000           36,500          -            -              36,500

Deposits on share subscriptions                 -             106,000          -            -             106,000

Share issue costs                               -              (1,305)         -            -              (1,305)

Loss for the year                               -                 -            -         (211,299)       (211,299)
- ----------------------------------------------------------------------------------------------------------------------

Balance at July 31, 2002                  10,217,303        8,231,636          -       (6,648,816)      1,582,820
- ----------------------------------------------------------------------------------------------------------------------

1. NATURE AND CONTINUANCE OF OPERATIONS

The Company was incorporated under the laws of the Province of British Columbia, Canada on February 15, 1967. Effective October 14, 1999, the Company changed its name from Colby Resources Corp. to International Colby Resources Corp. Effective March 15, 2000, the Company changed its name from International Colby Resources Corp. to Canplats Resources Corporation.

The Company is in the process of acquiring, exploring and developing platinum group mineral properties. The Company will attempt to bring the properties to production, structure joint ventures with others, option or lease properties to third parties, or sell the properties outright. The Company has not determined whether these properties contain ore reserves that are economically recoverable and the Company is considered to be in the exploration stage.

These financial statements have been prepared assuming the Company will continue on a going-concern basis. Management has estimated that the Company will have adequate funds from existing working capital and additional financings to meet its corporate administrative and property obligations for the coming year. If the Company is to advance or develop its mineral properties further, it will be necessary to obtain additional financing and while it has been successful in the past, there can be no assurance that it will be able to do so in the future.

The recoverability of the amounts shown for mineral properties and related deferred costs is dependent upon the existence of economically recoverable reserves, securing and maintaining title and beneficial interest in the properties, the ability of the Company to obtain necessary financing to complete the development, and upon future profitable production. The amounts shown as deferred expenditures and property acquisition costs represent net costs to date, less amounts amortized and/or written off, and do not necessarily represent present or future values.

2. SIGNIFICANT ACCOUNTING POLICIES

Generally accepted accounting principles

These financial statements have been prepared in accordance with Canadian generally accepted accounting principles (Canadian GAAP). The significant measurement differences between those principles and those that would be applied under U.S. generally accepted accounting principles (U.S. GAAP), as they affect the Company, are disclosed in note 13.

Use of estimates

The preparation of financial statements in conformity with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenditures during the reporting period. Actual results could differ from those reported.

Mineral properties

The Company capitalizes the cost of acquiring mineral claims and exploration costs which are directly related to specific mineral claims until such time as the extent of the mineralization has been determined and the mineral claims are either developed, abandoned or allowed to expire.

If a claim is abandoned or if it is determined that its value is less than the book value, the accumulated mineral property and vested deferred exploration costs are written off in the year of abandonment or impairment in value. Once a property reaches commercial production, mineral property and deferred exploration costs will be amortized against production revenues.

Mineral claim option receipts received by the Company upon sale of an interest in a mining property would be considered as a recovery of costs and be recorded as a reduction of the deferred exploration costs on a property-by-property basis.

The amounts shown for acquisition of mineral claims and deferred exploration represent costs spent to date and do not necessarily reflect present or future values.

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Flow-through shares

The Company has issued flow-through shares to finance some of its exploration activities. Such shares were issued for cash in exchange for the Company giving up the tax benefits arising from the exploration expenditures. The amount of these tax benefits is renounced to investors in accordance with the Canadian tax legislation. The Company records such share issuances by crediting share capital for the full value of cash consideration received.

Deferred financing costs

The costs of the prospectus preparation for legal, accounting, filing and sponsorship were initially deferred. These costs were charged against share capital when the shares were issued in March 2001.

Income taxes

The Company follows the asset and liability method of accounting for income taxes in accordance with the recent recommendations of the Canadian Institute of Chartered Accountants. Under this method, future income taxes are recognized for the future income tax consequences attributable to differences between the financial statement carrying values and their respective income tax bases (temporary differences). Future income tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which temporary differences are expected to be recovered or settled. The effect on future income tax assets and liabilities of a change in tax rates in included in income in the period in which the change occurs. The amount of future income tax assets recognized is limited to the amount that is more likely than not to be realized.

Stock-based compensation

The Company grants stock options to executive officers and directors, employees and consultants pursuant to a stock option plan described in note 6. Effective January 1, 2002, the company adopted the recommendations of the new Canadian Institute of Chartered Accountants’ handbook section 3870, Stock-Based Compensation and Other Stock-Based Payments. This section establishes standards for the recognition, measurement and disclosure of stock-based compensation and other stock-based payments made in exchange for goods and services. The standard requires that all stock-based awards made to non-employees be measured and recognized using a fair value based method. The standard encourages the use of a fair value based method for direct awards of stock, stock appreciation rights, and awards that call for settlement in cash or other assets. Awards that a company has the ability to settle in stock are recorded as equity.

The Company has elected to adopt the intrinsic value method, which recognizes compensation cost for awards to employees only when the market price exceeds the exercise price at date of grant, but requires pro-forma disclosure of earnings and earnings per share as if the fair value method had been adopted. Any consideration paid by the option holders to purchase shares is credited to share capital. There is no effect on the financial statements of either the current period or prior period presented.

Loss per share

Basic income/loss per common share is calculated using the weighted average number of common shares issued and outstanding during each period. Diluted income/loss per share is calculated using the new Canadian Institute of Chartered Accountants treasury stock method. It assumes that the proceeds from the exercise of options or warrants would be used to purchase common shares at the average market price during the period. The new standard has been applied on a retroactive basis and had no impact on the amounts presented.

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Foreign currency translation

Transactions recorded in United States dollars are translated as follows:

o   Monetary assets and liabilities at the rate prevailing at the balance sheet date
o   Non-monetary assets and liabilities at historic rates
o   Income and expenses at the actual rate of exchange in effect on the date of the transaction

Exchange gains or losses are recorded in the statements of operations and deficit.

Effective January 1, 2002 the company adopted the revised recommendations of the Canadian Institute of Chartered Accountants for the translation of foreign currencies. Foreign exchange gains and losses for long-term debt not associated with self-sustaining foreign operations are no longer deferred and amortized over the term of the debt, but charged to earnings in the period they arise. There were no unamortized foreign exchange losses on long-term debt as at December 31, 2001 and consequently no adjustment to reduce opening retained earnings was necessary.

Environmental protection and rehabilitation costs

Liabilities related to environmental protection and rehabilitation costs are accrued and charged to income when their likelihood of occurrence is established. This includes future removal and site restoration costs as required due to environmental law or contracts.

3.MINERAL PROPERTY COSTS

The Company's properties are located in Ontario in the Thunder Bay Mining Division, Voltaire and Nipigon Lake areas.
                                                Voltaire  Black                                   Other
                  Grand Bay  Geikie     Posh    Johnspine Sturgeon   Tartan    Stucco    Mikinak  Properties  Total
                      $         $         $         $         $         $         $         $         $         $
Balance   -  July
31, 2000
                     34,385    73,779    75,489   128,773  42,821       6,480    32,942    10,621    57,082   462,372
- ----------------------------------------------------------------------------------------------------------------------

Acquisition costs
                     15,000    10,850         -    43,722     -       (5,000)         -     4,000     4,384    72,956
- ----------------------------------------------------------------------------------------------------------------------
Aircraft
                          -         -         -     3,000     -             -         -         -         -     3,000
Assays
                         51        77        81       159    34             -        26         -         -       428
Consulting
                      2,407     3,570     3,806     7,533   1,587           -     1,190        55         -    20,148
Drafting
                        132       792       467     2,321    176          108       176        88       220     4,480
Drilling
                          -         -         -    57,314         -         -         -         -         -    57,314
Geology
                      3,522    12,514     1,814    22,086   2,177         288     1,217       320     1,315    45,253
Geophysics
                     21,288    51,027    30,778    69,462  26,574       8,386       679    16,524         -   224,718
Labour
                          -     3,600         -         -         -         -         -         -         -     3,600
Line cutting
                      6,202    21,923    10,239    22,415         -    16,298         -     4,591         -    81,668
Living costs
                        693       443         -     1,436         -         -        59         -         -     2,631
Metallurgical
                        257     6,177         -     2,444         -         -         -         -         -     8,878
Office
expense-field           752     1,654     1,123     2,692    442            -       373        74       689     7,799
Prospecting
                      1,000     2,425     1,000     2,545         -         -       100         -         -     7,070
Storage
                        387       580       612     1,192    258            -       193         -         -     3,222
Travel                  631
                                1,114         -     2,711    180            -        67         -         -     4,703
- ----------------------------------------------------------------------------------------------------------------------
Exploration
costs  for
the year             37,322    105,896    49,920   197,310  31,428      25,080     4,080    21,652     2,224   474,912
- ----------------------------------------------------------------------------------------------------------------------
Costs     written
off   during  the
year                      -         -         -         -         -         -         -         -  (23,771)  (23,771)
- ----------------------------------------------------------------------------------------------------------------------
Balance   -  July
31, 2001
                     86,707   190,525   125,409   369,805    74,249    26,560    37,022    36,273    39,919   986,469
- ----------------------------------------------------------------------------------------------------------------------
Acquisition
costs
for the period            -    12,500         -       650         -         -  (28,850)   (4,200)    24,000     4,100
- ----------------------------------------------------------------------------------------------------------------------
Aircraft
                          -         -         -         -         -         -         -     2,413         -     2,413
Assaying
                      7,549    20,532     4,224     7,671     3,321         -       840     4,214         -    48,351
Consulting
                          -     1,267         -     1,500         -       680         -         -         -     3,447
Drafting
                      1,661     3,390     1,517     1,881       440         -       132       682         -     9,703
Drilling
                     27,903    49,731    14,235    69,199         -         -         -         -         -   161,068
Geochemistry
                      1,874         -         -         -     2,276         -         -     2,502         -     6,652
Geology
                     21,367    16,721    12,627    27,750     1,340         -       640     2,234       356    83,035
Geophysics                     26,206              41,476                                  13,294
                     28,913               2,500               5,382         -         -               1,795   119,566
Government fees
                         88       263         -       162         -         -        39         -        65       617
Equipment
                          -     7,913     2,325    22,793         -         -         -         -         -    33,031
Labour
                      1,846     3,788     1,461    11,024         -         -         -         -         -    18,119
Line cutting                                                                                                   25,132
                      2,866    10,224         -         -     5,971         -         -     6,071         -
Living costs
                      2,283     5,433     3,075     2,450         -         -       449         -       289    13,979
Metallurgical
                        781         -         -         -         -         -         -         -         -       781
Office
expense-field         1,043     3,621     2,473     2,019       179         -        94       179       133     9,741
Prospecting
                        325     3,675     1,400         -         -         -       325         -         -     5,725
Storage
                      1,359     2,758       846     1,829         -         -         -         -       408     7,200
Travel
                      3,226     9,354     1,992     6,911         -         -       146         -         -    21,629
Joint venture
   recoveries
                          -         -         -         -         -         -         -  (21,120)         -  (21,120)
- ----------------------------------------------------------------------------------------------------------------------
Exploration
costs   for   the   103,084   164,876             196,665                                  10,469
year                                     48,675              18,909       680     2,665               3,046   549,069
- ----------------------------------------------------------------------------------------------------------------------
Costs     written
off   during  the         -
year                                -         -         -         -  (27,240)         -         -  (34,144)  (61,384)
- ----------------------------------------------------------------------------------------------------------------------
Balance   -  July
31, 2002
                    189,791   367,901   174,084   567,120    93,158         -    10,837    42,542    32,821 1,478,254
- ----------------------------------------------------------------------------------------------------------------------

3. MINERAL PROPERTY COSTS (continued)

PRINCIPAL PROPERTIES

Grand Bay

The Company has an option to acquire from Canadian Golden Dragon Resources Ltd. up to a 75% interest in 5 mineral claims (76 units) by paying Golden Dragon $26,000 (paid) over two years and spending a total of $500,000 in exploration by June 30, 2003. The property is subject to a 1% net smelter return (“NSR”) which the Company can purchase for $500,000.

Geikie

The Company has an agreement to acquire a 100% interest in 7 mineral claims (108 units) near Cheeseman and Kitchen Lake area, by an initial cash payment of $10,000 (paid) and the requirement to issue a total of 100,000 common shares in four equal installments of 25,000 shares in six month intervals (notes 5 and 14), and the granting of a 1% NSR which may be repurchased by the Company for $500,000. An additional 27 mineral claims (381 units) have been staked, of which 19 mineral claims (274 units) remain.

Posh

The Company has an option to acquire from East West Resource Corporation (“East West”), a related company by one common director, up to a 75% interest in 7 mineral claims (112 units) near Cheeseman Lake, Circle Lake, and Lunch Creek area by making a total of $30,000 in cash payments (paid) and spending a total of $500,000 in exploration expenditures by June 30, 2003. A 1% NSR in the property can be purchased for $500,000. An additional 8 mineral claims (105 units) have been staked by the Company, of which 1 mineral claim (16 units) remain.

Voltaire-Johnspine

The 100%-owned Voltaire-Johnspine Property is comprised of five adjacent claim blocks that have been merged together: Voltaire, Johnspine, Gull River, Mount Lake and Chief Bay. The Voltaire-Johnspine Property consists of 62 mineral claims (815 units) covering an area of approximately 13,622 hectares and is located approximately 5 km southwest of the Gull River Indian Reservation and 65 km north of the Lac des Iles mine. The property is traversed by Highway 527 that links Thunder Bay, Ontario to Armstrong, Ontario.

Black Sturgeon

The Company has a 100% interest in the 4 mineral claims (64 units).

Tartan

The Company has a 100% interest in the 4 mineral claims (56 units). In fiscal 2002 the Company entered into an option agreement with Red Star Resource Corp. under which Red Star could earn a 50% interest. The claims were allowed to lapse in fiscal 2002 and all costs associated with the property were written off.

Stucco

The Company has a 100% interest in the Stucco property consisting of 23 mineral claims (314 units) located in the Thunder Bay Mining Division of Ontario. As part of the 314 claim unit property, a 16 unit claim has been purchased subject to the issuance of 50,000 common shares in three installments over 18 months. The vendors retain a 2% NSR of which 1% may be purchased for $1,000,000 and the remaining 1% may be purchased on a right of first refusal basis. In fiscal 2002 the Company signed an option agreement with Platinum Group Metals Ltd. whereby Platinum Group Metals can earn up to a 60% interest in the Stucco property. Under the terms of the agreement, Platinum Group Metals can earn a 51% interest in the property through cash payments totalling $65,000 and exploration and development expenditures of $1,000,000 over four years.

Mikinak

The Company has an option to acquire from East West up to a 50% interest in 11 mineral claims (163 units) by funding $20,000 of assessment work and option payments. The Company will be the operator. The property is subject to a 2% NSR of which 0.8% can be purchased for $800,000 and the balance of the royalty on which the companies have a first right of refusal if sold. In fiscal 2002 the Company entered into an option/joint venture agreement with Teck Cominco Limited. Under the terms of the agreement, Teck may earn a 51% interest through cash payments totalling $100,000 and by spending exploration and development expenditures of $750,000 over four years. An additional 9% may be earned by spending another $1,500,000 over two years. An additional 3 mineral claims (17 units) have been staked. Subsequent to fiscal 2002, Teck Cominco gave notice that it as terminating the agreement (note 14).

OTHER PROPERTIES

Awl Lake

The Company acquired 5 mineral claims (80 units) located in the Obonga Lake area, Thunder Bay Mining Division, by paying $3,000 (paid) and issuing 100,000 common shares (issued).

Plateau Lake

The Company acquired by staking 13 mineral claims (94 units), which it owns 50/50 with East West and which is optioned to Prism Resources Inc., a company in which a director and president is also a director of the Company, whereby Prism can earn up to a 60% interest by paying $4,500 by June 25, 2001 (paid) and incur $436,000 in exploration costs by June 25, 2003. A total of 4 mineral claims (52 units) are remaining.

North Fintry

The Company has a 100% interest in 4 mineral claims (48 units). In fiscal 2002 all costs associated with the property were written off.

Circle Lake

The Company had a 100% interest in 15 mineral claims (196 units). The claims were allowed to lapse in fiscal 2002 and all costs associated with the property were written off.

Boomer Lake

The Company had a 100% interest in 10 mineral claims (123 units). The claims were allowed to lapse in fiscal 2002 and all costs associated with the property were written off.

4. RESTRICTED CASH

During the year ending July 31, 2002 the Company raised a total of $501,000 in proceeds from the private placement of 2,505,000 flow-through common shares. A further $81,000 was received as deposits on share subscriptions for flow-through common shares. These proceeds can only be used on exploration of Canadian mineral properties and the tax benefits flow through to the subscribers. As of July 31, 2002, the unspent cash balance was $107,607.

5.SHARE CAPITAL

Authorized
100,000,000 common shares without par value.

[a]  The Company had the following shares issued and outstanding:

                                                                            Number of
                                                                             Shares              $
           ----------------------------------------------------------------------------------------------
                    Balance, July 31, 2000                                  1,111,303        5,859,097
                    For cash:
                       Initial public offering (c)                          2,500,000         1,000,000
                       Series "A" Special Warrants (b)                      1,600,000           400,000
                       Series "B" Special Warrants (b)                        970,000           242,500
                       Series "C" Special Warrants (b)                      1,181,000           295,250
                       For mineral properties (note 3)                         25,000             6,250
                       Share issue costs                                         -             (236,156)
           ----------------------------------------------------------- ---------------- -----------------
                   Balance, July 31, 2001                                   7,387,303         7,566,941
                    For cash:
                       Private placements (d)                                 150,000            22,500
                       Private placements - flow-through (d)                2,505,000           501,000
                    For mineral properties (note 3)                           175,000            36,500
                    Share issue costs                                            -              (1,305)
                    Deposits on share subscriptions (e)                          -              106,000
           ----------------------------------------------------------- ---------------- -----------------
                   Balance, July 31, 2002                                  10,217,303         8,231,636
           ----------------------------------------------------------- ---------------- -----------------

        As at July 31, 2002, the Company had 138,000 (2001 – 207,000) shares subject to escrow agreements.

[b] The Company has issued 1,600,000 Series “A” Special Warrants at $0.25 per Special Warrant, exchangeable into 1,600,000 common shares and 970,000 Series “B” Special Warrants, 770,000 of which are flow-through warrants and 200,000 non-flow-through warrants, exchangeable into 970,000 common shares and 970,000 warrants whereby each warrant can be exercised to acquire one share at $0.25 in the first year and at $0.30 in the second year. The Company received proceeds for 1,181,000 Series “C” Special Warrants, exchangeable into 1,181,000 common shares and 1,181,000 warrants whereby each warrant can be exercised to acquire one share at $0.25 for one share in the first year and $0.30 in the second year. The Series “C” Special Warrants did not close until September 30, 2000. The warrants all expired on September 30, 2002.

[c] The Company completed its initial public offering in March 2001 on the Canadian Venture Exchange by issuing to the public 2,500,000 units at a price of $0.40 per unit, to net the Company $763,844 after commissions, legal and sponsorship fees of $236,156. Each unit sold is comprised of one common share and one half of one non-transferable share purchase warrant. One whole warrant will entitle the holder to purchase one additional common share, exercisable at $0.50 per share, until March 19, 2002. The listing of the Company’s shares qualified the issuance of 3,751,000 shares and 2,151,000 share purchase warrants, which were issued pursuant to previously issued Series “A”, Series “B” and Series “C” special warrants. The warrants all expired on September 30, 2002.

The Company’s agents were granted non-transferable share purchase warrants with the same exercise terms as the share purchase warrants, entitling them to purchase 500,000 common shares of the Company. The warrants expired on March 21, 2002.

[d] During the year ending July 31, 2002 the Company issued, in three separate private placements, a total of 2,505,000 flow-through common shares at $0.20 per share and 150,000 common shares at $0.15 per share.

[e] In July 2002 the Company announced it was planning a private placement and in early August 2002 it closed on the private placement consisting of 790,000 shares consisting of 540,000 flow-through shares at $0.15 per share and 250,000 common shares at $0.10 per share. Total proceeds of $106,000 ($81,000 relating to flow-through shares and $25,000 relating to common shares) were received prior to year-end with the shares issued on August 2, 2002.

6. STOCK OPTIONS

The Company follows the policies of the TSX Venture Exchange under which it is authorized to grant options to executive officers and directors, employees and consultants, enabling them to acquire up to 10% of the issued and outstanding common stock of the Company. The exercise price of each option equals the closing market price of the Company’s stock as calculated on the date immediately preceding the grant. The options can be granted for a maximum term of 5 years.

Stock options issued to officers, employees and directors are as follows:

                                                       2002                                  2001
          -----------------------------------------------------------------------------------------------
                                                     Weighted                              Weighted
                                                      Average                              Average
                                                     Exercise                              Exercise
                                      Number           Price           Number               Price
                                     of Shares           $            of Shares               $
          -----------------------------------------------------------------------------------------------

          Options outstanding
              at August 1            1,040,000         0.50               -                   -
          Granted                        -               -              1,040,000            0.50
          -----------------------------------------------------------------------------------------------

          Options outstanding
          and exercisable
             at July 31              1,040,000         0.50             1,040,000            0.50
          -----------------------------------------------------------------------------------------------

The expiry date on all options is April 4, 2004.

7. WARRANTS

Warrants issued are as follows:

                                                       2002                                  2001
          -----------------------------------------------------------------------------------------------
                                                     Weighted                              Weighted
                                                      Average                              Average
                                                     Exercise                              Exercise
                                      Number           Price           Number               Price
                                     of Shares           $            of Shares               $
          -----------------------------------------------------------------------------------------------
          Warrants outstanding
              at August 1            3,901,000         0.37               -                   -
          Issued                         -               -            3,901,000              0.37
          Exercised                      -               -                -                   -
          Expired                    (500,000)         0.50               -                   -
          -----------------------------------------------------------------------------------------------
          Warrants outstanding       3,401,000         0.37           3,901,000              0.37
             at July 31
          -----------------------------------------------------------------------------------------------

        During the year the expiry dates for the 970,000 Series “B” warrants and 1,250,000 of the 1,750,000 warrants issued with the initial public offering were extended to September 30, 2002. Subsequent to year-end all remaining warrants expired unexercised.

The following table summarizes information on warrants outstanding at July 31, 2002.

                                                Number of           Exercise

                                                                                        Expiry
                                                  Shares             Price               Date
          -----------------------------------------------------------------------------------------------
          Series “B”                                 970,000         $0.30        September 30, 2002
          Series “C”                               1,181,000         $0.30        September 30, 2002
          Initial public offering                  1,250,000         $0.50        September 30, 2002
          -----------------------------------------------------------------------------------------------
                                                   3,401,000
          -----------------------------------------------------------------------------------------------

8. COMMITMENTS

Effective April 1, 2001, the Company entered into a Management Services Agreement with Silver Standard Resources Inc., a company in which two directors are also directors of the Company. The agreement is for a term of 24 months and may be extended by agreement of the parties. Under the agreement, Silver Standard provides general corporate management, administrative and technical services for the Company. For personnel, hourly rates charged are based on direct costs plus a factor of 30% for benefits. For overhead costs, office equipment usage and management services personnel, which cannot reasonably be allocated to time spent on behalf of the Company, the management fee was $2,600 per month. An additional $1,500 per month was charged for office space and furnishings used by the Company. On January 1, 2002 the management fee was reduced to $1,500 per month and the amount charged for office space and furnishings was reduced to $1,000 per month.

9. RELATED PARTY TRANSACTIONS

[a]     The Company entered into the following transactions with related parties:

{i} Paid or accrued $185,529 (2001 — $126,946) in geological support, management and administration expenses from Silver Standard Resources Inc., a company in which two directors are also directors of the Company (note 8).

{ii} The Company has entered into mineral property option agreements and share an exploration office with East West (note 3), a company that has one director who is also a director of the Company. The Company paid or accrued $28,472 (2001 — $22,574) to East West for the share of the exploration office. The Company received or accrued $22,598 (2001 — $Nil) from East West’s share of the mineral property option agreements.

{iii} The Company has entered into a mineral property option agreement with Prism Resources Inc. relating to the Plateau Lake property [note 3], a company whose president and director is also a director of the Company. In fiscal 2002 the Company received $Nil (2001 – $2,250) from Prism.

{iv} In fiscal 2002 the Company acquired the Awl Lake mineral property from a company that is controlled by a major shareholder of the Company (note 3). The consideration paid was $3,000 in cash and the issuance of 100,000 common shares with value of $20,000.

[b]     Included in amounts receivables and payables at July 31, 2002 are the following:

             {i}        $10,988 (2001 — $232) due from East West

             {ii}        $30,539 (2001 — $26,528) payable to Silver Standard.

10.  INCOME TAXES

As at July 31, 2002, the Company had available for deduction against future taxable income, net loss carryforwards of approximately $701,000 (2001 — $508,000). These losses, if unutilized, expire from 2003 and 2009. Subject to certain restrictions, the Company has further resource development, exploration and finance expenses totalling approximately $4,654,000 (2001 — $4,644,000) available to reduce taxable income in future years with no fixed expiry date. The net loss carryforwards resulted from regular operating losses in prior years.

Future income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s future tax assets as of July 31 are as follows:

                                                                                        2002                2001
                                                                                $                    $
          -----------------------------------------------------------------------------------------------------------

          Long term future tax assets:
             Non capital loss carryforwards                                         277,700             227,600
             Book amortization in excess of tax CCA and resource claims           1,204,400           1,547,900
             Finance charges                                                         56,500              84,300
          -----------------------------------------------------------------------------------------------------------
             Total future tax assets                                              1,538,600           1,859,800
             Less:  Valuation allowance for future tax assets                    (1,538,600)
                                                                                                     (1,859,800)
          -----------------------------------------------------------------------------------------------------------
             Net future tax assets                                                    -                     -
          -----------------------------------------------------------------------------------------------------------

The potential income tax benefit of these losses and tax pool balances have been offset by a valuation allowance.

A reconciliation of income tax attributable to continuing operations computed at the statutory tax rates to income tax expense (recovery) is as follows:

                                                                                        2002                2001
                                                                                          $                   $
          -----------------------------------------------------------------------------------------------------------

          Loss before taxes                                                         (211,299)          (201,005)
          -----------------------------------------------------------------------------------------------------------
             Income taxes at statutory rates of 39.6% (2001 - 44.6%)                 (83,700)           (89,700)
             Non deductible expenses and adjustment for income tax                     7,100            (10,500)
             Unrecognized benefit of net operating losses carried forward             76,600            100,200
          -----------------------------------------------------------------------------------------------------------
                                                                                           -                   -
          -----------------------------------------------------------------------------------------------------------

11.  SEGMENTED INFORMATION

The Company operates in one industry segment in Canada – the exploration and development of mineral properties. Mineral property expenditures by property are detailed in note 3.

12.  FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company’s financial instruments consist of cash, receivables, accounts payable and accrued liabilities. The estimated fair values of the Company’s financial instruments approximate their book value as the amounts are short-term in nature.

13.  DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN CANADA AND THE UNITED STATES

These financial statements have been prepared in accordance with Canadian generally accepted accounting principles (“Canadian GAAP”) which differ in certain material respects from United States generally accepted accounting principles and practices (“U.S. GAAP”).

[a]       Mineral Properties

Under Canadian GAAP, mineral property acquisition and exploration expenditures are capitalized until such property is placed into production, sold or abandoned.

Under U.S. GAAP, the recoverability of capitalized mineral property expenditures is generally considered insupportable until a commercially mineable deposit is determined; therefore all mineral property expenditures are expensed as incurred.

[b]       Common Stock

Under U.S. GAAP, compensation cost must be considered for all stock options granted requiring the Company to utilize both the intrinsic value-based and the fair value based methods of accounting and reporting stock-based compensation. Under Canadian GAAP, effective January 1, 2002, all stock-based awards made to non-employees must be measured and recognized using the fair value based method. The Company has elected to adopt the intrinsic value method, which recognizes compensation cost for awards to employees only when the market price exceeds the exercise price at date of grant, but requires pro-forma disclosure of earnings and earnings per share as if the fair value method had been adopted.

The Company, if required to report under U.S. GAAP, would elect to apply Accounting Principles Board Opinion No. 25: Accounting for Stock Issued to Employees (APB 25”) to account for all stock options granted. Further, Statement of Financial Accounting Standards No. 123: Accounting for Stock-Based Compensation (“SFAS 123”) requires additional disclosure to reflect the results of the Company as if it had elected to follow SFAS 123. SFAS 123 requires a fair value based method of accounting for stock options using the Black-Scholes option pricing model. This model was developed for use in estimating the fair value of traded options and require the input of and are highly sensitive to subjective assumptions including the expected stock price volatility. Stock options granted by the Company have characteristics significantly different from those of traded options. In the opinion of management, the existing model does not provide a reliable single measure of the fair value of stock options granted by the Company.

Under APB 25, compensation cost must be recognized for all compensatory stock options granted whenever the market price of Company’s shares on the date of grant exceeds the exercise price. During the 2001 fiscal year, the Company granted stock options to purchase 1,040,000 common shares at a price of $0.50 per share expiring on April 4, 2004. No compensation cost has been recognized as the market price of the Company’s shares on the date of grant was less than the exercise price. During the 2002 and 2000 fiscal years, no stock options were granted by the Company.

13.  DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN CANADA AND THE UNITED STATES (continued)

In accordance with SFAS 123, the following is a summary of the changes in the Company’s stock options for the 2002, 2001 and 2000 fiscal years:

                                                       2002                     2001                      2000
    ----------------------------------------- ----------------------- ------------------------- --------------------------
                                                          Weighted                  Weighted                  Weighted
                                              Number of   Average     Number of     Average     Number of      Average
                                                Shares    Exercise      Shares      Exercise      Shares      Exercise
                                                            Price                    Price                      Price
                                                             ($)                      ($)                        ($)
    ----------------------------------------- ----------- ----------- ----------- ------------- ----------- --------------
    Balance at beginning of year              1,040,000      0.50         -            -            -             -
    Granted                                       -           -       1,040,000       0.50          -             -
                                              ----------- ----------- ----------- ------------- ----------- --------------

    Outstanding at end of year                1,040,000      0.50     1,040,000       0.50          -             -
                                              ----------- ----------- ----------- ------------- ----------- --------------

    Exercisable at end of year                1,040,000      0.50     1,040,000       0.50          -             -
                                              ----------- ----------- ----------- ------------- ----------- --------------

    Weighted-average fair value of
     Options  granted during the year                         -                       0.05                        -
                                                          -----------             -------------             --------------

For the 2001 fiscal year, the weighted-average fair values for stock options were estimated at the date of grant or amendment using a Black-Scholes option pricing model with the following weighted-average assumptions: risk-free interest rate of 5.0% volatility factor of the expected market price of the Company’s common stock of 0.31; option lives of three years; and no expected dividends. During the 2002 and 2000 fiscal years, no stock options were granted by the Company.

The following is a summary of the Company’s net loss and basic and diluted loss per share as reported and pro forma as if the fair value based method of accounting defined in SFAS 123 had been applied for the 2002, 2001, and 2000 fiscal years:

                                           2002                         2001                        2000
                                            $                            $                            $
                                As Reported     Pro Forma     As Reported    Pro Forma    As Reported     Pro Forma
                               -------------- -------------- -------------- ------------ --------------- ------------

      Net loss for the year        (703,084)    (703,084)        (725,102)   (775,126)        (410,537)    (410,537)
                               -------------- -------------- -------------- ------------ --------------- ------------

      Basic and diluted
        Loss per share                (0.08)       (0.08)           (0.24)     (0.26)            (0.37)       (0.37)
                               -------------- -------------- -------------- ------------ --------------- ------------

13.  DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN CANADA AND THE UNITED STATES (continued)

    [c]        Application of U.S. GAAP to Financial Statements

        The impact of the application of U.S. GAAP to the Company’s financial statements are summarized as follows:

         BALANCE SHEETS                                                        2002             2001         2000
                                                                               $                   $         $
         ----------------------------------------------------------- ---------------- --------------- ---------------
         Assets
         Mineral properties under Canadian GAAP                           1,478,254         986,469         462,372
         Add back write-off of mineral properties under
            Canadian GAAP                                                    61,384          23,771          79,412
         Mineral property expenditures expensed
            under U.S. GAAP                                                (553,169)       (547,868)       (374,825)
         Cumulative historical adjustments                                 (986,469)       (462,372)       (166,959)
         ----------------------------------------------------------- ---------------- --------------- ---------------
         Mineral properties under U.S. GAAP                                  -                -               -
         ----------------------------------------------------------- ---------------- --------------- ---------------
         Total Assets under U.S. GAAP                                       160,464         200,443         148,517
         ----------------------------------------------------------- ---------------- --------------- ---------------

         Shareholders' Equity
         Deficit under Canadian GAAP                                     (6,648,816)     (6,437,517)     (6,236,512)
         Deduct net loss under Canadian GAAP                                211,299         201,005         115,124
         Add net loss under U.S. GAAP                                      (703,084)       (725,102)       (410,537)
         Cumulative historical adjustments                                 (986,469)       (462,372)       (166,959)
         ----------------------------------------------------------- ---------------- --------------- ---------------
         Deficit under U.S. GAAP                                         (8,127,070)     (7,423,986)     (6,698,884)
         ----------------------------------------------------------- ---------------- --------------- ---------------
         Total Shareholders' Equity
            Under U.S. GAAP                                                 104,566         142,955          97,963
         ----------------------------------------------------------- ---------------- --------------- ---------------



         STATEMENTS OF OPERATIONS

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

         Loss for the year under Canadian GAAP                             (211,299)       (201,005)       (115,124)
         Add back write-off of mineral properties under
            Canadian GAAP                                                    61,384          23,771          79,412
         Mineral property expenditures expensed
            under U.S. GAAP                                                (553,169)       (547,868)        (374,825)

         ----------------------------------------------------------- ---------------- --------------- ---------------
         Loss for the year under U.S. GAAP                                 (703,084)       (725,102)        (410,537)
         ----------------------------------------------------------- ---------------- --------------- ---------------






13.      DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN CANADA AND THE UNITED STATES (continued)


         STATEMENTS OF CASH FLOWS                                              2002             2001            2000
                                                                               $                $               $
         -------------------------------------------------------------- ------------- --------------- ---------------

         Operating Activities
         Loss for the year under U.S. GAAP                                 (703,084)       (725,102)       (410,537)
         Non-cash issue of shares for property                               36,500           6,250            -
         Other components of operating activities which
            are similar under Canadian and U.S. GAAP                        (2,089)          16,292        (405,485)
         -------------------------------------------------------------- ------------- --------------- ---------------
         Net cash provided by (used for) operating
            activities under U.S. GAAP                                     (668,673)       (702,560)       (816,022)
         -------------------------------------------------------------- ------------- --------------- ---------------

         Investing Activities
         Mineral property costs under U.S. GAAP                                -               -               -
         -------------------------------------------------------------- ------------- --------------- ---------------
         -------------------------------------------------------------- ------------- --------------- ---------------
         Net cash used for investment activities under U.S. GAAP               -               -               -
         -------------------------------------------------------------- ------------- --------------- ---------------

[d] Loss per Share

Under U.S. GAAP, the presentation of both basic and diluted earnings per share ("EPS") is required for all entities with complex capital structures including a reconciliation of each numerator and denominator. Basic EPS excludes dilutive securities and is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding in the year. Diluted EPS reflects the potential dilution that could occur if dilutive securities were converted into common shares and is computed similarly to fully diluted EPS pursuant to previous accounting pronouncements. These requirements under U.S. GAAP apply equally to loss per share presentations.

The following is a reconciliation of the numerators and denominators of the basic and diluted loss per share calculations:

                                                                               2002             2001            2000
                                                                                $               $               $
                                                                     ---------------- --------------- ---------------

         Numerator, net loss for the year under U.S. GAAP                  (703,084)       (725,102)        (410,537)

                                                                     ---------------- --------------- ---------------
         Denominator:
         Weighted-average number of shares
            under Canadian GAAP                                           9,202,413       3,062,700       1,111,303
         Effect of escrow shares excluded from
           the denominator under U.S. GAAP                                 (138,000)        (76,562)             --
                                                                     ---------------- --------------- ---------------

         Weighted-average number of shares under U.S. GAAP                9,064,413       2,986,138       1,111,303
                                                                     ---------------- --------------- ---------------

         Basic and diluted loss per share under U.S. GAAP                     (0.08)          (0.24)           (0.37)
                                                                     ---------------- --------------- ---------------

Stock options and warrants outstanding were not included in the computation of diluted loss per share as their inclusion would be antidilutive.

[e] Recent Accounting Pronouncements

In August, 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets that established a single accounting model, based on the framework of SFAS No. 121 ("Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of"), for long-lived assets to be disposed of by sale. The statement is effective for fiscal years beginning after December 15, 2001 and the Company does not expect any significant impact upon adoption.

14.  SUBSEQUENT EVENTS

[a] The Company issued 25,000 shares pursuant to the terms of a mineral property agreement with respect to the Geikie mineral properties. The shares were issued at $0.25 per share (note 3) and this concludes the obligations under the agreement.

The Company issued 12,500 shares pursuant to the terms of a mineral property agreement with respect to the Stucco mineral properties. The shares were issued at $0.16 per share (note 3).

[b] The Company has been notified in October, 2002 that Teck Cominco was terminating its agreement relating to the Mikinak property and further, that the claims were in good standing (note 3).

ITEM 18.  FINANCIAL STATEMENTS

See “Item 17. Financial Statements”

ITEM 19. EXHIBITS

The exhibits included in this Form 20-F are in the following order:

1. Articles of Incorporation and Bylaws

(a)    Certificate of Incorporation of Colby Mines Ltd. (N.P.L.) dated February 15, 1967;
(b)    Articles of Incorporation; [1]
(c)    Certificate of Change from a Private Company into a Public Company dated December 11, 1967; [1]
(d)    Certificate of Change of Name to Colby Mines Ltd. dated January 11, 1977; [1]
(e)    Certificate of Change of Name to Colby Resources Corp. dated February 11, 1980; [1]
(f)    Certificate of Change of Name to International Colby Resources Corp. dated October 14, 1999; [1]
(g)    Certificate of Change of Name to Canplats Resources Corporation dated March 15, 2000; [1]

3. Voting Trust Agreements

      Not applicable

4. Material Contracts

       Principal Properties

       (a) Geikie

Agreement dated April 28, 1999 with Bryan Patrie, whereby Canplats was granted an option to purchase a 100% interest in and certain rights to prospect and examine 108 mineral claim units forming the Geikie Property; [1]

         (b)Posh

Agreement dated June 30, 1999 between Canplats and East West, whereby Canplats may earn a 75% interest in 112 mining claim units forming the Posh Property; [1]

Amending Agreement dated September 30, 2000 between Canplats and East West, amending the agreement dated June 30, 1999 between Canplats and East West in respect of the Posh Property by the inclusion of an additional six claims (73 claim units) under such agreement; [1]

Amending Agreement dated April 4, 2001 between Canplats and East West, amending the agreement dated June 30, 1999 between Canplats and East West in respect of the Posh Property by extending the time by three months from June 30, 2001 to September 30, 2001 in which Canplats has to incur exploration expenditures on the property of $100,000; [1]

      (c) Grand Bay

Agreement dated June 30, 1999 between Canplats and Golden Dragon whereby Canplats acquired a 75% interest in 156 claim units forming the Grand Bay Property; [1]

Amending Agreement dated December 21, 2000 between Golden Dragon and the Registrant, amending the agreement dated June 30, 1999 between Golden Dragon and Canplats in respect of the Grand Bay Property by extending the time by six months, from December 30, 2000 to June 30, 2001, in which Canplats has to incur exploration expenditures on the property of $40,000; [1]

Amending Agreement dated April 4, 2001 between Golden Dragon and the Registrant, amending the agreement dated June 30, 1999 between Golden Dragon and Canplats in respect of the Grand Bay Property by extending the time by three months from June 30, 2001 to September 30, 2001 in which Canplats has to incur exploration expenditures on the property of $100,000; [1]

      (d) Mikinak West and East

Option and Joint Venture Agreement dated March 17, 2000 between East West and Canplats pursuant to which Canplats may earn a 50% interest in 151 claim units forming the Mikinak West and East Property; [1]

Agreement dated March 25, 2002 with Teck Cominco Limited whereby the Registrant granted an option to Teck Cominco to acquire up to a 60% interest in the 149 mineral claim units which comprise the Mikinak West property.

      (e) Stucco

Agreement dated September 21, 2001 with Aki Siltamaki, R. Hietapakka and A. Hietapakka whereby Canplats was granted an option to purchase a 100% interest in and certain rights to prospect and examine 16 mineral claim units.

Agreement dated September 27, 2001 with Platinum Group Metals Ltd. whereby Canplats granted an option to Platinum to acquire up to a 60% interest in the 314 mineral claim units which comprise the Stucco property.

      Other Material Contracts

      (a) Escrow Agreements

Escrow Agreement dated January 29, 2001 among the Registrant, Computershare Trust Company of Canada, R.E. Gordon Davis, Robert A. Quartermain, Ross A. Mitchell and Kathleen Mitchell in respect of the escrow of certain securities of the Registrant; [1]

      (b) Stock Option Plan

Stock option plan dated April 2, 2001 providing for the issuance of stock options to acquire up to a total of 1,400,000 common shares of the Registrant [1]

      (c) Transfer Agency Agreement

Transfer agent, registrar and dividend disbursing agent agreement dated February 5, 2001 between Computershare Trust Co. of Canada and the Registrant [1]

      (d) Management Agreement

        Management services agreement dated April 1, 2001 between Silver Standard Resources Inc. and the Registrant [1]

10. Additional Exhibits

(a)   Sponsorship Agreement dated April 28, 2000 between Canplats and Haywood Securities Inc.; [1]
(b)    Agency Agreement dated January 29, 2001 between Canplats and Haywood Securities Inc.; [1]
(c)    Prospectus dated February 14, 2001 offering up to 2,500,000 units of Canplats at a price of $0.40 per unit; [1]
(d)    Flow-Through Share Private Placement Subscription Agreement dated September 18, 2001 offering up to 1,305,000 shares of Canplats at a price of $0.20 per unit; [2]
(f)     2001 Field Activities Report on the Geikie property dated March, 2002 and updated August, 2002; [4]
(e)    Flow-through share private placement subscription agreement dated December 21, 2001 offering up to 900,000 shares of Canplats at a price of $0.20 per unit; [3]
(g)   Flow-Through Share Private Placement Subscription Agreement dated March 13, 2002 offering up to 300,000 shares of Canplats at a price of $0.20 per unit;
(h)    Share Private Placement Subscription Agreement dated March 13, 2002 offering up to 150,000 shares of Canplats at a price of $0.15 per unit;
(i)    Share Private Placement Subscription Agreement dated July 16, 2002 offering up to 540,000 shares of Canplats at a price of $0.15 per unit;
(j)   Share Private Placement Subscription Agreement dated July 16, 2002, offering up to 250,000 shares of Canplats at a price of $0.10 per unit.

99.1   Certification of Chairman, President and Chief Executive Officer pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002

99.2   Certification of Vice President, Financer pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002

[1]     Herein incorporated by reference as previously included in the Form 20-F registration statement of Canplats as filed on July 30, 2001

[2]     Herein incorporated by reference as previously included in the Amendment Number One to the Form 20-F registration statement of Canplats as filed on December 11, 2001

[3]     Herein incorporated by reference as previously included in the Amendment Number Two to the Form 20-F registration statement of Canplats as filed on January 21, 2002

[4]     Herein incorporated by reference as previously included in Form 6-K of Canplats as filed on December 13, 2002.

EXHIBIT 99.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, R.E. Gordon Davis, Chairman, President and Chief Executive Officer, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. the Annual Report on Form 20-F of Canplats Resources Corporation (the “Company”) for the annual period ended July 31, 2002 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: December 17, 2002

/s/ R.E. Gordon Davis
______________________

R.E. Gordon Davis, Chairman, Presidentand
Chief Executive Officer

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Ross A. Mitchell, Vice President, Finance, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. the Annual Report on Form 20-F of Canplats Resources Corporation (the “Company”) for the annual period ended July 31, 2002 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: December 17, 2002

/s/ Ross A. Mitchell
___________________

Ross A. Mitchell, Vice President, Finance

SIGNATURE PAGE

Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the Registrant certifies that it meets all of the requirements for filing on Form 20-F and has duly caused this annual report be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: December 17, 2002

On Behalf of the Registrant,

CANPLATS RESOURCES CORPORATION

per:

/s/ R.E. Gordon Davis
____________________________

R.E. Gordon Davis

Chairman, President and Chief Executive Officer

/s/ Ross A. Mitchell

Ross A. Mitchell
____________________________
Vice President, Finance

CERTIFICATION OF CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, R.E. Gordon Davis, certify that:

1.     I have reviewed this annual report on Form 20-F of Canplats Resources Corporation;

2.     Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report; and

3.     Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report.

Date: December 17, 2002

/s/ R.E. Gordon Davis
___________________

R.E. Gordon Davis, Chairman, Presidentand
Chief Executive Officer

CERTIFICATION OF VICE PRESIDENT, FINANCE PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Ross A. Mitchell, certify that:

1.     I have reviewed this annual report on Form 20-F of Canplats Resources Corporation;

2.     Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report; and

3.     Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report.

Date: December 17, 2002

/s/ Ross A. Mitchell
___________________

Ross A. Mitchell, Vice President, Finance

EX-10

OPTION/JOINT VENTURE AGREEMENT

made between

TECK COMINCO LIMITED

and

EAST WEST RESOURCE CORPORATION

and

CANPLATS RESOURCES CORPORATION

in respect of the

Mikinak West Property

Dated as of March 25, 2002

TABLE OF CONTENTS

                     Article 1 INTERPRETATION..................................2
                        Definitions............................................2
                        Included Words.........................................8
                        Headings...............................................8
                        References.............................................8
                        Currency...............................................8
                        Interest...............................................8
                        Statutes...............................................8
                        Schedules..............................................9
                        Governing Law..........................................9
                        Severability...........................................9

                     Article 2 REPRESENTATIONS, WARRANTIES AND COVENANTS.......9
                        Representations, Warranties and Covenants of Each Party9
                        Representations and Warranties of EWR and CRC.........10
                        Covenants of EWR and CRC..............................11
                        Survival of Representations, Warranties and Covenants.12

                     Article 3 OPTION AND INITIAL PROGRAMS....................12
                        Option................................................12
                        Exercise of Option....................................12
                        Report of Expenditures................................13
                        Deficiencies in Expenditures..........................13
                        Teck Cominco's Right of Entry.........................14
                        Teck Cominco's Obligations During Currency of Option..14
                        CRC Option............................................15
                        Teck Cominco's Obligations on Termination.............15
                        Abandonment of Part of Property.......................15
                        Participation Date....................................16

                     Article 4 JOINT VENTURE..................................16
                        Formation and Scope...................................16
                        Transactions in Name of Operator......................16
                        No Partnership........................................17
                        Liability for Costs...................................17
                        Holding Title to the Assets...........................17
                        Participants' Rights to Conduct Other Business........17
                        No Right of One Participant to Bind the Other.........18

                     Article 5 INTERESTS OF PARTICIPANTS......................18
                        Interests.............................................18
                        Dilution Formula......................................18
                        Multiple Participants.................................19
                        Dilution and Conversion of an Interest to a Royalty...19
                        Royalty Calculation and Payment.......................19

                     Article 6 MANAGEMENT COMMITTEE...........................19
                        Management Committee..................................19
                        Members...............................................19
                        Time and Place of Meetings............................20
                        Resolutions in Writing................................20
                        Quorum................................................20
                        Voting................................................20
                        Secretary and Records.................................20
                        Abandonment of Property...............................21

                     Article 7 OPERATOR.......................................21
                        Rights and Powers of the Operator.....................21
                        Resignation of the Operator...........................22
                        Duties and Obligations of the Operator................22
                        Non-Performance by the Operator.......................23
   Delivery of Assets by Former Operator to Successor Operator...................................................23
                        Termination of Joint Venture if No Operator...........24
                        Indemnification of Operator...........................24
                        No Indemnification of Operator........................24
                        Indemnification in Proportion to Interests............24
                        No Liability for Special Damages......................24
                        Emergency Expenditures................................24

                     Article 8 PROGRAMS.......................................25
                        Expenditures to be Incurred Under Programs............25
                        Programs in Progress on Participation Date............25
                        Election to Participate in Programs...................25
                        Effect of Election to Not Contribute..................25
                        Operator Not to Proceed Unless Program is Fully Funded26
                        Obligation to Pay Expenditures and Overruns...........26
                        Procedures for Payment................................26
                        Meeting Required to Approve Excess Program Overruns...26
                        Effect of Default in Paying Expenditures..............26
                        Program for a Preliminary Feasibility Report..........27
                        Program for a Feasibility Report......................27
                        Participant's Feasibility Report......................27
                        Favourable Feasibility Report.........................27
                        Provision of Security.................................27

                     Article 9 PRODUCTION PROGRAM.............................28
                        Delivery of Proposed Production Program...............28
                        Operator to Proceed with Adopted Production Program...28
                       Obligation to Pay Production Program Costs and Overruns28
                        Procedures for Payment................................28
   Meeting Required to Approve Excess Production Program Cost Overruns...........................................29
                        Curtailment of Production Program.....................29
                        Effect of Default in Paying Production Program Costs..29
   Operator's Right to Curtail Production Program Upon Default...................................................30

                     Article 10 OPERATING PLANS...............................30
                        Obligation to Pay Operating Costs and Overruns........30
                        Operating Plans.......................................30
                        Excess Operating Cost Overruns........................30
                        No Agreement on Operating Plans.......................30
                        Statements of Operating Costs.........................31
                        Effect of Default in Paying Operating Costs...........31
                        Participant may Require Operations to be Shut Down....31
                        Resumption of Operations..............................32
                        Permanent Suspension..................................32

                     Article 11 DISPOSITION OF PRODUCTION.....................32
                        Taking in Kind........................................32
                        Valuing Mineral Products..............................32
                        Priority..............................................33
                        Accounting by Operator................................33
                        Records...............................................33
                        Non-Arm's Length Sale of Product......................33

                     Article 12 CONFIDENTIAL INFORMATION......................34
                        Obligation Not to Disclose............................34
                        Consent to Disclose...................................34
                        No Liability for Actions of Third Parties.............34
                        Notice Period.........................................34
                        Press Releases and Other Public Disclosure............34

                     Article 13 DISCLOSURE STANDARDS..........................35
                        Compliance with Disclosure Standards..................35
                        Breach of Disclosure Standards........................35
                        Misleading Disclosure.................................35

                     Article 14 RESTRICTIONS ON ALIENATION....................36
                        No Sale of Interest Except as Specified...............36
                        Terms of Sale.........................................36
                        Notice of Intention to Sell...........................36
                        Notice of Receiving an Acceptable Offer...............36
                        Content of Notice.....................................36
                        Notice Acceptance Period..............................37
                        Effect of Acceptance of Offer.........................37
                        Effect of Not Accepting an Offer......................37
                        No Coincident Offers..................................37
                        Operatorship is not Transferable Without Consent......37
                        Purchasers Agreement to be Bound......................38

                     Article 15 ENCUMBRANCES AND PARTITION....................38
                        Obligation to Hold Interest Free of Encumbrances......38
                        Limited Right to Mortgage.............................38
                        Waiver of Right to Partition..........................39

                     Article 16 OPERATOR'S LIEN...............................39
                        Operator's Lien.......................................39
                        Enforcement of Lien by the Operator...................40
                        Right of Participant to Deal With Mineral Product.....40
                        Participant's Lien....................................40

                     Article 17 ARBITRATION...................................41
                        Single Arbitrator.....................................41
                        Notice of Intent to Arbitrate.........................41
                        Effect of Lack of Agreement on Arbitration............41
                        Procedural Matters....................................41

                     Article 18 NOTICE........................................42
                        Means of Notice.......................................42
                        Effective Time of Notice..............................42
                        Change of Address for Notice..........................43

                     Article 19 FORCE MAJEURE.................................43
                        Events................................................43
                        Extension of Time Periods.............................43
                        Obligation To Eliminate Events Causing Force Majeure..43
                        Notice of Occurrence..................................43

                     Article 20 GENERAL PROVISIONS............................43
                        Entire Agreement......................................43
                        Waiver................................................44
                        Further Assurances....................................44
                        Manner of Payment.....................................44
                        Termination...........................................44
                        Default...............................................45
                        Time of the Essence...................................45
                        Enurement.............................................45
                        Rule Against Perpetuities.............................45
                        Remedies..............................................45
                        Agreement in English Language.........................46



                        SCHEDULE 1 -......Description of Property
                        SCHEDULE 2 -......Net Profits Royalty
                        SCHEDULE 3 - .....Underlying Agreements

MIKINAK WEST CLAIMS AGREEMENT

THIS AGREEMENT made as of March 25, 2002

BETWEEN:

TECK COMINCO LIMITED, a corporation incorporated under the laws of Canada and having an office at 600-200 Burrard Street, Vancouver, British Columbia, V6C 3L9

         (“Teck Cominco”)

OF THE FIRST PART

AND:

EAST WEST RESOURCE CORPORATION, a company incorporated under the laws of British Columbia with an office at 402-905 West Pender Street, Vancouver, British Columbia, V6C 1L6

          (“EWR”)

OF THE SECOND PART

AND:

CANPLATS RESOURCES CORPORATION, a company incorporated under the laws of British Columbia with an office at 1190 – 999 West Hastings Street, Vancouver, British Columbia, V6C 2W2

          (“CRC”)

OF THE THIRD PART

WHEREAS:

(A)     EWR entered into an agreement made as of the 12th day of February, 2000 with Ken Fenwick and Don Leighman (the “Underlying Agreement”) under which EWR has the option to acquire a 100% interest in the Property hereinafter defined subject to a royalty in favour of the Optionors;

(B)     EWR and CRC (collectively the “Owners”) entered into an agreement dated March 17, 2000 under which CRC has the option to acquire a 50% interest in the Property;

(C)     the Owners have agreed to grant to Teck Cominco an exclusive option to earn up to a 60% interest in the Property upon and subject to the terms and conditions hereinafter set out; and

(D)     upon Teck Cominco earning its interest in the Property, the parties have agreed to form a joint venture to further explore and develop the Property, all upon and subject to the terms and conditions hereinafter set out.

NOW, THEREFORE, THIS AGREEMENT WITNESSES that, in consideration of the payment of $1.00 by Teck Cominco to the Owners and the mutual covenants and agreements herein contained, the parties hereto mutually agree as follows:

ARTICLE 1

INTERPRETATION

Definitions

1.1     In this Agreement the following words and phrases shall have the following meanings:

Affiliate means, in respect of a party hereto, a corporation with which that party is affiliated within the meaning of §1(2) of the Securities Act (British Columbia).

Assets means the Property and any and all assets acquired or held by the Participants with respect to the Property or pursuant to this Agreement, as the same may exist from time to time, including, without limiting the generality of the foregoing, Other Tenements, Facilities, Mineral Products and all supplies and equipment related to operations hereunder.

         Associated Company means, in respect of a party hereto:

(i) any corporation which beneficially owns, directly or indirectly, securities carrying more than 30% of the voting rights attached to the outstanding securities of such party;

(ii) any corporation in respect of which such party beneficially owns, directly or indirectly, securities carrying more than 30% of the voting rights attached to the outstanding securities of such corporation; or

(iii) any corporation in respect of which corporations referred to in §(i) and (ii) hereof beneficially own, directly or indirectly in the aggregate, more than 30% of the voting rights attached to the outstanding securities of such corporation.

For the purposes hereof, beneficial ownership shall include securities deemed beneficially owned within the meaning of §1(4) of the Securities Act (British Columbia).

Business Day means a day, other than a Saturday or Sunday, on which the main branch of Bank of Montreal in Vancouver, British Columbia is open to the public for the transaction of business.

Commercial Production means the operation of the Property or any part thereof as a mine but does not include milling for the purpose of testing or milling by a pilot plant. Commercial Production shall be deemed to have commenced on the first day of the month following the first 15 consecutive days during which Mineral Products have been produced from the Property at an average rate not less than 70% of the initial rated capacity of the Facilities.

         Completion Date means the date on which Commercial Production shall be deemed to have commenced.

Cost Share means the respective share of all Expenditures incurred in connection with a Program, Production Program Costs incurred in connection with a Production Program, Operating Costs and other liabilities hereunder, whether incurred by the Operator or otherwise, to be borne by each Participant after the Participation Date and shall be equal to the respective Interest of each Participant as determined from time to time or such greater amount as a Participant may elect to pay pursuant to the terms hereof.

Costs means cash outlays, expenses, obligations and liabilities of whatever kind or nature, but without duplication.

Expenditures means all Costs spent or incurred or deemed incurred hereunder prior to the adoption of a Production Program by all of the Participants in connection with the exploration and development of the Property including, without limiting the generality of the foregoing:

(i) monies expended in maintaining the Property in good standing, including any monies expended in doing and filing assessment work and any required vendor’s or royalty payments made to the Underlying Optionors;

(ii) monies expended in doing geophysical, geochemical and geological surveys, drilling, assaying and metallurgical testing;

(iii) monies expended in acquiring Assets;

(iv) monies expended in paying the fees, wages and salaries of all employees of Teck Cominco and its Associated Companies engaged in work with respect to and for the direct benefit of the Property, together with an amount for fringe benefits usually paid by Teck Cominco;

(v) monies expended in paying for the food, lodging and travelling expenses and other reasonable needs of the persons referred to in §(iv) hereof;

(vi) a charge equal to 12% of all Expenditures, other than the charge referred to in this §(vi) and §(vii), for unallocable overhead and head office expenses and all other expenses relating to supervision and management of all work done with respect to and for the benefit of the Property;

(vii) monies expended or set aside for environmental remediation and reclamation; (viii) all Costs related to the preparation of Programs and reporting as to the results thereof; and (ix) all Costs related to the preparation of a Feasibility Report, a Property Holding Program and a

         Production Program;

         but does not include any amount incurred in respect of Production Program Costs.

Facilities means all mines and plants including, without limitation, all pits, shafts, haulageways and other underground workings, and all buildings, plants and other structures, fixtures and improvements, and all other property, whether fixed or moveable, as the same may exist at any time in or on the Property and relating to the operation of the Property as a mine or outside the Property if for the exclusive benefit of the Property only.

Feasibility Report means a comprehensive report prepared pursuant to Article 8 showing the feasibility of placing the Property or part thereof into Commercial Production. The report shall contain all geological, engineering, operating, economic and other relevant factors which are to be considered in sufficient detail that the report could reasonably serve as the basis for a final decision by a financial institution to finance the development of the Property for Commercial Production. The report shall include at least the following information:

(i)     a description of that part of the Property to be covered by the proposed mine;

(ii)     the estimated recoverable reserves of minerals and the estimated composition and content thereof;

(iii)     the proposed procedure for development, mining and production;

(iv)     results of ore amenability tests (if any);

(v)     the nature and extent of the Facilities proposed to be acquired which may include mill facilities, if the size, extent and location of the ore body makes such mill facilities feasible, in which event the study shall also include a preliminary design for such mill;

(vi) the total costs, including capital budget, which are reasonably required to purchase, construct and install all structures, machinery and equipment required for the proposed mine, including a schedule of timing of such requirements;

(vii) all environmental impact studies and costs;

(viii) the period in which it is proposed the Property shall be brought to Commercial Production;

(ix) such other data and information as are reasonably necessary to substantiate the existence of an ore deposit of sufficient size and grade to justify development of a mine, taking into account all relevant business, tax and other economic considerations; and

(x) working capital requirements for the initial four months of operation of the Property as a mine or such longer period as may be reasonably justified in the circumstances.

Interest means the undivided beneficial percentage interest of a party in the Assets as determined pursuant to this Agreement, but does not include a Net Profits Royalty, and does not include a third party holding a beneficial interest in the Assets.

         Joint Venture means the joint venture formed pursuant to §4.1.

         Management Committee means the committee formed pursuant to Article 6.

         Mineral Products means the end products derived from operating the Property as a mine.

Net Profits Royalty to which any party is entitled hereunder means a percentage interest in net profits derived from the Property pursuant to §5.4, §8.9 or, §9.7 that is equivalent to that percentage of net profits that is equal to 20% of the maximum Interest that was held by that party on or after the Participation Date at any time less any assignments of Interest made by that party, and not including any increase in that party’s Interest as a result of the dilution of Interest of any other party, such net profits and the royalty to be calculated and payable as provided in Schedule 2.

operating the Property as a mine or operation of the Property as a mine means any or all of the mining, milling, smelting, refining and other processing of ores, minerals, metals, tailings or concentrates derived from the Property and other ancillary activities and operations related thereto.

Operating Costs means, for any period after commencement of Commercial Production, all Costs, incurred or chargeable, directly or indirectly, by the Operator in connection with Operating Plans including, without duplication and without limiting the generality of the foregoing, the following:

(i) all Costs of or related to operating employee facilities, including housing;

(ii) all duties, charges, levies, royalties, taxes (excluding taxes levied on the income of the parties) and other payments imposed by any government or municipality or department or agency thereof upon or in connection with operating the Property as a mine;

(iii) all Costs of maintaining the Property in good standing, including any required vendor’s or royalty payments;

(iv) all reasonable Costs of the Operator for providing technical, management and/or supervisory services; (vii)

(v) all reasonable Costs of consulting, legal, accounting, insurance and other services;

(vi) all exploration expenditures incurred after commencement of Commercial Production;

(vii) all capital costs of operating the Property as a mine including all Costs of construction, equipment and mine development and including maintenance, repairs and replacements, and any capital expenditures relating to an improvement, expansion, modernization or replacement of the Facilities;

(viii) a reasonable amount of funds set aside to cover reclamation Costs;

(ix) all Costs incurred or to be incurred relating to a temporary or permanent shut-down of the Facilities, including Costs to be incurred after any shut-down;

(x) a management fee payable to the Operator in respect of its unallocable overhead and head office expenses equal to 3% of all Operating Costs other than those referred to in (viii) and (x) hereof; and

(xi) Operating Cost Overruns and approved Excess Operating Cost Overruns as described in §10.3;

and, except where specific provision is made otherwise, all Operating Costs shall be determined in accordance with generally accepted accounting principles applied consistently from year to year, provided however that such costs shall not include any amount in respect of amortization of Expenditures or Production Program Costs, depletion or depreciation.

Operating Plan means a plan for an Operating Year as contemplated in Article 10 including, inter alia, the following information:

(i) a written plan of the proposed mining operations for the Operating Year, including any plans for exploration or for expansion of the Facilities;

(ii) a detailed estimate of all Operating Costs plus a reasonable allowance for contingencies, on a monthly basis, including any proposed cash calls;

(iii) an estimate of the quantity and quality of the ore to be mined and of the quality of Mineral Products to be produced on a monthly basis; and

(iv) such other facts as may be reasonably necessary to present the results proposed to be achieved during the Operating Year.

Operating Year means a calendar year or such other fiscal year as the Management Committee may approve. In the case of the first Operating Year, unless otherwise decided by the Management Committee, that Operating Year shall be the remainder of the current calendar or fiscal year, if the Completion Date occurs two months or more before the expiration of the year, or the period from the Completion Date to the end of the next succeeding calendar or fiscal year, if the Completion Date occurs on or after the date which is two months before the expiration of the year.

Operator means that party acting as operator from time to time in accordance with Article 7 and includes any Affiliate acting as the agent or delegate of the Operator in that regard.

         Option means the right of Teck Cominco to earn an Interest as described in §3.1.

Other Tenements means all surface rights of and to any lands within or outside the Property including surface rights held in fee or under lease, licence, easement, right of way or other rights of any kind (and all renewals, extensions and amendments thereof or substitutions therefor) acquired by or on behalf of the parties with respect to the Property.

Participant means any party having an Interest and its successors and permitted assigns and Participants means collectively all parties having an Interest and their respective successors and permitted assigns.

         Participation Date shall mean the date described in §3.10.

Preliminary Feasibility Report means comprehensive study of the viability of the Property that has advanced to a stage where the mining method, in the case of underground mining, or the pit configuration, in the case of an open pit, has been established, and which, if an effective method of mineral processing has been determined, includes a financial analysis based on reasonable assumptions of technical, engineering, operating, economic factors and the evaluation of other relevant factors which are sufficient for a qualified person, acting reasonably, to determine if all or part of the mineral resource may be classified as a mineral reserve.

Prime Rate means the per annum rate declared from time to time by the main branch in Vancouver, B.C., of Bank of Montreal as the rate of interest charged by it to its largest and most creditworthy commercial borrowers for demand Canadian dollar loans over $200,000.

Production Program means any program based on a Feasibility Report contemplating the achievement of Commercial Production.

Production Program Costs means all Costs spent or incurred directly or indirectly in connection with a Production Program in order to equip the Property or a part thereof for Commercial Production, including, without limitation:

(i) all monies expended to develop, construct or acquire the Facilities and other Assets, as contemplated in the Production Program;

(ii) working capital required for the initial four months of operation of the Property or part thereof as a mine or for such longer period as may be reasonably justified in the circumstances;

(iii) a contingency amount of not less than 10% and not more than 20% of total Production Program Costs;

(iv) a management fee payable to the Operator in respect of its unallocable overhead and head office expenses equal to 3% of all Production Program Costs other than those referred to in this §(iv); and

(v) monies set aside or lodged as security for environmental remediation and reclamation.

         Program means, as the context requires:

(i) any program to carry out work and incur Expenditures after the Participation Date and prior to the approval of a Production Program on or in respect of the Property;

(ii) a document or documents wherein there is specified in reasonable detail an outline of any and all research, prospecting and exploration and development work proposed to be carried out during such Program, the estimated Expenditures to be incurred in carrying out such work and the area of the Property on which such work is to be undertaken;

(iii) the preparation, after the Participation Date, of any Feasibility Report and Production Program; and (iv) a Property Holding Program;

(iv) a Property Holding Program;

        and shall include any amendments to a Program as may be agreed upon by the Management Committee.

Property means an undivided 100% right, title and interest in and to the mining properties, claims, interests and other rights more particularly described in Schedule 1 and shall include any renewal thereof and any other form of successor or substitute title therefor, and shall include any other mineral properties, claims or interests made part of the Property pursuant to this Agreement, but shall exclude any mineral properties, claims or interests transferred or abandoned in accordance with §3.9 or §6.8 or otherwise sold or disposed of by the Joint Venture.

Property Holding Program means a program for maintenance of the Property and continued work, if necessary, after the Feasibility Report and before the Production Program.

         Underlying Agreements mean the agreements set out on the attached Schedule 3.

         Underlying Optionors means the optionors under the Underlying Agreements.

Included Words

1.2 This Agreement shall be read with such changes in gender or number as the context shall require.

Headings

1.3 The headings to the articles, paragraphs, parts or clauses of this Agreement and the table of contents are inserted for convenience only and shall not affect the construction hereof.

References

1.4 Unless otherwise stated, a reference herein to a numbered or lettered article, paragraph, clause or schedule refers to the article, paragraph, clause or schedule bearing that number or letter in this Agreement. A reference to “this” article, paragraph, clause or schedule means the article, paragraph, clause or schedule in which the reference appears. A reference to “this Agreement”, “hereof”, “hereunder”, “herein” or words of similar meaning, means this agreement including the schedules hereto, together with any amendments thereof.

Currency

1.5 All dollar amounts expressed herein refer to lawful currency of Canada.

Interest

1.6 Wherever interest is chargeable under this Agreement, unless otherwise specifically provided, interest shall be at the specified per annum rate, calculated daily and compounded on the last day of each calendar month. For the purposes hereof, the Prime Rate in effect for each day of a month shall be equal to the Prime Rate declared at noon on the first Business Day of that month. For greater certainty, the interest chargeable for any day shall be based upon the specified per annum rate in effect on that day.

Statutes

1.7 A reference to a statute, regulation or other legislation herein shall be deemed to extend to and include any amendments thereto and successor legislation.

Schedules

1.8 The following schedules are incorporated into this Agreement by reference:

                Schedule                        Description

                      1                          Description of Property
                      2                          Net Profits Royalty
                      3                          Underlying Agreements

Governing Law

1.9 This Agreement shall be construed and governed by the laws in force in the Province of British Columbia and, except as provided in Article 17, the courts of said Province shall have exclusive jurisdiction to hear and determine all disputes arising hereunder. Each of the parties hereto irrevocably attorns to the jurisdiction of said courts and consents to the commencement of proceedings in such courts. This paragraph shall not be construed to affect the rights of a party to enforce a judgement or award outside the said Province, including the right to record or enforce a judgement or award in any jurisdiction in which Assets are situated.

Severability

1.10 If any provision of this Agreement is or shall become illegal, invalid or unenforceable, in whole or in part, the remaining provisions shall nevertheless be and remain valid and subsisting and the said remaining provisions shall be construed as if this Agreement had been executed without the illegal, invalid or unenforceable portion.

ARTICLE 2

REPRESENTATIONS, WARRANTIES AND COVENANTS

Representations, Warranties and Covenants of Each Party

2.1 Each party represents and warrants to the other party hereto that:

(a) it is a body corporate duly incorporated, organized and validly subsisting under the laws of its incorporating jurisdiction;

(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;

(c) neither the execution and delivery of this Agreement nor any of the agreements referred to herein or contemplated hereby, nor the consummation of the transactions hereby contemplated conflict with, result in the breach of or accelerate the performance required by any agreement to which it is a party;

(d) the execution and delivery of this Agreement and the agreements contemplated hereby shall not violate or result in the breach of the laws of any jurisdiction applicable or pertaining thereto or of its constating documents; and

(e) each holds a valid and subsisting Client Number under applicable Ontario Mining Legislation.

Representations and Warranties of EWR and CRC

2.2 EWR and CRC each represent and warrant to Teck Cominco that:

(a) the mineral claims and other interests comprising the Property are accurately described in Schedule 1, 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;

(b) each 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) any mineral claims included in the Property as described in Schedule 1 have been properly and legally staked, recorded and tagged;

(d) the Underlying Agreements are valid and enforceable, there has been no default thereunder, and the Owners are entitled to assign their interests therein to Teck Cominco;

(e) there is no adverse claim or challenge against or to the ownership of or title to any of the mineral claims and other interests comprising the Property, nor to the knowledge of either EWR and CRC 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 or any production therefrom, and no person other than Ken Fenwick and Don Leighman, who hold royalties as provided for in the Underlying Agreements, has any royalty or other interest whatsoever in the Property or in production therefrom;

(f) the Property and its existing and prior uses comply and have at all times complied with, and each of EWR and CRC are not in violation of, and has not violated, in connection with the ownership, 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) without limiting the generality of §(f), each of EWR and CRC:

(i) have operated the Property and has at all times received, handled, used, stored, treated, shipped and disposed of all environmental or similar contaminants in strict compliance with all applicable environmental, health or safety laws, regulations, orders or approvals; and

(ii) have removed from and off the Property all environmental or similar contaminants;

(h) there are no writs, injunctions, orders or judgements 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, archaeological or similar matters, or otherwise, nor, to each of EWR’s and CRC’s knowledge, is there any basis for such law suits, claims, proceedings or investigations being instituted or filed;

(i) 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 EWR’s and CRC’s operations carried out on the Property, nor, to the best of EWR’s and CRC’s knowledge, have any of the above occurred nor has the Property been used at any time by any person as a landfill or waste disposal site;

(j) to the best of EWR’s and CRC’s knowledge no notices of any violation or apparent violation of any of the matters referred to in §(f) through §(i) relating to the Property or its use have been received by either of EWR and CRC;

(k) there are no active treaty negotiations in respect of native land claims affecting the Property, nor are EWR and CRC aware of pending land claims that may affect the Property;

(l) it holds the interests in the Property as set out on Schedule 1;

(m) all corporate authorizations have been obtained by it for the execution of this Agreement and for the performance of its obligations hereunder;

(n) 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 or placing it into bankruptcy or subject to any other laws governing the affairs of insolvent persons;

(o) its interest in the Property is not the whole or substantially the whole of its assets or undertaking; and

(p) it is in compliance with all applicable security laws and applicable stock exchange rules and regulations.

Covenants of EWR and CRC

2.3 EWR and CRC jointly and generally covenant with Teck Cominco that:

(a) they shall, at their sole cost and expense, remove or take remedial action with regard to any materials released by either of them or their contractors and agents, into the environment at, on or near the Property prior to the date hereof for which any removal or remedial action is required pursuant to any law, regulation, order or governmental action, whether enacted, made or declared in force before or after the date hereof, provided that:

(i) no such removal or remedial action shall be taken except after reasonable advance written notice has been given to Teck Cominco; and

(ii) any such removal or remedial action shall be undertaken in a manner so as to minimize any impact on Teck Cominco’s operation on the Property;

(b) they shall at all times retain any and all liabilities arising from the handling, treatment, storage, transportation or disposal of environmental or similar contaminants on or near the Property by either of them or by any of their contractors or agents;

(c) they shall, during the currency of the Option, keep the Property free and clear of all liens, charges and encumbrances, save and except those arising from Teck Cominco’s activities on the Property;

(d) in the event of an adverse claim or claims (i) respecting the Property which does not arise from Teck Cominco’s activities on the Property, or (ii) respecting defects of title affecting all or a portion of the Property, they shall, all at their sole expense, take immediate steps to defend against any such claim or claims or to cure any such default of title until such adverse claim or claims is or are judicially or otherwise fully settled and determined or such defects are otherwise cured, and Teck Cominco shall be held harmless from and indemnified for any resulting loss from adverse claims or other title defects. If they are unable or refuse to cure any defect in title to the Property promptly, Teck Cominco may, without affecting EWR’s and CRC’s obligations under this subparagraph, at Teck Cominco’s election, take steps to cure such defect and shall be fully reimbursed for all costs incurred for that purpose, plus interest at the Prime Rate plus 3% from the date the Costs are incurred, and until reimbursed (and without limitation as to exercise of other remedies) Teck Cominco may recover the Costs of such cure, including legal fees and court costs, from amounts otherwise due to EWR and CRC hereunder;

(e) prior to transferring the Property to Teck Cominco under §3.1, EWR and CRC covenant to pay all applicable taxes on the Property and to make all option payments and incur all expenditures required to keep the Property in good standing; and

(f) EWR shall make all share issuances required by it pursuant to the Underlying Agreements in order to keep such agreements in good standing.

Survival of Representations, Warranties and Covenants

2.4 The representations, warranties, covenants, agreements and conditions hereinbefore set out are conditions on which the parties have relied in entering into this Agreement and shall survive the acquisition of any Interest hereunder and each party shall 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 (including, without limitation, lawyer’s fees and disbursements).

ARTICLE 3

OPTION AND INITIAL PROGRAMS

Option

3.1 Subject as hereinafter provided, EWR and CRC hereby grant to Teck Cominco the sole and exclusive right and option to acquire up to an undivided 60% right, title and interest in and to the Assets. Forthwith after execution of this Agreement, EWR and CRC shall execute and deliver to Teck Cominco (or, at Teck Cominco’s written request, to an escrow agent designated by Teck Cominco) a transfer or transfers of the Property in recordable form. Prior to the Participation Date, title to the Property shall be held by Teck Cominco (or such escrow agent) subject to the provisions of this Article.

Exercise of Option

3.2 Teck Cominco may exercise the option granted inss.3.1 by incurring the following cumulative Expenditures and making the following non-cumulative cash payments all on or before the following dates: (a) to acquire a 51% Interest:

                                                     Non-cumulative                     Cumulative
                  On or before                         cash payment                     Expenditures

                  June 30, 2002                        $    10,000                      $      25,000
                  April 30, 2003                            25,000                             75,000
                  April 30, 2004                            30,000                            175,000
                  April 30, 2005                            35,000                            400,000
                  April 30, 2006                                --                            775,000;

provided that, within the Expenditures to be incurred by April 30, 2003, Teck Cominco will complete a drill program of at least 500 meters; and

(b) if Teck Cominco has acquired the 51% Interest under §3.2(a) and elects within 90 days thereof to proceed, Teck Cominco may acquire an additional 9% Interest by incurring additional optional Expenditures of $1,500,000 on or before April 30, 2008;

it being agreed that in connection with the above that the cash portion of any option payments to be made under the Underlying Agreement will be paid by Teck Cominco to the Underlying Optionors directly and will be credited as an Expenditure.

Report of Expenditures

3.3 Within 60 days following the anniversary of this Agreement, Teck Cominco shall deliver to each of EWR and CRC a statement showing in reasonable detail the Expenditures incurred by Teck Cominco during the period last expired and the aggregate Expenditures incurred to the end of such period and EWR and CRC shall have 45 days from the time of receipt of such statement to question the accuracy thereof in writing, failing which such statement shall be deemed to be correct and unimpeachable thereafter. If a statement delivered pursuant to §3.3 is questioned by one of the Owners:

(a) the questioning Owner shall have 12 months from the time of delivery of the statement to have the amounts specified therein audited;

(b) the audited results shall be final and determinative of the amount of Expenditures incurred for the audited period; provided that, if such audit discloses a deficiency in the amount of Expenditures required to be incurred to maintain its option in good standing, Teck Cominco may pay to the Owners the amount of such deficiency within 15 days following receipt of notice of such audited results, whereupon such amount shall be deemed to have been Expenditures incurred during the audited period; and

(c) the costs of the audit shall be borne by such Owner if Teck Cominco’s statement understated Expenditures or overstated Expenditures by not more than 3% and shall be borne by Teck Cominco if such statement overstated Expenditures by greater than 3%.

Deficiencies in Expenditures

3.4 Notwithstanding §3.2, if Teck Cominco has not incurred the requisite Expenditures or made the cash payment to maintain its option in good standing as specified in §3.2, Teck Cominco may pay to the Owners, within 60 days, the amount of the deficiency of Expenditures or 110% of the unpaid cash payment and such amount shall thereupon be deemed to have been Expenditures incurred or cash payment made by Teck Cominco prior to the due date.

Teck Cominco’s Right of Entry

3.5 During the currency of the Option, Teck Cominco shall be considered the operator and it and its employees, agents and independent contractors shall have the right and option to: (a) enter upon the Property; (b) have exclusive and quiet possession thereof; (c) do such prospecting, exploration, development or other mining work thereon and thereunder as Teck

Cominco in its sole discretion may consider advisable and including, without limitations, the removal of ores, minerals and metals from the Property but only for the purpose of testing; and

(d)     bring upon and erect upon the Property such Facilities as Teck Cominco may consider advisable.

Teck Cominco’s Obligations During Currency of Option

3.6 Unless, by written notice to the Owners, Teck Cominco abandons the Property sooner, Teck Cominco shall, during the currency of the Option: (a) keep the Property free and clear of all liens, charges and encumbrances arising from its operations

hereunder (except liens for taxes not yet due, other inchoate liens and liens contested in good faith by Teck Cominco) and shall proceed with all diligence to contest and discharge any such lien that is filed and shall keep the Property in good standing by the doing and filing of all necessary work and by the doing of all other acts and things and making all other payments which may be necessary in that regard;

(b) permit the Owners, or their representatives duly authorized by it in writing, at their own risk and expense, access to the Property at all reasonable times and to all records prepared by Teck Cominco in connection with work done on or with respect to the Property and furnish the Owners with quarterly reports during the conduct of the work carried out by Teck Cominco on or with respect to the Property and results obtained, together with timely current reports and information on any material results obtained;

(c) obtain and maintain, or cause any contractor engaged hereunder to obtain and maintain, during any period in which active work is carried out hereunder, such insurance as Teck Cominco reasonably considers to be appropriate in the circumstances in light of general industry practice; and

(d) conduct all work on or with respect to the Property in a manner consistent with good exploration, engineering and mining practices and in compliance with all applicable laws, rules, orders and regulations, and indemnify and save the Owners harmless from any and all claims, suits or actions made or brought against it as a result of work done by or on behalf of Teck Cominco on or with respect to the Property.

CRC Option

3.7 If Teck Cominco exercises the Option, CRC will be deemed to have exercised its option contemplated in recital (B).

Teck Cominco’s Obligations on Termination

3.8 At any time prior to exercising the Option under §3.2(a), Teck Cominco may terminate this Agreement and the Option, so long as it is not in default of any of its obligations under this Agreement, by giving notice in writing to that effect to the Owners and, on receipt of such notice, or if Teck Cominco fails to make the requisite Expenditures under §3.2(a), but subject to §3.4, this Agreement shall be of no further force or effect and Teck Cominco shall have no interest in the Property; provided, however, that Teck Cominco shall: (a) leave the Property in good standing with respect to the filing of assessment work for a period of 180

days from the date of termination, free and clear of all liens, charges and encumbrances arising from operations hereunder (except for taxes not yet due, other inchoate liens and liens contested in good faith by Teck Cominco) and in good standing with respect to all applicable environmental, safety and other statutory rules, regulations and orders arising from or applicable to work done on the Property by Teck Cominco; provided however, that Teck Cominco shall have no liability or obligation hereunder in respect of claims arising or damages suffered after the termination of this Agreement if upon such termination any workings on or improvements to the Property arising from Teck Cominco’s operations hereunder have been left in good standing as aforesaid;

(b) deliver to the Owners, within 60 days of a written request made by both Owners, a comprehensive report on all work carried out by Teck Cominco on the Property (limited to factual matters only), together with all drill cores, assay samples, copies of all maps, drill logs, assay results and other factual technical data compiled by Teck Cominco with respect to the Property which were not previously delivered to the Owners;

(c) have the right to remove from the Property within 180 days of the effective date of termination all temporary structures, equipment and supplies erected, installed or brought upon the Property by or at the instance of Teck Cominco; and

(d) deliver to the Owners an acknowledgement of abandonment and release of any interest in the Assets or under this Agreement, together with a bill of sale or other appropriate deed or transfer in recordable form whereby the Property is transferred or quit claimed back to the Owners, free of any liens or charges arising from Teck Cominco’s activities in respect of the Property.

Abandonment of Part of Property

3.9 At any time prior to the Participation Date, Teck Cominco may elect to abandon any one or more of the mineral claims comprised in the Property by giving notice to the Owners of such intention. For a period of 30 days after the date of delivery of such notice the Owners may elect to have any or all of the mineral claims in respect of which such notice has been given transferred and quit claimed back to the Owners by delivery of a request therefor to Teck Cominco, whereupon Teck Cominco shall deliver to the Owners a bill of sale or other appropriate deed or assurance in recordable form transferring or releasing such mineral claims back to the Owners and the provisions of §3.8(c) and §3.8(d) shall apply with respect thereto, mutatis mutandis. If the Owners fail to make a request for the transfer of any mineral claims as aforesaid within such 30-day period, Teck Cominco may then abandon such mineral claims without further notice to the Owners. Upon any such transfer, release or abandonment the mineral claims so transferred, released or abandoned shall for all purposes of this Agreement cease to form part of the Property. For greater certainty, there shall be no abatement of the Expenditure or payment requirements under this Article as a result of such transfer, release or abandonment, but any Expenditures previously made in respect of the abandoned claims shall continue to be included in cumulative Expenditures hereunder.

Participation Date

3.10 Subject to earlier termination hereunder, the Participation Date shall be the earlier of the date that: (a) Teck Cominco makes the cash payments and incurs the Expenditures contemplated inss.3.2(a) and does not

      make the election contemplated in §3.2(b); or

(b) Teck Cominco makes the election contemplated in §3.2(b) but terminates its rights, or fails to incur the additional Expenditures, contemplated in §3.2(b); or

(c) Teck Cominco makes the election contemplated in §3.2(b) and incurs the additional Expenditures contemplated in §3.2(b).

Article 4

JOINT VENTURE

Formation and Scope

4.1 On the Participation Date, Teck Cominco and the Owners shall, and shall be deemed to, form a single purpose joint venture for the purpose of undertaking such activities as are determined in accordance with the provisions hereof, to be necessary or appropriate, directly or indirectly, to:

(a) explore and, if deemed warranted as herein provided, develop the Property and equip it for Commercial Production;

(b) operate the Property as a mine; and

(c) engage in such other activity as may be considered by the Participants to be necessary or desirable in connection with the foregoing.

Transactions in Name of Operator

4.2 All transactions, contracts, employments, purchases, operations, negotiations with third parties and any other matter or act undertaken on behalf of the Participants in connection with the Property shall, subject to §4.5, be done, transacted, undertaken or performed in the name of the Operator, and no party (other than the Operator acting in that capacity) shall do, transact, perform or undertake anything in the name of another party hereto or in the joint names of the Participants or in the name of the Joint Venture.

No Partnership

4.3 After the Participation Date, the rights and obligations of the Participants shall be, in each case, several, and shall not be or be construed to be either joint or joint and several. Nothing contained in this Agreement shall, except to the extent specifically authorized hereunder, be deemed to constitute a Participant a partner, an agent or legal representative of any other party. It is intended that this Agreement shall not create the relationship of a partnership between the Participants and that no act done by any Participant pursuant to the provisions hereof shall operate to create such a relationship.

Liability for Costs

4.4 After the Participation Date, except as otherwise provided herein, each Participant shall be liable for its Cost Share of all costs, debts, liabilities or obligations arising from operations hereunder from and at the time incurred by the Operator. Except as otherwise provided herein, any amount due to the Operator hereunder shall bear interest from its due date at a per annum rate equal to the Prime Rate plus 2%.

Holding Title to the Assets

4.5 Each Participant shall have such Interest as is determined in accordance with the provisions of this Agreement, and any legal title to any of the Assets shall be held by the Operator in trust for the Participants in proportion to their respective Interests under the terms of this Agreement. Nothing herein contained shall prevent a party hereto from registering notice of this Agreement and its Interest against the title to the Property or any other Assets.

Participants’ Rights to Conduct Other Business

4.6 Each Participant shall devote such time as may be required to fulfil any obligation assumed by it hereunder but: (a) each Participant shall be at liberty to engage in any other business or activity outside the Joint

        Venture, including the ownership and operation of any other mining permits, licenses, claims and leases; (b) no Participant shall be under any fiduciary or other obligation to any other party which shall prevent

or impede such Participant from participating in, or enjoying the benefits of, competing endeavours of a nature similar to the business or activity undertaken by the Participants hereunder; and

(c) the legal doctrines of “corporate opportunity” or “business opportunity” sometimes applied to persons occupying a relationship similar to that of the Participants shall not apply with respect to participation by any Participant in any business activity or endeavour outside the Joint Venture, and, without implied limitation, a Participant shall not be accountable to the others for participation in any such business activity or endeavour outside the Joint Venture which is in direct competition with the business or activity undertaken by the Joint Venture. Unless otherwise agreed in writing, no Participant shall have any Obligations to mill, beneficiate or otherwise treat any Mineral Products or any other Participant’s share of production in any facility owned or controlled by that Participant. Conversely, the Joint Venture shall have no obligation to mill, beneficiate or otherwise treat or accommodate any minerals produced by a Participant from lands not comprising the Property.

No Right of One Participant to Bind the Other

4.7 A Participant shall not have authority to act for or assume any obligations or liabilities on behalf of the other Participant except such as are specifically authorized pursuant to and in accordance with the terms of this Agreement, and each Participant shall indemnify and hold the other Participant, and its officers, employees and agents, harmless from and against any and all losses, claims, damages and liabilities arising out of any act or any assumption of any obligations by it done or undertaken on behalf of the other Participant other than as provided herein.

Article 5

INTERESTS OF PARTICIPANTS

Interests

5.1 On the Participation Date contemplated in §3.10(a), Teck Cominco shall have an undivided 51% Interest, EWR shall have an undivided 24.5% Interest and CRC shall have an undivided 24.5% Interest. On the Participation Date contemplated in §3.10(c), Teck Cominco shall have an undivided 60% Interest, EWR shall have an undivided 20% Interest and CRC shall have an undivided 20% Interest. Thereafter, each Participant shall have such Interest as is determined from time to time in accordance with the provisions of this Agreement.

Dilution Formula

5.2 Subsequent to the Participation Date, the respective Interests of the Participants shall be determined from time to time as being equal to the product obtained by multiplying 100% by a fraction of which the numerator is as follows:

(a)     If the Participation Date was established under 3.10(a):

                  Teck Cominco:         $775,000, being its Expenditures underss.3.2(a)
                  EWR                   24.5/51 of $775,000
                  CRC:                  24.5/51 of $775,000

(b)     If the Participation Date was established under 3.10(c):

                  Teck Cominco:         $2,275,000, being its Expenditures under 3.2(a) and 3.2(b)
                  EWR:                  20/60 of $2,275,000
                  CRC:                  20/60 of $2,275,000

plus, in each case, above that Participant’s respective contribution to Expenditures and Production Program Costs made subsequent to the Participation Date;

and the denominator is $775,000, if the Participation Date is established under §3.10(a), or $2,275,000, if the Participation Date was established under §3.10(c), plus in each case, the amount of all contributions to Expenditures and Production Program Costs made subsequent to the Participation Date by all Participants.

Multiple Participants

5.3 If there are more than two Participants the dilution formula in §5.2 shall be applied mutatis mutandis as required provided, that an assignment by a Participant of all or part of its Interest shall carry with it an assignment of that proportion of the aggregate of the Participant’s Expenditures and Production Program Costs to the time of assignment which equals the percentage of the Participant’s Interest which is being assigned.

Dilution and Conversion of an Interest to a Royalty 5.4 The respective Interests of the Participants shall not change so long as they each contribute their respective Cost Share of every Program as set out in Article 8 and Production Program as set out in Article 9. At any time and from time to time after a Participant elects or is deemed to have elected not to contribute to a Program or Production Program, its respective Interest shall be reduced, and each other Participant’s Interest shall be proportionately increased, in accordance with the formula set out in §5.2. If, as a result of such calculation, the Interest of a Participant is reduced to or below 15%, its Interest shall be deemed to be converted to a Net Profits Royalty and thereafter such party shall have no further rights or interest in respect of the Assets or under this Agreement, save and except for the Net Profits Royalty, provided however, that if a Participant assigns part of its Interest the percentage Interest to which the Participant’s and the assignee’s Interest must be diluted prior to its Interest being converted to a Net Profits Royalty shall remain at 15% for each of them and the Net Profits Royalty to which the assigning Participant’s or the assignee’s Interest shall be converted shall be that derived by multiplying the Net Profits Royalty to which the assigning Participant’s Interest would have been converted to prior to the assignment by the fraction, the numerator of which is the Participant’s Interest immediately after the assignment and the denominator of which is the assigning Participant’s Interest immediately prior to the assignment and such shall be applied in like fashion for any additional assignments.

Royalty Calculation and Payment

5.5 Any Net Profits Royalty shall be calculated pursuant to Schedule 2 by the Operator if it is the sole Participant, or if there is more than one Participant, by each Participant as to its respective share of the Net Profits Royalty and the Operator or the Participants, as the case may be, shall pay the Net Profits Royalty as described in Schedule 2.

Article 6

MANAGEMENT COMMITTEE

Management Committee

6.1 The Participants shall, as soon as is practicable after the Participation Date, establish a Management Committee which shall direct and control the operations of the Joint Venture.

Members

6.2 Each Participant having an Interest shall be entitled to two members on the Management Committee. A Participant may from time to time revoke in writing the appointment of any of its nominees on the Management Committee and appoint in writing another in his place. A Participant may from time to time in writing appoint one alternate member for any member theretofore appointed by such Participant. Alternate members may attend meetings of the Management Committee and, in the absence of the member, his alternate may vote and otherwise act in the place and stead of a member. Whenever any member or alternate member votes or acts, his votes or actions shall for all purposes of this Agreement be considered the actions of the Participant whom he represents. The Participants shall give written notice to each other from time to time as to names, addresses, telephone numbers and facsimile numbers of their respective members and alternates on the Management Committee.

Time and Place of Meetings

6.3 All meetings of the Management Committee shall be held in Vancouver, B.C. unless all members of the Management Committee agree otherwise and any member of the Management Committee may call a meeting at any time by giving seven days’ notice to the other members of the time and place of such meeting and the general nature of the business to be conducted, but no Participant other than the Operator shall be entitled to call a meeting less than three months after the date of the last meeting of the Management Committee. Any member of the Management Committee, or his alternate, may waive in writing the giving of such notice before or after such meeting. Otherwise, the giving of notices under this Article shall be governed by Article 18.

Resolutions in Writing

6.4 Any resolution in writing signed by all members of the Management Committee in one or more counterparts shall be as valid and binding as if passed at a meeting of the Management Committee duly called and constituted. The Chairman of a meeting of the Management Committee may require that a resolution duly passed at such meeting be reduced to writing and signed by all of the Participants present at such meeting in order to properly record such resolution.

Quorum

6.5 Except as herein set out, a quorum for any meeting of the Management Committee shall consist of a member or members representing a Participant or Participants whose Interest or Interests aggregate in excess of 50%. If a quorum is not present within 30 minutes after the time fixed for holding any such meeting, the meeting shall be adjourned to the sixth Business Day thereafter at the same time and place. Notice of any adjournment shall be given forthwith to each member of the Management Committee who was not present at the adjourned meeting. At the meeting to which the prior meeting was adjourned, the members (or their respective alternates) present in person shall form a quorum and may transact the business for which the meeting was originally convened.

Voting

6.6 Except as herein set out, the members of the Management Committee or their respective alternates shall have a number of votes equal in number to the Interest held by the Participant that he or they represent. The Management Committee shall decide all matters coming before it at a meeting by the affirmative vote of a majority of the votes entitled to be cast by members at the meeting. The representative of the Operator shall act as Chairman of each meeting of the Management Committee and, as such, shall have an additional or casting vote in the case of an equality of votes on any matter.

Secretary and Records

6.7 The Management Committee shall appoint a secretary (who need not be a member of the Management Committee) who shall keep a record of the meetings of the Management Committee, and circulate to all members minutes of each meeting promptly after the conclusion thereof. Each Participant shall have the right to examine and take extracts of all records of the Management Committee (which shall be maintained by the Operator), at reasonable times and on reasonable notice at the Operator’s offices during regular business hours.

Abandonment of Property

6.8 The Management Committee may decide to surrender or abandon a portion of the Property, provided such decision is made at least 90 days prior to the date on which such portion shall cease to be in good standing in the records of the appropriate governmental authority, and provided further that notice of such proposed abandonment is forthwith given to any Participant which was not represented at the meeting at which such decision was made. Those Participants which did not vote in favour of the abandonment may elect, by notice to the Operator within 30 days following the meeting or such notification, as the case may be, that the portion to be abandoned be transferred to it, or if more than one, to them in proportion to their respective Interests, whereupon the Operator and those Participants that voted in favour of the abandonment shall, forthwith after the expiry of the applicable 30-day period, transfer, assign and quit claim the subject portion to the Participant or Participants so electing. Failing any such election, the subject portion may be abandoned or surrendered as decided upon. Following a transfer or abandonment under this paragraph, the portion so transferred or abandoned shall thereafter cease to form part of the Property and shall no longer be subject to this Agreement, save and except with respect to such obligations or liabilities of the Participants as have accrued hereunder up to the date of such transfer or abandonment.

Article 7

OPERATOR

Rights and Powers of the Operator

7.1 Following the Participation Date, but subject to §7.2 and §7.4, Teck Cominco shall act as the Operator under this Agreement and as such shall, subject to the direction and control of the Management Committee, have full right, power and authority to do everything necessary or desirable to carry out the purposes of the parties in connection with this Agreement, including and without limiting the generality of the foregoing, the right, power and authority to:

(a) prepare and present to the Management Committee, Programs in respect of the Property and implement such Programs as are approved in accordance with the terms of this Agreement;

(b) regulate access to the Property subject only to the right of designates of the Participants duly authorized in writing to have access to the Property at all reasonable times for the purpose of inspecting work being done thereon, but at their own risk and expense;

(c) employ and engage such employees, agents, and independent contractors as it may consider necessary or advisable to carry out its duties and obligations hereunder and in this connection to delegate any of its powers and rights to perform its duties and obligations hereunder, but the Operator shall not, for the account of the Joint Venture, enter into contractual relationships with a Participant or any Associated Company of a Participant except upon terms that are commercially competitive;

(d) prepare, present and implement any Production Program that is approved in accordance with the terms of this Agreement;

(e) after the Completion Date and subject to the authority of the Management Committee, prepare, present and implement Operating Plans and operate the Property as a mine; and

(f) charge fees in respect of overhead costs as specified in the definitions of Expenditures, Production Program Costs and Operating Costs.

Resignation of the Operator

7.2 The Operator may resign at any time by giving 120 days’ prior written notice to the other Participants (or such shorter notice as the other Participants accept) and the Participants shall, within 60 days after receipt of such notice, convene a meeting of the Management Committee which shall appoint another Participant who consents to act as Operator, and determine its terms of engagement.

Duties and Obligations of the Operator

7.3 The Operator shall have such duties and obligations as the Management Committee may from time to time determine including, without limiting the generality of the foregoing, the following duties and obligations: (a) to propose and, if they are approved, implement Programs, Property Holding Programs, any Production

      Program and Operating Plans;

(b) to manage, direct and control all exploration, development, construction and producing operations in and under the Property, in a manner consistent with good exploration, engineering and mining practices and in compliance with all applicable laws, rules, orders and regulations;

(c) to prepare and deliver to the Participants, during periods of active field work, periodic progress reports as well as timely current reports and information on any material results obtained;

(d) subject to the terms and conditions of this Agreement, to keep the Assets in good standing and free of liens, charges and encumbrances of every character arising from operations (except liens for taxes not yet due, other inchoate liens and liens contested in good faith by the Operator) and to proceed with all diligence to contest or discharge any such lien that is filed;

(e) to account to the Participants for all contributions to and expenditure of Expenditures, Production Program Costs and Operating Costs;

(f) to maintain true and correct books, accounts and records of operations hereunder and, following the Completion Date, to prepare and deliver to the Participants audited financial statements of the Joint Venture within 120 days following the end of each Operating Year;

(g) to permit the Participants, at their own expense, to inspect, take abstracts from or audit any or all of the records and accounts referred to in §(f) hereof on reasonable notice during normal business hours, and without undue disruption of the work and operations of the Operator hereunder;

(h) to obtain and maintain, or cause any contractor engaged hereunder to obtain and maintain, during any period in which active work is carried out hereunder, such insurance as the Operator reasonably considers to be appropriate in the circumstances in light of general industry practice;

(i) to permit the Participants and their representatives appointed in writing, at their own expense and risk, access to the Property and all data derived from carrying out work thereon, on reasonable notice and without undue disruption of the work and operations of the Operator hereunder;

(j) to arrange for and maintain workers’ compensation or equivalent coverage for all eligible employees engaged by the Operator in accordance with local statutory requirements;

(k) to perform its duties and obligations in a manner consistent with good exploration, engineering and mining practices and in good faith and in the best interest of the Joint Venture;

(l) to transact, undertake and perform all transactions, contracts, employments, purchases, operations, negotiations with third parties and any other matter or thing undertaken on behalf of the parties in the Operator’s name; and

(m) endeavour to use Robert S. Middleton as the manager of all Programs until a decision is made to prepare a Feasibility Report on the Property with all such work to be completed under the direction of, and with the approval of, the Operator. The Operator shall be entitled to remove Robert S. Middleton as manager of all such work on the Property without notice if Mr. Middleton does not perform such work in a manner that is consistent with good exploration, engineering and mining practices. After a decision is made to prepare a Feasibility Report on the Property, Teck Cominco (provided it is the Operator at such time) shall be the manager of all Programs, Property Holding Programs, Production Programs and Operating Plans.

Non-Performance by the Operator

7.4 If the Operator fails to perform in a manner that is consistent with good exploration, engineering and mining practices or fails to perform in a manner consistent with its duties and responsibilities under this Agreement, or is adjudged to be bankrupt or insolvent or a receiver is appointed for its business and assets, then the Management Committee shall give to the Operator written notice setting forth particulars of the Operator’s default. The Operator shall within 30 days of receipt of such notice commence to remedy the default. Failure of the Operator to commence to remedy the default within such 30-day period (and thereafter to proceed continuously and diligently to complete all required remedial action) shall be grounds for termination of the Operator’s appointment; provided that if there shall be any disagreement between the Management Committee and the Operator as to whether a default has occurred, the matter may be submitted to arbitration under Article 17, and the Operator shall not be considered in default of any obligation determined on the arbitration if it commences to remedy the default within 10 days after the arbitration decision or within such longer period as may be fixed in the arbitration award. On any termination of the Operator’s appointment hereunder, a meeting of the Management Committee shall forthwith be convened to appoint another party who consents to act as Operator, and determine its terms of engagement. At such meeting, an Operator in default hereunder shall not be entitled to vote as a Participant for the purposes of this paragraph and the remaining Participant or Participants shall be sufficient to form a quorum for such purposes.

Delivery of Assets by Former Operator to Successor Operator

7.5 Upon ceasing to be Operator, the former Operator shall forthwith deliver to the successor Operator custody of all Assets and any books and records pertaining to the Assets which it prepared or maintained in its capacity as Operator. The successor Operator shall assume all of the rights, responsibilities, duties, and status of the previous Operator as provided in this Agreement. The successor Operator shall have no obligation to hire any of the employees of the former Operator.

Termination of Joint Venture if No Operator

7.6 If the Operator resigns or is removed and no other party consents to act as Operator, the Joint Venture shall be terminated and the Assets shall be liquidated or sold and the Assets or proceeds from the sale thereof distributed to the Participants, net of liabilities hereunder or related thereto, in accordance with their Interests. Each Participant shall be responsible for its Cost Share of all costs and expenses related to such termination and liquidation. The party which was the Operator may, if it consents to act, continue to act as Operator to effect such termination and liquidation and it shall have a lien on the Participants’ respective interests in the Assets and any proceeds therefrom as security for their respective Cost Shares of all costs, expenses and other liabilities owing in respect of or as of the date of such termination.

Indemnification of Operator

7.7 Subject to §7.8, each Participant shall, pro rata to its Interest, indemnify and save the Operator and any former Operator harmless from and against any loss, liability, claim, demand, damage, expense, injury and death (including, without limiting the generality of the foregoing, legal fees) resulting from any acts or omissions of the Operator or its officers, employees or agents.

No Indemnification of Operator

7.8 Notwithstanding §7.7, the Operator shall not be indemnified nor held harmless by any of the Participants for any loss, liability, claim, demand, damage, expense, injury or death (including, without limiting the generality of the foregoing, legal fees) resulting from the gross negligence or wilful misconduct of the Operator or its officers, employees or agents; provided however that in no case shall indemnification be withheld if the act or omission of the Operator or its officers, employees or agents was done or omitted to be done: (a) at the direction, or within the scope of the direction, of the unanimous consent of the Management

      Committee;

(b)     with the concurrence of the unanimous consent of the Management Committee; or (c) unilaterally and in good faith by the Operator to protect life, limb or property.

Indemnification in Proportion to Interests

7.9 The obligation of a Participant to indemnify and save the Operator harmless pursuant to §7.7 shall be in proportion to its Interest as at the date that the loss, liability, claim, demand, damage, expense, injury or death occurred or arose.

No Liability for Special Damages

7.10 The Operator shall not be liable to any Participant nor shall any Participant be liable to the Operator in contract, tort or otherwise for special or consequential damages, including, without limiting the generality of the foregoing, loss of profits or revenues.

Emergency Expenditures

7.11 Notwithstanding anything herein contained to the contrary, the Operator shall be entitled to incur, and the Participants shall be responsible for their respective Cost Share of, any costs expended which the Operator deems necessary to preserve or protect life, limb, property or the environment in respect of the Property and the operations hereunder.

Article 8

PROGRAMS

Expenditures to be Incurred Under Programs

8.1 After the Participation Date, but subject to §8.2, Expenditures shall only be incurred under and pursuant to Programs prepared by the Operator and approved by the Management Committee as provided in this Article. Any Preliminary Feasibility Report or Feasibility Report shall be prepared pursuant to a separate Program.

Programs in Progress on Participation Date

8.2 Upon the occurrence of the Participation Date, Expenditures incurred by Teck Cominco or the Operator as part of ongoing exploration work then in progress, up to a maximum of $100,000, shall be deemed to have been approved as a Program and each Participant shall be liable for its Cost Share thereof, upon being invoiced by Teck Cominco or Operator, as the case may be. Thereafter, the Operator shall, within 120 days following completion of each Program, prepare and submit to the Management Committee a Program of not less than 6 months and a maximum of 12 months in duration, which shall include at least such Expenditures as are necessary to maintain the Property in good standing. A Program for the preparation of a Feasibility Report and a Production Program may be for such duration as the Operator estimates is required for the completion thereof.

Election to Participate in Programs

8.3 Within 30 days after the approval by the Management Committee of a Program, the Participants shall each give written notice to the Operator stating whether or not they elect to contribute their respective Cost Shares of such Program. Failure by a Participant to give notice pursuant to this paragraph within such 30-day period shall be deemed to be an election by that Participant not to contribute to such Program.

Effect of Election to Not Contribute

8.4 If a Participant (for the purposes hereof a “Non-Contributor”) elects or is deemed to have elected not to contribute its Cost Share of a Program, each other Participant (for the purposes hereof a “Contributor”) that has elected to contribute its Cost Share of the Program may give notice in writing to the Operator stating that it shall contribute, in addition to its own Cost Share, the Cost Share of the Non-Contributor. If more than one Participant gives such notice, they shall contribute pro rata to their Interests or as they may otherwise agree. In such event, subject to §8.5, the Operator shall proceed with such Program and, on completion of such Program, the Interests of the parties shall be adjusted in accordance with §5.4; provided that, if such Program is completed to the extent of less than 80% of the originally estimated Expenditures thereunder, the Interests of the parties shall not be adjusted unless notice is first given to the Non-Contributor that the Program was abated, together with notice of the amount of the actual Expenditures thereunder, and the Non-Contributor does not, within 20 days thereafter, reimburse the Contributor or Contributors to the extent of its Cost Share thereof (being the amount which the respective Contributor elected to and did contribute instead of the Non-Contributor), together with interest thereon from the date contributed by the Contributor, at a per annum rate equal to the Prime Rate plus 2%. If the Non-Contributor so reimburses the Contributor or Contributors within such 20-day period, it shall be deemed to have elected to contribute its Cost Share of such Program and the Interests of the parties shall not be adjusted. A Participant that elects or is deemed to have elected not to contribute to a Program may, subject to §5.4, participate in future Programs.

Operator Not to Proceed Unless Program is Fully Funded

8.5 The Operator shall not proceed with any Program which is not fully subscribed except that the Operator shall at all times be entitled to incur such Expenditures as are necessary pursuant to §7.11, pursuant to a Property Holding Program or to maintain the Property in good standing and the Participants shall be liable for their Cost Share thereof, regardless of any election hereunder. If the Participants fully subscribe to a Program, the Operator shall proceed with such Program.

Obligation to Pay Expenditures and Overruns

8.6 An election by a Participant to contribute to a Program shall make that Participant liable to pay its respective share of Expenditures actually incurred under or pursuant to the Program including Program Overruns, as hereinafter defined, of up to but not exceeding 20%.

Procedures for Payment

8.7 After having elected to contribute to a Program which is proceeded with or if a Participant is otherwise obligated to pay its Cost Share, a Participant shall, within 15 days after being requested in writing to do so by the Operator, pay such portion of its Cost Share as the Operator may require, including cash calls for anticipated Expenditures, but the Operator shall not require payment of any funds more than 45 days in advance of the anticipated date of disbursement thereof.

Meeting Required to Approve Excess Program Overruns

8.8 If it appears to the Operator that Expenditures shall exceed those estimated under a Program, the Operator shall immediately give written notice to the Participants contributing to that Program outlining the nature and extent of the additional costs and expenses (herein called “Program Overruns”) and the reasons therefor. If Program Overruns are estimated to exceed by 20% those approved under the Program (herein called “Excess Program Overruns”), the notice of the Operator shall contain a notice of a meeting of the Management Committee, to be held no sooner than five Business Days after the date of delivery of the notice, for the purpose of considering, and if deemed advisable, approving the Excess Program Overruns. If the Excess Program Overruns are approved by the Management Committee, the Participants contributing to that Program shall, within 15 days after the receipt of a written request from the Operator, provide the Operator with their Cost Share of such Excess Program Overruns. If such Excess Program Overruns are not approved by the Management Committee, the Operator shall curtail or abandon such Program.

Effect of Default in Paying Expenditures

8.9 If a Participant at any time fails to pay its Cost Share in accordance with §8.5, §8.7 or §8.8, the Operator may give written notice to that Participant demanding payment and, if that Participant has not paid such amount, together with interest thereon at Prime Rate plus 2% from the date on which payment was due, within 15 days after receipt of such notice, the Interest of that Participant shall be deemed to be converted to a Net Profits Royalty and thereafter that party shall have no further rights or interest in respect of the Assets or under this Agreement, save and except its Net Profits Royalty. Notwithstanding the conversion of a defaulting party’s Interest pursuant to this paragraph, the Operator shall be entitled to take action to recover the amount owing by such defaulting party, and such conversion shall otherwise not relieve the defaulting party of any liability or obligation incurred up to the time of such default and conversion. The Operator shall have a lien on the Net Profits Royalty of the defaulting party to recover any amounts so owing, together with interest thereon, and may deduct same from any payments due in respect of the defaulting party’s Net Profits Royalty until so recovered in full. Any interest paid by or recovered from the defaulting Participant shall be for the account of the Participants that provided funds required of them as a result of the default, pro rata to their contributions, or otherwise shall be paid to the Participants not in default, pro rata to their Interests.

Program for a Preliminary Feasibility Report

8.10 Any of the Participants holding in the aggregate not less than a 40% Interest, shall be entitled to request, by written notice to the Operator, that the Operator propose a Program for the preparation of a Preliminary Feasibility Report.

Program for a Feasibility Report

8.11 Any of the Participants holding in the aggregate not less than a 40% Interest, shall be entitled to request, by written notice to the Operator, that the Operator propose a Program for the preparation of a Feasibility Report. If the Operator fails to do so within 60 days following receipt of such notice, the Participants giving such notice shall be entitled to prepare, at their own expense, a Feasibility Report and, forthwith upon completion of same, shall deliver copies thereof to the Operator and the other Participants. The preparation of a Feasibility Report by a Participant or Participants under this paragraph shall not affect the rights of the Operator to continue to propose and carry out Programs as otherwise set forth in this Article.

Participant’s Feasibility Report

8.12 In the event that a Feasibility Report prepared by one or more Participants does not demonstrate that the Property or a part thereof may be economically placed into Commercial Production, no further action shall be taken in respect thereof and any expenses incurred by the Participants which prepared such Feasibility Report shall be for their own account and shall not be considered Expenditures made under this Agreement.

Favourable Feasibility Report

8.13 In the event that a Feasibility Report prepared by the Operator as a Program or by one or more Participants pursuant to §8.11 demonstrates that the Property or a part thereof may be economically placed into Commercial Production, the Feasibility Report shall be delivered to the Participants or other Participants, as the case may be, and the provisions of Article 9 shall apply.

Provision of Security

8.14 To the extent that security (whether in the form of cash, negotiable securities, letters of guarantee, irrevocable letters of credit or otherwise) is required to be posted with or in favour of any regulatory authority or government in connection with Programs, a Production Program or Operating Plan, each of the Participants shall lodge security, in such form as may be acceptable to the particular authority, in an amount proportionate to its Interest at the time and to the total amount of security then required by the authority; and if the security shall expire at a particular time a Participant shall replace or renew its security before that time if required by the authority.

Article 9

PRODUCTION PROGRAM

Delivery of Proposed Production Program

9.1 At any time after delivery to the Participants of a Feasibility Report pursuant to §8.13, the Operator may, and shall within 120 days of receipt by it from Participants holding in the aggregate not less than a 40% Interest of a request in writing to do so, prepare and deliver to the Participants a Production Program which shall be based on such Feasibility Report. The preparation of the Production Program shall be deemed to be pursuant to a Program in which each Participant has elected to pay its Cost Share of Expenditures incurred thereunder. Within 180 days of the receipt by each Participant from the Operator of a Production Program, each such Participant shall give written notice to the Operator stating whether it elects to contribute its Cost Share of the Production Program (subject to §5.2(b)). Failure to give such notice within such 180-day period shall be deemed to be an election by such Participant not to contribute to the Production Program.

Operator to Proceed with Adopted Production Program

9.2 If Participants holding Interests aggregating not less than 51% elect to contribute their respective Cost Share of a Production Program, together with the Cost Share of those Participants who have elected or are deemed to have elected not to participate in the Production Program, the Operator shall, subject to §9.3, proceed with such Production Program and the provisions of §5.4 shall apply. If the Feasibility Report on which such Production Program is based was prepared by one or more Participants pursuant to §8.11, then 125% of the costs thereof as incurred by such Participants and as supported by written evidence shall be deemed to be Expenditures and, within 15 days following a written demand therefor (together with such evidence), the other Participants shall reimburse the Participant or Participants that prepared such Feasibility Report to the extent of their respective Cost Shares thereof. Failure by a Participant to reimburse its Cost Share thereof shall result in dilution of its Interest under §5.4, with the non-reimbursed portion as aforesaid deemed to have been contributed (in addition to its own Cost Share) by the Participant that prepared the Feasibility Report, or, if more than one Participant, such shall be apportioned among them in accordance with their respective contributions to the Costs of preparing the Feasibility Report.

Obligation to Pay Production Program Costs and Overruns

9.3 An election to contribute to a Production Program shall make a Participant liable to pay its Cost Share of all of the Production Program Costs actually incurred under or pursuant to such Production Program, including Production Program Overruns (as hereinafter defined) up to but not exceeding 15%. The Operator need not proceed with a Production Program until each Participant has delivered proof, satisfactory to the Operator, of the Participant’s ability to pay its Cost Share of such Production Program including, if required by the Operator from any Participant whose net worth (according to its last available balance sheet) is less than 300% of its Cost Share of anticipated Production Program Costs, Letters of Credit or other reasonable guarantee of availability of funds.

Procedures for Payment

9.4 After having elected to contribute to a Production Program which is proceeded with, each Participant shall, within 15 days after being requested in writing to do so by the Operator, pay such portion of its Cost Share of the Production Program Costs as the Operator may require, including cash calls for anticipated Production Program Costs, and provide such security or additional security as may then be required under §8.14, but the Operator shall not require payment of any funds more than 45 days in advance of the proposed expenditure thereof.

Meeting Required to Approve Excess Production Program Cost Overruns

9.5 If it appears to the Operator that Production Program Costs shall exceed those estimated under the Production Program, the Operator shall immediately give written notice to the Participants outlining the nature and extent of the additional costs and expenses (herein called “Production Program Overruns”) and the reasons therefor. If Production Program Overruns are estimated to exceed by 15% those estimated under the Production Program (herein called “Excess Production Program Overruns”), the notice of the Operator shall contain a notice of a meeting of the Management Committee, to be held no sooner than five Business Days after the date of delivery of the notice, for the purpose of considering, and if deemed advisable, approving the Excess Production Program Overruns. If the Excess Production Program Overruns are approved by the Management Committee, each Participant shall, within 15 days after the receipt of a written request from the Operator, provide the Operator with its Cost Share of such Excess Production Program Overruns.

Curtailment of Production Program

9.6 If Excess Production Program Overruns are not approved by the Management Committee, as provided in §9.5, the Operator shall have the right to curtail or abandon the Production Program. Alternatively, any Participant that has approved such Excess Production Program Overruns may advance the amount of such Excess Production Program Overruns which have not been accepted (if more than one of them, pro rata to their respective Interests or as they may otherwise agree) and, on so doing, such Participants shall be entitled to recover the amount of such advances from the sale of Mineral Products of the other Participant or Participants, together with interest thereon from the date advanced at a per annum rate equal to the Prime Rate plus 4%, and the provisions of §11.3 shall apply with respect thereto.

Effect of Default in Paying Production Program Costs

9.7 If a Participant at any time fails to pay its Cost Share of Production Program Costs (including Production Program Overruns and approved Excess Production Program Overruns) in accordance with §9.4 or §9.5, the Operator may give written notice to such Participant demanding payment and, if such Participant has not paid such amount, together with interest thereon at Prime Rate plus 2% from the date on which payment was due, within 15 days after receipt of such notice, such Participant shall be deemed to be in default hereunder and either, as the Management Committee (excluding the Participant in default) may determine, (a) its Interest shall be deemed converted to a Net Profits Royalty, or (b) it shall be liable for all damages occasioned to the other Participants by its default hereunder, unaffected by any dilution in its Interest arising from failure or delay in making contributions. If the Management Committee adopts alternative (a), thereafter, such defaulting Participant shall have no further rights or interest in respect of the Assets or under this Agreement, save and except for such Net Profits Royalty. For the purposes of the calculation of Net Profits under Schedule 2, it is understood that cumulative Costs thereunder shall include, inter alia, all Expenditures and Production Program Costs whether or not a portion of such costs were contributed by the holder of the Net Profits Royalty. Any interest paid by or recovered from the defaulting Participant shall be for the account of the Participants that provided funds required of them as a result of the default pro rata to their contributions, or otherwise shall be paid to the Participants not in default, pro rata to their Interests.

Operator’s Right to Curtail Production Program Upon Default

9.8 If, upon the default of a Participant pursuant to §9.7, the other Participant or Participants, if more than one, do not thereafter elect to contribute pro rata to their Interests or as otherwise agreed by them, what would have been the defaulting Participant’s Cost Share of remaining Production Program Costs, the Operator shall have the right to curtail or abandon the Production Program.

Article 10

OPERATING PLANS

Obligation to Pay Operating Costs and Overruns

10.1 Following the Completion Date, each Participant shall be liable to pay its Cost Share of all Operating Costs incurred under Operating Plans, including Operating Cost Overruns (as hereinafter defined) up to but not exceeding 20%.

Operating Plans

10.2 At least 90 days prior to the date the Operator anticipates the Completion Date shall occur, the Operator shall propose and deliver to the Participants an Operating Plan for the first Operating Year. Subsequently, at least 90 days before the commencement of each succeeding Operating Year, the Operator shall propose an Operating Plan by delivery of such to each Participant, for such succeeding Operating Year. Within 30 days of delivery of a proposed Operating Plan hereunder, a meeting of the Management Committee shall be convened to review, amend (if deemed appropriate) and approve same.

Excess Operating Cost Overruns

10.3 Except as herein provided, the Operator shall have the power and authority to deviate from or make modifications to Operating Plans from time to time, in accordance with good engineering and mining practices. If it appears to the Operator that Operating Costs shall exceed those estimated under an Operating Plan, the Operator shall immediately give written notice to the Participants outlining the nature and extent of the additional costs and expenses (herein called “Operating Cost Overruns”) and the reasons therefor. If Operating Cost Overruns are estimated to exceed by 20% those estimated under the Operating Plan (herein called “Excess Operating Cost Overruns”), the notice of the Operator shall contain a notice of a meeting of the Management Committee, to be held no sooner than five Business Days after the date of delivery of the notice, together with a proposed amendment to the Operating Plan. The meeting of the Management Committee shall be convened to review, amend (if deemed appropriate) and approve same.

No Agreement on Operating Plans

10.4 In the event that a proposed Operating Plan or amendment thereto is not approved by the Management Committee as hereinbefore provided, the Operating Plan shall be deemed to be approved as submitted and shall be implemented by the Operator provided that it is consistent with:

(a)     the Feasibility Report; or (b) the most recently approved Operating Plan.

If the Management Committee does not approve an Operating Plan for 3 successive Operating Years, the Operator shall prepare a shut-down plan for the mine and budget therefor which shall be implemented within 90 days after it is submitted to each Participant. Each Participant shall pay or to the satisfaction of the Operator provide security for, its entire Cost Share of the shut-down budget.

For the purposes of this paragraph, an Operating Plan shall be consistent with the Feasibility Report or prior Operating Plan if the proposed production rate has not changed by more than 20% and projected Operating Costs have not changed by more than 20% from those depicted in the later of the Feasibility Report or prior Operating Plan and if the capital costs included in the proposed Operating Plan are generally consistent with those provided in the Feasibility Report for post-commencement of Commercial Production or in the prior Operating Plan.

Statements of Operating Costs

10.5 Following the Completion Date, the Operator shall, on or before the 15th day of each month, submit to the Participants a statement of Operating Costs, which the Operator estimates shall be incurred to the end of the next month (taking into account any current cash shortfall or surplus), and Operating Costs at the time incurred and unpaid), and on or before the last day of the month in which such statement is submitted, each Participant shall pay to the Operator its respective Cost Share thereof.

Effect of Default in Paying Operating Costs

10.6 If a Participant (for the purposes hereof a “Defaulting Participant”) fails to pay all or any part of its Cost Share pursuant to §10.5, the other Participant or Participants if more than one, shall be entitled, pro rata to their Interests or as otherwise agreed by them, to pay all or a portion of the unpaid Cost Share of the Defaulting Participant. If the other Participants decline to pay all of such unpaid Cost Share, the Operator shall be entitled to pay the unpaid portion thereof. If the other Participants and/or the Operator pay such unpaid share, then they or it shall be entitled to recover the amount so paid, together with interest thereon from the date so paid at a per annum rate equal to the Prime Rate plus 4%, and the provisions of §11.3 shall apply.

Participant may Require Operations to be Shut Down

10.7 Any Participant holding a 30% Interest or greater shall be entitled, by notice in writing to the Operator and the other Participant, to require that operations be suspended if: (a) for a period of 6 consecutive months such Participant can demonstrate (as set forth in such notice) that

        its Cost Share of Operating Costs has exceeded its proceeds from the sale of Mineral Products; (b) within 30 days after receipt of such notice, the other Participant has not demonstrated to the Operator

that its proceeds from the sale of Mineral Products have equalled or exceeded its Cost Share of Operating Costs during such six month period; and

(c) such Participant has provided assurances acceptable to the Operator that the Participant is capable of bearing its share of the care and maintenance costs of the mine on the Property.

If such notice is given to the Operator it shall prepare an Operating Plan for placing the mine on care and maintenance and shall convene a meeting of the Management Committee to approve such.

Resumption of Operations

10.8 If at any time after the suspension of operations pursuant to §10.7, the Operator determines that the mine can be placed back into Commercial Production with the Participants’ Cost Share of Operating Costs being not more than 80% of the proceeds which they should realize on the sale of their share of Mineral Products, the Operator shall prepare an Operating Plan for the resumption of Operations and shall convene a meeting of the Management Committee to consider that Operating Plan.

Permanent Suspension

10.9 The Operator, at the direction of the Management Committee, may at any time following a period of at least one year during which operations have been continuously suspended under §10.7, by notice to all Participants holding greater than a 25% Interest, request their agreement to a permanent termination of operations. Within 90 days after receipt of that notice, each of such Participants may give notice to the Operator stating that it agrees to the request of the Operator or that it does not agree. If a Participant fails to give notice within that 90 day period, it shall be deemed to have agreed to the request of the Operator. If one or more Participants holding greater than a 25% Interest gives notice that it does not agree to a permanent termination of operations, the Management Committee may elect to have the Operator resume operations or replace the Operator with another Participant (the objecting Participants deciding amongst themselves who shall be the Operator), in which case that Participant shall become the new Operator and shall resume operations. If the Operator has not resumed operations within one year after the end of the 90 day period, the Management Committee shall cause the Operator to remove, sell and dispose of the Assets other than timbers and structures affixed to the underground workings and shafts of the mine as may be removed pursuant to applicable environmental and mining laws. The net revenues shall be divided among Participants in proportion to their respective Interests.

Article 11

DISPOSITION OF PRODUCTION

Taking in Kind

11.1 Each Participant shall, subject to Article 16, take in kind and separately dispose of its share (in proportion to its respective Interest) of Mineral Products. However, unless otherwise specified by a particular Participant, that Participant hereby appoints the Operator as its sole marketing agent to sell and dispose of its share of Mineral Products and, upon completing any such sale and disposition on behalf of a Participant, the Operator shall, subject to Article 16, remit to such Participant its respective share of the proceeds, after making such deductions as are permitted under §11.2.

Valuing Mineral Products

11.2 For the purposes of determining the value of Mineral Products taken in kind pursuant to §11.1 or §11.3, each Participant’s share of Mineral Products shall be valued and accounted for as of the time of delivery to or settlement with the purchaser or purchasers thereof, after deduction of all costs of or related to the marketing thereof, including without limitation:

(a) all costs of storage and transportation, including insurance; (b) all commissions and discounts;

(c) such reasonable charge for marketing Mineral Products as is consistent with generally accepted industry marketing practices; and

(d) all taxes (other than income taxes), royalties or other charges or imposts provided for pursuant to any law or legal obligation imposed by any government if paid by the Operator for the account of such Participant in connection with the disposition of Mineral Products hereunder.

Priority

11.3 If the Operator or a Participant makes any payment on behalf of a Defaulting Participant pursuant to §10.6, or if a Participant advances Excess Production Program Overruns pursuant to §9.6, the Operator or such Participant, as the case may be, shall have the prior and first right to receive the share of Mineral Products of the Defaulting Participant or the Participant which did not advance Excess Production Program Overruns, as the case may be, pursuant to §11.1 until the Operator or such Participant has received Mineral Products in kind of a value equal to the amount advanced, together with interest thereon at the rate specified in §9.6 or §10.6, as the case may be.

Accounting by Operator

11.4 Proceeds from the sale by the Operator of Mineral Products hereunder shall be calculated by the Operator separately for each Participant at the end of each calendar month and shall be paid monthly within 20 days after the end of each such calendar month following payment to the Operator by each Participant of its respective Cost Share of Operating Costs outstanding as at the end of that calendar month, and otherwise subject to Article 16 and the foregoing provisions of this Article.

Records

11.5 The records relating to Mineral Products taken in kind or to the calculation of proceeds from the sale thereof may, at the direction of the Management Committee, be audited annually at the end of each Operating Year. Any adjustments required by such audit shall be made forthwith and a copy of the audited statements shall be delivered to the Participants. Any of the Participants shall, at reasonable times and upon reasonable notice in writing to the Operator, have the right to inspect, audit and copy the Operator’s accounts and records relating to the accounting for Mineral Products taken in kind or to the determination of proceeds from the sale thereof for any Operating Year within 12 months following the end of such Operating Year. All such accounts and records shall be deemed to be correct and accurate unless questioned by a Participant within 12 months following the end of the Operating Year to which the accounts relate. The Participants shall make all reasonable efforts to conduct audits in a manner which shall result in a minimum of inconvenience to the Operator.

Non-Arm’s Length Sale of Product

11.6 If the Operator or an Affiliate of the Operator is a purchaser of Mineral Products hereunder, and if the value of such Mineral Products is used to determine any matter arising under this Article, the Operator shall be required to receive competitive prices for all Mineral Products so sold.

Article 12

CONFIDENTIAL INFORMATION

Obligation Not to Disclose

12.1 Each party agrees that all information obtained hereunder is confidential and shall be the exclusive property of the parties and shall not be publicly disclosed or used other than for the activities contemplated hereunder, except as required by law or by the rules and regulations of any regulatory authority, trading facility or stock exchange having jurisdiction or in connection with the filing of an annual information form, prospectus or similar securities disclosure document, or with the written consent of the other parties, such consent not to be unreasonably withheld, provided that the provisions of this Article do not apply to information referred to in Article 13 or which is or becomes part of the public domain other than through a breach of the terms hereof.

Consent to Disclose

12.2 Consent to disclosure of information hereunder shall not be unreasonably withheld where a party wishes to disclose any such information to a third party for the purpose of arranging financing for its contributions hereunder or for the purpose of selling its interest in the Assets or its interest in this Agreement, provided that such third party gives its undertaking to the Participants that any such information not theretofore publicly disclosed shall be kept confidential and not disclosed to others for a period agreed upon by the Participants, which shall not be less than two years in duration.

No Liability for Actions of Third Parties

12.3 No party shall be liable to the others for the fraudulent or negligent disclosure of information by any of its employees, servants or agents, provided that such party has taken reasonable steps to ensure the preservation of the confidential nature of such information.

Notice Period

12.4 Where a request is made by written notice for permission to disclose confidential information hereunder (which notice shall specify the reason for the disclosure and the name of the person to whom disclosure is to be made), the other parties shall reply thereto within three Business Days after receipt of such request, failing which a party shall be deemed to have consented to such disclosure in the limited circumstances specified in such request.

Press Releases and Other Public Disclosure

12.5 The parties shall ensure that all public disclosure of information relating to the Property or work thereon shall comply with the rules, by-laws, policies and disclosure standards of the applicable stock exchanges or other regulatory authorities having jurisdiction and each party shall be entitled to independently verify information that the other party intends to release. The Owners shall consult with Teck Cominco and obtain approval of Teck Cominco (such approval not to be unreasonably withheld) prior to issuing any press release or other public statement regarding the Property, work thereon or the activities of the parties or Associated Companies with respect thereto. In addition, the Owners shall obtain prior approval of Teck Cominco before issuing any press release or public statement using Teck Cominco’s name or the name of any of Teck Cominco’s Associated Companies, the name of any of the officers, directors or employees of Teck Cominco or its Associated Companies. However, such approval shall not be considered certification by Teck Cominco of the accuracy of the information in such press release, or a confirmation by Teck Cominco that the content of such press release complies with the rules, policies, by-laws and disclosure standards of the applicable regulatory authorities or stock exchanges.

Article 13

DISCLOSURE STANDARDS

Compliance with Disclosure Standards

13.1 The parties shall ensure that all public disclosure of information relating to the Property or work thereon shall comply with the rules, by-laws, policies and disclosure standards of applicable stock exchanges and other regulatory authorities.

Breach of Disclosure Standards

13.2 Notwithstanding the terms of Article 12, if a party discovers that any person who has prepared, or provided, any information on behalf of another party has breached, or appears to have breached, the code of conduct or disclosure standards of any applicable professional association or of any applicable stock exchange, the discovering party may (but shall be under no liability for failure) report such breach, or appearance of breach, to the other party, and in such a case, such party shall take the necessary steps in a timely manner to report such breach, or appearance of breach, in accordance with the rules, by-laws, guidelines and disclosure standards of the stock exchange on which the such party’s share capital is listed. In the event such party fails to comply with such reporting requirements, the discovering party may (but shall be under no liability for failure to) report such breach, or appearance of breach, in accordance with such requirements.

Misleading Disclosure

13.3 Notwithstanding the terms of Article 12, if a party discovers that, in its opinion, another party’s publicly disclosed information (the “Prior Disclosure”) relating to the Property or work thereon is inconsistent with the data or other information regarding the Property, programs or results of programs, and as a result, in the opinion of the discovering party, the Prior Disclosure is or could be materially misleading to the public, the discovering party shall advise the other party of such inconsistency and (a) the other party shall promptly publish or disseminate, to an extent no less broad than the dissemination

        of the Prior Disclosure, a statement correcting the Prior Disclosure, or

(b) if the other party fails to promptly disseminate a correcting statement, the discovering party shall be entitled to do either or both of the following:

(i) disseminate a statement either correcting the Prior Disclosure, or stating that it is not responsible for publishing the Prior Disclosure and does not necessarily agree therewith, and

(ii) report the inconsistency to the applicable stock exchanges and other regulatory authorities.

Nothing in this section imposes any obligation on the discovering party to verify the accuracy of any statement by the other party correcting a Prior Disclosure.

Article 14

RESTRICTIONS ON ALIENATION

No Sale of Interest Except as Specified

14.1 Except in accordance with this Agreement the Owners shall not transfer, convey, assign, mortgage or grant an option in respect of or grant a right to purchase or in any manner transfer or alienate any or all of its Interest or transfer or assign any of its rights under this Agreement. Teck Cominco shall be entitled to transfer, convey, assign, mortgage or grant an option on its interest in the Property, its Interest or its rights under this Agreement.

Terms of Sale

14.2 The Owners shall not sell any of its Interest or transfer or assign any of its rights under this Agreement except: (a) in the case of an assignment of a Net Profits Royalty in its entirety;

(b) pursuant to an agreement in which the consideration is expressed only in lawful money of Canada or of the United States of America;

(c) as a single transaction not directly or indirectly part of some other sale or purchase or agreement for any additional consideration of any nature whatsoever; and

(d) when there is no default of any of the covenants and agreements herein contained by such party;

nor shall it make any assignment of less than its entire Interest if after giving effect thereto it shall hold less than a 20% Interest.

Notice of Intention to Sell

14.3 Subject to the foregoing, if an Owner (in this Article called the “Offeror”) intends to sell all or part of its Interest or transfer or assign its rights under this Agreement shall first give notice in writing to the other Participants (in this Article called the “Offeree”) of such intention together with the terms and conditions on which the Offeror intends to sell its Interest or transfer or assign its rights under this Agreement.

Notice of Receiving an Acceptable Offer

14.4 If an Owner (in this Article also called the “Offeror”) receives an offer to purchase its Interest or rights under this Agreement which meets the requirements of §14.2 and which it intends to accept, the Offeror shall not accept the same unless and until the Offeror has first offered to sell such Interest or rights to the other Participants (in this Article also called the “Offeree”) on the same terms and conditions as in the offer received and the same has not been accepted by the Offeree in accordance with §14.6.

Content of Notice

14.5 Any communication of an intention to sell pursuant to §14.3 or §14.4 shall be in writing delivered in accordance with Article 18 and shall: (a) set out fully and clearly all of the terms and conditions of any intended sale; (b) if it is made pursuant to §14.4, include a true copy of the offer received; and (c) if it is made pursuant to §14.4, clearly identify the offering party and include such information as is

        known by the Offeror about such offering party;

and such communication shall be deemed to constitute an offer (the “Offer”) by the Offeror to the Offeree (if more than one the Offer shall be made to the Offerees in proportion to their respective Interests or as otherwise agreed by them) to sell the Offeror’s Interest or transfer or assign its rights under this Agreement to the Offeree on the terms and conditions set out in such Offer.

Notice Acceptance Period

14.6 Any Offer made as contemplated in §14.5 shall be open for acceptance by the Offeree for a period of 60 days from the date of receipt by the Offeree.

Effect of Acceptance of Offer

14.7 If the Offeree accepts the Offer within the time provided in §14.6, then such acceptance shall constitute a binding agreement of purchase and sale between the Offeror and the Offeree for the Offeror’s Interest or rights under this Agreement on the terms and conditions set out in the Offer. If there is more than one Offeree the acceptance shall be in proportion to their respective Interests or as otherwise agreed by them.

Effect of Not Accepting an Offer

14.8 If the Offeree does not accept the Offer within the time limited, the Offeror may complete the sale of its Interest or its rights under this Agreement on exactly the same terms and conditions set out in the Offer and, where applicable, only to the party making the original offer to the Offeror as contemplated in §14.4, and in any event such sale shall be completed within 60 days from the expiration of the right of the Offeree to accept such Offer or the Offeror must again comply with the provisions of this Article.

No Coincident Offers

14.9 Following an Offer under §14.5, no other Offer may be made by the Offeror unless and until the 60-day period referred to in §14.8 has expired and no sale of the Offeror’s Interest or rights has been completed in accordance with the terms of the first-mentioned Offer.

Operatorship is not Transferable Without Consent

14.10 If a party which is the Operator sells its Interest or transfers or assigns its rights under this Agreement to a third party, its rights and obligations as Operator under this Agreement shall not be included in such sale unless the third party is capable of assuming and performing the duties and obligations of the Operator imposed under this Agreement and the consent of all Participants is first had and obtained, such consent not to be unreasonably withheld. However, nothing in this §14.10 shall prevent any assignee from proposing or voting for the appointment of itself as Operator at any meeting of the Management Committee called for that purpose.

Purchasers Agreement to be Bound

14.11 As a condition of the purchase of a Participant’s Interest and rights under this Agreement, the purchaser shall covenant and agree that it shall be bound by this Agreement, including this Article 14, and prior to the completion of any such purchase, the purchaser shall deliver to each of the other Participants notice to that effect in a form satisfactory to such Participants.

Article 15

ENCUMBRANCES AND PARTITION

Obligation to Hold Interest Free of Encumbrances

15.1 Except as hereinafter provided, a Participant shall not encumber or suffer to exist any lien, charge or encumbrance on its Interest.

Limited Right to Mortgage

15.2 Notwithstanding the provisions of §15.1, a Participant may pledge, mortgage, charge or otherwise encumber (in this paragraph a “Charge”) the whole or any part of its respective Interest in order to finance its Cost Share of Production Program Costs and Operating Costs, but only upon the condition that the holder of such Charge, (in this paragraph a “Chargee”), first enters into a written agreement with the other Participants in form satisfactory to counsel for such other Participants, binding upon the Chargee, to the effect that: (a) the Chargee shall not enter into possession or institute any proceedings for foreclosure or partition of

the encumbering Participant’s Interest and that the Charge shall be subject to the provisions of this Agreement including, without limitation, the provisions of Article 11 and Article 16; and

(b) the Chargee’s remedies under the Charge shall be limited to the sale of the whole, (but only of the whole), of the encumbering Participant’s secured Interest:

(i) to the other Participants, if more than one then in proportion to their respective interests at that time; or

        failing any such sale then either:

(ii) at a public auction to be held after 90 days’ prior notice to the other Participants but with a reserve price and terms no more favourable to a third party purchaser than those last offered by the Chargee to, and declined by, the other Participants; or

(iii) through private sale, but on terms no more favourable to a third party purchaser than those last offered by the Chargee to, and declined by, the other Participants;

provided however, that prior to completing the purchase, the purchaser shall deliver an agreement, in form reasonably satisfactory to counsel for the other Participants, that it assumes the obligations of the encumbering Participant under this Agreement and agrees to be bound by the terms of this Agreement as a Participant and party hereunder.

Waiver of Right to Partition

15.3 Each Participant hereto hereby waives its right to seek partition of the Property or any part thereof.

Article 16

OPERATOR’S LIEN

Operator’s Lien

16.1 In addition to any lien, charge or security interest (collectively in this Agreement called a “lien”) to which the Operator may be entitled by law, including any provided for elsewhere in this Agreement (including without limitation the lien that the Operator has under §8.9 on a defaulting party’s Net Profits Royalty), each Participant does hereby mortgage, charge, assign and grant a security interest to and in favour of the Operator in:

(a)     the undivided share of Mineral Products owned or to be owned by such Participant; (b) the Interest of such Participant; (c) all personal property in any form derived directly or indirectly from the sale, disposition or other

dealing with or comprised in or related to the collateral described in §(a) and (b), or the proceeds therefrom, including insurance proceeds, any other payment representing indemnity or compensation for loss of or damage thereto or the proceeds therefrom, and all book accounts and book debts and generally all accounts, debts, dues and demands and choses in action of every nature and kind and now due, owing or accruing or growing due or which may hereafter become due, owing or accruing or growing due to the Participant and all deeds, documents, writings, papers, books of account and other books and security documents relating to, being records of or securing the said accounts, debts, dues, demands and choses in action or by which the said accounts, debts, dues, demands and choses in action are or may hereafter be secured, evidenced, acknowledged or made payable;

        as security for:

(d) their respective obligations from time to time to make contributions to Expenditures and Production Program Costs under Article 8 and Article 9 respectively;

(e) their respective obligations from time to time to make contributions to Operating Costs as contemplated in Article 10;

(f) an amount equal to any amount paid or advanced by the Operator pursuant to §10.6, together with interest thereon at the rate specified in §10.6;

(g) their respective shares of the costs of a termination and liquidation under §7.6; and

(h) the fulfilment of all obligations, present and future, of the Participant to the Operator under this Agreement or otherwise in connection with the Property.

Enforcement of Lien by the Operator

16.2 Such lien in respect of a Participant who is in default of one or more of its obligations as specified in §16.1 (in this Article 16 a “Defaulting Participant”) may be enforced by the Operator against the Defaulting Participant by any one or more of the following:

(a) the sale or lease (either to one or more of the other Participants, or to a third party, but subject to Article 14, save and except for §14.2) of all or part of the Interest of the Defaulting Participant for cash or on credit or partly for cash and partly on credit;

(b) the sale of the Defaulting Participant’s share of Mineral Products for cash or on credit or partly for cash and partly on credit;

(c) the collection and/or retention of receipts due to the Defaulting Participant from the sale of Mineral Products or any other Assets and the application of the receipts so collected to the obligations, amounts and costs referred to in §16.1(d) to §16.1(g), inclusive; or

(d) without restricting the provisions of §(a), (b) and (c), the exercise by the Operator of any other rights and remedies available at law or in equity, which may be exercised in the alternative, concurrently or cumulatively.

In the case of the sale of the Defaulting Participant’s Interest or the sale of Mineral Products pursuant to §(a) and (b) respectively, the Defaulting Participant shall execute and deliver to the purchaser on demand any instrument reasonably necessary to confirm to the purchaser the title to the property so sold and the Operator is hereby irrevocably authorized by each Participant to execute on its behalf and in its name any such confirmatory instrument.

Right of Participant to Deal With Mineral Product

16.3 The security interest hereby granted by each Participant to the Operator shall in no way hinder or prevent a Participant, at any time or from time to time until the security interest hereby constituted shall have become enforceable pursuant to the provisions of §16.1, from:

(a) selling, assigning, transferring, conveying or otherwise disposing of all or any part of its Mineral Products, free from such security interest, in the ordinary course of its business and for the purpose of carrying on the same; provided that any forward sale commitment by a Participant shall be without prejudice to enforcement by the Operator of its security interest in respect of any Mineral Products that have not at the time been delivered to meet that commitment;

(b) selling, assigning, conveying, transferring or otherwise disposing of all or an undivided part of its Interest in accordance with the provisions of Article 14;

(c) subject always to compliance with the provisions of Article 15, entering into a security agreement in accordance with that Article;

provided that any such action is not in breach of any provision of this Agreement.

Participant’s Lien

16.4 A Participant other than the Operator which makes a payment on behalf of a defaulting Participant pursuant to §10.6 or advances a portion of Excess Production Program Overruns on behalf of another Participant pursuant to §9.6, or has a right to damages pursuant to §9.7, shall have a lien on the defaulting Participant’s Interest, the right of the defaulting Participant to receive either Mineral Products in kind or proceeds from the sale thereof or from the sale of any other Assets, the interest of the defaulting Participant in any contracts for the sale of Mineral Products, other Assets and Mineral Products received in kind by the defaulting Participant, as security for repayment by the defaulting Participant of all amounts paid or advanced by the Participant pursuant to §9.6, §10.6 and to which it may be entitled pursuant to §9.7, together with interest thereon at the rate specified in §9.6, §9.7 or §10.6, as the case may be.

The lien under this §16.4 shall rank pari passu with the Operator’s lien under §16.1 insofar as it secures amounts referred to in §16.1(f) and subordinate to the lien of the Operator insofar as it secures amounts referred to in §16.1(d), §16.1(e) or §16.1(g) and the provisions of §16.2 and §16.3 shall apply with respect thereto mutatis mutandis.

Article 17

ARBITRATION

Single Arbitrator

17.1 Any matter required or permitted to be referred to arbitration pursuant to §7.4 and §14.3 or Schedule 2 shall be determined by a single arbitrator to be appointed by the parties hereto.

Notice of Intent to Arbitrate

17.2 Any party may refer any such matter to arbitration by written notice to the others and, within 30 days after receipt of such notice, the parties shall agree on the appointment of an arbitrator, who shall be capable of commencing the arbitration within 21 days of his appointment. No person shall be appointed as an arbitrator hereunder unless such person agrees in writing to act.

Effect of Lack of Agreement on Arbitration

17.3 If the parties cannot agree on a single arbitrator as provided in §17.2 either party may request the court to appoint a single arbitrator in accordance with the Commercial Arbitration Act of the Province of British Columbia (the “Act”).

Procedural Matters

17.4 Except as specifically provided in this Article, an arbitration hereunder shall be conducted in accordance with the Act. The arbitrator shall fix a time and place in Vancouver, British Columbia for the purpose of hearing the evidence and representations of the parties, and of which shall be in camera, and he shall preside over the arbitration and determine all questions of procedure not provided for under such Act or this Article. After hearing any evidence and representations that the parties may submit, the arbitrator shall make an award and reduce the same to writing and deliver one copy thereof to each of the parties. The award shall be kept confidential by the partners except as disclosure is required by applicable securities laws. The decision of the arbitrator shall be made within 45 days after his appointment, subject to any reasonable delay due to unforeseen circumstances. The expense of the arbitration shall be paid as specified in the award. The parties agree that the award of the single arbitrator shall be final and binding upon each of them and shall not be subject to appeal.

Article 18

NOTICE

Means of Notice

18.1 Any notice, direction or other communication required or permitted to be given under this Agreement shall be in writing and may be given by personal delivery or by mail (first class postage prepaid) or by sending it by facsimile or other similar form of telecommunication, in each case addressed as follows: (a) If to Teck Cominco at:

600 - 200 Burrard Street
Vancouver, B.C.
V6C 3L9

Attention: Corporate Secretary
Fax: 604-687-6100

(b)     If to EWR at:

402— 905 West Pender Street
Vancouver, B.C. V6C 1L6

Attention: President
Fax: 604-689-5930

(c)     If to CRC at:

1180– 999 West Hastings Street
Vancouver, B.C. V6C 2W2

Attention: President
Fax: 604-689-3847

Effective Time of Notice

18.2 Any notice, direction or other communication aforesaid shall, if delivered, be deemed to have been given and received on the day it was delivered and, if mailed, shall be deemed to have been given and received on the third Business Day following the day of deposit thereof in a post office in Canada, except in the event of disruption of the postal service in which event notice shall be deemed to be received only when actually received and, if sent by facsimile or other similar form of telecommunication, shall be deemed to have been given or received on the next Business Day following the day on which it was so sent.

Change of Address for Notice

18.3 Any party may at any time give to any other party notice in writing of any change of address of the party giving such notice, and from and after the giving of such notice, the address therein specified shall be deemed to be the address of such party for the purposes of giving notice hereunder. Any change of address notice shall include a contact number for the sending of notices by telecommunication hereunder.

Article 19

FORCE MAJEURE

Events

19.1 No party shall be liable for its failure to perform any of its obligations under this Agreement due to a cause beyond its control (except those caused by its own lack of funds) including, but not limited to: acts of God, fire, flood, explosion, strikes, lockouts or other industrial disturbances; laws, rules and regulations or orders of any duly constituted court or governmental authority; or nonavailability of materials or transportation or protests or demonstrations by environmental lobbyists, First Nations or indigenous peoples’ groups (each an “Intervening Event”).

Extension of Time Periods

19.2 All time limits imposed by this Agreement (other than for the payment of monies) shall be extended by a period equivalent to the period of delay resulting from an Intervening Event described in this Article.

Obligation To Eliminate Events Causing Force Majeure

19.3 A party relying on the provisions of this Article shall take all reasonable steps to eliminate any Intervening Event and, if possible, shall perform its obligations under this Agreement as far as practical, but nothing herein shall require such party to settle or adjust any labour dispute or to question or to test the validity of any law, rule, regulation or order of any duly constituted court or governmental authority or to complete its obligations under this Agreement if an Intervening Event renders completion impossible.

Notice of Occurrence

19.4 A party relying on the provisions of this Article shall give notice to the other party forthwith upon the occurrence of the Intervening Event and forthwith after the end of the period of delay when such Intervening Event has been eliminated or rectified.

Article 20

GENERAL PROVISIONS

Entire Agreement

20.1 This Agreement constitutes the entire agreement between the parties and replaces and supersedes all prior agreements, memoranda, correspondence, communications, negotiations and representations, whether oral or written, express or implied, statutory or otherwise between the parties with respect to the subject matter herein. This Agreement may not be amended or modified except by an instrument in writing signed by each of the parties hereto except that amendments to any part of this Agreement other than the definition of Net Profits Royalty and Schedule 2 may be made without the execution thereof by any party that holds a Net Profits Royalty and shall be as effective as if executed by each such party.

Waiver

20.2 No consent or waiver, express or implied, by any party to or of any breach or default by any other party of any or all of its obligations under this Agreement shall: (a) be valid unless it is in writing and stated to be a consent or waiver hereunder; (b) be relied upon as a consent or waiver to or of any other breach or default of the same or any other

      obligation;

(c)     constitute a general waiver under this Agreement; or (d) eliminate or modify the need for a specific consent or waiver in any other or subsequent instance.

Further Assurances

20.3 The parties shall execute such further and other documents and do such further and other things as may be necessary or convenient to carry out and give effect to the intent of this Agreement including, if the Owners’s shares are listed on a stock exchange, the filing with, and obtaining the acceptance of, this Agreement with the stock exchange on which the shares of the Owners are listed, if such filing is required under the rules and policies of such stock exchange. The Owners covenants to obtain any required acceptance forthwith after the execution of this Agreement; however, the parties confirm that the failure of the Owners to file this Agreement for acceptance with such stock exchange or the failure of the Owners to obtain the acceptance of such stock exchange shall not cause this Agreement to be invalid or terminated.

Manner of Payment

20.4 All payments to be made to any party hereunder may be made by cheque or draft mailed or delivered to such party at its address for notice purposes as provided herein, or for the account of such party at such bank or banks in Canada as such party may designate from time to time by written notice. Such bank or banks shall be deemed the agent of the designating party for the purpose of receiving, collecting and receipting such payment.

Termination

20.5 This Agreement shall terminate upon the occurrence of the earliest of:

(a) liquidation of all Assets following the written agreement by the parties to terminate, and distribution of any Joint Venture funds held by the Operator;

(b) the termination of the Option pursuant to Article 3; (c) a termination pursuant to §7.6 and §10.9;

(d) except with respect to its Net Profits Royalty, the conversion of a party’s Interest to a Net Profits Royalty pursuant to §5.4, §8.9 or §9.7; or

(e) the sale, abandonment or liquidation of all of the Assets and the distribution of any proceeds therefrom, net of liabilities, to the Participants to the extent of their Interests therein, provided that all reclamation associated with a permanent shut-down of the Facilities has been carried out as required by applicable laws and regulations.

Such termination shall not affect any amount owing, obligation or liability existing or incurred prior to the date of such termination, nor any obligation of any party to maintain security under §8.14. If there are more than two Participants holding an Interest, then a termination shall not occur under §(d) so long as there remains at least two Participants holding an Interest.

Default

20.6 Except for the provisions of this Agreement providing for elections to contribute and contributions to Programs and Production Programs and Operating Costs, with which the Participants must strictly comply, and except as otherwise provided in this Agreement, if any party (a “Defaulting Party”) is in default of any requirement herein set forth, the other party may give written notice to the Defaulting Party specifying the default. The Defaulting Party shall not lose any rights under this Agreement unless, within 30 days after the giving of notice of default by the Operator, or if the Operator is the Defaulting Party, by any other party, the Defaulting Party has failed to take reasonable steps to cure the default by the appropriate performance or the Defaulting Party fails to dispute the notice of default. Upon any such failure, the Operator or any other party as the case may be, shall be entitled to seek any remedy it may have on account of such default.

Time of the Essence

20.7 Time shall be of the essence in the performance of this Agreement.

Enurement

20.8 This Agreement shall enure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns.

Rule Against Perpetuities

20.9 If any right, power or interest of any party in any property under this Agreement would violate the rule against perpetuities, then such right, power, or interest shall terminate at the expiration of 20 years after the death of the last survivor of all the lineal descendants of Her Majesty, Queen Elizabeth II of England, living on the date of execution of this Agreement.

Remedies

20.10 Each of the Participants agrees that its failure to comply with the covenants and restrictions set out in Article 12, Article 14, and Article 15 could constitute an injury and damage to the other Participants impossible to measure monetarily and, in the event of any such failure, the other Participants shall, in addition and without prejudice to any other rights and remedies at law or in equity, be entitled to injunctive relief restraining, enjoining or specifically enforcing any acquisition, sale, transfer, charge or encumbrance save in accordance with or as required by the provisions of Article 14 or Article 15 or restraining or enjoining any breach of Article 12, as the case may be, and any party intending to breach the provisions of said Article 12, Article 14, or Article 15 hereby waives any defence it might have in law to such injunctive or other equitable relief.

Agreement in English Language

20.11 The parties have agreed that this Agreement be drafted in the English language. Les parties ont convenu que cette entente de coparticipation soit rédigée en langue anglaise.

EXECUTION

IN WITNESS WHEREOF the parties hereto have caused this Agreement to be duly executed and delivered as of the day and year first above written.

TECK COMINCO LIMITED

Per:

"Fred S. Daley"
__________________________________

      Authorized Signatory

Per:

"Jon A. Collins"
__________________________________

      Authorized Signatory

EAST WEST RESOURCE CORPORATION

Per:

"Susan Olsen"
__________________________________

      Authorized Signatory

Per:

__________________________________

      Authorized Signatory

CANPLATS RESOURCES CORPORATION

Per:

"R.E. Gordon Davis"
__________________________________

      Authorized Signatory

Per:

"Robert A. Quartermain"
__________________________________

      Authorized Signatory

SCHEDULE 1

to an Agreement among Teck Cominco Limited, East West Resource Corporation and Canplats Resources Corporation dated as of March 25, 2002.

DESCRIPTION OF PROPERTY

MIKINAK WEST

CLAIM	UNITS	RECORDING DATE	DUE DATE
TB 1226495	16	2000-Apr-25	2002-Apr-25
TB 1238351	15	2000-Apr-25	2002-Apr-25
TB 1233921	8	2000-May-12	2002-May-12
TB 1233934	16	2000-May-12	2002-May-12
TB 1238584	16	2000-May-12	2002-May-12
TB 1238585	16	2000-May-12	2002-May-12
TB 1238588	12	2000-May-12	2002-May-12
TB 1238589	12	2000-May-12	2002-May-12
TB 1238590	14	2000-May-12	2002-May-12
TB 1192667	9	2001-Oct-26	2003-Oct-26
TB 1203182	8	2001-Oct-26	2003-Oct-26
TB 1191768	15	2001-Nov-19	2003-Nov-19
TB 1203192	6	2001-Nov-19	2003-Nov-19
13 Claims	163 Units

SCHEDULE 2

to an Agreement among Teck Cominco Limited, East West Resource Corporation and Canplats Resources Corporation dated as of March 25, 2002.

NET PROFITS ROYALTY

1. Interpretation 1.1 Where used herein:

(a) “Agreement” means the above-referenced agreement, including any amendments thereto or renewals or extensions thereof;

(b) “Holder” means the person or persons that are from time to time entitled to be paid Royalty hereunder; (c) “Royalty” shall mean the percentage share of Net Profits payable pursuant to a Net Profits Royalty under

      the Agreement; and

(d) all other defined terms used in this Schedule which are not defined herein have the meanings ascribed thereto in the Agreement.

1.2 All calculations and computations relating to the Royalty shall be carried out in accordance with generally accepted accounting principles to the extent that such principles are not inconsistent with the provisions of the Agreement and this Schedule.

2. Net Profits

2.1 For the purposes of the Agreement, “Net Profits” shall mean that amount by which Revenues exceed Costs.

If Costs exceed Revenues in any Operating Year, the excess Costs shall be carried forward into the next succeeding Operating Year. 2.2 For the purpose of computing Net Profits hereunder:

(a) “Revenues” shall mean the total proceeds, calculated at the point of sale, derived from the sale of Mineral Products plus any miscellaneous proceeds (including, without limitation, all net amounts received from the sale of plant, machinery, equipment or other assets prior to the cessation of operations, any insurance proceeds not used for the replacement or repair of lost or damaged assets, compensation for expropriated properties, government grants and interest on Revenue earned from the date of receipt to the date of payment, but excluding interest earned on working capital) from the Property; and

(b) “Costs” shall mean all expenditures, whether current or capital, incurred on or in connection with the Property and related to the exploration, development, and placing of the Property into Commercial Production, and all operating, mining, milling, smelting, refining, marketing and transportation costs, including, without limitation:

(i) taxes (other than income taxes), royalties (other than the Royalty) and other like charges necessary to maintain the Property in good standing or otherwise imposed, charged or levied upon the Property or any production therefrom;

(ii) interest on money borrowed for one or more of the above enumerated purposes by the Participants in existence at the time of a payment of the Royalty being made, at such rate as is actually charged to or incurred by such Participants in borrowing such money, where the Property is charged to the lender as security for the money borrowed or, where the money is borrowed or provided by such Participants without specific recourse to the Property as security, at a rate per annum equal to the Prime Rate plus 2%; and

(iii) all other charges and expenses usually made or incurred for a like operation and accounted for in accordance with generally accepted accounting principles and including, without limitation and without duplication, all Expenditures, Production Program Costs and Operating Costs incurred under the Agreement.

For greater certainty, in determining Costs hereunder, outlays of a capital nature shall not be amortized. 3. Calculation and Payment of Royalty 3.1 The Royalty shall be:

(a) calculated and paid on a quarterly basis within 45 days after the end of each quarter of the Operating Year, based on the Net Profits for such quarter, and after deducting any credit from the payment of advance royalties, if any, as may be set forth in the Agreement. However, when calculating the required quarterly payments, a reasonable provision may be made for anticipated Costs for the remainder of the Operating Year; and

(b) calculated by the Operator if it is the sole Participant, or if there is more than one Participant, by each Participant as to its respective share of Royalty and each Participant and the Operator shall keep separate accounts relating to its respective operations related to the Property.

3.2 The Royalty shall be payable by each Participant responsible for such as follows:

(a) each payment of Royalty shall be accompanied by an unaudited statement indicating the calculation of the Royalty hereunder in reasonable detail and the Holder shall receive, within 3 months of the end of each Operating Year, an annual summary unaudited statement (an “Annual Statement”) showing in reasonable detail the calculation of the Royalty for the last completed Operating Year and showing all credits and deductions added to or deducted from the amount due to the Holder;

(b) the Holder shall have 45 days from the time of receipt of the Annual Statement to question the accuracy thereof in writing and, failing such objection, the Annual Statement shall be deemed to be correct and unimpeachable thereafter;

(c) if the Annual Statement is questioned by the Holder, and if such questions cannot be resolved between the Holder and the Operator or Participant that prepared the Annual Statement, as the case may be, the Holder shall have 12 months from the time of receipt of the Annual Statement to have such audited, which shall initially be at the expense of the Holder;

(d) the audited Annual Statement shall be final and determinative of the calculation of the Royalty for the audited period and shall be binding on the Holder and the party that prepared the Annual Statement and any overpayment of Royalty shall be deducted from future payments of Royalty and any underpayment of Royalty shall be paid to the Holder forthwith;

(e) the costs of the audit shall be borne by the Holder if the Annual Statement overstated the Royalty payable or understated the Royalty payable by not more than 1% and shall be borne by the party that prepared the Annual Statement if such statement understated the Royalty payable by greater than 1%. If the party that prepared the Annual Statement is obligated to pay for the audit it shall forthwith reimburse the Holder for any of the audit costs which it had paid; and

(f) the Holder shall be entitled to examine, on reasonable notice and during normal business hours, such books and records as are reasonably necessary to verify the payment of the Royalty to it from time to time, provided however that such examination shall not unreasonably interfere with or hinder the Operator’s or Participants’ operations or procedures.

4. Inclusion of Income Taxes in Costs

4.1 Notwithstanding anything to the contrary herein contained, if there is any tax (“Tax”) on income paid or payable by a Participant by reason of the fact that the Royalty, in whole or in part, is or becomes non-deductible to the Participant for the purposes of calculating its taxable income: (a) if the Royalty is not required to be included in determining the taxable income of the Holder, the

Participant may deduct from the amount of Royalty otherwise payable by it hereunder, the full amount of the Tax; and

(b) if the Royalty is in whole or in part required to be included by the Holder in its taxable income, the Participant may deduct from the amount of Royalty otherwise payable by it hereunder, that percentage of such Tax that equals the percentage which the Royalty is of Net Profits in order for the Tax to be shared pro rata by the parties.

5. Segregation of Property

5.1 The determination of Net Profits hereunder is based on the premise that production shall be developed solely on the Property. Other mining properties may be incorporated with the Property into a single mining project and the metals, ores or concentrates pertaining to each may be blended at the time of mining or at any time thereafter, provided however, that the respective mining properties (including the Property) shall bear and have allocated to them their proportionate part of expenditures relating to the bringing of such single mining project into commercial production and thereafter operating the same and shall have allocated to them the proportionate part of the revenues realized from such single operation, all as determined in accordance with generally accepted accounting principles and from records maintained by the Operator. The Holder shall have the right, during reasonable business hours and upon prior notice to the Operator and Participants, to enter upon the mining properties and to inspect the plant and procedures followed with respect to allocations made under this paragraph provided that such entry shall be at the sole risk and cost of the Holder. If the parties disagree on the allocation of actual proceeds received and deductions therefrom, such shall be referred to arbitration in the manner provided in Article 17 of the Agreement and the arbitrator shall have reference first to the Agreement, and then, if necessary, to practices used in mining operations that are of a similar nature. The arbitrator shall be entitled to retain such independent mining consultants and financial advisors as he considers necessary. The decision of the arbitrator shall be final and binding on the parties.

END OF SCHEDULE 2

SCHEDULE 3

to an Agreement among Teck Cominco Limited, East West Resource Corporation and Canplats Resources Corporation dated as of March 25, 2002.

UNDERLYING AGREEMENTS

1. Property Option Agreement between Ken Fenwick, Don Leishman and East West Resource Corporation dated February 12, 2000.

EX-10

September 21, 2001

Mr. Aki Siltamaki		Mr. R. Hietapakka		Mr. A. Hietapakka
297 Ray Boulevard	AND	134 Heron Street	AND	134 Heron Street
Thunder Bay, ON		Thunder Bay, ON		Thunder Bay, ON
P7B 4E3		P7C 2M3		P7C 2M3

Dear Sirs:

This letter sets out the agreement terms between Canplats Resources Corporation (hereinafter referred to as “us” or “we”), and the above-noted individuals (hereinafter referred to as “you”).

It is intended that, when executed by you and a copy redelivered to us, this letter will constitute a binding agreement between us.

Representations:

You have represented to us that:

(a) you are the recorded and beneficial holder of a 100% interest in the property more particularly described in Schedule “A” attached to and forming part of this agreement, which said property, together with any successor form of title thereof, is described for convenience in this letter as “the mining claim”;

(b) the mining claim is properly and legally staked, recorded and tagged and that it is presently in good standing under the laws of the jurisdiction in which it is located, at least until the date set forth in Schedule “A” hereto, and is free and clear of any liens or encumbrances and otherwise in good standing; and

(c) that you have sole and complete power to deal with the mining claim.

Such representations shall survive the termination of this agreement.

Forthwith upon execution of this letter, you shall deliver to us recordable transfers for the mining claim transferring the mining claim to Canplats Resources Corporation.

Grant:

In consideration of the payment by us specified below, you hereby grant to us immediate and exclusive possession of the mining claim for the purpose of prospecting and exploring and developing the mining claim.

— 2 —

Payment:

Upon receipt of recordable transfers transferring the mining claim into the name of Canplats Resources Corporation, we shall pay to you the sum of $10,000 payable as: follows:

(i)	$5,000 upon receipt of recordable transfers; and
(ii)	$5,000 six months after the date in (i) above.

Shares:

In addition to the cash payments above, Canplats will also issue to you 50,000 shares in the company (pursuant to regulatory requirements and approvals), and such share certificates will be registered in the names and numbers as you direct, as follows:

(i)	a total of 25,000 shares within 6 months of the receipt of all regulatory approvals approving this agreement and the share issuance to you (the Approval Date);
(ii)	a total of 12,500 shares within 12 months of the Approval Date.
(iii)	a total of 12,500 shares within 18 months of the Approval Date.

Access:

We shall have sole access to the mining claim and may explore, prospect, develop and mine the mining claim, but if this agreement is terminated or our rights hereunder are surrendered, we shall have the right to remove our plant and equipment from the mining claim within six months thereafter.

Royalty Interest:

Upon completion of the payments and issuance of shares to you, we shall have a 100% interest in the mining claim and we may at any time place the mining claim into production, and you shall receive therefrom 2% of the Net Smelter Returns (“NSR”) calculated and payable in accordance with the provisions of Schedule “B” attached hereto (hereinafter “Royalty Interest”).

Royalty Purchase:

We may, at any time, purchase 1% of your NSR for $1 million by providing you notice of the same and, within 30 days of such notice date and upon completion of documentation transferring the royalty to us, will make the payment.

Advance Royalty Payment:

If, within 4 years of the Approval Date we have not commenced production, you will receive from us Advance Royalty Payments of $5,000 per year and; if such production has not commenced within 6 years of the Approval Date, then Advance Royalty Payments will increase to $10,000 per year.

Right of First Refusal:

You hereby grant to us and we shall have an exclusive right of first refusal in respect of any offer to purchase or otherwise acquire some or all of your Royalty Interest which you propose to accept, to be exercised as follows: in the event that you receive an offer from a third party to purchase or otherwise acquire some or all of the above-described Royalty Interest, you shall, prior to accepting same, provide to us written notice setting out the terms thereof. We shall have thirty days from receipt of said notice in which to advise you in writing of our intent to purchase or otherwise acquire the said Royalty Interest. In the event we do not so advise you in writing within said thirty-day period, you shall be entitled to accept the offer of said third party. However, if such offer is not accepted within 60 days of receipt of such offer, our right of first refusal will be reinstated in respect of such offer.

— 3 —

Share of Payments:

You have informed us that for the purposes of payments to be made to you either by cash, shares, royalty or royalty purchase, these are to be made as follows:

         50%  A. Siltamaki;
         25%  R. Hietapakka; and
         25%  A. Hietapakka

until such time as you inform us in writing of a change to this percentage distribution.

Maintenance of the Mining Claim:

We agree to keep the mining claim in good standing during the currency of this agreement, save as we may abandon some or all of them in accordance with the terms hereof.

Abandonment:

We may at any time from time to time while in this agreement is in full force and effect, by notice in writing, abandon the mining claim. In the event that the mining claim is abandoned (if this agreement is terminated, such termination will be abandonment of the mining claim), we shall re-transfer such mining claim to you in good standing for one hundred and eighty (180) days, and we shall have no further obligation with respect to the mining claim so abandoned. We shall provide you with all technical information we have in respect of such claim in our possession, including drill cores and samples.

Termination:

This agreement may be terminated by us at any time upon notice to you.

Agency:

You agree that we may assign this agreement provided the assignee assumes our obligations and liabilities hereunder, whereupon you agree that we shall automatically be released and discharged from all obligations and liabilities hereunder without the necessity of any further or other writing or documentation whatsoever.

Notice:

Any notice required to be given hereunder shall be deemed to be sufficiently given if delivered by hand or, if mailed, by registered mail. Receipt of any notice, if mailed, shall be deemed to be on the third business day following the date of mailing provided the postal service is then operative, and, if delivered by hand, on the date received. Either party may change its address by notice to the other. The address for notice shall be, in the case of A. Siltamaki, R. Hietapakka and A. Hietapakka as written at the top of this Letter Agreement and in the case of Canplats:

#1180 – 999 West Hastings Street Vancouver, B.C. V6C 2W2

— 4 —

Entire Agreement:

This letter and the Schedules hereto constitute the entire agreement between us, and there are not rights or obligations on the part of either of us toward each other or for the benefit of any other party, nor any other act, matter or thing to be done or taken by either of us or any other person with respect to the mining claim, except as are herein set forth.

You agree to execute any other documents with respect to or to clarify the intent of this letter agreement as we may reasonably request.

This agreement shall be governed by the laws of the Province of Ontario.

Yours sincerely,

CANPLATS RESOURCES CORPORATION

"R.E.Gordon Davis"
President

The foregoing truly represents my agreement in this respect, and I agree to be bound by and comply with the terms thereof.

Dated at Thunder Bay this 22 day of September, 2001.

"Mr. Aki Siltamaki"
_________________

Mr. Aki Siltamaki

"Mr. R. Hietapakka"
_________________

Mr. R. Hietapakka

"Mr. A. Hietapakka"
_________________

Mr. A. Hietapakka

SCHEDULE “A”

TO THAT AGREEMENT BY AND BETWEEN:

MR. A. SILTAMAKI AND MR. R. HIETAPAKKA AND MR. A. HIETAPAKKA

AND

CANPLATS RESOURCES CORPORATION

DATED SEPTEMBER 1, 2001

PROPERTY

G-0755 – Right Angle Lake Area

Thunder Bay Mining Division, Ontario

Claim 1187540 Recorded August 13, 2001

SCHEDULE “B”

TO THAT AGREEMENT BY AND BETWEEN:

MR. A. SILTAMAKI AND MR. R HIETAPAKKA AND MR. A. HIETAPAKKA

AND

CANPLATS RESOURCES CORPORATION

DATED SEPTEMBER 1, 2001

NET SMELTER RETURNS

1. Interpretation

1.1 Where used herein:

“Agreement” shall mean the above-referenced agreement, including any amendments thereto or renewals or  extensions thereof.

“Fiscal Period” shall mean each calendar year or other period of twelve consecutive months adopted for tax purposes  during the term of the Agreement.

        “Product” shall mean ores, metals, (metals shall include bullion), minerals, mineral products or concentrates.

        “Royalty Interest” shall mean the share of Net Smelter Returns payable under the Agreement.

Words and expressions defined in the Agreement have the same meaning herein.

2. Net Smelter Returns

“Net Smelter Returns” shall mean the actual proceeds received from any mint, smelter, refinery or other purchaser for the sale of Product produced from the Mining Claim and sold, after deducting from such proceeds the following charges to the extent that they were not deducted by the purchaser in computing payment: smelting and refining charges; penalties; smelter assay costs and umpire assay costs; cost of freight and handling of ores, metals or concentrates from the Mining Claim to any mint, smelter, refinery or other purchaser; marketing costs; insurance on all such ores, metals or concentrates; customs duties; severance, royalties, ad valorem or goods and services taxes, retail sales taxes or mineral taxes or the like and export and import taxes or tariffs payable in respect of said ores, metals or concentrates.

3. Payment

3.1 The Royalty Interest shall be paid on a quarterly basis within forty-five (45) days after the end of each fiscal quarter in respect of the actual proceeds received in such fiscal quarter

3.2 Each payment under paragraph 3.1 shall be accompanied by a statement indicating the calculation of Net Smelter Returns hereunder. The owner of the Royalty Interest shall be entitled to audit, during normal business hours, such books and records as are necessary to determine the correctness of the payment of the Royalty Interest, provided, however, that such audit shall be made only on an annual basis and within 12 months of the end of the Fiscal Period in respect of which such audit is made.

4. Non-Arm’s Length Sale of Product

For the purposes of calculating the amount of Royalty payable if the sales of any Product are to a company or enterprise associated with the seller, and if the sale price is not negotiated on an arm’s length basis, the seller shall, for the purposes of calculating Net Smelter Returns and notwithstanding the actual amount of such sale price, add to any moneys actually received with respect to such sale an amount which the seller considers sufficient to make the same represent a reasonable net sale price for such sale as if negotiated at arm’s length and after taking into account all pertinent circumstances (including, without limitation, then current market conditions relating to products similar to such Product; terms of agreements between arm’s length parties for the purchase and sale of similar products in similar quantities for delivery over similar periods of time; and physical andor chemical characteristics of such Products).

The seller shall by notice inform the owner of the Royalty Interest of the quantum of such reasonable net sale price and if the owner of the Royalty Interest does not object thereto within sixty (60) days after receipt of such notice, said quantum shall be final and binding upon the owner of the Royalty Interest.

If the owner of the Royalty Interest objects to such quantum by notice delivered to the seller within said sixty (60) days, then the quantum of such reasonable net sale price shall be decided by arbitration with a single arbitrator to be appointed in accordance with the Commercial Arbitration Act of British Columbia in accordance with the provisions of Article 16 of the Agreement and the arbitrator shall have reference first to the Agreement, and then, if necessary, to practices used in mining operations that are of similar nature. The arbitrator shall be entitled to retain such independent mining consultants as he considers necessary. The decision of the arbitrator shall be final and binding on the parties hereto and will not be subject to appeal.

5. Segregation of Property

The determination of Net Smelter Returns hereunder is based on the premise that production will be developed solely on the Mining Claim. Other mining properties may be incorporated with the Mining Claim into a single mining project and the metals, ores or concentrates pertaining to each may be blended at the time of mining or at any time thereafter, provided however, that the respective mining properties (including the Mining Claim) have allocated to them their proportionate share of the net smelter returns realized from such single operation, all as determined in accordance with generally accepted accounting principles and from records maintained by or on behalf of the seller. The owner of the Royalty Interest shall have the right, during reasonable business hours and upon prior notice to the seller and, if applicable, the Operator, to enter upon the mining properties and to inspect the plant and procedures followed with respect to allocations made under this paragraph provided that such entry shall be at the sole risk and cost of the owner of the Royalty Interest. If the parties disagree on the allocation of actual proceeds received and deductions therefrom, such shall be referred to arbitration in the manner provided in Article 16 of the Agreement and the arbitrator shall have reference first to the Agreement, and then, if necessary, to practices used in mining operations that are of similar nature. The arbitrator shall be entitled to retain such independent mining consultants as he considers necessary. The decision of the arbitrator shall be final and binding on the parties hereto and will not be subject to appeal.

EX-10

Platinum Group Metals Ltd.
301-1110 Hamilton Street
Vancouver BC, Canada
V6B 2S2
Phone: (604) 899-5450
Fax: (604) 730-0918

September 27, 2001

Robert Quartermain
Vice President, Operations
Canplats Resources Corporation
1180 999 West Hastings St.
Vancouver, B.C.

Dear Robert,

This letter sets out the terms under which Platinum Group Metals Ltd. (PTG), a company incorporated under the laws of British Columbia is prepared to acquire from Canplats Resources Corporation, “Canplats” a corporation incorporated under the laws of British Columbia, an option interest in the Stucco property consisting of 298 Units Thunder Bay mining district Ontario, defined herein as the “Property” as described in Schedule A and the Siltamaki claim, subject to regulatory approval of the underlying agreement, attached as Schedule B (the “Option Agreement”).

I.    OPTION AGREEMENT

(1) Canplats hereby grants to PTG, subject to all regulatory approvals, the sole and exclusive right and option to acquire a 51% undivided interest in and to the Property by:

a)	Paying to Canplats the following cash payments:
	$ 15,000 within 10 days of the date of this agreement
	$ 15,000 within 1 month of the date of this agreement
	$ 10,000 within 6 months of the date of this agreement
	$ 10,000 within 24 months of the date this agreement
	$ 15,000 within 48 months of the date this agreement
	For a total of $ 65,000.

b)	Completing the following Exploration Expenditures as defined below:
	$80,000 within 3 months of the date this agreement
	$ 125,000 within 12 months of the date this agreement
	$ 1,000,000 within 48 months of the date this agreement

c) Provided that if PTG elects to keep this Option agreement in good standing, PTG will pay will pay to Canplats, at the time of the issuances of Canplats shares to A. Siltamaki, R. Hietapakka and L. Hietapakka as per the relevant underlying agreement dated September 22, 2001 attached, a cash value for the Canplats shares equal to the number of shares times the market price at the time issuance not exceeding $2.00 per share.

(2) PTG can earn a further 9 % interest in the Property for a total of 60% by completing a Feasibility Study, as defined below in I.5, at PTG’s expense and providing a copy to Canplats with 36 months of Notice that a 51% interest has been earned by PTG.

(3) The date of this Agreement referred to in I.1a) and I.1b) shall be the date signed by both parties and not defined as the date at the start of this letter Agreement.

(4) Exploration Expenditures shall mean all expenditures for the exploration of the Property including but not limited to, geological mapping, sampling, assaying, field support costs, drilling and mobilization of equipment, report writing and an overhead cost of 10% of such direct costs.

(5) Feasibility Study shall mean a report completed under the supervision of a qualified person, as per National Instrument 43-101, that outlines the reserves and resources on the Property, potential mining methods and plan, metallurgical extraction of valuable minerals, a proposed list of equipment and facilities required for the proposed mining plan and processing facilities, environmental and permitting considerations and requirements and a reclamation and remediation proposal accompanied with an estimate and schedule of the cost of the foregoing both for capital and operations and a schedule of production for valuable minerals and a financial model of detail suitable for a financial institution.

(6) The initial cash payments of $ 15,000 and 15,000 referred to in I.1a) and the first six months exploration expenditures of $ 80,000 in I.1b) are a firm obligations of PTG and are not optional and after these have been completed PTG is under no obligation to Canplats. PTG may terminate this Agreement at any time and any further performance is at the sole discretion of PTG.

(7) PTG will provide to Canplats an annual report detailing its activities for the calendar year within 90 days of the end of such calendar year.

II.    RIGHT OF ENTRY

Provided this Agreement is in good standing, PTG its servants and agents persons authorized by PTG shall have the right of access to and from the Property and the right to enter upon, take possession of and prospect, explore, sample and develop the Property in such a manner that PTG in its sole discretion may deem advisable.

III.     JOINT VENTURE

Following the earning of an interest in the Property as provided in I.1 or I.2 a Joint Venture shall be formed in the form as provided in the attached hereto, Schedule C. PTG shall be the operator of the Joint Venture initially but the operator may be replaced as provided in Joint Venture Agreement.

The joint venture shall include a provision that a party diluting to a 10% working interest shall be converted to a 2% Net Smelter Return Royalty with a 60 day right of first refusal on the disposition of such Royalty Interest. The joint venture shall include a buy-out provision as outlined in Schedule D.

In the case of conflict with the Joint Venture form, Schedule C and this Agreement this Agreement shall take precedence.

IV.     REPRESENTATIONS, WARRANTIES OF CANPLATS AND THE UNDERLYING AGREEMENT

PTG acknowledges the Underlying Agreement attached hereto in Schedule B. Canplats represents and warrants that:

a) That it is properly constituted and has the full power and authority to enter into this Agreement;

b) That there are no encumbrances, royalties or liens of any kind associated in any way with the Property, other than as outlined in Schedule B;

c) That there are no reclamation or rehabilitation requirements outstanding on the Property and that all work including claim staking has been carried out in accordance with all applicable laws of the Province of Ontario;

d) That they have advised PTG of all of the material information about the property generally and as to its mineral potential.

PTG has relied on these representations and warranties hereinbefore set out and they shall survive the exercise of the Option and Canplats hereby indemnifies and saves PTG harmless from all loss damage costs actions and suits arising out of or in connection with any breach of any representation or warranty contained in this agreement.

V.     REPRESENTATIONS, WARRANTIES OF PTG

PTG represents and warrants that:

a) that it is properly constituted and has the full power and authority to enter into this Agreement;

b) that there are no outstanding suits or actions for non-performance on reclamation work with respect to PTG or its founder.

VI.     COVENANTS OF PTG

(1) PTG covenants and agrees with Canplats that until the Option is exercised or otherwise terminates:

a) PTG shall keep the Property clear of liens and other charges arising from the operations under the Option Agreement;

b) PTG shall carry on all operations on the Property in a good and miner-like manner and in compliance with all applicable governmental regulations and restrictions;

c) PTG shall pay or cause to be paid any rates, taxes, duties, royalties, assessments or fees levied with respect to the Property or PTG’s operations thereon with the exception of royalties due after PTG has earned an interest in the property and from this time forward any rates, taxes, duties, royalties, assessments or fees levied with respect to the Property shall be paid by the parties pro-rata to their interests and notwithstanding the foregoing Canplats is obligated to make any payments due through the Underlying Agreements prior to PTG’s earning an interest;

d) PTG shall indemnify and hold Canplats harmless from any and all liabilities, costs, damages or charges arising from the failure of PTG to comply with the covenants contained in this article or otherwise arising from its operations on the Property by PTG, its servants or agents, including any environmental cleanup required or ordered pursuant to the laws of the Province of Ontario;

e) PTG shall provide Canplats with an annual report, in writing, with respect to its operations on the Property and shall provide Canplats with copies of any and all documents filed by PTG to record assessment work on the Property.

VII.    TERMINATION

(1) The Property and any additional add-on claims shall be dealt with separately for the purpose of termination pursuant to this Agreement.

(2) This agreement shall terminate upon PTG, not being at the time in default under any provision of this agreement, giving 5 days written notice to Canplats of termination.

(3) Notwithstanding paragraph VII (2), if PTG fails to make any payment or fails to do anything on or before the last day provided for such payment or performance under this agreement, Canplats may terminate this agreement but only if:

(a) they shall have first given PTG written notice of the failure containing particulars of the payment which PTG has not made or the act which PTG has not performed; and

(b) PTG has not, within 30 days, following delivery of such notice, cured such failure or commenced proceedings to cure such failure by appropriate payment or performance (PTG hereby agreeing that should it so commence to cure any failure they will prosecute the same to completion without undue delay).

(4) Should PTG fail to comply with the provisions of sub-paragraph VII (3), Canplats may thereafter terminate this agreement by notice to PTG with respect to the Property to which the failure in sub-paragraph VII (3) relates.

(5) Upon the termination of this agreement, PTG forfeits any and all interest in the property in question and shall cease to be liable to Canplats in debt, damages or otherwise save for the performance of those of their obligations, which theretofore should have been performed,

(6) Upon termination of this agreement, PTG shall provide copies of all maps and reports with respect to the Property that it has generated and vacate the Property within a reasonable time after such termination, but shall have the right of access to such Property for a period of six months thereafter for the purpose of removing its chattels, machinery, equipment and fixtures therefrom.

(7) Upon full or partial termination, PTG will be responsible to ensure that the Property is returned with a minimum of 90 days good standing.

VIII.    INDEPENDENT ACTIVITIES

Except as expressly provided herein, all parties shall have the free and unrestricted right to independently engage in and receive the full benefit of any and all business endeavours of any sort whatsoever, whether or not competitive with the endeavours contemplated herein without consulting the others or inviting or allowing the others to participate therein. No parties shall be under any fiduciary or other duty to the others, which will prevent them from engaging in or enjoying the benefits of competing endeavours within the general scope of the endeavours contemplated herein. The legal doctrines of “corporate opportunity” sometimes applied to persons engaged in a joint venture or having fiduciary status shall not apply in the case of any of the parties. In particular, without limiting the foregoing, none of the parties shall have an obligation to any of the other parties as to:

(a)	any opportunity to acquire, explore and develop any mining property, interest or right presently owned by them or offered to them outside of the Property at any time; and
(b)	the erection of any mining plant, mill, smelter or refinery, whether or not such mining plant, mill, smelter or refinery ores or concentrates from the Property.

IX.     CONFIDENTIALITY OF INFORMATION

The parties hereto shall treat all data, reports, records and other information relating to this agreement and the Property as confidential. While this agreement is in effect, none of the parties hereto shall, without the express written consent of the others, disclose to any third party any information concerning the results of the operations hereunder nor issue any press releases concerning this agreement or its exploration operations except:

(a) where such disclosure is mandatory under the law or is deemed necessary by PTG’s counsel for the satisfaction by PTG of their obligations to applicable securities regulatory bodies; or

(b) where PTG is seeking the participation of such third party in the exploration, development or production or financing of the Property and such information is divulged under confidential circumstances.

Due consideration shall be given to present and future governmental regulations with respect to such data disclosures.

X.     ASSIGNMENT

Each of the parties has the right to assign all or any part of their interest in the Property and in this agreement. It shall be a condition precedent to any such assignment that the assignees of the interest being transferred agree in writing to be bound by the terms of this agreement, as if it had been an original party hereto.

XI.     UNAVOIDABLE DELAYS

If either party should be delayed in or prevented from performing any of the terms, covenants or conditions of this agreement by reason of a cause beyond the control of such parties, including fires, floods, earthquakes, subsidence, ground collapse or landslides, interruptions or delays in transportation or power supplies, strikes, lockouts, wars, acts of God, government regulation or interference, including but without restricting the generality of the foregoing, forest or highway closures or any other cause beyond such parties’ control, then any such failure on the part of such parties to so perform shall not be deemed to be a breach of this agreement and the time within which such parties are obliged to comply with any such term, covenant or condition of this agreement shall be extended by the total period of all such delays. In order that the provisions of this article may become operative, such of the parties shall give notice in writing to the other parties, forthwith and for each new cause of delay or prevention and shall set out in such notice particulars of the cause thereof and the day upon which the same arose, and shall give like notice forthwith following the date that such cause ceased to subsist.

XII.     ARBITRATION

If there is any disagreement, dispute or controversy (hereinafter collectively called a “Dispute”) between the parties with respect to any matter arising under this agreement or the construction hereof, then the Dispute shall be determined by arbitration in accordance with the following procedures:

(a) The parties on one side of the Dispute shall inform the other parties by notice of the names of three impartial and independent persons who are recognized experts in the area which is the subject matter of the Disputes; and

(b) The other parties shall, within seven days of receipt of the notice, inform the parties on the other side of the Dispute the name of the one person that they wish to act as the sole arbitrator.

The arbitration shall be conducted in accordance with the Arbitrations Act (Ontario) and the decision of the arbitrator shall be made within 30 days following his being named, shall be based exclusively on the advancement of exploration, development and production work on the Property and not on the financial circumstances of the parties. The costs of arbitration shall be borne equally by the parties to the Dispute unless otherwise determined by the arbitrator in the award.

XIII.     NOTICES

Any notice, election, consent or other writing required or permitted to be given hereunder shall be deemed to be sufficiently given if delivered or if mailed by registered airmail or by telegram or fax, addressed as follows:

In the case of Canplats	Canplats Resources Corporation
	Mr Robert Quartermain
	1180 - 999 West Hastings St
	Vancouver BC, V6C 2W2
	Phone: (604) 689-3846
	Fax: (604) 689-3847
In the case of PTG:	Platinum Group Metals Ltd.
	Mr. R. Michael Jones
	301 - 1110 Hamilton Street
	Vancouver BC, V6B 2S2
	Phone: (604) 899-5450
	Fax: (604) 730-0918

and any such notice given as aforesaid shall be deemed to have been given to the parties hereto if delivered, when delivered, or if mailed, on the tenth business day following the date of mailing, or, if telegraphed or faxed, on the next succeeding day following the telegraphing or faxing thereof PROVIDED HOWEVER that during the period of any postal interruption in either the country of mailing or the country of delivery, any notice given hereunder by mail shall be deemed to have been given only as of the date of actual delivery of the same. Any party may from time to time by notice in writing change its address for the purpose of this paragraph.

XIV.    GENERAL TERMS AND CONDITIONS

(1) The parties hereto hereby covenant and agree that they will execute such further agreements, conveyances and assurances as may be requisite, or which counsel for the parties may deem necessary to effectually carry out the intent of is agreement.

(2) This agreement shall represent the entire understanding between the parties with respect to the Property. No representations or inducements have been made save as herein set forth. No changes, alterations, or modifications of this agreement shall be binding upon all parties until and unless a memorandum in writing to such effect shall have been signed by all parties hereto.

(3) The titles to the articles to this agreement shall not be deemed to form part of this agreement but shall be regarded as having been used for convenience of reference only.

(4) The schedules to this agreement shall be construed with and as an integral part of this agreement to the same extent as if they were set forth verbatim herein.

(5) All reference to dollar amounts contained in this agreement is references to Canadian funds.

(6) This agreement shall be governed by and interpreted in accordance with the laws in effect in Ontario, and the parties hereto attorn to the courts of Ontario for the resolution of any disputes arising out of this agreement.

(7) The agreement may be executed by facsimile and in any number of counterparts. Each counterpart shall be deemed for all purposes to be an original, and all such counter-parts shall constitute one and the same instrument, binding on all of the parties hereto.

(8) This agreement shall enure to the benefit of and be binding upon the parties hereto and their respective successors and assigns.

(9) Each party agrees with the other to execute any other documents with respect to this agreement to clarify the intent of this Letter of Agreement as may be reasonably requested.

XV.    AREA OF INTEREST

(1) Any mineral claims staked or property acquired, including the Underlying Royalty within an area described by lines drawn parallel and 1.0 km distant from the outer boundary of the Property, “Area of Interest”, shall be added to the Property provided, however, if a property is identified by Canplats or PTG for acquisition within the Area of Interest and it is Offered to the other party for 20 days and elects not to add such property to the Property then the first party shall be free to acquire this property for its own account within 60 days of the offer to other party on the same terms as the offer to other party. For the purpose of this clause XV.1 Offered shall mean that all information on the property available at the time and the terms of the potential acquisition are supplied in writing to the other party.

(2) The foregoing terms of Area of Interest shall apply to the joint venture.

IN WITNESS WHEREOF this agreement has been executed by the parties hereto SIGNED, SEALED and DELIVERED on this 27 day of September, 2001, in the presence of:

	"Robert A. Quartermain"
___________________________	___________________________
	Canplats Resources Corporation
Witness	Robert A. Quartermain
	"R. Michael Jones"
___________________________	___________________________
	Platinum Group Metals Ltd.
Witness	R. Michael Jones

SCHEDULE “A”

Canplats Stucco Property, Rightangle and Circle Lake Map Area, Thunder Bay Mining Division.

Claim #	Units	Recording Date
1214716	16	December 23, 1999
1214717	16	December 23, 1999
1214718	16	December 23, 1999
1214719	16	December 23, 1999
1214720	16	December 23, 1999
1214721	8	December 23, 1999
1214722	8	December 23, 1999
Total Units	96

Claim #	Units	Recording Date
1228957	16	December 23, 1999
1229580	15	December 23, 1999
1229581	15	December 23, 1999
1229583	16	December 23, 1999
1229596	16	December 23, 1999
1229611	16	December 23, 1999
1230052	12	December 23, 1999
Total Units	106

Claim #	Units	Date Recording
1122940	8	April 4, 2000
1122941	8	April 4, 2000
1122942	16	April 4, 2000
1141577	8	April 4, 2000
1147575	16	April 4, 2000
1147576	16	April 4, 2000
1147577	8	April 4, 2000
1147578	16	April 4, 2000
Total Units	96
Grand Total: 298 Claims

SCHEDULE “B”

I.     SILTAMAKI PROPERTY

G-0755 – Right Angle Lake Area

Thunder Bay Mining Division, Ontario

Siltamaki Claim #1187540 16 units Recorded August 13, 2001

SCHEDULE “B”

II.     SILTAMAKI PROPERTY AGREEMENT

        That agreement dated September 22, 2001 as between Canplats and Aki Siltamaki a R. Hietapakka and L. Hietapakka.

September 21, 2001

Mr. Aki Siltamaki		Mr. R. Hietapakka		Mr. A. Hietapakka
297 Ray Boulevard	AND	134 Heron Street	AND	134 Heron Street
Thunder Bay, ON		Thunder Bay, ON		Thunder Bay, ON
P7B 4E3		P7C 2M3		P7C 2M3

Dear Sirs:

This letter sets out the agreement terms between Canplats Resources Corporation (hereinafter referred to as “us” or “we”), and the above-noted individuals (hereinafter referred to as “you”).

It is intended that, when executed by you and a copy redelivered to us, this letter will constitute a binding agreement between us.

Representations:

You have represented to us that:

(a) you are the recorded and beneficial holder of a 100% interest in the property more particularly described in Schedule “A” attached to and forming part of this agreement, which said property, together with any successor form of title thereof, is described for convenience in this letter as “the mining claim”;

(b) the mining claim is properly and legally staked, recorded and tagged and that it is presently in good standing under the laws of the jurisdiction in which it is located, at least until the date set forth in Schedule “A” hereto, and is free and clear of any liens or encumbrances and otherwise in good standing; and

(c) that you have sole and complete power to deal with the mining claim.

Such representations shall survive the termination of this agreement.

Forthwith upon execution of this letter, you shall deliver to us recordable transfers for the mining claim transferring the mining claim to Canplats Resources Corporation.

Grant:

In consideration of the payment by us specified below, you hereby grant to us immediate and exclusive possession of the mining claim for the purpose of prospecting and exploring and developing the mining claim.

— 2 —

Payment:

Upon receipt of recordable transfers transferring the mining claim into the name of Canplats Resources Corporation, we shall pay to you the sum of $10,000 payable as: follows:

(i)	$5,000 upon receipt of recordable transfers; and
(ii)	$5,000 six months after the date in (i) above.

Shares:

In addition to the cash payments above, Canplats will also issue to you 50,000 shares in the company (pursuant to regulatory requirements and approvals), and such share certificates will be registered in the names and numbers as you direct, as follows:

(i)	a total of 25,000 shares within 6 months of the receipt of all regulatory approvals approving this agreement and the share issuance to you (the Approval Date);
(ii)	a total of 12,500 shares within 12 months of the Approval Date.
(iii)	a total of 12,500 shares within 18 months of the Approval Date.

Access:

We shall have sole access to the mining claim and may explore, prospect, develop and mine the mining claim, but if this agreement is terminated or our rights hereunder are surrendered, we shall have the right to remove our plant and equipment from the mining claim within six months thereafter.

Royalty Interest:

Upon completion of the payments and issuance of shares to you, we shall have a 100% interest in the mining claim and we may at any time place the mining claim into production, and you shall receive therefrom 2% of the Net Smelter Returns (“NSR”) calculated and payable in accordance with the provisions of Schedule “B” attached hereto (hereinafter “Royalty Interest”).

Royalty Purchase:

We may, at any time, purchase 1% of your NSR for $1 million by providing you notice of the same and, within 30 days of such notice date and upon completion of documentation transferring the royalty to us, will make the payment.

Advance Royalty Payment:

If, within 4 years of the Approval Date we have not commenced production, you will receive from us Advance Royalty Payments of $5,000 per year and; if such production has not commenced within 6 years of the Approval Date, then Advance Royalty Payments will increase to $10,000 per year.

Right of First Refusal:

You hereby grant to us and we shall have an exclusive right of first refusal in respect of any offer to purchase or otherwise acquire some or all of your Royalty Interest which you propose to accept, to be exercised as follows: in the event that you receive an offer from a third party to purchase or otherwise acquire some or all of the above-described Royalty Interest, you shall, prior to accepting same, provide to us written notice setting out the terms thereof. We shall have thirty days from receipt of said notice in which to advise you in writing of our intent to purchase or otherwise acquire the said Royalty Interest. In the event we do not so advise you in writing within said thirty-day period, you shall be entitled to accept the offer of said third party. However, if such offer is not accepted within 60 days of receipt of such offer, our right of first refusal will be reinstated in respect of such offer.

— 3 —

Share of Payments:

You have informed us that for the purposes of payments to be made to you either by cash, shares, royalty or royalty purchase, these are to be made as follows:

         50%  A. Siltamaki;
         25%  R. Hietapakka; and
         25%  A. Hietapakka

until such time as you inform us in writing of a change to this percentage distribution.

Maintenance of the Mining Claim:

We agree to keep the mining claim in good standing during the currency of this agreement, save as we may abandon some or all of them in accordance with the terms hereof.

Abandonment:

We may at any time from time to time while in this agreement is in full force and effect, by notice in writing, abandon the mining claim. In the event that the mining claim is abandoned (if this agreement is terminated, such termination will be abandonment of the mining claim), we shall re-transfer such mining claim to you in good standing for one hundred and eighty (180) days, and we shall have no further obligation with respect to the mining claim so abandoned. We shall provide you with all technical information we have in respect of such claim in our possession, including drill cores and samples.

Termination:

This agreement may be terminated by us at any time upon notice to you.

Agency:

You agree that we may assign this agreement provided the assignee assumes our obligations and liabilities hereunder, whereupon you agree that we shall automatically be released and discharged from all obligations and liabilities hereunder without the necessity of any further or other writing or documentation whatsoever.

Notice:

Any notice required to be given hereunder shall be deemed to be sufficiently given if delivered by hand or, if mailed, by registered mail. Receipt of any notice, if mailed, shall be deemed to be on the third business day following the date of mailing provided the postal service is then operative, and, if delivered by hand, on the date received. Either party may change its address by notice to the other. The address for notice shall be, in the case of A. Siltamaki, R. Hietapakka and A. Hietapakka as written at the top of this Letter Agreement and in the case of Canplats:

#1180 – 999 West Hastings Street Vancouver, B.C. V6C 2W2

— 4 —

Entire Agreement:

This letter and the Schedules hereto constitute the entire agreement between us, and there are not rights or obligations on the part of either of us toward each other or for the benefit of any other party, nor any other act, matter or thing to be done or taken by either of us or any other person with respect to the mining claim, except as are herein set forth.

You agree to execute any other documents with respect to or to clarify the intent of this letter agreement as we may reasonably request.

This agreement shall be governed by the laws of the Province of Ontario.

Yours sincerely,

CANPLATS RESOURCES CORPORATION

R.E. Gordon Davis
President

The foregoing truly represents my agreement in this respect, and I agree to be bound by and comply with the terms thereof.

Dated at Thunder Bay this 22 day of September, 2001.

"Mr. Aki Siltamaki"
_________________

Mr. Aki Siltamaki

"Mr. R. Hietapakka"
_________________

Mr. R. Hietapakka

"Mr. A. Hietapakka"
_________________

Mr. A. Hietapakka

SCHEDULE “A”

TO THAT AGREEMENT BY AND BETWEEN:

MR. A. SILTAMAKI AND MR. R. HIETAPAKKA AND MR. A. HIETAPAKKA

AND

CANPLATS RESOURCES CORPORATION

DATED SEPTEMBER 1, 2001

PROPERTY

G-0755 – Right Angle Lake Area

Thunder Bay Mining Division, Ontario

Claim 1187540 Recorded August 13, 2001

SCHEDULE “B”

TO THAT AGREEMENT BY AND BETWEEN:

MR. A. SILTAMAKI AND MR. R HIETAPAKKA AND MR. A. HIETAPAKKA

AND

CANPLATS RESOURCES CORPORATION

DATED SEPTEMBER 1, 2001

NET SMELTER RETURNS

1. Interpretation

1.1 Where used herein:

“Agreement” shall mean the above-referenced agreement, including any amendments thereto or renewals or  extensions thereof.

“Fiscal Period” shall mean each calendar year or other period of twelve consecutive months adopted for tax purposes  during the term of the Agreement.

        “Product” shall mean ores, metals, (metals shall include bullion), minerals, mineral products or concentrates.

        “Royalty Interest” shall mean the share of Net Smelter Returns payable under the Agreement.

Words and expressions defined in the Agreement have the same meaning herein.

2. Net Smelter Returns

“Net Smelter Returns” shall mean the actual proceeds received from any mint, smelter, refinery or other purchaser for the sale of Product produced from the Mining Claim and sold, after deducting from such proceeds the following charges to the extent that they were not deducted by the purchaser in computing payment: smelting and refining charges; penalties; smelter assay costs and umpire assay costs; cost of freight and handling of ores, metals or concentrates from the Mining Claim to any mint, smelter, refinery or other purchaser; marketing costs; insurance on all such ores, metals or concentrates; customs duties; severance, royalties, ad valorem or goods and services taxes, retail sales taxes or mineral taxes or the like and export and import taxes or tariffs payable in respect of said ores, metals or concentrates.

3. Payment

3.1 The Royalty Interest shall be paid on a quarterly basis within forty-five (45) days after the end of each fiscal quarter in respect of the actual proceeds received in such fiscal quarter

3.2 Each payment under paragraph 3.1 shall be accompanied by a statement indicating the calculation of Net Smelter Returns hereunder. The owner of the Royalty Interest shall be entitled to audit, during normal business hours, such books and records as are necessary to determine the correctness of the payment of the Royalty Interest, provided, however, that such audit shall be made only on an annual basis and within 12 months of the end of the Fiscal Period in respect of which such audit is made.

4. Non-Arm’s Length Sale of Product

For the purposes of calculating the amount of Royalty payable if the sales of any Product are to a company or enterprise associated with the seller, and if the sale price is not negotiated on an arm’s length basis, the seller shall, for the purposes of calculating Net Smelter Returns and notwithstanding the actual amount of such sale price, add to any moneys actually received with respect to such sale an amount which the seller considers sufficient to make the same represent a reasonable net sale price for such sale as if negotiated at arm’s length and after taking into account all pertinent circumstances (including, without limitation, then current market conditions relating to products similar to such Product; terms of agreements between arm’s length parties for the purchase and sale of similar products in similar quantities for delivery over similar periods of time; and physical andor chemical characteristics of such Products).

The seller shall by notice inform the owner of the Royalty Interest of the quantum of such reasonable net sale price and if the owner of the Royalty Interest does not object thereto within sixty (60) days after receipt of such notice, said quantum shall be final and binding upon the owner of the Royalty Interest.

If the owner of the Royalty Interest objects to such quantum by notice delivered to the seller within said sixty (60) days, then the quantum of such reasonable net sale price shall be decided by arbitration with a single arbitrator to be appointed in accordance with the Commercial Arbitration Act of British Columbia in accordance with the provisions of Article 16 of the Agreement and the arbitrator shall have reference first to the Agreement, and then, if necessary, to practices used in mining operations that are of similar nature. The arbitrator shall be entitled to retain such independent mining consultants as he considers necessary. The decision of the arbitrator shall be final and binding on the parties hereto and will not be subject to appeal.

5. Segregation of Property

The determination of Net Smelter Returns hereunder is based on the premise that production will be developed solely on the Mining Claim. Other mining properties may be incorporated with the Mining Claim into a single mining project and the metals, ores or concentrates pertaining to each may be blended at the time of mining or at any time thereafter, provided however, that the respective mining properties (including the Mining Claim) have allocated to them their proportionate share of the net smelter returns realized from such single operation, all as determined in accordance with generally accepted accounting principles and from records maintained by or on behalf of the seller. The owner of the Royalty Interest shall have the right, during reasonable business hours and upon prior notice to the seller and, if applicable, the Operator, to enter upon the mining properties and to inspect the plant and procedures followed with respect to allocations made under this paragraph provided that such entry shall be at the sole risk and cost of the owner of the Royalty Interest. If the parties disagree on the allocation of actual proceeds received and deductions therefrom, such shall be referred to arbitration in the manner provided in Article 16 of the Agreement and the arbitrator shall have reference first to the Agreement, and then, if necessary, to practices used in mining operations that are of similar nature. The arbitrator shall be entitled to retain such independent mining consultants as he considers necessary. The decision of the arbitrator shall be final and binding on the parties hereto and will not be subject to appeal.

SCHEDULE “B”

III.     ENCUMBRANCES

          The encumbrances of the claims are:

          TB 1187540 (Siltamaki Claim) a 2% Net Smelter Royalty.

SCHEDULE “C”

JOINT VENTURE

The form of Joint Venture is as attached.

Upon earning a 51% interest Canplats and PTG will form a Management Committee in which PTG will be chair and have an additional vote. All votes will be by majority, save and except for:

a)	a production decision
b)	a termination decision
c)	capital expenditures in excess of $10 million

which will require unanimous consent. In the event that there is not a unanimous decision, the provision of the buy/sell clause in Schedule D may be initiated by either party.

SCHEDULE “D”

BUY/SELL CLAUSE

In the event that parties to this agreement are unable to reach unanimous consent on such issues requiring the same by the Management Committee, then one party (the “Offering Party”) may make an offer (the “Offer”) to buy all of the other party’s interest (the “Other Party”), in cash and/or its shares or any combination thereof. The Other Party may elect to either accept such offer or may give notice to the Offering Party that it will purchase the Offering Party’s interest pro rata on the same terms in cash and shares of its equity such offer(s) to be concluded within 120 days of any required regulatory approval.

OPTION/JOINT VENTURE AGREEMENT

made between

CANPLATS RESOURCES CORPORATION

and

PLATINUM GROUP METALS LTD.

in respect of the

Stucco Property

Thunder Bay Mining Division, Ontario

Dated as of •, 2001

_________________

TABLE OF CONTENTS

         Article 1 INTERPRETATION..................................1
            Definitions............................................1
            Included Words.........................................7
            Headings...............................................7
            References.............................................7
            Currency...............................................7
            Interest...............................................8
            Statutes...............................................8
            Schedules..............................................8
            Governing Law..........................................8
            Severability...........................................8

          Article 2 REPRESENTATIONS, WARRANTIES AND COVENANTS......8
            Representations, Warranties and Covenants of Each Party8
            Representations, Warranties and Covenants of the Owner.9
            Covenants of the Owner................................10
            Survival of Representations, Warranties and Covenants.11

          Article 3 OPTION AND INITIAL PROGRAMS...................11
            Option................................................11
            Commitment to Make Expenditures.......................12
            Option Payments and Expenditures to be Incurred.......12
            Report of Expenditures................................12
            Deficiencies in Expenditures..........................13
            PTG's Right of Entry..................................13
            PTG's Obligations During Currency of Option...........13
            PTG's Obligations on Termination......................14
            Abandonment of Part of Property.......................14
            Participation Date....................................15

          Article 4 JOINT VENTURE.................................15
            Formation and Scope...................................15
            Transactions in Name of Operator......................15
            No Partnership........................................16
            Liability for Costs...................................16
            Holding Title to the Assets...........................16
            Participants' Rights to Conduct Other Business........16
            No Right of One Participant to Bind the Other.........17

          Article 5 INTERESTS OF PARTICIPANTS.....................17
            Interests.............................................17
            Dilution Formula......................................17
            Multiple Participants.................................17
            Dilution and Conversion of an Interest to a Royalty...17
            Royalty Calculation and Payment.......................18

          Article 6 MANAGEMENT COMMITTEE..........................18
            Management Committee..................................18
            Members...............................................18
            Time and Place of Meetings............................18
            Resolutions in Writing................................19
            Quorum................................................19
            Voting................................................19
            Secretary and Records.................................19
            Abandonment of Property...............................19

          Article 7 OPERATOR......................................20
            Rights and Powers of the Operator.....................20
            Resignation of the Operator...........................20
            Duties and Obligations of the Operator................21
            Non-Performance by the Operator.......................22
               Delivery of Assets by Former Operator to Successor
            Operator..............................................22
            Termination of Joint Venture if No Operator...........22
            Indemnification of Operator...........................22
            No Indemnification of Operator........................23
            Indemnification in Proportion to Interests............23
            No Liability for Special Damages......................23
            Emergency Expenditures................................23

          Article 8 PROGRAMS......................................23
            Expenditures to be Incurred Under Programs............23
            Programs in Progress on Participation Date............23
            Election to Participate in Programs...................24
            Effect of Election to Not Contribute..................24
            Operator Not to Proceed Unless Program is Fully Funded24
            Obligation to Pay Expenditures and Overruns...........24
            Procedures for Payment................................25
            Meeting Required to Approve Excess Program Overruns...25
            Effect of Default in Paying Expenditures..............25
            Program for a Feasibility Report......................25
            Participant's Feasibility Report......................26
            Favourable Feasibility Report.........................26
            Provision of Security.................................26

          Article 9 PRODUCTION PROGRAM............................26
            Delivery of Proposed Production Program...............26
            Operator to Proceed with Adopted Production Program...26
                 Obligation to Pay Production Program Costs and
            Overruns..............................................27
            Procedures for Payment................................27
              Meeting Required to Approve Excess Production Program
            Cost Overruns.........................................27
            Curtailment of Production Program.....................27
            Effect of Default in Paying Production Program Costs..28
               Operator's Right to Curtail Production Program Upon
            Default...............................................28

          Article 10 OPERATING PLANS..............................28
            Obligation to Pay Operating Costs and Overruns........28
            Operating Plans.......................................28
            Excess Operating Cost Overruns........................29
            No Agreement on Operating Plans.......................29
            Statements of Operating Costs.........................29
            Effect of Default in Paying Operating Costs...........29
            Participant may Require Operations to be Shut Down....30
            Resumption of Operations..............................30
            Permanent Suspension..................................30

          Article 11 DISPOSITION OF PRODUCTION....................31
            Taking in Kind........................................31
            Valuing Mineral Products..............................31
            Priority..............................................31
            Accounting by Operator................................31
            Records...............................................32
            Non-Arm's Length Sale of Product......................32

          Article 12 CONFIDENTIAL INFORMATION.....................32
            Obligation Not to Disclose............................32
            Consent to Disclose...................................32
            No Liability for Actions of Third Parties.............32
            Notice Period.........................................33
            Press Releases and Other Public Disclosure............33

          Article 13 DISCLOSURE STANDARDS.........................33
            Compliance with Disclosure Standards..................33
            Breach of Disclosure Standards........................33
            Misleading Disclosure.................................34

          Article 14 RESTRICTIONS ON ALIENATION...................34
            No Sale of Interest Except as Specified...............34
            Terms of Sale.........................................34
            Sales to Associates...................................35
            Notice of Intention to Sell...........................35
            Notice of Receiving an Acceptable Offer...............35
            Content of Notice.....................................36
            Notice Acceptance Period..............................36
            Effect of Acceptance of Offer.........................36
            Effect of Not Accepting an Offer......................36
            No Coincident Offers..................................36
            Operatorship is not Transferrable Without Consent.....36
            Purchasers Agreement to be Bound......................37

          Article 15 ENCUMBRANCES AND PARTITION...................37
            Obligation to Hold Interest Free of Encumbrances......37
            Limited Right to Mortgage.............................37
            Waiver of Right to Partition..........................38

          Article 16 OPERATOR'S LIEN..............................38
            Operator's Lien.......................................38
            Enforcement of Lien by the Operator...................39
            Right of Participant to Deal With Mineral Product.....39
            Participant's Lien....................................40

          Article 17 ARBITRATION..................................40
            Single Arbitrator.....................................40
            Notice of Intent to Arbitrate.........................40
            Effect of Lack of Agreement on Arbitration............40
            Procedural Matters....................................40

          Article 18 NOTICE.......................................41
            Means of Notice.......................................41
            Effective Time of Notice..............................41
            Change of Address for Notice..........................41

          Article 19 FORCE MAJEURE................................42
            Events................................................42
            Extension of Time Periods.............................42
            Obligation To Eliminate Events Causing Force Majeure..42
            Notice of Occurrence..................................42

          Article 20 AREA OF INTEREST.............................42
            Area of Interest......................................42
            Acquisitions Within Area of Interest..................42
            Provision of Notice of Acquisition....................43
            Notice of Acquired Interest to Become Part of Property43
            Further Assurances to Give Effect to Acquisition......43
            Noss.20.4 Notice......................................43
            Best Efforts of Parties Regarding Acquisition Agreement43
            Non-Compliance by Affiliate Considered a Default......44

          Article 21 RIGHT OF FIRST REFUSAL ON FINANCING..........44
            PTG's Right to Provide Owner with Financing...........44
            Terms of Financing Offer..............................44
            PTG not Accepting Financing Offer.....................45
            PTG Accepting Financing Offer.........................45
            No Coincident Financing Offers........................45
            Owner's Obligation to Hold Interest Free of Liens.....45

          Article 22 GENERAL PROVISIONS...........................45
            Entire Agreement......................................45
            Waiver................................................45
            Further Assurances....................................46
            Manner of Payment.....................................46
            Termination...........................................46
            Default...............................................47
            Time of the Essence...................................47
            Enurement.............................................47
            Rule Against Perpetuities.............................47
            Remedies..............................................47
            Agreement in English Language.........................47
            Election under United States Income Tax Laws..........47
            Share Option..........................................48
                                     

            SCHEDULE 1 -......Description of Property
            SCHEDULE 2 -......Net Profits Royalty
            SCHEDULE 3 -......Share Option

THIS AGREEMENT made as of the • day of •, 20•

BETWEEN:

PLATINUM GROUP METALS LTD., a company incorporated under the laws of the Province of British Columbia and having an office at Suite 301 – 1110 Hamilton Street, Vancouver, British Columbia, V6C 2S2

            (“PTG”)

OF THE FIRST PART

AND:

CANPLATS RESOURCES CORPORATION, a corporation incorporated under the laws of the Province of British Columbia and having an office at Suite 1180 – 999 West Hastings Street, Vancouver, British Columbia, V6C 3L9

            (“the Owner”)

OF THE SECOND PART

WHEREAS:

(A)    the Owner is the owner of the Property (as hereinafter defined);

(B)     the Owner has agreed to grant to PTG an exclusive option to earn a •% interest in the Property upon and subject to the terms and conditions hereinafter set out; and

(C)     upon PTG earning its interest in the Property, the parties have agreed to form a joint venture to further explore and develop the Property, all upon and subject to the terms and conditions hereinafter set out.

NOW, THEREFORE, THIS AGREEMENT WITNESSES that, in consideration of the payment of $• by PTG to the Owner and the mutual covenants and agreements herein contained, the parties hereto mutually agree as follows:

ARTICLE 1

INTERPRETATION

Definitions

1.1     In this Agreement the following words and phrases shall have the following meanings:

Affiliate means, in respect of a party hereto, a corporation with which that party is affiliated within the meaning of §1(2) of the Securities Act (British Columbia).

Assets means the Property and any and all assets acquired or held by the Participants with respect to the Property or pursuant to this Agreement, as the same may exist from time to time, including, without limiting the generality of the foregoing, Other Tenements, Facilities, Mineral Products and all supplies and equipment related to operations hereunder.

Associated Company means, in respect of a party hereto:

(i) any corporation which beneficially owns, directly or indirectly, securities carrying more than 30% of the voting rights attached to the outstanding securities of such party;

(ii) any corporation in respect of which such party beneficially owns, directly or indirectly, securities carrying more than 30% of the voting rights attached to the outstanding securities of such corporation; or

(iii) any corporation in respect of which corporations referred to in §(i) and (ii) hereof beneficially own, directly or indirectly in the aggregate, more than 30% of the voting rights attached to the outstanding securities of such corporation.

For the purposes hereof, beneficial ownership shall include securities deemed beneficially owned within the meaning of §1(4) of the Securities Act (British Columbia).

Business Day means a day, other than a Saturday or Sunday, on which the main branch of Bank of Montreal in Vancouver, British Columbia is open to the public for the transaction of business.

Commercial Production means the operation of the Property or any part thereof as a mine but does not include milling for the purpose of testing or milling by a pilot plant. Commercial Production shall be deemed to have commenced on the first day of the month following the first 15 consecutive days during which Mineral Products have been produced from the Property at an average rate not less than 70% of the initial rated capacity of the Facilities.

Completion Date means the date on which Commercial Production shall be deemed to have commenced.

Cost Share means the respective share of all Expenditures incurred in connection with a Program, Production Program Costs incurred in connection with a Production Program, Operating Costs and other liabilities hereunder, whether incurred by the Operator or otherwise, to be borne by each Participant after the Participation Date and shall be equal to the respective Interest of each Participant as determined from time to time or such greater amount as a Participant may elect to pay pursuant to the terms hereof.

        Costs means cash outlays, expenses, obligations and liabilities of whatever kind or nature, but without duplication.

Expenditures means all Costs spent or incurred or deemed incurred hereunder prior to the adoption of a Production Program by all of the Participants in connection with the exploration and development of the Property including, without limiting the generality of the foregoing:

(i)   monies expended in maintaining the Property in good standing, including any monies expended in doing and filing assessment work and any required vendor’s or royalty payments;

(ii)   monies expended in doing geophysical, geochemical and geological surveys, drilling, assaying and metallurgical testing;

(iii)   monies expended in acquiring Assets;

(iv)   monies expended in paying the fees, wages and salaries of all employees of PTG and its Associated Companies engaged in work with respect to and for the benefit of the Property, together with an amount for fringe benefits usually paid by PTG;

(v)   monies expended in paying for the food, lodging and travelling expenses and other reasonable needs of the persons referred to in §(iv) hereof;

(vi)   a charge equal to 12% of all Expenditures, other than the charge referred to in this §(vi) and §(vii), for unallocable overhead and head office expenses and all other expenses relating to supervision and management of all work done with respect to and for the benefit of the Property;

(vii)   monies expended or set aside for environmental remediation and reclamation;

(viii)   all Costs related to the preparation of Programs and reporting as to the results thereof; and

(ix)   all Costs related to the preparation of a Feasibility Report, a Property Holding Program and a Production Program;

        but does not include any amount incurred in respect of Production Program Costs.

Facilities means all mines and plants including, without limitation, all pits, shafts, haulageways and other underground workings, and all buildings, plants and other structures, fixtures and improvements, and all other property, whether fixed or moveable, as the same may exist at any time in or on the Property and relating to the operation of the Property as a mine or outside the Property if for the exclusive benefit of the Property only.

Feasibility Report means a detailed report prepared pursuant to Article 8 showing the feasibility of placing the Property or part thereof into Commercial Production and shall include at least the following information:

(i)	a description of that part of the Property to be covered by the proposed mine;
(ii)	the estimated recoverable reserves of minerals and the estimated composition and content thereof;
(iii)	the proposed procedure for development,mining and production;
(iv)	results of ore amenability tests (if any);
(v)	the nature and extent of the Facilities proposed to be acquired which may include mill facilities, if the size, extent and location of the ore body makes such mill facilities feasible, in which event the study shall also include a preliminary design for such mill;

(vi)   the total costs, including capital budget, which are reasonably required to purchase, construct and install all structures, machinery and equipment required for the proposed mine, including a schedule of timing of such requirements;

(vii)   all environmental impact studies and costs;

(viii)   the period in which it is proposed the Property shall be brought to Commercial Production;

(ix)   such other data and information as are reasonably necessary to substantiate the existence of an ore deposit of sufficient size and grade to justify development of a mine, taking into account all relevant business, tax and other economic considerations; and

(x)   working capital requirements for the initial four months of operation of the Property as a mine or such longer period as may be reasonably justified in the circumstances.

Interest means the undivided beneficial percentage interest of a party in the Assets as determined pursuant to this Agreement, but does not include a Net Profits Royalty.

       Joint Venture means the joint venture formed pursuant to §4.1.

       Management Committee means the committee formed pursuant to Article 6.

       Mineral Products means the end products derived from operating the Property as a mine.

Net Profits Royalty to which any party is entitled hereunder means a percentage interest in net profits derived from the Property pursuant to §5.4, §8.9 or, §9.7 that is equivalent to that percentage of net profits that is equal to •% of the maximum Interest that was held by that party on or after the Participation Date at any time less any assignments of Interest made by that party, and not including any increase in that party’s Interest as a result of the dilution of Interest of any other party, such net profits and the royalty to be calculated and payable as provided in Schedule 2.

operating the Property as a mine or operation of the Property as a mine means any or all of the mining, milling, smelting, refining and other processing of ores, minerals, metals, tailings or concentrates derived from the Property and other ancillary activities and operations related thereto.

Operating Costs means, for any period after commencement of Commercial Production, all Costs, incurred or chargeable, directly or indirectly, by the Operator in connection with Operating Plans including, without duplication and without limiting the generality of the foregoing, the following:

(i)   all Costs of or related to operating employee facilities, including housing;

(ii)   all duties, charges, levies, royalties, taxes (excluding taxes levied on the income of the parties) and other payments imposed by any government or municipality or department or agency thereof upon or in connection with operating the Property as a mine;

(iii)   all Costs of maintaining the Property in good standing, including any required vendor’s or royalty payments;

(iv)   all reasonable Costs of the Operator for providing technical, management and/or supervisory services;

(v)   all reasonable Costs of consulting, legal, accounting, insurance and other services;

(vi)   all exploration expenditures incurred after commencement of Commercial Production;

(vii)   all capital costs of operating the Property as a mine including all Costs of construction, equipment and mine development and including maintenance, repairs and replacements, and any capital expenditures relating to an improvement, expansion, modernization or replacement of the Facilities;

(viii)   a reasonable amount of funds set aside to cover reclamation Costs;

(ix)   all Costs incurred or to be incurred relating to a temporary or permanent shut-down of the Facilities, including Costs to be incurred after any shut-down;

(x)   a management fee payable to the Operator in respect of its unallocable overhead and head office expenses equal to 3% of all Operating Costs other than those referred to in §[(iv)], (viii) and (x) hereof; and

(xi)   Operating Cost Overruns and approved Excess Operating Cost Overruns as described in §10.3;

and, except where specific provision is made otherwise, all Operating Costs shall be determined in accordance with generally accepted accounting principles applied consistently from year to year, provided however that such costs shall not include any amount in respect of amortization of Expenditures or Production Program Costs, depletion or depreciation.

Operating Plan means a plan for an Operating Year as contemplated in Article 10 including, inter alia, the following information:

(i)   a written plan of the proposed mining operations for the Operating Year, including any plans for exploration or for expansion of the Facilities;

(ii)   a detailed estimate of all Operating Costs plus a reasonable allowance for contingencies, on a monthly basis, including any proposed cash calls;

(iii)   an estimate of the quantity and quality of the ore to be mined and of the quality of Mineral Products to be produced on a monthly basis; and

(iv)   such other facts as may be reasonably necessary to present the results proposed to be achieved during the Operating Year.

Operating Year means a calendar year or such other fiscal year as the Management Committee may approve. In the case of the first Operating Year, unless otherwise decided by the Management Committee, that Operating Year shall be the remainder of the current calendar or fiscal year, if the Completion Date occurs two months or more before the expiration of the year, or the period from the Completion Date to the end of the next succeeding calendar or fiscal year, if the Completion Date occurs on or after the date which is two months before the expiration of the year.

Operator means that party acting as operator from time to time in accordance with Article 7 and includes any Affiliate acting as the agent or delegate of the Operator in that regard.

       Option means the right of PTG to earn an Interest as described in §3.1.

Other Tenements means all surface rights of and to any lands within or outside the Property including surface rights held in fee or under lease, licence, easement, right of way or other rights of any kind (and all renewals, extensions and amendments thereof or substitutions therefor) acquired by or on behalf of the parties with respect to the Property.

Participant means any party having an Interest and its successors and permitted assigns and Participants means collectively all parties having an Interest and their respective successors and permitted assigns.

       Participation Date shall mean the date described in §3.10.

Prime Rate means the per annum rate declared from time to time by the main branch in Vancouver, B.C., of Bank of Montreal as the rate of interest charged by it to its largest and most creditworthy commercial borrowers for demand Canadian dollar loans over $200,000.

       Production Program means any program based on a Feasibility Report contemplating the achievement of Commercial Production.

Production Program Costs means all Costs spent or incurred directly or indirectly in connection with a Production Program in order to equip the Property or a part thereof for Commercial Production, including, without limitation:

(i)   all monies expended to develop, construct or acquire the Facilities and other Assets, as contemplated in the Production Program;

(ii)   working capital required for the initial four months of operation of the Property or part thereof as a mine or for such longer period as may be reasonably justified in the circumstances;

(iii)   a contingency amount of not less than 10% and not more than 20% of total Production Program Costs;

(iv)   a management fee payable to the Operator in respect of its unallocable overhead and head office expenses equal to 3% of all Production Program Costs other than those referred to in this §(iv); and

(v)   monies set aside or lodged as security for environmental remediation and reclamation.

       Program means, as the context requires:

(i)   any program to carry out work and incur Expenditures after the Participation Date and prior to the approval of a Production Program on or in respect of the Property;

(ii)   a document or documents wherein there is specified in reasonable detail an outline of any and all research, prospecting and exploration and development work proposed to be carried out during such Program, the estimated Expenditures to be incurred in carrying out such work and the area of the Property on which such work is to be undertaken;

(iii)   the preparation, after the Participation Date, of any Feasibility Report and Production Program;

(iv)   a Property Holding Program;

        and shall include any amendments to a Program as may be agreed upon by the Management Committee.

Property means an undivided 100% right, title and interest in and to the mining properties, claims, interests and other rights more particularly described in Schedule 1 and shall include any renewal thereof and any other form of successor or substitute title therefor, and shall include any other mineral properties, claims or interests made part of the Property pursuant to this Agreement, but shall exclude any mineral properties, claims or interests transferred or abandoned in accordance with §3.9 or §6.8 or otherwise sold or disposed of by the Joint Venture.

Property Holding Program means a program for maintenance of the Property and continued work, if necessary, after the Feasibility Report and before the Production Program.

Included Words

1.2      This Agreement shall be read with such changes in gender or number as the context shall require.

Headings

1.3      The headings to the articles, paragraphs, parts or clauses of this Agreement and the table of contents are inserted for convenience only and shall not affect the construction hereof.

References

1.4      Unless otherwise stated, a reference herein to a numbered or lettered article, paragraph, clause or schedule refers to the article, paragraph, clause or schedule bearing that number or letter in this Agreement. A reference to “this” article, paragraph, clause or schedule means the article, paragraph, clause or schedule in which the reference appears. A reference to “this Agreement”, “hereof”, “hereunder”, “herein” or words of similar meaning, means this agreement including the schedules hereto, together with any amendments thereof.

Currency

1.5     All dollar amounts expressed herein refer to lawful currency of Canada.

Interest

1.6      Wherever interest is chargeable under this Agreement, unless otherwise specifically provided, interest will be at the specified per annum rate, calculated daily and compounded on the last day of each calendar month. For the purposes hereof, the Prime Rate in effect for each day of a month shall be equal to the Prime Rate declared at noon on the first Business Day of that month. For greater certainty, the interest chargeable for any day will be based upon the specified per annum rate in effect on that day.

Statutes

1.7      A reference to a statute, regulation or other legislation herein shall be deemed to extend to and include any amendments thereto and successor legislation.

Schedules

1.8      The following schedules are incorporated into this Agreement by reference:

Schedule	Description
1	Description of Property
2	Net Profits Royalty
3	Share Option

Governing Law

1.9      This Agreement shall be construed and governed by the laws in force in the Province of British Columbia and, except as provided in Article 17, the courts of said Province shall have exclusive jurisdiction to hear and determine all disputes arising hereunder. Each of the parties hereto irrevocably attorns to the jurisdiction of said courts and consents to the commencement of proceedings in such courts. This paragraph shall not be construed to affect the rights of a party to enforce a judgement or award outside the said Province, including the right to record or enforce a judgement or award in any jurisdiction in which Assets are situated.

Severability

1.10      If any provision of this Agreement is or shall become illegal, invalid or unenforceable, in whole or in part, the remaining provisions shall nevertheless be and remain valid and subsisting and the said remaining provisions shall be construed as if this Agreement had been executed without the illegal, invalid or unenforceable portion.

ARTICLE 2

REPRESENTATIONS, WARRANTIES AND COVENANTS

Representations, Warranties and Covenants of Each Party

2.1      Each party represents and warrants to the other party hereto that:

(a) it is a body corporate duly incorporated, organized and validly subsisting under the laws of its incorporating jurisdiction;

(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;

(c) neither the execution and delivery of this Agreement nor any of the agreements referred to herein or contemplated hereby, nor the consummation of the transactions hereby contemplated conflict with, result in the breach of or accelerate the performance required by any agreement to which it is a party; and

(d) the execution and delivery of this Agreement and the agreements contemplated hereby will not violate or result in the breach of the laws of any jurisdiction applicable or pertaining thereto or of its constating documents.

Representations, Warranties and Covenants of the Owner

2.2      The Owner represents and warrants to PTG that:

(a) the mineral claims and other interests comprising the Property are accurately described in Schedule 1, 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;

(b) the Owner 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 Owner is the sole recorded and beneficial owner of the Property;

(d) any mineral claims included in the Property as described in Schedule 1 have been properly and legally staked, recorded and tagged;

(e) there is no adverse claim or challenge against or to the ownership of or title to any of the mineral claims and other interests comprising the Property, nor to the knowledge of the Owner 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 or any production therefrom, and no person other than • has any royalty or other interest whatsoever in the Property or in production therefrom;

(f) all corporate authorizations have been obtained by the Owner for the execution of this Agreement and for the performance of its obligations hereunder;

(g) no proceedings are pending for and the Owner is unaware of any basis for the institution of any proceedings leading to the dissolution or winding-up of the Owner or the placing of the Owner into bankruptcy or subject to any other laws governing the affairs of insolvent persons;

(h) the Property and its existing and prior uses comply and have at all times complied with, and the Owner is not in violation of, and has not violated, in connection with the ownership, 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;

(i) without limiting the generality of §(h), the Owner:

(i) has operated the Property and has at all times received, handled, used, stored, treated, shipped and disposed of all environmental or similar contaminants in strict compliance with all applicable environmental, health or safety laws, regulations, orders or approvals; and

(ii) has removed from and off the Property all environmental or similar contaminants;

(j) there are no writs, injunctions, orders or judgements 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, archaeological or similar matters, or otherwise, nor, to the Owner’s knowledge, is there any basis for such law suits, claims, proceedings or investigations being instituted or filed;

(k) 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 Owner’s operations carried out on the Property, nor, to the best of the Owner’s knowledge, have any of the above occurred nor has the Property been used at any time by any person as a landfill or waste disposal site;

(l) to the best of the Owner’s knowledge

(i) no notices of any violation or apparent violation of any of the matters referred to in §(h) through §(k) relating to the Property or its use have been received by the Owner, and

(ii) [NOTE TO DRAFT: Only include if not including §2.2(j)] there are no writs, injunctions, orders or judgements 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, archaeological or similar matters, or otherwise, nor, to the knowledge of the Owner, is there any basis for such law suits, claims, proceedings or investigations being instituted or filed;

(m) the Property is not the whole or substantially the whole of the assets or undertaking of the Owner; and

(n) the Owner holds a valid and subsisting Free Miner Certificate issued under the Mineral Tenure Act (British Columbia) or the comparable licence or certificate required under the mining laws of the jurisdiction in which the Property is located.

Covenants of the Owner

2.3      The Owner covenants with PTG that:

(a) it will, at its sole cost and expense, remove or take remedial action with regard to any materials released by the Owner or its contractors and agents, into the environment at, on or near the Property prior to the date hereof for which any removal or remedial action is required pursuant to any law, regulation, order or governmental action, whether enacted, made or declared in force before or after the date hereof, provided that:

(i) no such removal or remedial action shall be taken except after reasonable advance written notice has been given to PTG; and

(ii) any such removal or remedial action shall be undertaken in a manner so as to minimize any impact on PTG’s operation on the Property;

(b) it will at all times retain any and all liabilities arising from the handling, treatment, storage, transportation or disposal of environmental or similar contaminants on or near the Property by the Owner or by any of the Owner’s contractors or agents;

(c) it will, during the currency of the Option, keep the Property free and clear of all liens, charges and encumbrances, save and except those arising from PTG’s activities on the Property; and

(d) in the event of an adverse claim or claims (i) respecting the Property which does not arise from PTG’s activities on the Property, or (ii) respecting defects of title affecting all or a portion of the Property, the Owner shall, all at its sole expense, take immediate steps to defend against any such claim or claims or to cure any such default of title until such adverse claim or claims is or are judicially or otherwise fully settled and determined or such defects are otherwise cured, and PTG shall be held harmless from and indemnified for any resulting loss from adverse claims or other title defects. In the event that the Owner is unable or refuses to cure any defect in title to the Property promptly, PTG may, without affecting the Owner’s obligations under this subparagraph, at PTG’s election, take steps to cure such defect and shall be fully reimbursed for all costs incurred for that purpose, plus interest at the Prime Rate plus 3% from the date the Costs are incurred, and until reimbursed (and without limitation as to exercise of other remedies) PTG may recover the Costs of such cure, including legal fees and court costs, from amounts otherwise due to the Owner hereunder.

Survival of Representations, Warranties and Covenants

2.4      The representations, warranties, covenants, agreements and conditions hereinbefore set out are conditions on which the parties have relied in entering into this Agreement and shall survive the acquisition of any Interest 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 (including, without limitation, lawyer’s fees and disbursements).

ARTICLE 3

OPTION AND INITIAL PROGRAMS

Option

3.1      Subject as hereinafter provided, the Owner hereby grants to PTG the sole and exclusive right and option to acquire an undivided •% right, title and interest in and to the Assets. Forthwith after execution of this Agreement, the Owner shall execute and deliver to PTG (or, at PTG’s written request, to an escrow agent designated by PTG) a transfer or transfers of the Property in recordable form. Prior to the Participation Date, title to the Property shall be held by PTG (or such escrow agent) subject to the provisions of this Article.

Commitment to Make Expenditures

3.2      On or before the first anniversary of the date of this Agreement PTG shall incur Expenditures of not less than $•. It is understood that this is a firm commitment to make such Expenditures and that, upon failure by PTG to do so, the deficiency shall be an amount owing by PTG to the Owner and payable forthwith upon demand. [NOTE TO DRAFT: This is not a PTG standard clause]

Option Payments and Expenditures to be Incurred

3.3      The Option granted to PTG pursuant to §3.1 shall, subject to §3.5, terminate: [OR: Include the following in place of preceding sentence if an initial option payment is to be made] [To preserve the Option granted to PTG pursuant to §3.1, PTG shall pay the Owner $• on the execution date of this Agreement. Thereafter the Option shall, subject to §3.5:]

(a) on the first anniversary of the date of this Agreement, unless on or before that date PTG has incurred $• in Expenditures and paid to the Owner an additional $•;

(b) on the second anniversary of the date of this Agreement, unless on or before that date PTG has incurred $• in Expenditures in the aggregate and paid to the Owner an additional $•;

(c) on the third anniversary of the date of this Agreement, unless on or before that date PTG has incurred $• in Expenditures in the aggregate and paid to the Owner an additional $•;

(d) on the fourth anniversary of the date of this Agreement, unless on or before that date PTG has incurred $• in Expenditures in the aggregate and paid to the Owner an additional $•; or

(e) if PTG gives notice in accordance with §3.8 or this Agreement is otherwise terminated prior to the Participation Date in accordance with the terms hereof.

It is understood that the amounts required to be spent within the periods referred to in §(a) to §• hereof are cumulative, aggregate amounts and that, accordingly, all Expenditures incurred in a particular period, including any excess in the amount of Expenditures required to be incurred to maintain the option during such period, shall be carried over and included in the aggregate amount of Expenditures for the subsequent period.

Report of Expenditures

3.4      Within 60 days following the expiry of each of the periods referred to in §3.3, PTG shall deliver to the Owner a statement showing in reasonable detail the Expenditures incurred by PTG during the period last expired and the aggregate Expenditures incurred to the end of such period (together with payment by PTG of any deficiency, if applicable) and the Owner shall have 45 days from the time of receipt of such statement to question the accuracy thereof in writing, failing which such statement shall be deemed to be correct and unimpeachable thereafter. If a statement delivered pursuant to §3.4 is questioned by the Owner:

(a) the Owner shall have 12 months from the time of delivery of the statement to have the amounts specified therein audited;

(b) the audited results shall be final and determinative of the amount of Expenditures incurred for the audited period; provided that, if such audit discloses a deficiency in the amount of Expenditures required to be incurred to maintain its option in good standing, PTG may pay to the Owner the amount of such deficiency within 15 days following receipt of notice of such audited results, whereupon such amount shall be deemed to have been Expenditures incurred during the audited period; and

(c) the costs of the audit shall be borne by the Owner if PTG’s statement understated Expenditures or overstated Expenditures by not more than 3% and shall be borne by PTG if such statement overstated Expenditures by greater than 3%.

Deficiencies in Expenditures

3.5      Notwithstanding §3.3, if PTG has not incurred the requisite Expenditures to maintain its option in good standing within any of the periods specified in §3.3, PTG may pay to the Owner, within 60 days following the expiry of such period, the amount of the deficiency and such amount shall thereupon be deemed to have been Expenditures incurred by PTG during such period.

PTG’s Right of Entry

3.6      During the periods set out inss.3.3, PTG and its employees, agents and independent contractors shall have the right and option to:

(a) enter upon the Property;

(b) have exclusive and quiet possession thereof;

(c) do such prospecting, exploration, development or other mining work thereon and thereunder as PTG in its sole discretion may consider advisable and including, without limitations, the removal of ores, minerals and metals from the Property but only for the purpose of testing; and

(d) bring upon and erect upon the Property such Facilities as PTG may consider advisable.

PTG’s Obligations During Currency of Option

3.7      Unless, by written notice to the Owner, PTG abandons the Property sooner, PTG shall, during the currency of the Option:

(a) keep the Property free and clear of all liens, charges and encumbrances arising from its operations hereunder (except liens for taxes not yet due, other inchoate liens and liens contested in good faith by PTG) and shall proceed with all diligence to contest and discharge any such lien that is filed and shall keep the Property in good standing by the doing and filing of all necessary work and by the doing of all other acts and things and making all other payments which may be necessary in that regard;

(b) permit the Owner, or its representatives duly authorized by it in writing, at their own risk and expense, access to the Property at all reasonable times and to all records prepared by PTG in connection with work done on or with respect to the Property and furnish the Owner with quarterly reports during the conduct of the work carried out by PTG on or with respect to the Property and results obtained, together with timely current reports and information on any material results obtained;

(c) obtain and maintain, or cause any contractor engaged hereunder to obtain and maintain, during any period in which active work is carried out hereunder, such insurance as PTG reasonably considers to be appropriate in the circumstances in light of general industry practice; and

(d) conduct all work on or with respect to the Property in a manner consistent with good exploration, engineering and mining practices and in compliance with all applicable laws, rules, orders and regulations, and indemnify and save the Owner harmless from any and all claims, suits or actions made or brought against it as a result of work done by or on behalf of PTG on or with respect to the Property.

PTG’s Obligations on Termination

3.8      At any time prior to the Participation Date, PTG may terminate this Agreement and the Option, so long as it is not in default of any of its obligations under this Agreement, by giving notice in writing to that effect to the Owner and, on receipt of such notice, or if PTG fails to make the requisite Expenditures under §3.3, but subject to §3.5, this Agreement shall be of no further force or effect and PTG shall have no interest in the Property; provided, however, that PTG shall:

(a) remain liable for any amount owing under §3.2;

(b) leave the Property in good standing with respect to the filing of assessment work for a period of [90] days from the date of termination, free and clear of all liens, charges and encumbrances arising from operations hereunder (except for taxes not yet due, other inchoate liens and liens contested in good faith by PTG) and in good standing with respect to all applicable environmental, safety and other statutory rules, regulations and orders arising from or applicable to work done on the Property by PTG; provided however, that PTG shall have no liability or obligation hereunder in respect of claims arising or damages suffered after the termination of this Agreement if upon such termination any workings on or improvements to the Property arising from PTG’s operations hereunder have been left in good standing as aforesaid;

(c) deliver to the Owner, within 60 days of a written request made by the Owner, a comprehensive report on all work carried out by PTG on the Property (limited to factual matters only), together with all drill cores, assay samples, copies of all maps, drill logs, assay results and other factual technical data compiled by PTG with respect to the Property which were not previously delivered to the Owner;

(d) have the right to remove from the Property within 180 days of the effective date of termination all temporary structures, equipment and supplies erected, installed or brought upon the Property by or at the instance of PTG; and

(e) deliver to the Owner an acknowledgement of abandonment and release of any interest in the Assets or under this Agreement, together with a bill of sale or other appropriate deed or transfer in recordable form whereby the Property is transferred or quit claimed back to the Owner, free of any liens or charges arising from PTG’s activities in respect of the Property.

Abandonment of Part of Property

3.9      At any time prior to the Participation Date, PTG may elect to abandon any one or more of the mineral claims comprised in the Property by giving notice to the Owner of such intention. For a period of 30 days after the date of delivery of such notice the Owner may elect to have any or all of the mineral claims in respect of which such notice has been given transferred and quit claimed back to the Owner by delivery of a request therefor to PTG, whereupon PTG shall deliver to the Owner a bill of sale or other appropriate deed or assurance in recordable form transferring or releasing such mineral claims back to the Owner and the provisions of §3.8(d) and §3.8(e) shall apply with respect thereto, mutatis mutandis. If the Owner fails to make a request for the transfer of any mineral claims as aforesaid within such 30-day period, PTG may then abandon such mineral claims without further notice to the Owner. Upon any such transfer, release or abandonment the mineral claims so transferred, released or abandoned shall for all purposes of this Agreement cease to form part of the Property. For greater certainty, there shall be no abatement of the Expenditure or payment requirements under this Article as a result of such transfer, release or abandonment, but any Expenditures previously made in respect of the abandoned claims shall continue to be included in cumulative Expenditures hereunder.

Participation Date

3.10      Subject to earlier termination hereunder, the Participation Date shall be that date on which PTG has exercised the Option by incurring in the aggregate at least $• in Expenditures or paying cash in lieu thereof within the time referred to in §3.3 and §3.5 and paid to the Owner $• in accordance with the terms hereof. On the Participation Date, PTG shall be deemed to have earned an undivided •% right, title and interest in and to the Assets and the Joint Venture referred to in Article 4 shall be formed.

ARTICLE 4

JOINT VENTURE

Formation and Scope

4.1      On the Participation Date, PTG and the Owner shall and shall be deemed to form a single purpose joint venture for the purpose of undertaking such activities as are determined in accordance with the provisions hereof, to be necessary or appropriate, directly or indirectly, to:

(a)	explore and, if deemed warranted as herein provided, develop the Property and equip it for Commercial Production;
(b)	operate the Property as a mine; and
(c)	engage in such other activity as may be considered by the Participants to be necessary or desirable in connection with the foregoing.

Transactions in Name of Operator

4.2      All transactions, contracts, employments, purchases, operations, negotiations with third parties and any other matter or act undertaken on behalf of the Participants in connection with the Property shall, subject to §4.5, be done, transacted, undertaken or performed in the name of the Operator, and no party (other than the Operator acting in that capacity) shall do, transact, perform or undertake anything in the name of another party hereto or in the joint names of the Participants or in the name of the Joint Venture.

No Partnership

4.3      After the Participation Date, the rights and obligations of the Participants shall be, in each case, several, and shall not be or be construed to be either joint or joint and several. Nothing contained in this Agreement shall, except to the extent specifically authorized hereunder, be deemed to constitute a Participant a partner, an agent or legal representative of any other party. It is intended that this Agreement shall not create the relationship of a partnership between the Participants and that no act done by any Participant pursuant to the provisions hereof shall operate to create such a relationship.

Liability for Costs

4.4      After the Participation Date, except as otherwise provided herein, each Participant shall be liable for its Cost Share of all costs, debts, liabilities or obligations arising from operations hereunder from and at the time incurred by the Operator. Except as otherwise provided herein, any amount due to the Operator hereunder shall bear interest from its due date at a per annum rate equal to the Prime Rate plus 2%.

Holding Title to the Assets

4.5      Each Participant shall have such Interest as is determined in accordance with the provisions of this Agreement, and any legal title to any of the Assets shall be held by the Operator in trust for the Participants in proportion to their respective Interests under the terms of this Agreement. Nothing herein contained shall prevent a party hereto from registering notice of this Agreement and its Interest against the title to the Property or any other Assets.

Participants’ Rights to Conduct Other Business

4.6     Each Participant shall devote such time as may be required to fulfil any obligation assumed by it hereunder but, subject to Article 20:

(a) each Participant shall be at liberty to engage in any other business or activity outside the Joint Venture, including the ownership and operation of any other mining permits, licenses, claims and leases;

(b) no Participant shall be under any fiduciary or other obligation to any other party which shall prevent or impede such Participant from participating in, or enjoying the benefits of, competing endeavours of a nature similar to the business or activity undertaken by the Participants hereunder; and

(c) the legal doctrines of “corporate opportunity” or “business opportunity” sometimes applied to persons occupying a relationship similar to that of the Participants shall not apply with respect to participation by any Participant in any business activity or endeavour outside the Joint Venture, and, without implied limitation, a Participant shall not be accountable to the others for participation in any such business activity or endeavour outside the Joint Venture which is in direct competition with the business or activity undertaken by the Joint Venture. Unless otherwise agreed in writing, no Participant shall have any Obligations to mill, beneficiate or otherwise treat any Mineral Products or any other Participant’s share of production in any facility owned or controlled by that Participant. Conversely, the Joint Venture shall have no obligation to mill, beneficiate or otherwise treat or accommodate any minerals produced by a Participant from lands not comprising the Property.

No Right of One Participant to Bind the Other

4.7      A Participant shall not have authority to act for or assume any obligations or liabilities on behalf of the other Participant except such as are specifically authorized pursuant to and in accordance with the terms of this Agreement, and each Participant shall indemnify and hold the other Participant, and its officers, employees and agents, harmless from and against any and all losses, claims, damages and liabilities arising out of any act or any assumption of any obligations by it done or undertaken on behalf of the other Participant other than as provided herein.

ARTICLE 5

INTERESTS OF PARTICIPANTS

Interests

5.1      On the Participation Date, PTG shall have an undivided •% Interest and the Owner shall have an undivided •% Interest. Thereafter, each Participant shall have such Interest as is determined from time to time in accordance with the provisions of this Agreement.

Dilution Formula

5.2      Subsequent to the Participation Date, the respective Interests of the Participants shall be determined from time to time as being equal to the product obtained by multiplying 100% by a fraction of which the numerator is $1,020,000 in the case of PTG and $980,000 in the case of the Owner, plus the amount of the respective Participant’s contributions to Expenditures and Production Program Costs made subsequent to the Participation Date and the denominator is $2,000,000 plus the amount of all contributions to Expenditures and Production Program Costs made subsequent to the Participation Date by all Participants .

Multiple Participants

5.3      If there are more than two Participants the dilution formula in §5.2 will be applied mutatis mutandis as required provided, that an assignment by a Participant of all or part of its Interest will carry with it an assignment of that proportion of the aggregate of the Participant’s Expenditures and Production Program Costs to the time of assignment which equals the percentage of the Participant’s Interest which is being assigned.

Dilution and Conversion of an Interest to a Royalty

5.4      The respective Interests of the Participants shall not change so long as they each contribute their respective Cost Share of every Program as set out in Article 8 and Production Program as set out in Article 9. At any time and from time to time after a Participant elects or is deemed to have elected not to contribute to a Program or Production Program, its respective Interest shall be reduced, and each other Participant’s Interest shall be proportionately increased, in accordance with the formula set out in §5.2. If, as a result of such calculation, the Interest of a Participant is reduced to or below •%, its Interest shall be deemed to be converted to a Net Profits Royalty and thereafter such party shall have no further rights or interest in respect of the Assets or under this Agreement, save and except for the Net Profits Royalty, provided however, that if a Participant assigns part of its Interest the percentage Interest to which the Participant’s and the assignee’s Interest must be diluted prior to its Interest being converted to a Net Profits Royalty shall remain at •% for each of them and the Net Profits Royalty to which the assigning Participant’s or the assignee’s Interest will be converted shall be that derived by multiplying the Net Profits Royalty to which the assigning Participant’s Interest would have been converted to prior to the assignment by the fraction, the numerator of which is the Participant’s Interest immediately after the assignment and the denominator of which is the assigning Participant’s Interest immediately prior to the assignment and such shall be applied in like fashion for any additional assignments.

Royalty Calculation and Payment

5.5      Any Net Profits Royalty shall be calculated pursuant to Schedule 2 by the Operator if it is the sole Participant, or if there is more than one Participant, by each Participant as to its respective share of the Net Profits Royalty and the Operator or the Participants, as the case may be, shall pay the Net Profits Royalty as described in Schedule 2.

ARTICLE 6

MANAGEMENT COMMITTEE

Management Committee

6.1      The Participants shall, as soon as is practicable after the Participation Date, establish a Management Committee which shall direct and control the operations of the Joint Venture.

Members

6.2      Each Participant having an Interest of not less than 30% shall be entitled to two members, and each other Participant shall be entitled to one member, on the Management Committee. A Participant may from time to time revoke in writing the appointment of any of its nominees on the Management Committee and appoint in writing another in his place. A Participant may from time to time in writing appoint one alternate member for any member theretofore appointed by such Participant. Alternate members may attend meetings of the Management Committee and, in the absence of the member, his alternate may vote and otherwise act in the place and stead of a member. Whenever any member or alternate member votes or acts, his votes or actions shall for all purposes of this Agreement be considered the actions of the Participant whom he represents. The Participants shall give written notice to each other from time to time as to names, addresses, telephone numbers and facsimile numbers of their respective members and alternates on the Management Committee.

Time and Place of Meetings

6.3      All meetings of the Management Committee shall be held in Vancouver, B.C. unless all members of the Management Committee agree otherwise and any member of the Management Committee may call a meeting at any time by giving seven days’ notice to the other members of the time and place of such meeting and the general nature of the business to be conducted, but no Participant other than the Operator shall be entitled to call a meeting less than three months after the date of the last meeting of the Management Committee. Any member of the Management Committee, or his alternate, may waive in writing the giving of such notice before or after such meeting. Otherwise, the giving of notices under this Article shall be governed by Article 18.

Resolutions in Writing

6.4      Any resolution in writing signed by all members of the Management Committee in one or more counterparts shall be as valid and binding as if passed at a meeting of the Management Committee duly called and constituted. The Chairman of a meeting of the Management Committee may require that a resolution duly passed at such meeting be reduced to writing and signed by all of the Participants present at such meeting in order to properly record such resolution.

Quorum

6.5      Except as herein set out, a quorum for any meeting of the Management Committee shall consist of a member or members representing a Participant or Participants whose Interest or Interests aggregate in excess of 50%. If a quorum is not present within 30 minutes after the time fixed for holding any such meeting, the meeting shall be adjourned to the sixth Business Day thereafter at the same time and place. Notice of any adjournment shall be given forthwith to each member of the Management Committee who was not present at the adjourned meeting. At the meeting to which the prior meeting was adjourned, the members (or their respective alternates) present in person shall form a quorum and may transact the business for which the meeting was originally convened.

Voting

6.6      Except as herein set out, the members of the Management Committee or their respective alternates shall have a number of votes equal in number to the Interest held by the Participant that he or they represent. The Management Committee shall decide all matters coming before it at a meeting by the affirmative vote of a majority of the votes entitled to be cast by members at the meeting. The representative of the Operator shall act as Chairman of each meeting of the Management Committee and, as such, shall have an additional or casting vote in the case of an equality of votes on any matter.

Secretary and Records

6.7      The Management Committee shall appoint a secretary (who need not be a member of the Management Committee) who shall keep a record of the meetings of the Management Committee, and circulate to all members minutes of each meeting promptly after the conclusion thereof. Each Participant shall have the right to examine and take extracts of all records of the Management Committee (which shall be maintained by the Operator), at reasonable times and on reasonable notice at the Operator’s offices during regular business hours.

Abandonment of Property

6.8      The Management Committee may decide to surrender or abandon a portion of the Property, provided such decision is made at least [90] days prior to the date on which such portion shall cease to be in good standing in the records of the appropriate governmental authority, and provided further that notice of such proposed abandonment is forthwith given to any Participant which was not represented at the meeting at which such decision was made. Those Participants which did not vote in favour of the abandonment may elect, by notice to the Operator within 30 days following the meeting or such notification, as the case may be, that the portion to be abandoned be transferred to it, or if more than one, to them in proportion to their respective Interests, whereupon the Operator and those Participants that voted in favour of the abandonment shall, forthwith after the expiry of the applicable 30-day period, transfer, assign and quit claim the subject portion to the Participant or Participants so electing. Failing any such election, the subject portion may be abandoned or surrendered as decided upon. Following a transfer or abandonment under this paragraph, the portion so transferred or abandoned shall thereafter cease to form part of the Property and shall no longer be subject to this Agreement, save and except with respect to such obligations or liabilities of the Participants as have accrued hereunder up to the date of such transfer or abandonment.

ARTICLE 7

OPERATOR

Rights and Powers of the Operator

7.1      Following the Participation Date, but subject to §7.2 and §7.4, PTG will act as the Operator under this Agreement and as such shall, subject to the direction and control of the Management Committee, have full right, power and authority to do everything necessary or desirable to carry out the purposes of the parties in connection with this Agreement, including and without limiting the generality of the foregoing, the right, power and authority to:

(a) prepare and present to the Management Committee, Programs in respect of the Property and implement such Programs as are approved in accordance with the terms of this Agreement;

(b) regulate access to the Property subject only to the right of designates of the Participants duly authorized in writing to have access to the Property at all reasonable times for the purpose of inspecting work being done thereon, but at their own risk and expense;

(c) employ and engage such employees, agents, and independent contractors as it may consider necessary or advisable to carry out its duties and obligations hereunder and in this connection to delegate any of its powers and rights to perform its duties and obligations hereunder, but the Operator shall not, for the account of the Joint Venture, enter into contractual relationships with a Participant or any Associated Company of a Participant except upon terms that are commercially competitive;

(d) prepare, present and implement any Production Program that is approved in accordance with the terms of this Agreement;

(e) after the Completion Date and subject to the authority of the Management Committee, prepare, present and implement Operating Plans and operate the Property as a mine; and

(f) charge fees in respect of overhead costs as specified in the definitions of Expenditures, Production Program Costs and Operating Costs.

Resignation of the Operator

7.2      The Operator may resign at any time by giving 120 days’ prior written notice to the other Participants (or such shorter notice as the other Participants accept) and the Participants shall, within 60 days after receipt of such notice, convene a meeting of the Management Committee which shall appoint another Participant who consents to act as Operator, and determine its terms of engagement.

Duties and Obligations of the Operator

7.3      The Operator shall have such duties and obligations as the Management Committee may from time to time determine including, without limiting the generality of the foregoing, the following duties and obligations:

(a) to propose and, if they are approved, implement Programs, Property Holding Programs, any Production Program and Operating Plans;

(b) to manage, direct and control all exploration, development, construction and producing operations in and under the Property, in a manner consistent with good exploration, engineering and mining practices and in compliance with all applicable laws, rules, orders and regulations;

(c) to prepare and deliver to the Participants, during periods of active field work, periodic progress reports as well as timely current reports and information on any material results obtained;

(d) subject to the terms and conditions of this Agreement, to keep the Assets in good standing and free of liens, charges and encumbrances of every character arising from operations (except liens for taxes not yet due, other inchoate liens and liens contested in good faith by the Operator) and to proceed with all diligence to contest or discharge any such lien that is filed;

(e) to account to the Participants for all contributions to and expenditure of Expenditures, Production Program Costs and Operating Costs;

(f) to maintain true and correct books, accounts and records of operations hereunder and, following the Completion Date, to prepare and deliver to the Participants audited financial statements of the Joint Venture within 120 days following the end of each Operating Year;

(g) to permit the Participants, at their own expense, to inspect, take abstracts from or audit any or all of the records and accounts referred to in §(f) hereof on reasonable notice during normal business hours, and without undue disruption of the work and operations of the Operator hereunder;

(h) to obtain and maintain, or cause any contractor engaged hereunder to obtain and maintain, during any period in which active work is carried out hereunder, such insurance as the Operator reasonably considers to be appropriate in the circumstances in light of general industry practice;

(i) to permit the Participants and their representatives appointed in writing, at their own expense and risk, access to the Property and all data derived from carrying out work thereon, on reasonable notice and without undue disruption of the work and operations of the Operator hereunder;

(j) to arrange for and maintain workers’ compensation or equivalent coverage for all eligible employees engaged by the Operator in accordance with local statutory requirements;

(k) to perform its duties and obligations in a manner consistent with good exploration, engineering and mining practices; and

(l) to transact, undertake and perform all transactions, contracts, employments, purchases, operations, negotiations with third parties and any other matter or thing undertaken on behalf of the parties in the Operator’s name.

Non-Performance by the Operator

7.4      If the Operator fails to perform in a manner that is consistent with good exploration, engineering and mining practices or fails to perform in a manner consistent with its duties and responsibilities under this Agreement, or is adjudged to be bankrupt or insolvent or a receiver is appointed for its business and assets, then the Management Committee shall give to the Operator written notice setting forth particulars of the Operator’s default. The Operator will within 30 days of receipt of such notice commence to remedy the default. Failure of the Operator to commence to remedy the default within such 30-day period (and thereafter to proceed continuously and diligently to complete all required remedial action) will be grounds for termination of the Operator’s appointment; provided that if there shall be any disagreement between the Management Committee and the Operator as to whether a default has occurred, the matter may be submitted to arbitration under Article 17, and the Operator shall not be considered in default of any obligation determined on the arbitration if it commences to remedy the default within 10 days after the arbitration decision or within such longer period as may be fixed in the arbitration award. On any termination of the Operator’s appointment hereunder, a meeting of the Management Committee shall forthwith be convened to appoint another party who consents to act as Operator, and determine its terms of engagement. At such meeting, an Operator in default hereunder shall not be entitled to vote as a Participant for the purposes of this paragraph and the remaining Participant or Participants shall be sufficient to form a quorum for such purposes.

Delivery of Assets by Former Operator to Successor Operator

7.5      Upon ceasing to be Operator, the former Operator shall forthwith deliver to the successor Operator custody of all Assets and any books and records pertaining to the Assets which it prepared or maintained in its capacity as Operator. The successor Operator shall assume all of the rights, responsibilities, duties, and status of the previous Operator as provided in this Agreement. The successor Operator shall have no obligation to hire any of the employees of the former Operator.

Termination of Joint Venture if No Operator

7.6      If the Operator resigns or is removed and no other party consents to act as Operator, the Joint Venture shall be terminated and the Assets shall be liquidated or sold and the Assets or proceeds from the sale thereof distributed to the Participants, net of liabilities hereunder or related thereto, in accordance with their Interests. Each Participant shall be responsible for its Cost Share of all costs and expenses related to such termination and liquidation. The party which was the Operator may, if it consents to act, continue to act as Operator to effect such termination and liquidation and it shall have a lien on the Participants’ respective interests in the Assets and any proceeds therefrom as security for their respective Cost Shares of all costs, expenses and other liabilities owing in respect of or as of the date of such termination.

Indemnification of Operator

7.7      Subject to §7.8, each Participant shall, pro rata to its Interest, indemnify and save the Operator and any former Operator harmless from and against any loss, liability, claim, demand, damage, expense, injury and death (including, without limiting the generality of the foregoing, legal fees) resulting from any acts or omissions of the Operator or its officers, employees or agents.

No Indemnification of Operator

7.8      Notwithstanding §7.7, the Operator shall not be indemnified nor held harmless by any of the Participants for any loss, liability, claim, demand, damage, expense, injury or death (including, without limiting the generality of the foregoing, legal fees) resulting from the gross negligence or wilful misconduct of the Operator or its officers, employees or agents; provided however that in no case shall indemnification be withheld if the act or omission of the Operator or its officers, employees or agents was done or omitted to be done:

(a)	at the direction, or within the scope of the direction, of the Management Committee;
(b)	with the concurrence of the Management Committee; or
(c)	unilaterally and in good faith by the Operator to protect life, limb or property.

Indemnification in Proportion to Interests

7.9      The obligation of a Participant to indemnify and save the Operator harmless pursuant to §7.7 shall be in proportion to its Interest as at the date that the loss, liability, claim, demand, damage, expense, injury or death occurred or arose.

No Liability for Special Damages

7.10      The Operator shall not be liable to any Participant nor shall any Participant be liable to the Operator in contract, tort or otherwise for special or consequential damages, including, without limiting the generality of the foregoing, loss of profits or revenues.

Emergency Expenditures

7.11      Notwithstanding anything herein contained to the contrary, the Operator shall be entitled to incur, and the Participants shall be responsible for their respective Cost Share of, any costs expended which the Operator deems necessary to preserve or protect life, limb, property or the environment in respect of the Property and the operations hereunder.

ARTICLE 8

PROGRAMS

Expenditures to be Incurred Under Programs

8.1      After the Participation Date, but subject to §8.2, Expenditures shall only be incurred under and pursuant to Programs prepared by the Operator and approved by the Management Committee as provided in this Article. Any Feasibility Report shall be prepared pursuant to a separate Program.

Programs in Progress on Participation Date

8.2      Upon the occurrence of the Participation Date, Expenditures incurred by PTG or the Operator as part of ongoing exploration work then in progress, up to a maximum of $100,000, shall be deemed to have been approved as a Program and each Participant shall be liable for its Cost Share thereof, upon being invoiced by PTG or Operator, as the case may be. Thereafter, the Operator shall, within 120 days following completion of each Program, prepare and submit to the Management Committee a Program of not less than 6 months and a maximum of 12 months in duration, which shall include at least such Expenditures as are necessary to maintain the Property in good standing. A Program for the preparation of a Feasibility Report and a Production Program may be for such duration as the Operator estimates is required for the completion thereof.

Election to Participate in Programs

8.3      Within 30 days after the approval by the Management Committee of a Program, the Participants shall each give written notice to the Operator stating whether or not they elect to contribute their respective Cost Shares of such Program. Failure by a Participant to give notice pursuant to this paragraph within such 30-day period shall be deemed to be an election by that Participant not to contribute to such Program.

Effect of Election to Not Contribute

8.4      If a Participant (for the purposes hereof a “Non-Contributor”) elects or is deemed to have elected not to contribute its Cost Share of a Program, each other Participant (for the purposes hereof a “Contributor”) that has elected to contribute its Cost Share of the Program may give notice in writing to the Operator stating that it will contribute, in addition to its own Cost Share, the Cost Share of the Non-Contributor. If more than one Participant gives such notice, they shall contribute pro rata to their Interests or as they may otherwise agree. In such event, subject to §8.5, the Operator will proceed with such Program and, on completion of such Program, the Interests of the parties shall be adjusted in accordance with §5.4; provided that, if such Program is completed to the extent of less than 80% of the originally estimated Expenditures thereunder, the Interests of the parties will not be adjusted unless notice is first given to the Non-Contributor that the Program was abated, together with notice of the amount of the actual Expenditures thereunder, and the Non-Contributor does not, within 20 days thereafter, reimburse the Contributor or Contributors to the extent of its Cost Share thereof (being the amount which the respective Contributor elected to and did contribute instead of the Non-Contributor), together with interest thereon from the date contributed by the Contributor, at a per annum rate equal to the Prime Rate plus 2%. If the Non-Contributor so reimburses the Contributor or Contributors within such 20-day period, it shall be deemed to have elected to contribute its Cost Share of such Program and the Interests of the parties shall not be adjusted. A Participant that elects or is deemed to have elected not to contribute to a Program may, subject to §5.4, participate in future Programs.

Operator Not to Proceed Unless Program is Fully Funded

8.5      The Operator will not proceed with any Program which is not fully subscribed except that the Operator shall at all times be entitled to incur such Expenditures as are necessary pursuant to §7.11, pursuant to a Property Holding Program or to maintain the Property in good standing and the Participants shall be liable for their Cost Share thereof, regardless of any election hereunder. If the Participants fully subscribe to a Program, the Operator will proceed with such Program.

Obligation to Pay Expenditures and Overruns

8.6      An election by a Participant to contribute to a Program shall make that Participant liable to pay its respective share of Expenditures actually incurred under or pursuant to the Program including Program Overruns, as hereinafter defined, of up to but not exceeding 20%.

Procedures for Payment

8.7      After having elected to contribute to a Program which is proceeded with or if a Participant is otherwise obligated to pay its Cost Share, a Participant shall, within 15 days after being requested in writing to do so by the Operator, pay such portion of its Cost Share as the Operator may require, including cash calls for anticipated Expenditures, but the Operator shall not require payment of any funds more than 45 days in advance of the anticipated date of disbursement thereof.

Meeting Required to Approve Excess Program Overruns

8.8      If it appears to the Operator that Expenditures will exceed those estimated under a Program, the Operator shall immediately give written notice to the Participants contributing to that Program outlining the nature and extent of the additional costs and expenses (herein called “Program Overruns”) and the reasons therefor. If Program Overruns are estimated to exceed by 20% those approved under the Program (herein called “Excess Program Overruns”), the notice of the Operator shall contain a notice of a meeting of the Management Committee, to be held no sooner than five Business Days after the date of delivery of the notice, for the purpose of considering, and if deemed advisable, approving the Excess Program Overruns. If the Excess Program Overruns are approved by the Management Committee, the Participants contributing to that Program shall, within 15 days after the receipt of a written request from the Operator, provide the Operator with their Cost Share of such Excess Program Overruns. If such Excess Program Overruns are not approved by the Management Committee, the Operator shall curtail or abandon such Program.

Effect of Default in Paying Expenditures

8.9      If a Participant at any time fails to pay its Cost Share in accordance with §8.5, §8.7 or §8.8, the Operator may give written notice to that Participant demanding payment and, if that Participant has not paid such amount, together with interest thereon at Prime Rate plus 2% from the date on which payment was due, within 15 days after receipt of such notice, the Interest of that Participant shall be deemed to be converted to a Net Profits Royalty and thereafter that party will have no further rights or interest in respect of the Assets or under this Agreement, save and except its Net Profits Royalty. Notwithstanding the conversion of a defaulting party’s Interest pursuant to this paragraph, the Operator shall be entitled to take action to recover the amount owing by such defaulting party, and such conversion shall otherwise not relieve the defaulting party of any liability or obligation incurred up to the time of such default and conversion. The Operator shall have a lien on the Net Profits Royalty of the defaulting party to recover any amounts so owing, together with interest thereon, and may deduct same from any payments due in respect of the defaulting party’s Net Profits Royalty until so recovered in full. Any interest paid by or recovered from the defaulting Participant shall be for the account of the Participants that provided funds required of them as a result of the default, pro rata to their contributions, or otherwise shall be paid to the Participants not in default, pro rata to their Interests.

Program for a Feasibility Report

8.10      Any of the Participants holding in the aggregate not less than a 40% Interest, shall be entitled to request, by written notice to the Operator, that the Operator propose a Program for the preparation of a Feasibility Report. If the Operator fails to do so within 60 days following receipt of such notice, the Participants giving such notice shall be entitled to prepare, at their own expense, a Feasibility Report and, forthwith upon completion of same, shall deliver copies thereof to the Operator and the other Participants. The preparation of a Feasibility Report by a Participant or Participants under this paragraph shall not affect the rights of the Operator to continue to propose and carry out Programs as otherwise set forth in this Article.

Participant’s Feasibility Report

8.11      In the event that a Feasibility Report prepared by one or more Participants does not demonstrate that the Property or a part thereof may be economically placed into Commercial Production, no further action shall be taken in respect thereof and any expenses incurred by the Participants which prepared such Feasibility Report shall be for their own account and shall not be considered Expenditures made under this Agreement.

Favourable Feasibility Report

8.12      In the event that a Feasibility Report prepared by the Operator as a Program or by one or more Participants pursuant to §8.10 demonstrates that the Property or a part thereof may be economically placed into Commercial Production, the Feasibility Report shall be delivered to the Participants or other Participants, as the case may be, and the provisions of Article 9 shall apply.

Provision of Security

8.13      To the extent that security (whether in the form of cash, negotiable securities, letters of guarantee, irrevocable letters of credit or otherwise) is required to be posted with or in favour of any regulatory authority or government in connection with Programs, a Production Program or Operating Plan, each of the Participants will lodge security, in such form as may be acceptable to the particular authority, in an amount proportionate to its Interest at the time and to the total amount of security then required by the authority; and if the security will expire at a particular time a Participant will replace or renew its security before that time if required by the authority.

ARTICLE 9

PRODUCTION PROGRAM

Delivery of Proposed Production Program

9.1      At any time after delivery to the Participants of a Feasibility Report pursuant to §8.12, the Operator may, and shall within 120 days of receipt by it from Participants holding in the aggregate not less than a 40% Interest of a request in writing to do so, prepare and deliver to the Participants a Production Program which shall be based on such Feasibility Report. The preparation of the Production Program shall be deemed to be pursuant to a Program in which each Participant has elected to pay its Cost Share of Expenditures incurred thereunder. Within 180 days of the receipt by each Participant from the Operator of a Production Program, each such Participant shall give written notice to the Operator stating whether it elects to contribute its Cost Share of the Production Program. Failure to give such notice within such 180-day period shall be deemed to be an election by such Participant not to contribute to the Production Program.

Operator to Proceed with Adopted Production Program

9.2      If Participants holding Interests aggregating not less than 51% elect to contribute their respective Cost Share of a Production Program, together with the Cost Share of those Participants who have elected or are deemed to have elected not to participate in the Production Program, the Operator will, subject to §9.3, proceed with such Production Program and the provisions of §5.4 shall apply. If the Feasibility Report on which such Production Program is based was prepared by one or more Participants pursuant to §8.10, then 125% of the costs thereof as incurred by such Participants and as supported by written evidence shall be deemed to be Expenditures and, within 15 days following a written demand therefor (together with such evidence), the other Participants shall reimburse the Participant or Participants that prepared such Feasibility Report to the extent of their respective Cost Shares thereof. Failure by a Participant to reimburse its Cost Share thereof shall result in dilution of its Interest under §5.4, with the non-reimbursed portion as aforesaid deemed to have been contributed (in addition to its own Cost Share) by the Participant that prepared the Feasibility Report, or, if more than one Participant, such shall be apportioned among them in accordance with their respective contributions to the Costs of preparing the Feasibility Report.

Obligation to Pay Production Program Costs and Overruns

9.3      An election to contribute to a Production Program shall make a Participant liable to pay its Cost Share of all of the Production Program Costs actually incurred under or pursuant to such Production Program, including Production Program Overruns (as hereinafter defined) up to but not exceeding 15%. The Operator need not proceed with a Production Program until each Participant has delivered proof, satisfactory to the Operator, of the Participant’s ability to pay its Cost Share of such Production Program including, if required by the Operator from any Participant whose net worth (according to its last available balance sheet) is less than 300% of its Cost Share of anticipated Production Program Costs, Letters of Credit or other reasonable guarantee of availability of funds.

Procedures for Payment

9.4      After having elected to contribute to a Production Program which is proceeded with, each Participant shall, within 15 days after being requested in writing to do so by the Operator, pay such portion of its Cost Share of the Production Program Costs as the Operator may require, including cash calls for anticipated Production Program Costs, and provide such security or additional security as may then be required under §8.13, but the Operator shall not require payment of any funds more than 45 days in advance of the proposed expenditure thereof.

Meeting Required to Approve Excess Production Program Cost Overruns

9.5      If it appears to the Operator that Production Program Costs will exceed those estimated under the Production Program, the Operator shall immediately give written notice to the Participants outlining the nature and extent of the additional costs and expenses (herein called “Production Program Overruns”) and the reasons therefor. If Production Program Overruns are estimated to exceed by 15% those estimated under the Production Program (herein called “Excess Production Program Overruns”), the notice of the Operator shall contain a notice of a meeting of the Management Committee, to be held no sooner than five Business Days after the date of delivery of the notice, for the purpose of considering, and if deemed advisable, approving the Excess Production Program Overruns. If the Excess Production Program Overruns are approved by the Management Committee, each Participant shall, within 15 days after the receipt of a written request from the Operator, provide the Operator with its Cost Share of such Excess Production Program Overruns.

Curtailment of Production Program

9.6      If Excess Production Program Overruns are not approved by the Management Committee, as provided in §9.5, the Operator shall have the right to curtail or abandon the Production Program. Alternatively, any Participant that has approved such Excess Production Program Overruns may advance the amount of such Excess Production Program Overruns which have not been accepted (if more than one of them, pro rata to their respective Interests or as they may otherwise agree) and, on so doing, such Participants shall be entitled to recover the amount of such advances from the sale of Mineral Products of the other Participant or Participants, together with interest thereon from the date advanced at a per annum rate equal to the Prime Rate plus 4%, and the provisions of §11.3 shall apply with respect thereto.

Effect of Default in Paying Production Program Costs

9.7      If a Participant at any time fails to pay its Cost Share of Production Program Costs (including Production Program Overruns and approved Excess Production Program Overruns) in accordance with §9.4 or §9.5, the Operator may give written notice to such Participant demanding payment and, if such Participant has not paid such amount, together with interest thereon at Prime Rate plus 2% from the date on which payment was due, within 15 days after receipt of such notice, such Participant shall be deemed to be in default hereunder and either, as the Management Committee (excluding the Participant in default) may determine, (a) its Interest shall be deemed converted to a Net Profits Royalty, or (b) it shall be liable for all damages occasioned to the other Participants by its default hereunder, unaffected by any dilution in its Interest arising from failure or delay in making contributions. If the Management Committee adopts alternative (a), thereafter, such defaulting Participant shall have no further rights or interest in respect of the Assets or under this Agreement, save and except for such Net Profits Royalty. For the purposes of the calculation of Net Profits under Schedule 2, it is understood that cumulative Costs thereunder shall include, inter alia, all Expenditures and Production Program Costs whether or not a portion of such costs were contributed by the holder of the Net Profits Royalty. Any interest paid by or recovered from the defaulting Participant shall be for the account of the Participants that provided funds required of them as a result of the default pro rata to their contributions, or otherwise shall be paid to the Participants not in default, pro rata to their Interests.

Operator’s Right to Curtail Production Program Upon Default

9.8      If, upon the default of a Participant pursuant to §9.7, the other Participant or Participants, if more than one, do not thereafter elect to contribute pro rata to their Interests or as otherwise agreed by them, what would have been the defaulting Participant’s Cost Share of remaining Production Program Costs, the Operator shall have the right to curtail or abandon the Production Program.

ARTICLE 10

OPERATING PLANS

Obligation to Pay Operating Costs and Overruns

10.1      Following the Completion Date, each Participant shall be liable to pay its Cost Share of all Operating Costs incurred under Operating Plans, including Operating Cost Overruns (as hereinafter defined) up to but not exceeding 20%.

Operating Plans

10.2      At least 90 days prior to the date the Operator anticipates the Completion Date will occur, the Operator will propose and deliver to the Participants an Operating Plan for the first Operating Year. Subsequently, at least 90 days before the commencement of each succeeding Operating Year, the Operator shall propose an Operating Plan by delivery of such to each Participant, for such succeeding Operating Year. Within 30 days of delivery of a proposed Operating Plan hereunder, a meeting of the Management Committee shall be convened to review, amend (if deemed appropriate) and approve same.

Excess Operating Cost Overruns

10.3      Except as herein provided, the Operator shall have the power and authority to deviate from or make modifications to Operating Plans from time to time, in accordance with good engineering and mining practices. If it appears to the Operator that Operating Costs will exceed those estimated under an Operating Plan, the Operator shall immediately give written notice to the Participants outlining the nature and extent of the additional costs and expenses (herein called “Operating Cost Overruns”) and the reasons therefor. If Operating Cost Overruns are estimated to exceed by 20% those estimated under the Operating Plan (herein called “Excess Operating Cost Overruns”), the notice of the Operator shall contain a notice of a meeting of the Management Committee, to be held no sooner than five Business Days after the date of delivery of the notice, together with a proposed amendment to the Operating Plan. The meeting of the Management Committee shall be convened to review, amend (if deemed appropriate) and approve same.

No Agreement on Operating Plans

10.4      In the event that a proposed Operating Plan or amendment thereto is not approved by the Management Committee as hereinbefore provided, the Operating Plan shall be deemed to be approved as submitted and shall be implemented by the Operator provided that it is consistent with:

    (a)     the Feasibility Report; or

    (b)     the most recently approved Operating Plan.

If the Management Committee does not approve an Operating Plan for 3 successive Operating Years, the Operator shall prepare a shut-down plan for the mine and budget therefor which shall be implemented within 90 days after it is submitted to each Participant. Each Participant shall pay or to the satisfaction of the Operator provide security for, its entire Cost Share of the shut-down budget.

For the purposes of this paragraph, an Operating Plan shall be consistent with the Feasibility Report or prior Operating Plan if the proposed production rate has not changed by more than 20% and projected Operating Costs have not changed by more than 20% from those depicted in the later of the Feasibility Report or prior Operating Plan and if the capital costs included in the proposed Operating Plan are generally consistent with those provided in the Feasibility Report for post-commencement of Commercial Production or in the prior Operating Plan. [NOTE TO DRAFT: What about depreciation schedule?]

Statements of Operating Costs

10.5     Following the Completion Date, the Operator shall, on or before the 15th day of each month, submit to the Participants a statement of Operating Costs, which the Operator estimates will be incurred to the end of the next month (taking into account any current cash shortfall or surplus), and Operating Costs at the time incurred and unpaid), and on or before the last day of the month in which such statement is submitted, each Participant shall pay to the Operator its respective Cost Share thereof.

Effect of Default in Paying Operating Costs

10.6     If a Participant (for the purposes hereof a “Defaulting Participant”) fails to pay all or any part of its Cost Share pursuant to §10.5, the other Participant or Participants if more than one, shall be entitled, pro rata to their Interests or as otherwise agreed by them, to pay all or a portion of the unpaid Cost Share of the Defaulting Participant. If the other Participants decline to pay all of such unpaid Cost Share, the Operator shall be entitled to pay the unpaid portion thereof. If the other Participants and/or the Operator pay such unpaid share, then they or it will be entitled to recover the amount so paid, together with interest thereon from the date so paid at a per annum rate equal to the Prime Rate plus 4%, and the provisions of §11.3 will apply.

Participant may Require Operations to be Shut Down

10.7     Any Participant holding a 30% Interest or greater shall be entitled, by notice in writing to the Operator and the other Participant, to require that operations be suspended if:

(a) for a period of 6 consecutive months such Participant can demonstrate (as set forth in such notice) that its Cost Share of Operating Costs has exceeded its proceeds from the sale of Mineral Products;

(b) within 30 days after receipt of such notice, the other Participant has not demonstrated to the Operator that its proceeds from the sale of Mineral Products have equalled or exceeded its Cost Share of Operating Costs during such six month period; and

(c) such Participant has provided assurances acceptable to the Operator that the Participant is capable of bearing its share of the care and maintenance costs of the mine on the Property.

If such notice is given to the Operator it shall prepare an Operating Plan for placing the mine on care and maintenance and shall convene a meeting of the Management Committee to approve such.

Resumption of Operations

10.8     If at any time after the suspension of operations pursuant to §10.7, the Operator determines that the mine can be placed back into Commercial Production with the Participants’ Cost Share of Operating Costs being not more than 80% of the proceeds which they should realize on the sale of their share of Mineral Products, the Operator shall prepare an Operating Plan for the resumption of Operations and shall convene a meeting of the Management Committee to consider that Operating Plan.

Permanent Suspension

10.9     The Operator, at the direction of the Management Committee, may at any time following a period of at least one year during which operations have been continuously suspended under §10.7, by notice to all Participants holding greater than a 25% Interest, request their agreement to a permanent termination of operations. Within 90 days after receipt of that notice, each of such Participants may give notice to the Operator stating that it agrees to the request of the Operator or that it does not agree. If a Participant fails to give notice within that 90 day period, it shall be deemed to have agreed to the request of the Operator. If one or more Participants holding greater than a 25% Interest gives notice that it does not agree to a permanent termination of operations, the Management Committee may elect to have the Operator resume operations or replace the Operator with another Participant (the objecting Participants deciding amongst themselves who shall be the Operator), in which case that Participant shall become the new Operator and shall resume operations. If the Operator has not resumed operations within one year after the end of the 90 day period, the Management Committee shall cause the Operator to remove, sell and dispose of the Assets other than timbers and structures affixed to the underground workings and shafts of the mine as may be removed pursuant to applicable environmental and mining laws. The net revenues shall be divided among Participants in proportion to their respective Interests.

ARTICLE 11

DISPOSITION OF PRODUCTION

Taking in Kind

11.1     Each Participant shall, subject to Article 16, take in kind and separately dispose of its share (in proportion to its respective Interest) of Mineral Products. However, unless otherwise specified by a particular Participant, that Participant hereby appoints the Operator as its sole marketing agent to sell and dispose of its share of Mineral Products and, upon completing any such sale and disposition on behalf of a Participant, the Operator shall, subject to Article 16, remit to such Participant its respective share of the proceeds, after making such deductions as are permitted under §11.2.

Valuing Mineral Products

11.2     For the purposes of determining the value of Mineral Products taken in kind pursuant to §11.1 or §11.3, each Participant’s share of Mineral Products shall be valued and accounted for as of the time of delivery to or settlement with the purchaser or purchasers thereof, after deduction of all costs of or related to the marketing thereof, including without limitation:

(a)	all costs of storage and transportation, including insurance;
(b)	all commissions and discounts;
(c)	such reasonable charge for marketing Mineral Products as is consistent with generally accepted industry marketing practices; and
(d)	all taxes (other than income taxes), royalties or other charges or imposts provided for pursuant to any law or legal obligation imposed by any government if paid by the Operator for the account of such Participant in connection with the disposition of Mineral Products hereunder.

Priority

11.3     If the Operator or a Participant makes any payment on behalf of a Defaulting Participant pursuant to §10.6, or if a Participant advances Excess Production Program Overruns pursuant to §9.6, the Operator or such Participant, as the case may be, shall have the prior and first right to receive the share of Mineral Products of the Defaulting Participant or the Participant which did not advance Excess Production Program Overruns, as the case may be, pursuant to §11.1 until the Operator or such Participant has received Mineral Products in kind of a value equal to the amount advanced, together with interest thereon at the rate specified in §9.6 or §10.6, as the case may be.

Accounting by Operator

11.4     Proceeds from the sale by the Operator of Mineral Products hereunder shall be calculated by the Operator separately for each Participant at the end of each calendar month and shall be paid monthly within 20 days after the end of each such calendar month following payment to the Operator by each Participant of its respective Cost Share of Operating Costs outstanding as at the end of that calendar month, and otherwise subject to Article 16 and the foregoing provisions of this Article.

Records

11.5     The records relating to Mineral Products taken in kind or to the calculation of proceeds from the sale thereof may, at the direction of the Management Committee, be audited annually at the end of each Operating Year. Any adjustments required by such audit shall be made forthwith and a copy of the audited statements shall be delivered to the Participants. Any of the Participants shall, at reasonable times and upon reasonable notice in writing to the Operator, have the right to inspect, audit and copy the Operator’s accounts and records relating to the accounting for Mineral Products taken in kind or to the determination of proceeds from the sale thereof for any Operating Year within 12 months following the end of such Operating Year. All such accounts and records shall be deemed to be correct and accurate unless questioned by a Participant within 12 months following the end of the Operating Year to which the accounts relate. The Participants shall make all reasonable efforts to conduct audits in a manner which will result in a minimum of inconvenience to the Operator.

Non-Arm’s Length Sale of Product

11.6     If the Operator or an Affiliate of the Operator is a purchaser of Mineral Products hereunder, and if the value of such Mineral Products is used to determine any matter arising under this Article, the Operator shall be required to receive competitive prices for all Mineral Products so sold.

ARTICLE 12

CONFIDENTIAL INFORMATION

Obligation Not to Disclose

12.1     Each party agrees that all information obtained hereunder is confidential and shall be the exclusive property of the parties and shall not be publicly disclosed or used other than for the activities contemplated hereunder, except as required by law or by the rules and regulations of any regulatory authority, trading facility or stock exchange having jurisdiction or in connection with the filing of an annual information form, prospectus or similar securities disclosure document, or with the written consent of the other parties, such consent not to be unreasonably withheld, provided that the provisions of this Article do not apply to information referred to in Article 13 or which is or becomes part of the public domain other than through a breach of the terms hereof.

Consent to Disclose

12.2     Consent to disclosure of information hereunder shall not be unreasonably withheld where a party wishes to disclose any such information to a third party for the purpose of arranging financing for its contributions hereunder or for the purpose of selling its interest in the Assets or its interest in this Agreement, provided that such third party gives its undertaking to the Participants that any such information not theretofore publicly disclosed shall be kept confidential and not disclosed to others for a period agreed upon by the Participants, which shall not be less than two years in duration.

No Liability for Actions of Third Parties

12.3     No party shall be liable to the others for the fraudulent or negligent disclosure of information by any of its employees, servants or agents, provided that such party has taken reasonable steps to ensure the preservation of the confidential nature of such information.

Notice Period

12.4     Where a request is made by written notice for permission to disclose confidential information hereunder (which notice shall specify the reason for the disclosure and the name of the person to whom disclosure is to be made), the other parties shall reply thereto within three Business Days after receipt of such request, failing which a party shall be deemed to have consented to such disclosure in the limited circumstances specified in such request.

Press Releases and Other Public Disclosure

12.5     The parties will ensure that all public disclosure of information relating to the Property or work thereon will comply with the rules, by-laws, policies and disclosure standards of the applicable stock exchanges or other regulatory authorities having jurisdiction and each party will be entitled to independently verify information that the other party intends to release. The Owner shall consult with PTG and obtain approval of PTG (such approval not to be unreasonably withheld) prior to issuing any press release or other public statement regarding the Property, work thereon or the activities of the parties or Associated Companies with respect thereto. In addition, the Owner shall obtain prior approval of PTG before issuing any press release or public statement using PTG’s name or the name of any of PTG’s Associated Companies, the name of any of the officers, directors or employees of PTG or its Associated Companies. However, such approval shall not be considered certification by PTG of the accuracy of the information in such press release, or a confirmation by PTG that the content of such press release complies with the rules, policies, by-laws and disclosure standards of the applicable regulatory authorities or stock exchanges.

ARTICLE 13

DISCLOSURE STANDARDS

Compliance with Disclosure Standards

13.1     The parties shall ensure that all public disclosure of information relating to the Property or work thereon shall comply with the rules, by-laws, policies and disclosure standards of applicable stock exchanges and other regulatory authorities.

Breach of Disclosure Standards

13.2     Notwithstanding the terms of Article 12, if a party discovers that any person who has prepared, or provided, any information on behalf of another party has breached, or appears to have breached, the code of conduct or disclosure standards of any applicable professional association or of any applicable stock exchange, the discovering party may (but shall be under no liability for failure) report such breach, or appearance of breach, to the other party, and in such a case, such party shall take the necessary steps in a timely manner to report such breach, or appearance of breach, in accordance with the rules, by-laws, guidelines and disclosure standards of the stock exchange on which the such party’s share capital is listed. In the event such party fails to comply with such reporting requirements, the discovering party may (but shall be under no liability for failure to) report such breach, or appearance of breach, in accordance with such requirements.

Misleading Disclosure

13.3     Notwithstanding the terms of Article 12, if a party discovers that, in its opinion, another party’s publicly disclosed information (the “Prior Disclosure”) relating to the Property or work thereon is inconsistent with the data or other information regarding the Property, programs or results of programs, and as a result, in the opinion of the discovering party, the Prior Disclosure is or could be materially misleading to the public, the discovering party shall advise the other party of such inconsistency and

(a) the other party shall promptly publish or disseminate, to an extent no less broad than the dissemination of the Prior Disclosure, a statement correcting the Prior Disclosure, or

(b) if the other party fails to promptly disseminate a correcting statement, the discovering party shall be entitled to do either or both of the following:

(i) disseminate a statement either correcting the Prior Disclosure, or stating that it is not responsible for publishing the Prior Disclosure and does not necessarily agree therewith, and

(ii) report the inconsistency to the applicable stock exchanges and other regulatory authorities.

Nothing in this section imposes any obligation on the discovering party to verify the accuracy of any statement by the other party correcting a Prior Disclosure.

ARTICLE 14

RESTRICTIONS ON ALIENATION

No Sale of Interest Except as Specified

14.1     Except in accordance with this Agreement no party shall transfer, convey, assign, mortgage or grant an option in respect of or grant a right to purchase or in any manner transfer or alienate any or all of its Interest or transfer or assign any of its rights under this Agreement.

Terms of Sale

14.2    A party shall not sell any of its Interest or transfer or assign any of its rights under this Agreement except:

(a) in the case of an assignment of a Net Profits Royalty in its entirety;

(b) pursuant to an agreement in which the consideration is expressed only in lawful money of Canada or of the United States of America;

(c) as a single transaction not directly or indirectly part of some other sale or purchase or agreement for any additional consideration of any nature whatsoever; and

(d) when there is no default of any of the covenants and agreements herein contained by such party;

nor shall it make any assignment of less than its entire Interest if after giving effect thereto it will hold less than a 20% Interest.

Sales to Associates

14.3     Nothing in this Article shall prevent:

(a) a sale by a party of all or part of its Interest or a transfer or assignment of all its rights under this Agreement to an Associated Company provided that such Associated Company first assumes and agrees to be bound by the terms of this Agreement, provided that a Participant may not, after such a sale or transfer to an Associated Company, take or permit any action whereby the Associated Company will cease to be an Associated Company without first either causing the Associated Company to retransfer such Interest to the Participant from whom the Interest was acquired or causing the Associated Company to offer the Interest at fair market value to the other Participants in the manner provided in this Article. If the other Participants do not agree with the fair market value placed upon the Interest, they shall notify the offeror of such within 15 days of receipt of the offer. If an agreement cannot be reached on the fair market value of the Interest within 90 days of the expiration of the 15-day period, the value will be determined by arbitration pursuant to Article 17;

(b) a joint disposition of the Property or all or any part of the other assets constituting any part of the Assets to a third party by all the Participants;

(c) an amalgamation or corporate reorganization involving a party hereto which has the effect in law of the amalgamated or surviving corporation possessing all the property, rights and interests and being subject to all the debts, liabilities and obligations of each amalgamating or predecessor corporation; or

(d) a sale, forfeiture, charge, withdrawal, transfer or other disposition or encumbrance which is otherwise specifically required or permitted under this Agreement.

Notice of Intention to Sell

14.4     Subject to the foregoing, any Participant (in this Article called the “Offeror”) intending to sell all or part of its Interest or transfer or assign its rights under this Agreement shall first give notice in writing to the other Participants (in this Article called the “Offeree”) of such intention together with the terms and conditions on which the Offeror intends to sell its Interest or transfer or assign its rights under this Agreement.

Notice of Receiving an Acceptable Offer

14.5     If any Participant (in this Article also called the “Offeror”) receives an offer to purchase its Interest or rights under this Agreement which meets the requirements of §14.2 and which it intends to accept, the Offeror shall not accept the same unless and until the Offeror has first offered to sell such Interest or rights to the other Participants (in this Article also called the “Offeree”) on the same terms and conditions as in the offer received and the same has not been accepted by the Offeree in accordance with §14.7.

Content of Notice

14.6    Any communication of an intention to sell pursuant toss.14.4 orss.14.5 shall be in writing delivered in accordance with Article 18 and shall:

(a) set out fully and clearly all of the terms and conditions of any intended sale;

(b) if it is made pursuant to §14.5, include a true copy of the offer received; and

(c) if it is made pursuant to §14.5, clearly identify the offering party and include such information as is known by the Offeror about such offering party;

and such communication will be deemed to constitute an offer (the “Offer”) by the Offeror to the Offeree (if more than one the Offer shall be made to the Offerees in proportion to their respective Interests or as otherwise agreed by them) to sell the Offeror’s Interest or transfer or assign its rights under this Agreement to the Offeree on the terms and conditions set out in such Offer.

Notice Acceptance Period

14.7     Any Offer made as contemplated in §14.6 shall be open for acceptance by the Offeree for a period of 60 days from the date of receipt by the Offeree.

Effect of Acceptance of Offer

14.8     If the Offeree accepts the Offer within the time provided in §14.7, then such acceptance shall constitute a binding agreement of purchase and sale between the Offeror and the Offeree for the Offeror’s Interest or rights under this Agreement on the terms and conditions set out in the Offer. If there is more than one Offeree the acceptance shall be in proportion to their respective Interests or as otherwise agreed by them.

Effect of Not Accepting an Offer

14.9     If the Offeree does not accept the Offer within the time limited, the Offeror may complete the sale of its Interest or its rights under this Agreement on exactly the same terms and conditions set out in the Offer and, where applicable, only to the party making the original offer to the Offeror as contemplated in §14.5, and in any event such sale will be completed within 60 days from the expiration of the right of the Offeree to accept such Offer or the Offeror must again comply with the provisions of this Article.

No Coincident Offers

14.10     Following an Offer under §14.6, no other Offer may be made by the Offeror unless and until the 60-day period referred to in §14.9 has expired and no sale of the Offeror’s Interest or rights has been completed in accordance with the terms of the first-mentioned Offer.

Operatorship is not Transferable Without Consent

14.11     If a party which is the Operator sells its Interest or transfers or assigns its rights under this Agreement to a third party, its rights and obligations as Operator under this Agreement shall not be included in such sale unless the third party is capable of assuming and performing the duties and obligations of the Operator imposed under this Agreement and the consent of all Participants is first had and obtained, such consent not to be unreasonably withheld. However, nothing in this §14.11 shall prevent any assignee from proposing or voting for the appointment of itself as Operator at any meeting of the Management Committee called for that purpose.

Purchasers Agreement to be Bound

14.12     As a condition of the purchase of a Participant’s Interest and rights under this Agreement, the purchaser shall covenant and agree that it will be bound by this Agreement, including this Article 14, and prior to the completion of any such purchase, the purchaser shall deliver to each of the other Participants notice to that effect in a form satisfactory to such Participants.

ARTICLE 15

ENCUMBRANCES AND PARTITION

Obligation to Hold Interest Free of Encumbrances

15.1     Except as hereinafter provided, a Participant shall not encumber or suffer to exist any lien, charge or encumbrance on its Interest.

Limited Right to Mortgage

15.2     Notwithstanding the provisions of §15.1, a Participant may pledge, mortgage, charge or otherwise encumber (in this paragraph a “Charge”) the whole or any part of its respective Interest in order to finance its Cost Share of Production Program Costs and Operating Costs, but only upon the condition that the holder of such Charge, (in this paragraph a “Chargee”), first enters into a written agreement with the other Participants in form satisfactory to counsel for such other Participants, binding upon the Chargee, to the effect that:

(a) the Chargee will not enter into possession or institute any proceedings for foreclosure or partition of the encumbering Participant’s Interest and that the Charge shall be subject to the provisions of this Agreement including, without limitation, the provisions of Article 11 and Article 16; and

(b) the Chargee’s remedies under the Charge shall be limited to the sale of the whole, (but only of the whole), of the encumbering Participant’s secured Interest:

(i) to the other Participants, if more than one then in proportion to their respective interests at that time; or

        failing any such sale then either:

(ii) at a public auction to be held after 90 days’ prior notice to the other Participants but with a reserve price and terms no more favourable to a third party purchaser than those last offered by the Chargee to, and declined by, the other Participants; or

(iii) through private sale, but on terms no more favourable to a third party purchaser than those last offered by the Chargee to, and declined by, the other Participants;

provided however, that prior to completing the purchase, the purchaser shall deliver an agreement, in form reasonably satisfactory to counsel for the other Participants, that it assumes the obligations of the encumbering Participant under this Agreement and agrees to be bound by the terms of this Agreement as a Participant and party hereunder.

Waiver of Right to Partition

15.3     Each Participant hereto hereby waives its right to seek partition of the Property or any part thereof.

ARTICLE 16

OPERATOR’S LIEN

Operator’s Lien

16.1     In addition to any lien, charge or security interest (collectively in this Agreement called a “lien”) to which the Operator may be entitled by law, including any provided for elsewhere in this Agreement (including without limitation the lien that the Operator has under §8.9 on a defaulting party’s Net Profits Royalty), each Participant does hereby mortgage, charge, assign and grant a security interest to and in favour of the Operator in: [NOTE TO DRAFT: Should NPR be included in this list?]

(a) the undivided share of Mineral Products owned or to be owned by such Participant;

(b) the Interest of such Participant;

(c) all personal property in any form derived directly or indirectly from the sale, disposition or other dealing with or comprised in or related to the collateral described in §(a) and (b), or the proceeds therefrom, including insurance proceeds, any other payment representing indemnity or compensation for loss of or damage thereto or the proceeds therefrom, and all book accounts and book debts and generally all accounts, debts, dues and demands and choses in action of every nature and kind and now due, owing or accruing or growing due or which may hereafter become due, owing or accruing or growing due to the Participant and all deeds, documents, writings, papers, books of account and other books and security documents relating to, being records of or securing the said accounts, debts, dues, demands and choses in action or by which the said accounts, debts, dues, demands and choses in action are or may hereafter be secured, evidenced, acknowledged or made payable;

        as security for:

(d) their respective obligations from time to time to make contributions to Expenditures and Production Program Costs under Article 8 and Article 9 respectively;

(e) their respective obligations from time to time to make contributions to Operating Costs as contemplated in Article 10;

(f) an amount equal to any amount paid or advanced by the Operator pursuant to §10.6, together with interest thereon at the rate specified in §10.6;

(g) their respective shares of the costs of a termination and liquidation under §7.6; and

(h) the fulfilment of all obligations, present and future, of the Participant to the Operator under this Agreement or otherwise in connection with the Property.

Enforcement of Lien by the Operator

16.2     Such lien in respect of a Participant who is in default of one or more of its obligations as specified in §16.1 (in this Article 16 a “Defaulting Participant”) may be enforced by the Operator against the Defaulting Participant by any one or more of the following:

(a) the sale or lease (either to one or more of the other Participants, or to a third party, but subject to Article 14, save and except for §14.2) of all or part of the Interest [or Net Profits Royalty] of the Defaulting Participant for cash or on credit or partly for cash and partly on credit;

(b) the sale of the Defaulting Participant’s share of Mineral Products for cash or on credit or partly for cash and partly on credit;

(c) the collection and/or retention of receipts due to the Defaulting Participant from the sale of Mineral Products or any other Assets and the application of the receipts so collected to the obligations, amounts and costs referred to in §16.1(d) to §16.1(g), inclusive; or

(d) without restricting the provisions of §(a), (b) and (c), the exercise by the Operator of any other rights and remedies available at law or in equity, which may be exercised in the alternative, concurrently or cumulatively.

In the case of the sale of the Defaulting Participant’s Interest or the sale of Mineral Products pursuant to §(a) and (b) respectively, the Defaulting Participant shall execute and deliver to the purchaser on demand any instrument reasonably necessary to confirm to the purchaser the title to the property so sold and the Operator is hereby irrevocably authorized by each Participant to execute on its behalf and in its name any such confirmatory instrument.

Right of Participant to Deal With Mineral Product

16.3     The security interest hereby granted by each Participant to the Operator shall in no way hinder or prevent a Participant, at any time or from time to time until the security interest hereby constituted shall have become enforceable pursuant to the provisions of §16.1, from:

(a) selling, assigning, transferring, conveying or otherwise disposing of all or any part of its Mineral Products, free from such security interest, in the ordinary course of its business and for the purpose of carrying on the same; provided that any forward sale commitment by a Participant shall be without prejudice to enforcement by the Operator of its security interest in respect of any Mineral Products that have not at the time been delivered to meet that commitment;

(b) selling, assigning, conveying, transferring or otherwise disposing of all or an undivided part of its Interest in accordance with the provisions of Article 14;

(c) subject always to compliance with the provisions of Article 15, entering into a security agreement in accordance with that Article;

provided that any such action is not in breach of any provision of this Agreement.

Participant’s Lien

16.4     A Participant other than the Operator which makes a payment on behalf of a defaulting Participant pursuant to §10.6 or advances a portion of Excess Production Program Overruns on behalf of another Participant pursuant to §9.6, or has a right to damages pursuant to §9.7, shall have a lien on the defaulting Participant’s Interest, the right of the defaulting Participant to receive either Mineral Products in kind or proceeds from the sale thereof or from the sale of any other Assets, the interest of the defaulting Participant in any contracts for the sale of Mineral Products, other Assets and Mineral Products received in kind by the defaulting Participant [or the Net Profits Royalty], as security for repayment by the defaulting Participant of all amounts paid or advanced by the Participant pursuant to §9.6, §10.6 and to which it may be entitled pursuant to §9.7, together with interest thereon at the rate specified in §9.6, §9.7 or §10.6, as the case may be.

The lien under this §16.4 shall rank pari passu with the Operator’s lien under §16.1 insofar as it secures amounts referred to in §16.1(f) and subordinate to the lien of the Operator insofar as it secures amounts referred to in §16.1(d), §16.1(e) or §16.1(g) and the provisions of §16.2 and §16.3 shall apply with respect thereto mutatis mutandis.

ARTICLE 17

ARBITRATION

Single Arbitrator

17.1     Any matter required or permitted to be referred to arbitration pursuant to §7.4 and §14.3 or Schedule 2 will be determined by a single arbitrator to be appointed by the parties hereto.

Notice of Intent to Arbitrate

17.2     Any party may refer any such matter to arbitration by written notice to the others and, within 30 days after receipt of such notice, the parties will agree on the appointment of an arbitrator, who shall be capable of commencing the arbitration within 21 days of his appointment. No person will be appointed as an arbitrator hereunder unless such person agrees in writing to act.

Effect of Lack of Agreement on Arbitration

17.3     If the parties cannot agree on a single arbitrator as provided in §17.2 either party may request the court to appoint a single arbitrator in accordance with the Commercial Arbitration Act of the Province of British Columbia (the “Act”).

Procedural Matters

17.4     Except as specifically provided in this Article, an arbitration hereunder shall be conducted in accordance with the Act. The arbitrator shall fix a time and place in Vancouver, British Columbia for the purpose of hearing the evidence and representations of the parties, and of which shall be in camera, and he shall preside over the arbitration and determine all questions of procedure not provided for under such Act or this Article. After hearing any evidence and representations that the parties may submit, the arbitrator shall make an award and reduce the same to writing and deliver one copy thereof to each of the parties. The award shall be kept confidential by the partners except as disclosure is required by applicable securities laws. The decision of the arbitrator will be made within 45 days after his appointment, subject to any reasonable delay due to unforeseen circumstances. The expense of the arbitration shall be paid as specified in the award. The parties agree that the award of the single arbitrator shall be final and binding upon each of them and shall not be subject to appeal.

ARTICLE 18

NOTICE

Means of Notice

18.1     Any notice, direction or other communication required or permitted to be given under this Agreement shall be in writing and may be given by personal delivery or by mail (first class postage prepaid) or by sending it by facsimile or other similar form of telecommunication, in each case addressed as follows:

(a)	If to PTG at:
	#301– 1110 Hamilton Street
	Vancouver BC
	V6B 2S2
	Attention: R. Michael Jones
	Fax:(604) 484-4710

(b)	If to the Owner at:
	#1180 – 999 West Hastings Street
	Vancouver BC
	V6C 2W2
	Attention: Secretary
	Fax: (604) 689-3847

Effective Time of Notice

18.2     Any notice, direction or other communication aforesaid will, if delivered, be deemed to have been given and received on the day it was delivered and, if mailed, will be deemed to have been given and received on the third Business Day following the day of deposit thereof in a post office in Canada, except in the event of disruption of the postal service in which event notice will be deemed to be received only when actually received and, if sent by facsimile or other similar form of telecommunication, will be deemed to have been given or received on the next Business Day following the day on which it was so sent.

Change of Address for Notice

18.3     Any party may at any time give to any other party notice in writing of any change of address of the party giving such notice, and from and after the giving of such notice, the address therein specified will be deemed to be the address of such party for the purposes of giving notice hereunder. Any change of address notice shall include a contact number for the sending of notices by telecommunication hereunder.

ARTICLE 19

FORCE MAJEURE

Events

19.1     No party will be liable for its failure to perform any of its obligations under this Agreement due to a cause beyond its control (except those caused by its own lack of funds) including, but not limited to: acts of God, fire, flood, explosion, strikes, lockouts or other industrial disturbances; laws, rules and regulations or orders of any duly constituted court or governmental authority; or nonavailability of materials or transportation or protests or demonstrations by environmental lobbyists, First Nations or indigenous peoples’ groups (each an “Intervening Event”).

Extension of Time Periods

19.2     All time limits imposed by this Agreement (other than for the payment of monies) will be extended by a period equivalent to the period of delay resulting from an Intervening Event described in this Article.

Obligation To Eliminate Events Causing Force Majeure

19.3     A party relying on the provisions of this Article will take all reasonable steps to eliminate any Intervening Event and, if possible, will perform its obligations under this Agreement as far as practical, but nothing herein will require such party to settle or adjust any labour dispute or to question or to test the validity of any law, rule, regulation or order of any duly constituted court or governmental authority or to complete its obligations under this Agreement if an Intervening Event renders completion impossible.

Notice of Occurrence

19.4     A party relying on the provisions of this Article shall give notice to the other party forthwith upon the occurrence of the Intervening Event and forthwith after the end of the period of delay when such Intervening Event has been eliminated or rectified.

ARTICLE 20

AREA OF INTEREST

Area of Interest

20.1     For the purposes of this Article, the “Area of Interest” means the area or areas lying within a distance of • from the external perimeter of each of the claims or other mineral properties described in Schedule 1 (as such Schedule exists as of the date of this Agreement, but excluding therefrom any claims or other mineral properties which have been abandoned pursuant to §3.9 or §6.8).

Acquisitions Within Area of Interest

20.2     Each party hereby covenants and agrees with each other party that it will not acquire, nor will it permit any Affiliate to acquire, whether directly or indirectly or pursuant to any third party agreement, any form of interest or rights in property or minerals located wholly or in part within the Area of Interest unless such acquisition is made subject to the terms of this Agreement and the acquiring party complies with the provisions of this Article.

Provision of Notice of Acquisition

20.3     Forthwith upon completing an acquisition as contemplated in §20.2, the acquiring party shall give notice thereof to the other Participants which notice shall be in writing, setting out the nature of the interest acquired, including all information known to the acquiring party about such interest, the costs of acquisition and all other pertinent details relating thereto. Upon receipt of such notice, the other party shall have a period of 60 days to decide whether the interest acquired shall be made subject to the terms of this Agreement and made part of the Property. During such 60-day period, the acquiring party shall, from time to time, deliver to the other Participants as soon as practicable such further information related to the acquisition and the interest acquired as such other party may reasonably request in order to permit such other party to make an informed decision with respect to the matters herein.

Notice of Acquired Interest to Become Part of Property

20.4     If, within the 60-day period referred to in §20.3, any other Participant gives notice to the acquiring party requiring that the acquired interest be made part of the Property, then the acquired interest shall forthwith be transferred to the party holding title to the Property and the acquired interest shall thereafter form part of the Property under this Agreement. If such transaction occurs prior to the Participation Date, PTG shall reimburse the acquiring party for such costs of acquisition and such costs of acquisition paid by PTG shall be considered Expenditures made in accordance with Article 3. If such transaction occurs following the Participation Date, the Operator shall reimburse the acquiring party for the costs of acquisition and each of the Participants shall be responsible for and shall pay to the Operator its respective Cost Share of such costs.

Further Assurances to Give Effect to Acquisition

20.5     Each of the parties hereto will execute and deliver or cause to be executed and delivered such further documents and instruments and give such further assurances as the other may reasonably require to evidence and give effect to any acquisition and/or transfer of an interest in property or minerals as hereinbefore provided in this Article.

No §20.4 Notice

20.6     If, within the 60-day period referred to in §20.3, the other party which received the original notice from the acquiring party does not give the notice referred to in §20.4, it shall be deemed to have consented to the acquisition by the acquiring party of the interest in property or minerals as referred to in the original notice from the acquiring party and such interest may thereafter be held or dealt with by the acquiring party free of the terms and conditions of this Agreement. However, the terms of this Article shall continue to apply with respect to any future or other acquisition within the Area of Interest.

Best Efforts of Parties Regarding Acquisition Agreement

20.7     Each of the parties hereto covenants and agrees with the other to use its best efforts to provide or cause to be provided, in any acquisition agreement related to the Area of Interest as hereinbefore contemplated, for appropriate perimeter clauses, royalty interests (as opposed to property interests) for any property vendor, appropriate processing facilities for ores derived from the various properties in or partly within the Area of Interest and unencumbered rights to assign an interest in any such agreements and the properties related thereto pursuant to the provisions of this Agreement and as contemplated in this Article.

Non-Compliance by Affiliate Considered a Default

20.8     Non-compliance with the provisions of this Article by an Affiliate of a Participant, shall be considered a default under this Agreement by the party hereto with whom the acquiring party is affiliated in which case the provisions of §20.6 shall apply.

ARTICLE 21

RIGHT OF FIRST REFUSAL ON FINANCING

[NOTE TO DRAFT: Optional Article]

PTG’s Right to Provide Owner with Financing

21.1    If the Owner intends to arrange a financing in respect of its Cost Share of a Production Program and:

(a) the Owner receives a bona fide offer from a person, firm or corporation willing to provide the funds (whether by way of investment in the capital stock of the Owner or otherwise) required to finance the Owner’s Cost Share of the Production Program, which offer the Owner intends to accept; or

(b) the Owner intends to raise sufficient funds (whether by way of public or private sale of the capital stock of the Owner or otherwise) to finance the Owner’s Cost Share of the Production Program;

the Owner shall not accept such bona fide offer or complete such financing unless and until it has given notice in writing to PTG of such offer or intention (a “Financing Notice”) which Financing Notice shall:

(c) set out fully and clearly all of the terms and conditions of the intended financing; and

(d) if made pursuant to §(a) hereof, include a copy of the offer, clearly identifying the offering party, and include such information as is known by the Owner about such offering party, including its ability to complete such financing;

and such Financing Notice will be deemed to constitute an offer by the Owner to PTG to arrange a financing in respect of the Owner’s Cost Share of the Production Program on the terms and conditions set out in the Financing Notice (a “Financing Offer”).

Terms of Financing Offer

21.2     Any Financing Offer made by the Owner to PTG as hereinbefore contemplated will be open for acceptance by PTG for a period of 30 days from the date of receipt of the Financing Notice by PTG.

PTG not Accepting Financing Offer

21.3     If PTG does not accept the Financing Offer within the time limited, the Owner may, subject to Article 15, accept and complete a financing on the same terms and conditions as set out in the Financing Offer within 60 days from the expiration of the right of PTG to accept the Financing Offer; otherwise the Owner must again comply with the provisions of §21.1.

PTG Accepting Financing Offer

21.4     If PTG accepts the Financing Offer within the time limited, by notice in writing to the Owner, then the Owner shall be bound to enter into an agreement with PTG on the terms and conditions of the Financing Offer as applicable.

No Coincident Financing Offers

21.5     Following a Financing Offer under §21.1, no other Financing Offer may be made unless and until the 60-day period referred to in §21.3 has expired and the Owner has not completed a financing in accordance with the terms of the first-mentioned Financing Offer.

Owner’s Obligation to Hold Interest Free of Liens

21.6     Unless and until the Owner is entitled to and does accept and complete a third party financing in accordance with §21.3, or until the Owner completes a financing with PTG in accordance with §21.4, the Owner hereby covenants and agrees with PTG to hold its Interest free and clear of all liens, charges and encumbrances, including any floating charge (except liens for taxes not yet due, other inchoate liens and liens arising from operations hereunder being contested in good faith).

ARTICLE 22

GENERAL PROVISIONS

Entire Agreement

22.1     This Agreement constitutes the entire agreement between the parties and replaces and supersedes all prior agreements, memoranda, correspondence, communications, negotiations and representations, whether oral or written, express or implied, statutory or otherwise between the parties with respect to the subject matter herein. This Agreement may not be amended or modified except by an instrument in writing signed by each of the parties hereto except that amendments to any part of this Agreement other than the definition of Net Profits Royalty and Schedule 2 may be made without the execution thereof by any party that holds a Net Profits Royalty and shall be as effective as if executed by each such party.

Waiver

22.2     No consent or waiver, express or implied, by any party to or of any breach or default by any other party of any or all of its obligations under this Agreement will:

(a)    be valid unless it is in writing and stated to be a consent or waiver hereunder;
(b)    be relied upon as a consent or waiver to or of any other breach or default of the same or any other obligation;
(c)    constitute a general waiver under this Agreement; or
(d)    eliminate or modify the need for a specific consent or waiver in any other or subsequent instance.

Further Assurances

22.3     The parties will execute such further and other documents and do such further and other things as may be necessary or convenient to carry out and give effect to the intent of this Agreement including, if the Owner’s shares are listed on a stock exchange, the filing with, and obtaining the acceptance of, this Agreement with the stock exchange on which the shares of the Owner are listed, if such filing is required under the rules and policies of such stock exchange. The Owner covenants to obtain any required acceptance forthwith after the execution of this Agreement; however, the parties confirm that the failure of the Owner to file this Agreement for acceptance with such stock exchange or the failure of the Owner to obtain the acceptance of such stock exchange will not cause this Agreement to be invalid or terminated.

Manner of Payment

22.4     All payments to be made to any party hereunder may be made by cheque or draft mailed or delivered to such party at its address for notice purposes as provided herein, or for the account of such party at such bank or banks in Canada as such party may designate from time to time by written notice. Such bank or banks shall be deemed the agent of the designating party for the purpose of receiving, collecting and receipting such payment.

Termination

22.5     This Agreement shall terminate upon the occurrence of the earliest of:

(a) liquidation of all Assets following the written agreement by the parties to terminate, and distribution of any Joint Venture funds held by the Operator;

(b) the termination of the Option pursuant to Article 3;

(c) (c) a termination pursuant to §7.6 and §10.9;

(d) except with respect to its Net Profits Royalty, the conversion of a party’s Interest to a Net Profits Royalty pursuant to §5.4, §8.9 or §9.7; or

(e) the sale, abandonment or liquidation of all of the Assets and the distribution of any proceeds therefrom, net of liabilities, to the Participants to the extent of their Interests therein, provided that all reclamation associated with a permanent shut-down of the Facilities has been carried out as required by applicable laws and regulations.

Such termination shall not affect any amount owing, obligation or liability existing or incurred prior to the date of such termination, nor any obligation of any party to maintain security under §8.13. If there are more than two Participants holding an Interest, then a termination shall not occur under §(d) so long as there remains at least two Participants holding an Interest.

Default

22.6     Except for the provisions of this Agreement providing for elections to contribute and contributions to Programs and Production Programs and Operating Costs, with which the Participants must strictly comply, and except as otherwise provided in this Agreement, if any party (a “Defaulting Party”) is in default of any requirement herein set forth, the other party may give written notice to the Defaulting Party specifying the default. The Defaulting Party shall not lose any rights under this Agreement unless, within 30 days after the giving of notice of default by the Operator, or if the Operator is the Defaulting Party, by any other party, the Defaulting Party has failed to take reasonable steps to cure the default by the appropriate performance or the Defaulting Party fails to dispute the notice of default. Upon any such failure, the Operator or any other party as the case may be, shall be entitled to seek any remedy it may have on account of such default.

Time of the Essence

22.7    Time shall be of the essence in the performance of this Agreement.

Enurement

22.8     This Agreement shall enure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns.

Rule Against Perpetuities

22.9     If any right, power or interest of any party in any property under this Agreement would violate the rule against perpetuities, then such right, power, or interest shall terminate at the expiration of 20 years after the death of the last survivor of all the lineal descendants of Her Majesty, Queen Elizabeth II of England, living on the date of execution of this Agreement.

Remedies

22.10     Each of the Participants agrees that its failure to comply with the covenants and restrictions set out in Article 12, Article 14, Article 15, Article 20 and Article 21 could constitute an injury and damage to the other Participants impossible to measure monetarily and, in the event of any such failure, the other Participants shall, in addition and without prejudice to any other rights and remedies at law or in equity, be entitled to injunctive relief restraining, enjoining or specifically enforcing any acquisition, sale, transfer, charge or encumbrance save in accordance with or as required by the provisions of Article 14, Article 15, Article 20 or Article 21, or restraining or enjoining any breach of Article 12, as the case may be, and any party intending to breach the provisions of said Article 12, Article 14, Article 15, Article 20 or Article 21 hereby waives any defence it might have in law to such injunctive or other equitable relief.

Agreement in English Language

22.11     The parties have agreed that this Agreement be drafted in the English language. Les parties ont convenu que cette entente de coparticipation soit rédigée en langue Anglaise.

Election under United States Income Tax Laws

22.12     The Participants who are subject to United States income tax hereby elect to have the joint operations under this Agreement excluded from the application of Sub-chapter “K” of Chapter “1” of Subtitle “A” of the United States Internal Revenue Code of 1986, as amended; or such portion or portions thereof as may be permitted or authorized by the Secretary of the Treasury of the United States of America, or his delegate, insofar as Sub-chapter “K” or any portion or portions thereof may be applicable to the joint operations under this Agreement, and hereby bind themselves to do any and all things necessary or proper in the premises from time to time to effectuate such election under the authority of Section 761(a) of the said United States Internal Revenue Code of 1986, as amended, and the corresponding provisions of any subsequent Internal Revenue Code of the United States of America.

Share Option

[NOTE TO DRAFT: Optional section]

22.13     For the sum of Five Dollars ($5.00) and other good and valuable consideration (receipt and sufficiency of which is hereby acknowledged by the Owner), the Owner hereby grants to PTG the option to purchase up to • common shares in the capital of the Owner at a price per share equal to $• (the “Option”). The terms and conditions attached to the Option are as set forth in Schedule 3.

EXECUTION

IN WITNESS WHEREOF the parties hereto have caused this Agreement to be duly executed and delivered as of the day and year first above written.

       PLATINUM GROUP METALS LTD.

       by:    _______________________________

       and:  _______________________________

       CANPLATS RESOURCES CORPORATION

       by:    _______________________________

       and:  _______________________________

SCHEDULE 1

                      to an Agreement between PTG Resources Corporation and • dated as of the • day of •, 20•.

DESCRIPTION OF PROPERTY

Claim Name Mining Division No. of Units Record Number Assessment Due Date

SCHEDULE 2

to an Agreement between PTG Resources Corporation and • dated as of the • day of •, 20•.

NET PROFITS ROYALTY

1.     Interpretation

1.1     Where used herein:

(a)     “Agreement” means the above-referenced agreement, including any amendments thereto or renewals or extensions thereof;
(b) “Holder” means the person or persons that are from time to time entitled to be paid Royalty hereunder;
(c) “Royalty” shall mean the percentage share of Net Profits payable pursuant to a Net Profits Royalty under the Agreement; and
(d) all other defined terms used in this Schedule which are not defined herein have the meanings ascribed thereto in the Agreement.

1.2     All calculations and computations relating to the Royalty shall be carried out in accordance with generally accepted accounting principles to the extent that such principles are not inconsistent with the provisions of the Agreement and this Schedule.

2.     Net Profits

2.1     For the purposes of the Agreement, “Net Profits” shall mean that amount by which Revenues exceed Costs.

If Costs exceed Revenues in any Operating Year, the excess Costs shall be carried forward into the next succeeding Operating Year.

2.2     For the purpose of computing Net Profits hereunder:

(a) “Revenues” shall mean the total proceeds, calculated at the point of sale, derived from the sale of Mineral Products plus any miscellaneous proceeds (including, without limitation, all net amounts received from the sale of plant, machinery, equipment or other assets prior to the cessation of operations, any insurance proceeds not used for the replacement or repair of lost or damaged assets, compensation for expropriated properties, government grants and interest on Revenue earned from the date of receipt to the date of payment, but excluding interest earned on working capital) from the Property; and

(b) “Costs” shall mean all expenditures, whether current or capital, incurred on or in connection with the Property and related to the exploration, development, and placing of the Property into Commercial Production, and all operating, mining, milling, smelting, refining, marketing and transportation costs, including, without limitation:

(i) taxes (other than income taxes), royalties (other than the Royalty) and other like charges necessary to maintain the Property in good standing or otherwise imposed, charged or levied upon the Property or any production therefrom;

(ii) interest on money borrowed for one or more of the above enumerated purposes by the Participants in existence at the time of a payment of the Royalty being made, at such rate as is actually charged to or incurred by such Participants in borrowing such money, where the Property is charged to the lender as security for the money borrowed or, where the money is borrowed or provided by such Participants without specific recourse to the Property as security, at a rate per annum equal to the Prime Rate plus 2%; and

(iii) all other charges and expenses usually made or incurred for a like operation and accounted for in accordance with generally accepted accounting principles and including, without limitation and without duplication, all Expenditures, Production Program Costs and Operating Costs incurred under the Agreement.

For greater certainty, in determining Costs hereunder, outlays of a capital nature shall not be amortized.

3.    Calculation and Payment of Royalty

3.1    The Royalty shall be:

(a) calculated and paid on a quarterly basis within 45 days after the end of each quarter of the Operating Year, based on the Net Profits for such quarter, and after deducting any credit from the payment of advance royalties, if any, as may be set forth in the Agreement. However, when calculating the required quarterly payments, a reasonable provision may be made for anticipated Costs for the remainder of the Operating Year; and

(b) calculated by the Operator if it is the sole Participant, or if there is more than one Participant, by each Participant as to its respective share of Royalty and each Participant and the Operator shall keep separate accounts relating to its respective operations related to the Property.

3.2     The Royalty shall be payable by each Participant responsible for such as follows:

(a) each payment of Royalty will be accompanied by an unaudited statement indicating the calculation of the Royalty hereunder in reasonable detail and the Holder will receive, within 3 months of the end of each Operating Year, an annual summary unaudited statement (an “Annual Statement”) showing in reasonable detail the calculation of the Royalty for the last completed Operating Year and showing all credits and deductions added to or deducted from the amount due to the Holder;

(b) the Holder will have 45 days from the time of receipt of the Annual Statement to question the accuracy thereof in writing and, failing such objection, the Annual Statement will be deemed to be correct and unimpeachable thereafter;

(c) if the Annual Statement is questioned by the Holder, and if such questions cannot be resolved between the Holder and the Operator or Participant that prepared the Annual Statement, as the case may be, the Holder will have 12 months from the time of receipt of the Annual Statement to have such audited, which will initially be at the expense of the Holder;

(d) the audited Annual Statement will be final and determinative of the calculation of the Royalty for the audited period and will be binding on the Holder and the party that prepared the Annual Statement and any overpayment of Royalty will be deducted from future payments of Royalty and any underpayment of Royalty will be paid to the Holder forthwith;

(e) the costs of the audit will be borne by the Holder if the Annual Statement overstated the Royalty payable or understated the Royalty payable by not more than 1% and will be borne by the party that prepared the Annual Statement if such statement understated the Royalty payable by greater than 1%. If the party that prepared the Annual Statement is obligated to pay for the audit it will forthwith reimburse the Holder for any of the audit costs which it had paid; and

(f) the Holder will be entitled to examine, on reasonable notice and during normal business hours, such books and records as are reasonably necessary to verify the payment of the Royalty to it from time to time, provided however that such examination shall not unreasonably interfere with or hinder the Operator’s or Participants’ operations or procedures.

4. Inclusion of Income Taxes in Costs

4.1     Notwithstanding anything to the contrary herein contained, if there is any tax (“Tax”) on income paid or payable by a Participant by reason of the fact that the Royalty, in whole or in part, is or becomes non-deductible to the Participant for the purposes of calculating its taxable income:

(a) if the Royalty is not required to be included in determining the taxable income of the Holder, the Participant may deduct from the amount of Royalty otherwise payable by it hereunder, the full amount of the Tax; and

(b) if the Royalty is in whole or in part required to be included by the Holder in its taxable income, the Participant may deduct from the amount of Royalty otherwise payable by it hereunder, that percentage of such Tax that equals the percentage which the Royalty is of Net Profits in order for the Tax to be shared pro rata by the parties.

5. Segregation of Property

5.1     The determination of Net Profits hereunder is based on the premise that production will be developed solely on the Property. Other mining properties may be incorporated with the Property into a single mining project and the metals, ores or concentrates pertaining to each may be blended at the time of mining or at any time thereafter, provided however, that the respective mining properties (including the Property) shall bear and have allocated to them their proportionate part of expenditures relating to the bringing of such single mining project into commercial production and thereafter operating the same and shall have allocated to them the proportionate part of the revenues realized from such single operation, all as determined in accordance with generally accepted accounting principles and from records maintained by the Operator. The Holder shall have the right, during reasonable business hours and upon prior notice to the Operator and Participants, to enter upon the mining properties and to inspect the plant and procedures followed with respect to allocations made under this paragraph provided that such entry shall be at the sole risk and cost of the Holder. If the parties disagree on the allocation of actual proceeds received and deductions therefrom, such shall be referred to arbitration in the manner provided in Article 17 of the Agreement and the arbitrator shall have reference first to the Agreement, and then, if necessary, to practices used in mining operations that are of a similar nature. The arbitrator shall be entitled to retain such independent mining consultants and financial advisors as he considers necessary. The decision of the arbitrator shall be final and binding on the parties.

END OF SCHEDULE 2

SCHEDULE 3

to an Agreement between PTG Resources Corporation and • dated as of the • day of •, 20•.

SHARE OPTION

1.     For the purposes hereof, the “Option” means the share option granted to PTG pursuant to §22.13 of this Agreement.

2.     The Option may be exercised by PTG, in whole or in part, at any time before midnight on the first to occur of the following dates:

(a)  the 90th day following the delivery of a Production Program pursuant to §9.1 of this Agreement;
(b)   the fifteenth anniversary of the date of this Agreement; and
(c)   if this Agreement is terminated before the dates referred to in §(a) and (b) hereof, the 90th day following the effective date of such termination.

3. PTG’s Option hereunder shall be exercisable by the delivery to the Owner before the time set out in §2 hereof, of a written notice stating PTG’s intention to exercise in whole or in part the Option and the number of shares intended to be acquired by PTG and, upon receipt by the Owner of such notice, the Owner shall, subject to §4 hereof, deliver to PTG at its address for notice as set out in Article 18 of this Agreement, a certificate or certificates registered as PTG may advise representing such number of fully paid and non-assessable shares as PTG shall have then paid for.

4. Concurrently with the option notice delivered to the Owner pursuant to §3 hereof, PTG shall deliver to the Owner a certified cheque or bank draft in an amount equal to the applicable price per share multiplied by the number of optioned shares to be purchased.

5. PTG will not be obligated to purchase or pay for, nor will the Owner be obligated to issue, any shares other than those optioned shares in respect of which PTG has delivered an option notice as hereinbefore provided.

6. The Owner covenants and agrees that any optioned shares purchased by PTG pursuant to this Schedule will, upon issuance, be fully paid and non-assessable and free and clear of all liens, charges and encumbrances and, if required by PTG, the Owner will obtain and deliver to, or cause to be delivered to PTG, together with the share certificates referred to in §3 hereof, an opinion of counsel for the Owner to the effect that all necessary steps, consents, approvals and corporate proceedings have been taken and obtained by the Owner to duly allot and issue such optioned shares to PTG as fully paid and non-assessable shares free and clear of all liens, charges and encumbrances and stating the percentage which the shares issued to PTG hereunder represent of the total number of issued shares then outstanding. The Owner further covenants and agrees that during the period within which the Option may be exercised by PTG, the Owner will at all times have authorized and reserved a sufficient number of common shares to accommodate the exercise of the Option, and will at its expense expeditiously use its best efforts to procure the listing of such shares (subject to issuance or notice of issuance) on the Canadian Venture Exchange or any other stock exchange on which the shares of the Owner are listed for trading and any requisite approval of any securities commission or other regulatory authority having jurisdiction with respect thereto. The Owner shall deliver to PTG written evidence of all such approvals on or before •, 20• , failing which this Agreement shall, at PTG’s option, be rendered null and void and any payments or Expenditures theretofore made by PTG shall forthwith be reimbursed to PTG.

7. In the event of any subdivision of the common shares of the Owner at any time up to the expiry date set out in §2 hereof into a greater number of shares, the Owner shall deliver to PTG, at the time of any exercise thereafter of the Option hereby granted, such greater number of fully paid and non-assessable shares as would have resulted from such subdivision if the Option had been exercised prior to the date of such subdivision.

8. In the event of any consolidation of the common shares of the Owner at any time up to the expiry date set out in §2 hereof into a lesser number of shares, the Owner shall deliver to PTG, at the time of any exercise thereafter of the Option hereby granted, such lesser number of fully paid and non-assessable shares as would have resulted from such consolidation if the Option had been exercised prior to the date of such consolidation.

9. In the event of any capital reorganization, reclassification or other change in the outstanding common shares of the Owner (other than a change in the par value, if any) or any merger or amalgamation of the Owner with or into any company at any time up to the expiry date set out in §2 hereof, PTG shall be entitled to receive upon any exercise thereafter of the Option hereby granted, in lieu of the shares previously purchasable and receivable upon the exercise of the Option, the kind and amount of shares and other securities and property receivable upon such capital reorganization, reclassification, change, merger or amalgamation which the holder of a number of shares equal to the number of shares previously purchasable and receivable upon the exercise of the Option would have received. The subdivision or consolidation of shares at any time outstanding into a greater or lesser number of shares (whether with or without par value) shall not be deemed to be a capital reorganization or a reclassification of the capital of the Owner for the purpose of this paragraph.

10. If at any time up to the expiry date set out in §2 hereof, the Owner pays any dividend or makes any distribution to its shareholders, whether by stock dividend or otherwise, PTG shall be entitled to receive upon any exercise thereafter of the Option hereby granted (in addition to the number of shares which PTG would have been entitled to receive on the exercise of the Option if such dividend or distribution had not been paid) such dividend or distribution, without additional cost, as would have been payable to PTG on optioned shares acquired by PTG if such shares had been acquired by PTG on the record date for the payment of such dividend or distribution. The Owner covenants and agrees that, in the event of the payment of any such dividend or distribution, it will reserve and set aside sufficient monies, shares or assets in which any such dividend or distribution shall be payable to enable it to fulfil its obligations hereunder.

11. If:

(a) the Owner intends to offer for subscription pro rata to all the holders of its common shares any additional shares of any class or intends to issue any other rights or warrants to all of such holders;

(b) there is a proposed reclassification or change of the Owner’s common shares or proposed amalgamation or merger of the Owner with or into any other corporation or a sale, transfer or other disposition of all or substantially all of the assets of the Owner; or

(c) there is a contemplated voluntary or involuntary dissolution, liquidation or winding-up of the Owner;

then, in each such case, the Owner shall give notice to PTG of the action proposed to be taken and the date on which:

(d) the books of the Owner shall close or a record shall be taken for such dividend, distribution, subscription rights or other rights or warrants; or

(e) such reclassification, change, amalgamation, merger, sale, transfer or other disposition, dissolution, liquidation or winding-up shall take place;

as the case may be, but the Owner shall only be required to specify in such notice such particulars of such action as shall have been fixed and determined at the date on which such notice is given. A notice hereunder shall specify the date on which it is given and the date as of which the holders of the shares of record shall participate in such subscription rights or other rights or warrants, or shall be entitled to exchange their shares for securities or other property deliverable upon such other disposition, dissolution, liquidation or winding-up as the case may be. Notice shall be given by the Owner hereunder after regulatory approval for any such event has been obtained, if regulatory approval is required, and not less than 10 days prior to the record date or the date on which the Owner’s books are to be closed with respect thereto.

END OF SCHEDULE 3

EX-99.001

FLOW-THROUGH SHARES
PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT

THIS AGREEMENT dated for reference this 13th day of March, 2002

BETWEEN

R.E. Gordon Davis
5555 Newton Wynd
Vancouver, B.C.
V6G 1H6

(the “Purchaser”);

AND

CANPLATS RESOURCES CORPORATION, Suite 1180,
999 West Hastings Street, Vancouver, British Columbia, V6C 2W2

(the “Issuer”).

Subject and pursuant to the terms set out in Appendix III attached hereto, the Purchaser hereby irrevocably subscribes for, and on Closing will purchase from the Issuer, the following securities at the following price:

125,000      Flow-Through Shares;
$0.20        per Flow Through Share for a total purchase price of $25,000.

NUMBER OF SECURITIES IN THE ISSUER HELD EITHER DIRECTLY OR INDIRECTLY:

         621,500 common shares .
_____________________________________________________________

The Purchaser hereby directs the Issuer to issue, register and deliver the certificates representing the Flow-Through Shares as follows:

Registration Instructions:	Delivery Instructions:
__________________________	__________________________
Name to appear on certificate	Name and account reference, if applicable
R.E. Gordon Davis
__________________________	__________________________
Account reference, if applicable	Contact Name
__________________________	__________________________
Address	Address
5555 Newton Wynd
Vancouver, B.C     V6G 1H6
__________________________	__________________________
	(Telephone Number)

EXECUTED by the Purchaser this 5th day of April, 2002.

WITNESS:	EXECUTION BY PURCHASER:
"Linda J. Sue"	"R.E. Gordon Davis"
__________________________	__________________________
Signature of Witness	Signature of individual (if Purchaser is an individual)
__________________________	__________________________
Name of Witness	Authorized Signatory (if Purchaser is not an individual)
#1180-999 W. Hastings St. Vancouver, B.C. V6C 2W2
__________________________	__________________________
Address of Witness	Name of Purchaser (please print)
__________________________	__________________________
	Name of Authorized Signatory (please print)
	__________________________
	Address of Purchaser (residence if an individual)
	__________________________

ACCEPTED this 9th day of April, 2002.
CANPLATS RESOURCES CORPORATION
Per:
"R.A. Mitchell"
_______________________________
Authorized Signatory

APPENDIX 1 (A)

FORM 4D1

CORPORATE PLACEE REGISTRATION FORM

Where subscribers to a private placement are not individuals, the following information about the placee must be provided. This Form will remain on file with the Exchange. The corporation, trust, portfolio manager or other entity (the “Placee”) need only file it once, and it will be referenced for all subsequent private placements in which it participates. If any of the information provided in this Form changes, the Placee must notify the Exchange prior to participating in further placements with Exchange listed companies.

1.     Name of Placee:

2.     Address of Placee’s Head Office:

3.     Jurisdiction of Incorporation or Creation:

4. If the Placee will be purchasing securities as principal, but not as a portfolio manager, please check the box and include the names and addresses of persons having a greater than 10% beneficial interest in the Placee:   

5. The undersigned acknowledges that it is bound by the provisions of applicable Securities Law, including provisions concerning the filing of insider reports and reports of acquisitions (See for example, sections 87 and 111 of the Securities Act (British Columbia) and sections 141 and 147 of the Securities Act (Alberta).

6. For Placees which are portfolio managers or trusts purchasing pursuant to an exemption from the prospectus requirements prescribed by British Columbia Securities Law and are required pursuant to the applicable exemption to be purchasing as agent for accounts that are fully managed by it, please check the box and complete the Additional Undertaking and Certification in Form 4D2.  

Dated at ______________________ on _________________________________.

           _________________________________________

           (Name of Purchaser — please print)

           _________________________________________

           (Authorized Signature)

           _________________________________________

           (Official Capacity — please print)

           _________________________________________

(please print name of individual whose
signature appears above, if different
from name of purchaser printed above)

THIS IS A PUBLIC DOCUMENT

APPENDIX 1 (B)

FORM 4D2

Portfolio Manager:

Additional Undertaking and Certification

If the undersigned is a portfolio manager purchasing as agent for accounts that are fully managed by it, pursuant to an exemption from the prospectus requirements prescribed by British Columbia Securities Law, the undersigned acknowledges that it is bound by the provisions of the Securities Act (British Columbia) (the “Act”), and undertakes to comply with all provisions of the Act relating to ownership of, and trading in, securities including, without limitation, the filing of insider reports and reports pursuant to Section 111 of the Act. If any of the information provided in this Form changes, the portfolio manager undertakes to notify the Exchange prior to participating in further private placements with Exchange listed companies.

If the undersigned carries on business as a portfolio manager in a jurisdiction outside of Canada, the undersigned certifies that:

a) it is purchasing securities of the Issuer on behalf of managed accounts for which it is making the investment decision to purchase the securities and has full discretion to purchase or sell securities for such accounts without requiring the client’s express consent to a transaction;

b) it carries on the business of managing the investment portfolios of clients through discretionary authority granted by those clients (a “portfolio manager” business) in [jurisdiction], and it is permitted by law to carry on a portfolio manager business in that jurisdiction;

c) it was not created solely or primarily for the purpose of purchasing securities of the Issuer;

d) the total asset value of the investment portfolios it manages on behalf of clients is not less than $20,000,000; and

e) it has no reasonable grounds to believe, that any of the directors, senior officers and other insiders of the Issuer, and the persons that carry on investor relations activities for the Issuer has a beneficial interest in any of the managed accounts for which it is purchasing.

Dated at________________________on ____________________________.

           _________________________________________

           (Name of Purchaser — please print)

           _________________________________________

           (Authorized Signature)

           _________________________________________

           (Official Capacity — please print)

           _________________________________________

(please print name of individual whose
signature appears above, if different
from name of purchaser printed above)

APPENDIX II A

This is the form required under section 135 of the Securities Rules or, where required, under an order issued under section 76 of the Securities Act.

BCF #45-903F1

(formerly, Form 20A(IP))

Securities Act

ACKNOWLEDGMENT OF INDIVIDUAL PURCHASER

1. I have agreed to purchase from CANPLATS RESOURCES CORPORATION (the “Issuer”) 125,000 flow-through shares (the “Securities”) of the Issuer.

2. I am purchasing the Securities as principal and, on closing of the agreement of purchase and sale, I will be the beneficial owner of the Securities.

3. I [circle one] have/have not received an offering memorandum describing the Issuer and the Securities.

4. I acknowledge that:

(a) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities, AND

(b) there is no government or other insurance covering the Securities, AND

(c) I may lose all of my investment, AND

(d) there are restrictions on my ability to resell the Securities and it is my responsibility to find out what those restrictions are and to comply with them before selling the Securities, AND

(e) I will not receive a prospectus that the British Columbia Securities Act (the “Act”) would otherwise require to be given to me because the Issuer has advised me that it is relying on a prospectus exemption, AND

(f) because I am not purchasing the Securities under a prospectus, I will not have the civil remedies that would otherwise be available to me, AND

(g) the Issuer has advised me that it is using an exemption from the requirement to sell through a dealer registered under the Act, except purchases referred to in paragraph 5(g), and as a result I do not have the benefit of any protection that might have been available to me by having a dealer act on my behalf.

5.     I also acknowledge that: [circle one]

(a) I am purchasing Securities that have an aggregate acquisition cost of $97,000 or more, OR

(b) my net worth, or my net worth jointly with my spouse at the date of the agreement of purchase and sale of the security, is not less than $400,000, OR

(c) my annual net income before tax is not less than $75,000, or my annual net income before tax jointly with my spouse is not less than $125,000, in each of the two most recent calendar years, and I reasonably expect to have annual net income before tax of not less than $75,000 or annual net income before tax jointly with my spouse of not less than $125,000 in the current calendar year, OR

(d) I am registered under the Act, OR

(e) I am a spouse, parent, brother, sister or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer, OR

(f) I am a close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer, OR

(g) I am purchasing securities under section 128(c) ($25,000 — registrant required) of the Rules, and I have spoken to a person_____________________________ [Name of Registered Person] (the “Registered Person”) who has advised me that the Registered Person is registered to trade or advise in the Securities and that the purchase of the Securities is a suitable investment for me.

6. If I am an individual referred to in paragraph 5(b), 5(c), or 5(d), I acknowledge that, on the basis of information about the Securities furnished by the Issuer, I am able to evaluate the risks and merits of the Securities because: [circle one]

(a) of my financial, business or investment experience, OR

(b) I have received advice from a person ______________________________ [Name of adviser] (the “Adviser”) who has advised me that the Adviser is:

(i) registered to advise, or exempted from the requirement to be registered to advise, in respect of the Securities, and

(ii) not an insider of, or in a special relationship with, the Issuer.

The statements made in this report are true.

DATED the 5th day of April, 2002.

"R.E. Gordon Davis"

Signature of Purchaser

R.E. Gordon Davis

Name of Purchaser

5555 Newton Wynd

Vancouver, B.C   V6G 1H6

Address of Purchaser

APPENDIX II B

This is the form required under section 135 of the Rules and, if applicable, by an order issued under section 76 of the Securities Act.

BCF 45-903F2

(Formerly, Form 20A (NIP))

Securities Act

Acknowledgment of Purchaser that is not an individual

1.     I have agreed to purchase from CANPLATS RESOURCES CORPORATION (the “Issuer”) __________________________________ flow-through shares (the "Securities") of the Issuer.

2. The Purchaser is purchasing the Securities as principal, or is a trust Issuer, insurer or portfolio manager acting on behalf of fully managed accounts and is deemed to be purchasing as principal under section 74(1) of the British Columbia Securities Act (the “Act”).

3. On closing of the agreement of purchase and sale, the Purchaser will be the beneficial owner of the Securities, except where the Purchaser is a trust Issuer, insurer or portfolio manager acting on behalf of fully managed accounts under section 74(1) of the Act.

4. The Purchaser [circle one] has/has not received an offering memorandum describing the Issuer and the Securities.

5. The Purchaser acknowledges that:

(a) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities, AND

(b) there is no government or other insurance covering the Securities, AND

(c) the Purchaser may lose all of its investment, AND

(d) there are restrictions on the Purchaser’s ability to resell the Securities and it is the responsibility of the Purchaser to find out what those restrictions are and to comply with them before selling the Securities, AND

(e) the Purchaser will not receive a prospectus that the Act would otherwise require be given to the Purchaser because the Issuer has advised the Purchaser that the Issuer is relying on a prospectus exemption, AND

(f) because the Purchaser is not purchasing the Securities under a prospectus, the Purchaser will not have the civil remedies that would otherwise be available to the Purchaser, AND

(g) the Issuer has advised the Purchaser that the Issuer is using an exemption from the requirement to sell through a dealer registered under the Act, except purchases referred to in paragraph 6(b), and as a result the Purchaser does not have the benefit of any protection that might have been available to the Purchaser by having a dealer act on the Purchaser’s behalf.

6.     The Purchaser acknowledges that:

(a) it is a “sophisticated purchaser” as described in paragraph 2 in the attached Appendix A [circle the applicable subparagraph in paragraph 2 in Appendix A]; OR

(b) the Securities were purchased under section 128(c) ($25,000 — registrant required) of the Rules and an authorized signatory of the Purchaser has spoken to a person [Name of Registered Person] (the “Registered Person”) who has advised the authorized signatory that the Registered Person is registered to trade or advise in the Securities and that the purchase of the Securities is a suitable investment for the Purchaser; OR

(c) the Purchaser is a corporation, all the voting securities of which are beneficially owned by one or more of:

(i) a close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer, OR

(ii) a senior officer or director of the Issuer, or of an affiliate of the Issuer , OR

(iii) a spouse, parent, brother, sister, or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer.

7. If the Purchaser is referred to in paragraph 6(a), the Purchaser acknowledges that, on the basis of information about the Securities furnished by the Issuer, the Purchaser is able to evaluate the risks and merits of the Securities because: [circle one]

(a) of the financial, business or investment experience of the Purchaser, OR

(b) the Purchaser has received advice from a person [Name of adviser](the “Adviser”) who has advised the Purchaser that the Adviser is:

(i) registered to advise, or exempted from the requirement to be registered to advise, in respect of the Securities, AND

(ii) not an insider of, or in a special relationship with, the Issuer.

The statements made in this report are true.

DATED the ________________ day of ____________________________, 2002.

Signature of Authorized Signatory of Purchaser

Name and Office of Authorized Signatory of Purchaser

Name of Purchaser

Address of Purchaser

Please turn to Appendix A, which is attached to and forms a part of this BCF #45-903F2.

APPENDIX A TO BCF #45-903F2

[Circle the applicable subparagraph in paragraph 2.]

“Sophisticated purchaser” means a purchaser that, in connection with a distribution, gives an acknowledgment under section 135 of the Rules to the Issuer, where the Issuer does not believe, and has no reasonable grounds to believe, that the acknowledgment is false, acknowledging both that:

1. the purchaser is able, on the basis of information about the investment furnished by the Issuer, to evaluate the risks and merits of the prospective investment because of:

(a) the purchaser’s financial, business or investment experience, OR

(b) advice the purchaser receives from a person who is registered to advise, or is exempted from the requirement to be registered to advise, in respect of the security that is the subject of the trade (the “Security”) and who is not an insider of, or in a special relationship with, the Issuer of the Security; AND

2.     the purchaser is one of the following [circle one]:

    (a)        a person registered under the Securities Act, OR

    (b)        an individual who:

(i) has a net worth, or net worth jointly with the individual’s spouse, at the date of the agreement of purchase and sale of the Security, of not less than $400,000, OR

(ii) has had in each of the 2 most recent calendar years, and reasonably expects to have in the current calendar year:

- annual net income before tax of not less than $75,000, OR

- annual net income before tax, jointly with the individual's spouse, of not less than $125,000; OR

    (c)        a corporation, partnership or trust that:

(i) has net assets of not less than $400,000, OR

(ii); has had in each of the 2 most recent calendar years, and reasonably expects to have in the current calendar year, net income before tax of not less than $125,000, OR

(d) a corporation in which all of the voting shares are beneficially owned by sophisticated purchasers or of which the majority of the directors are sophisticated purchasers, OR

(e) a general partnership in which all of the partners are sophisticated purchasers, OR

(f) a limited partnership in which a majority of the general partners are sophisticated purchasers, OR

(g) a trust in which all of the beneficiaries are sophisticated purchasers or the majority of the trustees are sophisticated purchasers.

APPENDIX III

THE PARTIES to this Agreement therefore agree:

1.     PURCHASE AND SALE OF FLOW-THROUGH SHARES

On the Closing, the Purchaser will purchase from the Issuer 125,000 flow-through shares at a price of $0.20 per flow-through share and the Issuer will deliver to the Purchaser certificates representing the flow-through shares.

2.     DEFINITIONS

2.1     In this Agreement, which includes the cover page and all of the Appendices, the following words have the following meanings unless otherwise indicated:

(a)	“1933 Act” means the Securities Act of 1933 (United States of America), as amended;
(b)	“Alberta Act” means the Securities Act, (Alberta) S.A. 1981, c. S-6.1, as amended;
(c)	“Alberta Commission” means the Alberta Securities Commission;
(d)	“Alberta Rules” means the rules made under the Alberta Act;
(e)	“Applicable Legislation” means the B.C. Act and the Alberta Act, together with the regulations and rules made and promulgated thereunder and all administrative policy statements, blanket orders and rulings, notices, and other administrative directions issued by the Commissions;
(f)	“B.C. Act” means the Securities Act, (British Columbia) R.S.B.C. 1996, as amended; (g) (h) “B.C. Rules” means the rules made under the B.C. Act;
(g)	“B. C. Commission” means the British Columbia Securities Commission;
(h)	“B.C. Rules” means the rules made under the B.C. Act;
(i)	“CEDOE” means Canadian exploration and development overhead expense as prescribed for the purposes of section 66(12.6) of the Income Tax Act;
(j)	“CEE” means Canadian exploration expense as defined in paragraph 66.1(6) of the Income Tax Act;
(k)	“Closing” means the closing of the purchase and sale of the Shares under this Subscription Agreement;
(l)	“Closing Date” means the day the Shares are issued to the Purchaser;
(m)	“Commissions” means the B.C. Commission and Alberta Commission;
(n)	“Exchange” means the Canadian Venture Exchange Inc.;
(o)	“Exemptions” means the exemptions from the prospectus requirements under sections 74(2)(4) and 74(2)(9) of the B.C. Act, section 128(h) of the B.C. Rules, British Columbia Instrument #72-503 and sections 107(1)(d) and (z) of the Alberta Act;
(p)	“Exploration Account” means a segregated account maintained at a chartered Canadian bank for the purposes of receiving amounts of subscription of Shares pursuant to the Offering and of disbursing funds to finance conduct of the Exploration Program;
(q)	“Exploration Program” means a program to determine the existence, location, extent and quality of mineral resources in the Property and may include, without limitation, soil sampling, grid preparation, induced-polarization surveys and line-cutting, surveying and diamond drilling;
(r)	“Income Tax Act” means the Income Tax Act (Canada) as amended from time to time;

(s) “Offering” means the offering of the Shares that are “flow-through shares” for the purposes of the Income Tax Act under this form of Agreement;

(t) “Property” means resource property or properties in Canada beneficially owned by the Issuer or in which the Issuer has an interest or the right to acquire an interest;

(u) “Private Placement” means the offering of the Shares;

(v) “Purchaser” means the person named as “Purchaser” in this Subscription Agreement and wherever Purchaser is used in the plural, it shall connote all persons who are a “Purchaser” under this form of Subscription agreement and who subscribe for Shares under the Offering;

(w) “Purchaser’s Subscription Funds” means the amount subscribed for by the Purchaser under the Offering;

(x) “Qualified Expenditures” means CEE (other than CEDOE) in excess of amounts of “assistance” as such term is defined in subsection 66(15) of the Income Tax Act;

(y) “Regulation S” means Regulation S promulgated under the 1933 Act; and

(z) “Shares” means the flow-through common shares in the share capital of the Issuer, as presently constituted, to be issued under the Offering; and

(aa) “Termination Date” means the date that is twenty-four months after the end of the month in which this Subscription Agreement is executed by the parties.

2.2    A reference to persons:

(a) “dealing” or “acting” at or not at “arm’s length” shall be construed as a reference to dealing or acting at or not at “arm’s length” for the purposes of the Income Tax Act; and

(b) who or which are “related” shall be construed as a reference to persons who would be “related” for the purposes of the Income Tax Act.

2.3    In this Agreement, the following terms have the meanings defined in Regulation "S": "Directed Selling Efforts", "Foreign Issuer", "Substantial U.S. Market Interest", "U.S. Person" and "United States".

3.     PURCHASE AND SALE OF COMMON SHARES

3.1     The Purchaser, as principal, hereby subscribes for and agrees to purchase that number of Shares indicated on the Agreement to which this Appendix III is attached at a price of $0.20 (Cdn.) per Share, for that aggregate purchase price indicated on the Agreement to which this Appendix III is attached (the “Subscription Funds”).

3.2     The Purchaser shall pay the Subscription Funds to the Issuer on the date of execution of this Agreement (the “Payment Date”). The Subscription Funds shall be held as a non-interest bearing loan by the Issuer until the Closing Date.

3.3     This Agreement, when executed by the Purchaser and delivered to the Issuer, will constitute a subscription for the Shares which will not be binding on the Issuer until accepted by the Issuer by executing the Agreement in the space provided above.

3.4     Within 15 business days of receipt by the Issuer of final approval by the Exchange of the Private Placement, the Private Placement shall close (the “Closing”) by the issuance of certificates for the Shares 3.5     The issue of the Shares will not restrict or prevent the Issuer from obtaining any other financing or from issuing additional securities or rights.

3.5     The issue of the Shares will not restrict or prevent the Issuer from obtaining any other financing or from issuing additional securities or rights.

3.6 The Issuer will, upon receipt of the Purchaser’s Subscription Funds, deposit such funds (together with all other subscription funds received by the Issuer from this Offering) into the Exploration Account.

3.7 After the Closing, the Issuer will have the right to draw on the Exploration Account and will apply 100% of the principal of the Exploration Account to carry out and complete programs (a “Program”) of exploration on a resource property or properties in Canada beneficially owned by the Issuer or in which the Issuer has an interest or the right to acquire an interest.

3.8 In carrying out an Exploration Program the Issuer will use its best efforts to incur after the Closing, Qualifying Expenditures in an amount equal to the aggregate of Purchaser’s Subscription Funds for all Purchasers so that such Qualifying Expenditures can be renounced. The Issuer shall, in any event, cause Qualifying Expenditures to be incurred in the aggregate equal to the aggregate of Purchaser’s Subscription Funds for all Purchasers prior to the Termination Date.

3.9 The Issuer shall within the period set out below and in accordance with the provisions of the Income Tax Act and draft amendments thereto, renounce in favour of the Purchaser and others who have entered into this form of Subscription Agreement amounts of Qualified Expenditures incurred by it under Programs from the date of this Subscription Agreement to the Termination Date, as follows for persons dealing with the Issuer at “arm’s length”:

Period of Renunciation	Effective Date of Renunciation	Exploration Expenses to be Renounced
On or before March 31 of the year following the year (the "Base Year") in which this Agreement was made	December 31, 2002	Any and all Qualified Expenditures incurred from the date of this Agreement to the end of February of the year following the Base Year between March 1 and December 31 of the year following the Base Year
On or before March 31 of the year following the Base Year	December 31, 2002	Any and all Qualified Expenditures incurred or planned to be incurred
On or before March of the calendar year following the Termination Date	Earliest possible calendar year	Any and all Qualified Expenditures not previously renounced.

3.10 The Issuer shall within the period set out below and in accordance with the provisions of the Income Tax Act and draft amendments thereto, renounce in favour of the Purchaser and others who have entered into this form of Subscription Agreement amounts of Qualified Expenditures incurred by it under Programs from the date of this Subscription Agreement to the Termination Date, as follows for persons not dealing with the Issuer at “arm’s length”:

Period of Renunciation	Effective Date of Renunciation	Exploration Expenses to be Renounced
On or before March 31 of the year following the Base Year	December 31, 2002	Any and all Qualified Expenditures incurred from the date of this Agreement to the end of the Base Year
On or before March of the calendar year following the Termination Date	Earliest possible calendar year	Any and all Qualified Expenditures not previously renounced.

3.11 Renunciations shall be made to persons who are Purchasers pro rata in accordance with the respective amounts of Purchaser’s Subscription Funds for each of the Purchasers although the Issuer may renounce different amounts of Qualifying Expenditures to Purchasers who do not and those who do act at arm’s length with the Issuer so that members of these two groups receive renunciations of Qualified Expenditures as early as possible rateably. The aggregate Qualified Expenditures renounced to the Purchaser will not exceed the consideration paid by the Purchaser for the Shares.

3.12 The Purchaser acknowledges that if the Issuer renounces Qualified Expenditures pursuant to paragraph 3.11, effective December 31, 2002, incurred or planned to be incurred in the year following the Base Year and does not incur all or part of the Qualified Expenditures which it planned to incur during the specified period, the Issuer will be required to reduce the amount of Qualified Expenditures renounced pursuant to such provision and, as a result, the Purchaser:

    (a)     may become subject to increased income tax liabilities for the year in respect of which the excess renunciation was made; and

    (b)     may be required to file appropriate amendments to the Purchaser’s income tax return for that and other years.

3.13 If, before the Issuer renounces the full amount of Qualified Expenditures to the Purchaser in accordance with sections of this Agreement, the Issuer amalgamates or otherwise merges with one or more companies, any shares issued to or held by the Purchaser as a replacement of the Shares as a result of such amalgamation or merger, will qualify, whether by virtue of subsection 87(4.4) of the Income tax Act or otherwise, as “flow-through shares” as described in subsection 66(15) of the Income tax Act and in particular will not be prescribed shares as defined in section 6202.1 of the regulations to the Income Tax Act.

3.14 The Issuer represents and warrants to, and covenants with, the Purchaser that:

(a) all expenditures renounced by the Issuer to the Purchaser pursuant to this Subscription Agreement will be Qualified Expenditures;

(b) the Purchaser’s Shares will be, at the time of issue, “flow-through shares” within the meaning of Section 66(15) of the Income Tax Act;

(c) on the date provided as the effective date in each renunciation of Qualifying Expenditures pursuant to this Subscription Agreement, the Issuer will have cumulative CEE, within the meaning of paragraph 66.1(6) of the Income Tax Act, in an amount sufficient to make the renunciation to the Purchaser valid;

(d) in respect of each renunciation made by the Issuer pursuant to this Subscription Agreement, the Issuer will file on a timely basis all prescribed forms and other documents necessary to ensure valid and effective renunciation with the Minister of National Revenue on or before the last day of the month after the month in which the renunciation is made;

(e) the Issuer has complied or will comply with the provisions of the Income Tax Act relating to the filing of this Subscription Agreement including, without limitation, the obligation to file a copy of a “selling instrument” within the meaning of subsection 66(15), a copy of the agreement to be issued and the prescribed form on or before the last day of the month following the earlier of:

(i) the month in which this Agreement was entered into;

(ii) the month in which any “selling instrument” was first delivered to a potential purchaser;

(f) the Issuer will file, before March of the year following a particular year, any return required to be filed under Part XII.6 of the Income Tax Act in respect of the particular year, and will pay any tax or other amount owing in respect of the return on a timely basis;

(g) where an amount that the Issuer has purported to renounce to the Purchaser effective December 31 of the Base Year pursuant to section 3.11 or 3.12 exceeds the amount that it can renounce on that effective date because it did not actually incur Qualified Expenditures within the required period of time, and at the end of the year following the Base Year the Issuer knew or ought to have known of all or a part of such excess renunciation, the Issuer will file a statement in prescribed form before March of the second year following the Base Year, all as required by subsection 66(12.73) of the Income Tax Act;

(h) the Issuer is and will at all material times remain a “principal-business corporation” as that expression is defined in subsection 66(15) of the Income Tax Act;

(i) the Issuer is not a Joint Exploration Corporation;

(j) the Issuer will not, other than as required by this Subscription Agreement, renounce any CEE or otherwise do anything that will reduce its cumulative Canadian Exploration Expense otherwise than pursuant to this Agreement or other agreements in the same form in the course of the Offering until it has renounced to Purchasers the full amount of Qualified Expenditures required to be so renounced pursuant to this Offering.

4.     WARRANTIES AND DISCLAIMER

4.1     The Purchaser acknowledges, represents, warrants and covenants to and with the Issuer that, as at the date given above and at the Closing:

(a) no prospectus has been filed by the Issuer with the Commission in connection with the issuance of the Shares, the issuance is exempted from the prospectus requirements of the Applicable Legislation and that:

(i) the Purchaser is restricted from using most of the civil remedies available under the Applicable Legislation;

(ii) the Purchaser may not receive information that would otherwise be required to be provided to him under the Applicable Legislation; and

(iii) the Issuer is relieved from certain obligations that would otherwise apply under the Applicable Legislation;

(b) the Purchaser, wherever resident, is:

(i) purchasing sufficient Shares so that the aggregate acquisition cost of the Shares to the Purchaser is not less than $97,000, the Purchaser is not a corporation, partnership, trust, fund, association, or any other organized group of persons created solely, or used primarily, to permit the purchase of the Shares (or other similar purchases) by a group of individuals whose individual share of the aggregate acquisition cost of the Shares is less than $97,000, and the Purchaser is either:

(A) purchasing the Shares as principal and no other person, corporation, firm or other organization will have a beneficial interest in the Shares; or

(B)         if not purchasing the Shares as principal, is

(I) duly authorized to enter into this subscription and to execute all documentation in connection with the purchase on behalf of each beneficial purchaser, it being acknowledged that the Issuer may in the future be required by law to disclose on a confidential basis to securities regulatory authorities the identity of each beneficial purchaser of Shares for whom the Purchaser may be acting; and is

(a) a trust company, insurance company or financial institution that has been authorized to do business under the Financial Institutions Act (British Columbia);

(b) an adviser who manages the investment portfolio of clients through discretionary authority granted by one or more clients and who is registered as a portfolio manager under the B.C. Act or is exempt from such registration;

(c) a trust company or insurer, authorized under the laws of a province or territory of Canada other than British Columbia to carry on business in such province or territory; or

(d) a portfolio manager registered or exempt from registration under the laws of a province or territory of Canada, other than British Columbia, or a jurisdiction other than Canada and has provided the Issuer with an additional undertaking and certification in the form set out in Appendix I(B);

  and it is purchasing the Shares as an agent or trustee for accounts that are fully managed by it, and the aggregate acquisition cost of the Shares purchased for all the accounts managed by it is not less than $97,000; or

(II) is acting as agent for one or more disclosed principals, each of which principals is purchasing as a principal for its own account, not for the benefit of any other person, and not with a view to the resale or distribution of all or any of the Shares and each of which principals complies with subsection 4.1(b)(i) hereof; and

and if the Purchaser is an individual, the Purchaser has executed, prior to the execution of this Agreement, and delivered to the Issuer, a BCF #45-903F1 attached hereto as Appendix II(A);

OR

    (ii)        purchasing as principal and the Purchaser is:

(A) an employee, senior officer or director of the Issuer or of an affiliate of the Issuer and the Purchaser has not been induced to make this subscription by expectation of employment or continued employment; or

(B) a trustee on behalf of a person referred to in subparagraph (ii)(A) above; or

(C) an issuer all the voting securities of which are beneficially owned by one or more of the persons referred to in subparagraph (ii)(A) above;

OR

    (iii)        purchasing as principal and the Purchaser:

(A) is a spouse, parent, brother, sister, child or close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer; or

(B) is a company, all the voting securities of which are beneficially owned by one or more of a senior officer or director of the Issuer, or of an affiliate of the Issuer, or a spouse, parent, brother, sister, child or close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer; and

(C) the Purchaser has executed, prior to the execution of this Agreement, and delivered to the Issuer a BCF #45-903F1 or BCF #45-903F2, as applicable, attached hereto as Appendix II(A) (if the Purchaser is an individual) or Appendix II(B) (if the Purchaser is not an individual), respectively; or

OR

(iv) purchasing Shares under British Columbia Instrument #72-503 and the Purchaser has executed and delivered to the Issuer, the additional acknowledgements, representations and warranties set out in Exhibit I to this Appendix III; or

OR

(v) the Purchaser is the Business Development Bank of Canada, a bank, credit union, trust company or extra-provincial trust corporation authorized to carry on business under the Financial Institutions Act (British Columbia), a corporation that is a subsidiary of a bank and to which the Loan Companies Act (Canada) applies, the B.C. Community Financial Services Corporation established under the Community Financial Services Act (British Columbia), and insurance company or an extra-provincial insurance corporation licensed to do business under the Financial Institutions Act (British Columbia), a subsidiary wholly owned (except for voting securities required by law to be owned by directors of that subsidiary) of any of the foregoing, the government of Canada or a province, or a municipal corporation, public board or commission in Canada;

OR

(vi) the Purchaser is purchasing as principal, is not an individual and is designated as an exempt purchaser in an order made by the Executive Director of the B.C. Commission.

    (c)        the Purchaser, if resident in Alberta, is:

(i) purchasing as principal sufficient Shares so that the aggregate acquisition cost of the Shares to the Purchaser is not less than $97,000, the Purchaser is not a corporation, partnership, trust, fund, association, or any other organized group of persons created solely, or used primarily, to permit the purchase of the Shares (or other similar purchases) by a group of individuals whose individual share of the aggregate acquisition cost of the Shares is less than $97,000; or

(ii) is purchasing as principal and is:

(A) a senior officer or director of the Issuer; or

(B) a senior officer or director of an affiliate of the Issuer; or

(C) a spouse, parent, brother, sister or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer; or

(D) a company, all the voting securities of which are beneficially owned by one or more of a senior officer or director of the Issuer, or of an affiliate of the Issuer, or a spouse, parent, brother, sister or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer; or

(E) a close friend or business associate of a promoter of the Issuer, or a company all the voting securities of which are beneficially owned by a single close friend or single business associate of a promoter of the Issuer;

    (d)        the Purchaser has not received a copy of an offering memorandum;

    (e)        to the best of the Purchaser’s knowledge, the Shares were not advertised;

    (f)        no person has made to the Purchaser any written or oral representations:

    (i)        that any person will resell or repurchase the Shares;

    (ii)        that any person will refund the purchase price of the Shares;

    (iii)        as to the future price or value of any of the Shares;

    (g)        this subscription has not been solicited in any other manner contrary to the Applicable Legislation or the 1933 Act;

(h) the Purchaser is not a “control person” of the Issuer as defined in the Applicable Legislation, will not become a “control person” by virtue of this purchase of any of the Shares, and does not intend to act in concert with any other person to form a control group of the Issuer;

(i) the offer was not made to the Purchaser when he was in the United States and at the time the Purchaser’s buy order was made, the Purchaser was outside the United States;

(j) the Purchaser is at arm’s length with the Issuer, unless the Issuer is advised to the contrary prior to the Closing;

(k) the Purchaser acknowledges that the Shares have not been registered under the 1933 Act and may not be offered or sold in the United States unless registered under the 1933 Act and the securities laws of all applicable states of the United States or an exemption from such registration requirements is available, and that the Issuer has no obligation or present intention of filing a registration statement under the 1933 Act in respect of the Shares;

(l) the Purchaser is not a U.S. Person;

(m) the Purchaser is not and will not be purchasing Shares for the account or benefit of any U.S. Person;

(n) the Purchaser (or others for whom it is contracting hereunder) has been advised to consult its own legal and tax advisors with respect to applicable resale restrictions and tax considerations, and it (or others for whom it is contracting hereunder) is solely responsible for compliance with applicable resale restrictions and applicable tax legislation;

(o) the Purchaser has no knowledge of a “material fact” or “material change” (as those terms are defined in the Applicable Legislation) in the affairs of the Issuer that has not been generally disclosed to the public, save knowledge of this particular transaction;

(p) the offer made by this subscription is irrevocable (subject to the Purchaser’s right to withdraw his subscription and to terminate his obligations as set out in this Agreement) and requires acceptance by the Issuer;

(q) the Purchaser has the legal capacity and competence to enter into and execute this Agreement and to take all actions required pursuant hereto and, if the Purchaser is a corporation it is duly incorporated and validly subsisting under the laws of its jurisdiction of incorporation and all necessary approvals by its directors, shareholders and others have been given to authorize execution of this Agreement on behalf of the Purchaser;

(r) the entering into of this Agreement and the transactions contemplated hereby will not result in the violation of any of the terms and provisions of any law applicable to, or the constating documents of, the Purchaser or of any agreement, written or oral, to which the Purchaser may be a part or by which he is or may be bound;

(s) this Agreement has been duly executed and delivered by the Purchaser and constitutes a legal, valid and binding agreement of the Purchaser enforceable against the Purchaser;

(t) the Purchaser has been independently advised as to the applicable hold period imposed in respect of the Shares by securities legislation in the jurisdiction in which the Purchaser resides and confirms that no representation has been made respecting the applicable hold periods for the Shares and is aware of the risks and other characteristics of the Shares and of the fact that the Purchaser may not be able to resell the Shares except in accordance with the applicable securities legislation and regulatory policies;

(u) the Purchaser, and any beneficial purchaser for whom the Purchaser is acting, is resident in the province or jurisdiction set out on the cover page of this Agreement;

(v) the Purchaser is capable of assessing the proposed investment as a result of the Purchaser’s financial experience or as a result of advice received from a registered person other than the Issuer or any affiliates thereof;

(w) if required by applicable securities legislation, policy or order or by any securities commission, stock exchange or other regulatory authority, the Purchaser will execute, deliver, file and otherwise assist the Issuer in filing, such reports, undertakings and other documents with respect to the issue of the Shares as may be required;

(x) the Purchaser acknowledges that the offering of securities under this Private Placement is restricted to purchasers in Canada that are resident in British Columbia and Alberta only, and in such other jurisdictions outside of Canada and the United States, where such securities may be lawfully offered for sale; and

(y) the Purchaser agrees that the above representations, warranties and covenants in this subsection will be true and correct both as of the execution of this subscription and as of the Closing Date.

4.2 The foregoing representations, warranties and covenants are made by the Purchaser with the intent that they be relied upon by the Issuer in determining its suitability as a purchaser of Shares, and the Purchaser hereby agrees to indemnify the Issuer against all losses, claims, costs, expenses and damages or liabilities which any of them may suffer or incur as a result of reliance thereon. The Purchaser undertakes to notify the Issuer immediately of any change in any representation, warranty or other information relating to the Purchaser set forth herein which takes place prior to the Closing.

4.3 The Issuer represents and warrants that, as of the date given above and at the Closing:

(a) the Issuer and its subsidiaries, if any, are valid and subsisting corporations duly incorporated and in good standing under the laws of the jurisdiction in which they are incorporated, continued or amalgamated;

(b) the Issuer and its subsidiaries, if any, are duly registered and licenced to carry on business in the jurisdictions in which they carry on business or own property where required under the laws of that jurisdiction;

(c) the authorized and issued capital of the Issuer is as disclosed to the Purchaser, and the outstanding shares of the Issuer are fully paid and non-assessable;

(d) the Issuer will reserve or set aside sufficient shares in its treasury to issue the Shares and such common shares, on receipt of full payment therefor, will be duly and validly issued as fully paid and non-assessable;

(e) except as qualified by the disclosure in all prospectuses, filing statements and press releases filed with the Commissions (the “Disclosure Record”), the Issuer is the beneficial owner of the properties, business and assets or the interests in the properties, business or assets referred to in the Disclosure Record, all agreements by which the Issuer holds an interest in a property, business or assets are in good standing according to their terms, and the properties are in good standing under the applicable laws of the jurisdictions in which they are situated;

(f) the Disclosure Record, subscription form and all other written or oral representations made by the Issuer to the Purchaser in connection with the Private Placement is and will be accurate in all material respects and does and will omit no fact, the omission of which does or will make such representations misleading or incorrect;

(g) the financial statements most recently filed with the Commissions have been prepared in accordance with Canadian generally accepted accounting principles, accurately reflect the financial position and all material liabilities (accrued, absolute, contingent or otherwise) of the Issuer as of the date thereof, and no adverse material changes in the financial position of the Issuer have taken place since the date thereof, save in the ordinary course of the Issuer’s business;

(h) the Issuer has complied and will comply fully with the requirements of all applicable corporate and securities laws and administrative policies and directions, including, without limitation, the Applicable Legislation in relation to the issue and trading of its securities and in all matters relating to the Private Placement;

(i) there is not presently any material change, as defined in the Applicable Legislation, relating to the Issuer or change in any material fact, as defined in the Applicable Legislation, relating to any of the Shares which has not been or will not be fully disclosed in accordance with the requirements of the Applicable Legislation;

(j) the issue and sale of the Shares by the Issuer does not and will not conflict with, and does not and will not result in a breach of, any of the terms of the Issuer’s incorporating documents or any agreement or instrument to which the Issuer is a party;

(k) neither the Issuer nor any of its subsidiaries is a party to any actions, suits or proceedings which could materially affect its business or financial condition, and to the best of the Issuer’s knowledge no such actions, suits or proceedings are contemplated or have been threatened except as disclosed in the Disclosure Record;

(l) there are no judgments against the Issuer or any of its subsidiaries, if any, which are unsatisfied, nor are there any consent decrees or injunctions to which the Issuer or any of its subsidiaries, if any, is subject;

(m) this Agreement has been or will be by the Closing, duly authorized by all necessary corporate action on the part of the Issuer, and the Issuer has full corporate power and authority to undertake the Private Placement;

(n) the Issuer is not in default of any of the requirements of the Applicable Legislation or any of the administrative policies or notices of the Commissions;

(o) no order ceasing or suspending trading in securities of the Issuer nor prohibiting the sale of such securities has been issued to and is outstanding against the Issuer or its directors, officers or promoters or against any other companies that have common directors, officers or promoters and no investigations or proceedings for such purposes are pending or threatened;

(p) the Issuer satisfies and will satisfy all necessary requirements under the Exemptions in order to permit the sale of the Shares to Purchasers who are qualified to purchase the Shares under the Exemptions, pursuant to this Private Placement; and

(q) the Issuer has not issued during the preceding 12-month period and is not concurrently issuing any security or securities to more than 24 purchasers, including the purchasers who will purchase under the Private Placement, under the Exemption at section 128(h) of the B.C. Rules.

4.4 The representations and warranties contained in this Section will survive the Closing.

4.5 The Purchaser hereby acknowledges that all warranties, conditions, representations or stipulations, whether express or implied and whether arising hereunder or under prior agreement or statement or by statute or at common law are expressly those of the Issuer. The Purchaser acknowledges that no information or representation concerning the Issuer has been provided to the Purchaser by the Issuer other than those contained in this Agreement and the Disclosure Record and that the Purchaser is relying entirely upon this Agreement and the Disclosure Record.

5.     CLOSING

5.1 The Closing will take place within fifteen business days after receipt by the Issuer of final approval of the Private Placement by the Exchange. The Purchaser acknowledges that, although Shares may be issued to other purchasers under the Private Placement concurrently with the Closing, there may be other sales of Shares under the Private Placement, some or all of which may close after the Closing. The Purchaser further acknowledges that there is a risk that insufficient funds may be raised on the Closing to fund the Issuer’s objectives and that further closings may not take place after the Closing.

5.2 The Purchaser will deliver to the Issuer this subscription agreement, duly executed, and payment in full for the total price of the Shares to be purchased by the Purchaser.

5.3 At Closing, the Issuer will deliver to the Purchaser the certificates representing the Shares purchased by the Purchaser registered in the name of the Purchaser or its nominee.

5.4 The Purchaser will also deliver to the Issuer, along with this Subscription Agreement:

(a) a fully executed a BCF #45-903F1 or BCF #45-903F2, attached hereto as either Appendix IIA (if the Purchaser is an individual) or Appendix IIB (if the Purchaser is not an individual), whichever is applicable to the Purchaser, if required under the applicable Exemption;

(b) if the Purchaser is not an individual, a fully executed Corporate Placee Registration Form (the “Form”) as set out in Appendix I(A), unless the Form is already on file with the Exchange and the Exchange has been advised of any changes in the information provided in the Form, prior to the Purchaser participating in the Private Placement;

(c) if the Purchaser is a “portfolio manager”, a fully executed additional undertaking and certification in the form set out in Appendix I(B); and

(d) if the Purchaser is relying on the exemption contained in British Columbia Instrument #72-503, a fully executed acknowledgement in the form attached as Exhibit I to this Appendix III.

5.5 If the Closing does not occur within 180 days after the date of execution of this Subscription Agreement, this Subscription Agreement may be terminated by either party by delivering notice of termination to the other, and the Issuer shall return the Subscription Funds to the Purchaser. The obligation of the Issuer to repay the loan will be cancelled upon the occurrence of the Closing and delivery by the Issuer of the certificate(s) representing the Shares to the Purchaser.

6.     HOLD PERIOD

6.1 The Purchaser acknowledges that the Shares will be subject to restrictions on resale until such time as the earlier to occur of:

             (a) a period of four months has elapsed from the date of issue of the Shares; or

             (b) an appropriate discretionary order is obtained pursuant to applicable securities laws.

6.2 The certificates representing the Shares will bear a legend denoting the restrictions on transfer imposed by the Applicable Legislation and by the policies of the Exchange. The Purchaser agrees to sell, assign or transfer the Shares only in accordance with the requirements of applicable securities laws and such legends.

7.     MISCELLANEOUS

7.1 The Purchaser hereby authorizes the Issuer to correct any minor errors in, or complete any minor information missing from the Corporate Placee Registration Form (Appendix I(A)), Portfolio Manager: Additional Undertaking and Certification (Appendix I(B)), BCF #45-903F1 (Appendix (IIA)) or BCF #45-903F2 (Appendix II(B)), which has been executed by the Purchaser and delivered to the Issuer.

7.2 The Issuer will be entitled to rely on delivery by facsimile machine of an executed copy of this subscription, and acceptance by the Issuer of such facsimile copy will be equally effective to create a valid and binding agreement between the Purchaser and the Issuer in accordance with the terms hereof.

7.3 This agreement is not assignable or transferable by the parties hereto without the express written consent of the other party hereto.

7.4 Time is of the essence of this Agreement and will be calculated in accordance with the provisions of the Interpretation Act (British Columbia).

7.5 Except as expressly provided in this Agreement and in the agreements, instruments and other documents contemplated or provided for herein, this Agreement contains the entire agreement between the parties with respect to the Shares and there are no other terms, conditions, representations or warranties whether expressed, implied, oral or written, by statute, by common law, by the Issuer, or by anyone else.

7.6 The parties to this Agreement may amend this Agreement only in writing.

7.7 This Agreement enures to the benefit of and is binding upon the parties to this Agreement and their successors and permitted assigns.

7.8 A party to this Agreement will give all notices to or other written communications with the other party to this Agreement concerning this Agreement by hand or by registered mail addressed to the address given above.

7.9 This Agreement is to be read with all changes in gender or number as required by the context.

7.10 This Agreement will be governed by and construed in accordance with the laws of British Columbia, and the parties hereto irrevocably attorn and submit to the jurisdiction of the courts of British Columbia with respect to any dispute related to this Agreement.

END OF APPENDIX III

EXHIBIT I

Additional Acknowledgements, Representations, and Warranties
of the Purchaser for use of British Columbia Instrument #72-503 Exemption

The Purchaser acknowledges, represents, certifies and warrants as at the date of execution of the subscription agreement of the Purchaser and at the closing of the Offering of common shares (the “Securities”) of Canplats Resources Corporation (the Issuer), that:

(a) no prospectus has been filed by the Issuer with the British Columbia Securities Commission in connection with the issuance of the Securities, the issuance is exempted from the prospectus requirement of the Securities Act (British Columbia) (the “Act”) or any regulations (the “Regulations”) promulgated under the Act and that:

(i) the Purchaser is restricted from using most of the civil remedies available under the Act and Regulations;

(ii) the Purchaser may not receive information that would otherwise be required to be provided to the Purchaser under the Act and the Regulations; and

(iii) the Issuer is relieved from certain obligations that would otherwise apply under the Act and the Regulations;

(b)     the Purchaser is not a resident of British Columbia and that:

(i) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities;

(ii) there is no government or other insurance covering the Securities;

(iii) there are risks associated with the purchase of the Securities;

(iv) there are restrictions on the Purchaser’s ability to resell the Securities and it is the responsibility of the Purchaser to find out what those restrictions are and to comply with them before selling the Securities; and

(v) from the requirements to provide the Purchaser with a prospectus and to sell securities through a person registered to sell securities under the Act and, as a consequence of acquiring securities pursuant to this exemption, certain protections, rights and remedies provided by the Act, including statutory rights of rescission or damages, will not be available to the Purchaser;

(c) the Purchaser is purchasing the Securities as principal and no other person, corporation, firm or other organization will have the beneficial interest in the Securities;

EX-99.002

PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT

THIS AGREEMENT dated for reference this 13th day of March, 2002

BETWEEN

R.E. Gordon Davis
5555 Newton Wynd
Vancouver, B.C.
V6G 1H6

(the “Purchaser”);

AND

CANPLATS RESOURCES CORPORATION, Suite 1180,
999 West Hastings Street, Vancouver, British Columbia, V6C 2W2

(the “Issuer”).

Subject and pursuant to the terms set out in Appendix III attached hereto, the Purchaser hereby irrevocably subscribes for, and on Closing will purchase from the Issuer, the following securities at the following price:

75,000      Common Shares;
$0.15        per Common Share for a total purchase price of $11,250.

NUMBER OF SECURITIES IN THE ISSUER HELD EITHER DIRECTLY OR INDIRECTLY:

        621,500 common shares .
_____________________________________________________________

The Purchaser hereby directs the Issuer to issue, register and deliver the certificates representing the Common Shares as follows:

Registration Instructions:	Delivery Instructions:
__________________________	__________________________
Name to appear on certificate	Name and account reference, if applicable
R.E. Gordon Davis
__________________________	__________________________
Account reference, if applicable	Contact Name
__________________________	__________________________
Address	Address
5555 Newton Wynd
Vancouver, B.C     V6G 1H6
__________________________	__________________________
	(Telephone Number)

EXECUTED by the Purchaser this 5th day of April, 2002.

WITNESS:	EXECUTION BY PURCHASER:
"Linda J. Sue"	"R.E. Gordon Davis"
__________________________	__________________________
Signature of Witness	Signature of individual (if Purchaser is an individual)
__________________________	__________________________
Name of Witness	Authorized Signatory (if Purchaser is not an individual)
__________________________	__________________________
Address of Witness	Name of Purchaser (please print)
__________________________	__________________________
	Name of Authorized Signatory (please print)
	__________________________
	Address of Purchaser (residence if an individual)
	__________________________

ACCEPTED this 9th day of April, 2002.
CANPLATS RESOURCES CORPORATION
Per:
"R.A. Mitchell"
_______________________________
Authorized Signatory

APPENDIX 1 (A)

FORM 4D1

CORPORATE PLACEE REGISTRATION FORM

Where subscribers to a private placement are not individuals, the following information about the placee must be provided. This Form will remain on file with the Exchange. The corporation, trust, portfolio manager or other entity (the “Placee”) need only file it once, and it will be referenced for all subsequent private placements in which it participates. If any of the information provided in this Form changes, the Placee must notify the Exchange prior to participating in further placements with Exchange listed companies.

1.     Name of Placee:

2.     Address of Placee’s Head Office:

3.     Jurisdiction of Incorporation or Creation:

4. If the Placee will be purchasing securities as principal, but not as a portfolio manager, please check the box and include the names and addresses of persons having a greater than 10% beneficial interest in the Placee:   

5. The undersigned acknowledges that it is bound by the provisions of applicable Securities Law, including provisions concerning the filing of insider reports and reports of acquisitions (See for example, sections 87 and 111 of the Securities Act (British Columbia) and sections 141 and 147 of the Securities Act (Alberta).

6. For Placees which are portfolio managers or trusts purchasing pursuant to an exemption from the prospectus requirements prescribed by British Columbia Securities Law and are required pursuant to the applicable exemption to be purchasing as agent for accounts that are fully managed by it, please check the box and complete the Additional Undertaking and Certification in Form 4D2.  

Dated at ______________________ on _________________________________.

           _________________________________________

           (Name of Purchaser — please print)

           _________________________________________

           (Authorized Signature)

           _________________________________________

           (Official Capacity — please print)

           _________________________________________

(please print name of individual whose
signature appears above, if different
from name of purchaser printed above)

THIS IS A PUBLIC DOCUMENT

APPENDIX 1 (B)

FORM 4D2

Portfolio Manager:

Additional Undertaking and Certification

If the undersigned is a portfolio manager purchasing as agent for accounts that are fully managed by it, pursuant to an exemption from the prospectus requirements prescribed by British Columbia Securities Law, the undersigned acknowledges that it is bound by the provisions of the Securities Act (British Columbia) (the “Act”), and undertakes to comply with all provisions of the Act relating to ownership of, and trading in, securities including, without limitation, the filing of insider reports and reports pursuant to Section 111 of the Act. If any of the information provided in this Form changes, the portfolio manager undertakes to notify the Exchange prior to participating in further private placements with Exchange listed companies.

If the undersigned carries on business as a portfolio manager in a jurisdiction outside of Canada, the undersigned certifies that:

a) it is purchasing securities of the Issuer on behalf of managed accounts for which it is making the investment decision to purchase the securities and has full discretion to purchase or sell securities for such accounts without requiring the client’s express consent to a transaction;

b) it carries on the business of managing the investment portfolios of clients through discretionary authority granted by those clients (a “portfolio manager” business) in [jurisdiction], and it is permitted by law to carry on a portfolio manager business in that jurisdiction;

c) it was not created solely or primarily for the purpose of purchasing securities of the Issuer;

d) the total asset value of the investment portfolios it manages on behalf of clients is not less than $20,000,000; and

e) it has no reasonable grounds to believe, that any of the directors, senior officers and other insiders of the Issuer, and the persons that carry on investor relations activities for the Issuer has a beneficial interest in any of the managed accounts for which it is purchasing.

Dated at________________________on ____________________________.

           _________________________________________

           (Name of Purchaser — please print)

           _________________________________________

           (Authorized Signature)

           _________________________________________

           (Official Capacity — please print)

           _________________________________________

(please print name of individual whose
signature appears above, if different
from name of purchaser printed above)

APPENDIX II A

This is the form required under section 135 of the Securities Rules or, where required, under an order issued under section 76 of the Securities Act.

BCF #45-903F1

(formerly, Form 20A(IP))

Securities Act

ACKNOWLEDGMENT OF INDIVIDUAL PURCHASER

1. I have agreed to purchase from CANPLATS RESOURCES CORPORATION (the “Issuer”) 75,000 common shares (the “Securities”) of the Issuer.

2. I am purchasing the Securities as principal and, on closing of the agreement of purchase and sale, I will be the beneficial owner of the Securities.

3. I [circle one] have/have not received an offering memorandum describing the Issuer and the Securities.

4. I acknowledge that:

(a) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities, AND

(b) there is no government or other insurance covering the Securities, AND

(c) I may lose all of my investment, AND

(d) there are restrictions on my ability to resell the Securities and it is my responsibility to find out what those restrictions are and to comply with them before selling the Securities, AND

(e) I will not receive a prospectus that the British Columbia Securities Act (the “Act”) would otherwise require to be given to me because the Issuer has advised me that it is relying on a prospectus exemption, AND

(f) because I am not purchasing the Securities under a prospectus, I will not have the civil remedies that would otherwise be available to me, AND

(g) the Issuer has advised me that it is using an exemption from the requirement to sell through a dealer registered under the Act, except purchases referred to in paragraph 5(g), and as a result I do not have the benefit of any protection that might have been available to me by having a dealer act on my behalf.

5.     I also acknowledge that: [circle one]

(a) I am purchasing Securities that have an aggregate acquisition cost of $97,000 or more, OR

(b) my net worth, or my net worth jointly with my spouse at the date of the agreement of purchase and sale of the security, is not less than $400,000, OR

(c) my annual net income before tax is not less than $75,000, or my annual net income before tax jointly with my spouse is not less than $125,000, in each of the two most recent calendar years, and I reasonably expect to have annual net income before tax of not less than $75,000 or annual net income before tax jointly with my spouse of not less than $125,000 in the current calendar year, OR

(d) I am registered under the Act, OR

(e) I am a spouse, parent, brother, sister or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer, OR

(f) I am a close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer, OR

(g) I am purchasing securities under section 128(c) ($25,000 — registrant required) of the Rules, and I have spoken to a person_____________________________ [Name of Registered Person] (the “Registered Person”) who has advised me that the Registered Person is registered to trade or advise in the Securities and that the purchase of the Securities is a suitable investment for me.

6. If I am an individual referred to in paragraph 5(b), 5(c), or 5(d), I acknowledge that, on the basis of information about the Securities furnished by the Issuer, I am able to evaluate the risks and merits of the Securities because: [circle one]

(a) of my financial, business or investment experience, OR

(b) I have received advice from a person ______________________________ [Name of adviser] (the “Adviser”) who has advised me that the Adviser is:

(i) registered to advise, or exempted from the requirement to be registered to advise, in respect of the Securities, and

(ii) not an insider of, or in a special relationship with, the Issuer.

The statements made in this report are true.

DATED the_______________________day of April, 2002.

Signature of Purchaser

R.E. Gordon Davis

Name of Purchaser

5555 Newton Wynd

Vancouver, B.C   V6G 1H6

Address of Purchaser

APPENDIX II B

This is the form required under section 135 of the Rules and, if applicable, by an order issued under section 76 of the Securities Act.

BCF 45-903F2

(Formerly, Form 20A (NIP))

Securities Act

Acknowledgment of Purchaser that is not an individual

1.     I have agreed to purchase from CANPLATS RESOURCES CORPORATION (the “Issuer”) __________________________________ common shares (the "Securities") of the Issuer.

2. The Purchaser is purchasing the Securities as principal, or is a trust Issuer, insurer or portfolio manager acting on behalf of fully managed accounts and is deemed to be purchasing as principal under section 74(1) of the British Columbia Securities Act (the “Act”).

3. On closing of the agreement of purchase and sale, the Purchaser will be the beneficial owner of the Securities, except where the Purchaser is a trust Issuer, insurer or portfolio manager acting on behalf of fully managed accounts under section 74(1) of the Act.

4. The Purchaser [circle one] has/has not received an offering memorandum describing the Issuer and the Securities.

5. The Purchaser acknowledges that:

(a) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities, AND

(b) there is no government or other insurance covering the Securities, AND

(c) the Purchaser may lose all of its investment, AND

(d) there are restrictions on the Purchaser’s ability to resell the Securities and it is the responsibility of the Purchaser to find out what those restrictions are and to comply with them before selling the Securities, AND

(e) the Purchaser will not receive a prospectus that the Act would otherwise require be given to the Purchaser because the Issuer has advised the Purchaser that the Issuer is relying on a prospectus exemption, AND

(f) because the Purchaser is not purchasing the Securities under a prospectus, the Purchaser will not have the civil remedies that would otherwise be available to the Purchaser, AND

(g) the Issuer has advised the Purchaser that the Issuer is using an exemption from the requirement to sell through a dealer registered under the Act, except purchases referred to in paragraph 6(b), and as a result the Purchaser does not have the benefit of any protection that might have been available to the Purchaser by having a dealer act on the Purchaser’s behalf.

6.     The Purchaser acknowledges that:

(a) it is a “sophisticated purchaser” as described in paragraph 2 in the attached Appendix A [circle the applicable subparagraph in paragraph 2 in Appendix A]; OR

(b) the Securities were purchased under section 128(c) ($25,000 — registrant required) of the Rules and an authorized signatory of the Purchaser has spoken to a person [Name of Registered Person] (the “Registered Person”) who has advised the authorized signatory that the Registered Person is registered to trade or advise in the Securities and that the purchase of the Securities is a suitable investment for the Purchaser; OR

(c) the Purchaser is a corporation, all the voting securities of which are beneficially owned by one or more of:

(i) a close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer, OR

(ii) a senior officer or director of the Issuer, or of an affiliate of the Issuer , OR

(iii) a spouse, parent, brother, sister, or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer.

7. If the Purchaser is referred to in paragraph 6(a), the Purchaser acknowledges that, on the basis of information about the Securities furnished by the Issuer, the Purchaser is able to evaluate the risks and merits of the Securities because: [circle one]

(a) of the financial, business or investment experience of the Purchaser, OR

(b) the Purchaser has received advice from a person [Name of adviser](the “Adviser”) who has advised the Purchaser that the Adviser is:

(i) registered to advise, or exempted from the requirement to be registered to advise, in respect of the Securities, AND

(ii) not an insider of, or in a special relationship with, the Issuer.

The statements made in this report are true.

DATED the ________________ day of ____________________________, 2002.

Signature of Authorized Signatory of Purchaser

Name and Office of Authorized Signatory of Purchaser

Name of Purchaser

Address of Purchaser

Please turn to Appendix A, which is attached to and forms a part of this BCF #45-903F2.

APPENDIX A TO BCF #45-903F2

[Circle the applicable subparagraph in paragraph 2.]

“Sophisticated purchaser” means a purchaser that, in connection with a distribution, gives an acknowledgment under section 135 of the Rules to the Issuer, where the Issuer does not believe, and has no reasonable grounds to believe, that the acknowledgment is false, acknowledging both that:

1. the purchaser is able, on the basis of information about the investment furnished by the Issuer, to evaluate the risks and merits of the prospective investment because of:

(a) the purchaser’s financial, business or investment experience, OR

(b) advice the purchaser receives from a person who is registered to advise, or is exempted from the requirement to be registered to advise, in respect of the security that is the subject of the trade (the “Security”) and who is not an insider of, or in a special relationship with, the Issuer of the Security; AND

2.     the purchaser is one of the following [circle one]:

    (a)        a person registered under the Securities Act, OR

    (b)        an individual who:

(i) has a net worth, or net worth jointly with the individual’s spouse, at the date of the agreement of purchase and sale of the Security, of not less than $400,000, OR

(ii) has had in each of the 2 most recent calendar years, and reasonably expects to have in the current calendar year:

- annual net income before tax of not less than $75,000, OR

- annual net income before tax, jointly with the individual's spouse, of not less than $125,000; OR

    (c)        a corporation, partnership or trust that:

(i) has net assets of not less than $400,000, OR

(ii); has had in each of the 2 most recent calendar years, and reasonably expects to have in the current calendar year, net income before tax of not less than $125,000, OR

(d) a corporation in which all of the voting shares are beneficially owned by sophisticated purchasers or of which the majority of the directors are sophisticated purchasers, OR

(e) a general partnership in which all of the partners are sophisticated purchasers, OR

(f) a limited partnership in which a majority of the general partners are sophisticated purchasers, OR

(g) a trust in which all of the beneficiaries are sophisticated purchasers or the majority of the trustees are sophisticated purchasers.

APPENDIX III

THE PARTIES to this Agreement therefore agree:

1.     PURCHASE AND SALE OF COMMON SHARES

On the Closing, the Purchaser will purchase from the Issuer 75,000 common shares at a price of $0.15 per common share and the Issuer will deliver to the Purchaser certificates representing the common shares.

2.     DEFINITIONS

2.1     In this Agreement, which includes the cover page and all of the Appendices, the following words have the following meanings unless otherwise indicated:

(a)	“1933 Act” means the Securities Act of 1933 (United States of America), as amended;
(b)	“Alberta Act” means the Securities Act, (Alberta) S.A. 1981, c. S-6.1, as amended;
(c)	“Alberta Commission” means the Alberta Securities Commission;
(d)	“Alberta Rules” means the rules made under the Alberta Act;
(e)	“Applicable Legislation” means the B.C. Act and the Alberta Act, together with the regulations and rules made and promulgated thereunder and all administrative policy statements, blanket orders and rulings, notices, and other administrative directions issued by the Commissions;
(f)	“B.C. Act” means the Securities Act, (British Columbia) R.S.B.C. 1996, as amended; (g) (h) “B.C. Rules” means the rules made under the B.C. Act;
(g)	“B. C. Commission” means the British Columbia Securities Commission;
(h)	“B.C. Rules” means the rules made under the B.C. Act;
(i)	“Closing” means the closing of the purchase and sale of the Shares under this Subscription Agreement;
(j)	“Closing Date” means the day the Shares are issued to the Purchaser;
(k)	“Commissions” means the B.C. Commission and Alberta Commission;
(l)	“Exchange” means the Canadian Venture Exchange Inc.;
(m)	“Exemptions” means the exemptions from the prospectus requirements under sections 74(2)(4) and 74(2)(9) of the B.C. Act, section 128(h) of the B.C. Rules, British Columbia Instrument #72-503 and sections 107(1)(d) and (z) of the Alberta Act;
(n)	“Private Placement” means the offering of the Shares;
(o)	“Purchaser” means the person named as “Purchaser” in this Subscription Agreement and wherever Purchaser is used in the plural, it shall connote all persons who are a “Purchaser” under this form of Subscription agreement and who subscribe for Shares under the Offering;
(p)	“Purchaser’s Subscription Funds” means the amount subscribed for by the Purchaser under the Offering;
(q)	“Regulation S” means Regulation S promulgated under the 1933 Act; and
(r)	(r) “Shares” means the common shares in the share capital of the Issuer, as presently constituted, to be issued under the Offering.

2.2    In this Agreement, the following terms have the meanings defined in Regulation "S": "Directed Selling Efforts", "Foreign Issuer", "Substantial U.S. Market Interest", "U.S. Person" and "United States".

3.     PURCHASE AND SALE OF COMMON SHARES

3.1     The Purchaser, as principal, hereby subscribes for and agrees to purchase that number of Shares indicated on the Agreement to which this Appendix III is attached at a price of $0.15 (Cdn.) per Share, for that aggregate purchase price indicated on the Agreement to which this Appendix III is attached (the “Subscription Funds”).

3.2     The Purchaser shall pay the Subscription Funds to the Issuer on the date of execution of this Agreement (the “Payment Date”).

3.3     This Agreement, when executed by the Purchaser and delivered to the Issuer, will constitute a subscription for the Shares which will not be binding on the Issuer until accepted by the Issuer by executing the Agreement in the space provided above.

3.4     Within 15 business days of receipt by the Issuer of final approval by the Exchange of the Private Placement, the Private Placement shall close (the “Closing”) by the issuance of certificates for the Shares 3.5     The issue of the Shares will not restrict or prevent the Issuer from obtaining any other financing or from issuing additional securities or rights.

3.5     The issue of the Shares will not restrict or prevent the Issuer from obtaining any other financing or from issuing additional securities or rights.

4.     WARRANTIES AND DISCLAIMER

4.1     The Purchaser acknowledges, represents, warrants and covenants to and with the Issuer that, as at the date given above and at the Closing:

(a) no prospectus has been filed by the Issuer with the Commission in connection with the issuance of the Shares, the issuance is exempted from the prospectus requirements of the Applicable Legislation and that:

(i) the Purchaser is restricted from using most of the civil remedies available under the Applicable Legislation;

(ii) the Purchaser may not receive information that would otherwise be required to be provided to him under the Applicable Legislation; and

(iii) the Issuer is relieved from certain obligations that would otherwise apply under the Applicable Legislation;

(b) the Purchaser, wherever resident, is:

(i) purchasing sufficient Shares so that the aggregate acquisition cost of the Shares to the Purchaser is not less than $97,000, the Purchaser is not a corporation, partnership, trust, fund, association, or any other organized group of persons created solely, or used primarily, to permit the purchase of the Shares (or other similar purchases) by a group of individuals whose individual share of the aggregate acquisition cost of the Shares is less than $97,000, and the Purchaser is either:

(A) purchasing the Shares as principal and no other person, corporation, firm or other organization will have a beneficial interest in the Shares; or

(B)         if not purchasing the Shares as principal, is

(I) duly authorized to enter into this subscription and to execute all documentation in connection with the purchase on behalf of each beneficial purchaser, it being acknowledged that the Issuer may in the future be required by law to disclose on a confidential basis to securities regulatory authorities the identity of each beneficial purchaser of Shares for whom the Purchaser may be acting; and is

(a) a trust company, insurance company or financial institution that has been authorized to do business under the Financial Institutions Act (British Columbia);

(b) an adviser who manages the investment portfolio of clients through discretionary authority granted by one or more clients and who is registered as a portfolio manager under the B.C. Act or is exempt from such registration;

(c) a trust company or insurer, authorized under the laws of a province or territory of Canada other than British Columbia to carry on business in such province or territory; or

(d) a portfolio manager registered or exempt from registration under the laws of a province or territory of Canada, other than British Columbia, or a jurisdiction other than Canada and has provided the Issuer with an additional undertaking and certification in the form set out in Appendix I(B);

  and it is purchasing the Shares as an agent or trustee for accounts that are fully managed by it, and the aggregate acquisition cost of the Shares purchased for all the accounts managed by it is not less than $97,000; or

(II) is acting as agent for one or more disclosed principals, each of which principals is purchasing as a principal for its own account, not for the benefit of any other person, and not with a view to the resale or distribution of all or any of the Shares and each of which principals complies with subsection 4.1(b)(i) hereof; and

and if the Purchaser is an individual, the Purchaser has executed, prior to the execution of this Agreement, and delivered to the Issuer, a BCF #45-903F1 attached hereto as Appendix II(A);

OR

    (ii)        purchasing as principal and the Purchaser is:

(A) an employee, senior officer or director of the Issuer or of an affiliate of the Issuer and the Purchaser has not been induced to make this subscription by expectation of employment or continued employment; or

(B) a trustee on behalf of a person referred to in subparagraph (ii)(A) above; or

(C) an issuer all the voting securities of which are beneficially owned by one or more of the persons referred to in subparagraph (ii)(A) above;

OR

    (iii)        purchasing as principal and the Purchaser:

(A) is a spouse, parent, brother, sister, child or close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer; or

(B) is a company, all the voting securities of which are beneficially owned by one or more of a senior officer or director of the Issuer, or of an affiliate of the Issuer, or a spouse, parent, brother, sister, child or close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer; and

(C) the Purchaser has executed, prior to the execution of this Agreement, and delivered to the Issuer a BCF #45-903F1 or BCF #45-903F2, as applicable, attached hereto as Appendix II(A) (if the Purchaser is an individual) or Appendix II(B) (if the Purchaser is not an individual), respectively; or

OR

(iv) purchasing Shares under British Columbia Instrument #72-503 and the Purchaser has executed and delivered to the Issuer, the additional acknowledgements, representations and warranties set out in Exhibit I to this Appendix III; or

OR

(v) the Purchaser is the Business Development Bank of Canada, a bank, credit union, trust company or extra-provincial trust corporation authorized to carry on business under the Financial Institutions Act (British Columbia), a corporation that is a subsidiary of a bank and to which the Loan Companies Act (Canada) applies, the B.C. Community Financial Services Corporation established under the Community Financial Services Act (British Columbia), and insurance company or an extra-provincial insurance corporation licensed to do business under the Financial Institutions Act (British Columbia), a subsidiary wholly owned (except for voting securities required by law to be owned by directors of that subsidiary) of any of the foregoing, the government of Canada or a province, or a municipal corporation, public board or commission in Canada;

OR

(vi) the Purchaser is purchasing as principal, is not an individual and is designated as an exempt purchaser in an order made by the Executive Director of the B.C. Commission.

    (c)        the Purchaser, if resident in Alberta, is:

(i) purchasing as principal sufficient Shares so that the aggregate acquisition cost of the Shares to the Purchaser is not less than $97,000, the Purchaser is not a corporation, partnership, trust, fund, association, or any other organized group of persons created solely, or used primarily, to permit the purchase of the Shares (or other similar purchases) by a group of individuals whose individual share of the aggregate acquisition cost of the Shares is less than $97,000; or

(ii) is purchasing as principal and is:

(A) a senior officer or director of the Issuer; or

(B) a senior officer or director of an affiliate of the Issuer; or

(C) a spouse, parent, brother, sister or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer; or

(D) a company, all the voting securities of which are beneficially owned by one or more of a senior officer or director of the Issuer, or of an affiliate of the Issuer, or a spouse, parent, brother, sister or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer; or

(E) a close friend or business associate of a promoter of the Issuer, or a company all the voting securities of which are beneficially owned by a single close friend or single business associate of a promoter of the Issuer;

    (d)        the Purchaser has not received a copy of an offering memorandum;

    (e)        to the best of the Purchaser’s knowledge, the Shares were not advertised;

    (f)        no person has made to the Purchaser any written or oral representations:

    (i)        that any person will resell or repurchase the Shares;

    (ii)        that any person will refund the purchase price of the Shares;

    (iii)        as to the future price or value of any of the Shares;

    (g)        this subscription has not been solicited in any other manner contrary to the Applicable Legislation or the 1933 Act;

(h) the Purchaser is not a “control person” of the Issuer as defined in the Applicable Legislation, will not become a “control person” by virtue of this purchase of any of the Shares, and does not intend to act in concert with any other person to form a control group of the Issuer;

(i) the offer was not made to the Purchaser when he was in the United States and at the time the Purchaser’s buy order was made, the Purchaser was outside the United States;

(j) the Purchaser is at arm’s length with the Issuer, unless the Issuer is advised to the contrary prior to the Closing;

(k) the Purchaser acknowledges that the Shares have not been registered under the 1933 Act and may not be offered or sold in the United States unless registered under the 1933 Act and the securities laws of all applicable states of the United States or an exemption from such registration requirements is available, and that the Issuer has no obligation or present intention of filing a registration statement under the 1933 Act in respect of the Shares;

(l) the Purchaser is not a U.S. Person;

(m) the Purchaser is not and will not be purchasing Shares for the account or benefit of any U.S. Person;

(n) the Purchaser (or others for whom it is contracting hereunder) has been advised to consult its own legal and tax advisors with respect to applicable resale restrictions and tax considerations, and it (or others for whom it is contracting hereunder) is solely responsible for compliance with applicable resale restrictions and applicable tax legislation;

(o) the Purchaser has no knowledge of a “material fact” or “material change” (as those terms are defined in the Applicable Legislation) in the affairs of the Issuer that has not been generally disclosed to the public, save knowledge of this particular transaction;

(p) the offer made by this subscription is irrevocable (subject to the Purchaser’s right to withdraw his subscription and to terminate his obligations as set out in this Agreement) and requires acceptance by the Issuer;

(q) the Purchaser has the legal capacity and competence to enter into and execute this Agreement and to take all actions required pursuant hereto and, if the Purchaser is a corporation it is duly incorporated and validly subsisting under the laws of its jurisdiction of incorporation and all necessary approvals by its directors, shareholders and others have been given to authorize execution of this Agreement on behalf of the Purchaser;

(r) the entering into of this Agreement and the transactions contemplated hereby will not result in the violation of any of the terms and provisions of any law applicable to, or the constating documents of, the Purchaser or of any agreement, written or oral, to which the Purchaser may be a part or by which he is or may be bound;

(s) this Agreement has been duly executed and delivered by the Purchaser and constitutes a legal, valid and binding agreement of the Purchaser enforceable against the Purchaser;

(t) the Purchaser has been independently advised as to the applicable hold period imposed in respect of the Shares by securities legislation in the jurisdiction in which the Purchaser resides and confirms that no representation has been made respecting the applicable hold periods for the Shares and is aware of the risks and other characteristics of the Shares and of the fact that the Purchaser may not be able to resell the Shares except in accordance with the applicable securities legislation and regulatory policies;

(u) the Purchaser, and any beneficial purchaser for whom the Purchaser is acting, is resident in the province or jurisdiction set out on the cover page of this Agreement;

(v) the Purchaser is capable of assessing the proposed investment as a result of the Purchaser’s financial experience or as a result of advice received from a registered person other than the Issuer or any affiliates thereof;

(w) if required by applicable securities legislation, policy or order or by any securities commission, stock exchange or other regulatory authority, the Purchaser will execute, deliver, file and otherwise assist the Issuer in filing, such reports, undertakings and other documents with respect to the issue of the Shares as may be required;

(x) the Purchaser acknowledges that the offering of securities under this Private Placement is restricted to purchasers in Canada that are resident in British Columbia and Alberta only, and in such other jurisdictions outside of Canada and the United States, where such securities may be lawfully offered for sale; and

(y) the Purchaser agrees that the above representations, warranties and covenants in this subsection will be true and correct both as of the execution of this subscription and as of the Closing Date.

4.2 The foregoing representations, warranties and covenants are made by the Purchaser with the intent that they be relied upon by the Issuer in determining its suitability as a purchaser of Shares, and the Purchaser hereby agrees to indemnify the Issuer against all losses, claims, costs, expenses and damages or liabilities which any of them may suffer or incur as a result of reliance thereon. The Purchaser undertakes to notify the Issuer immediately of any change in any representation, warranty or other information relating to the Purchaser set forth herein which takes place prior to the Closing.

4.3 The Issuer represents and warrants that, as of the date given above and at the Closing:

(a) the Issuer and its subsidiaries, if any, are valid and subsisting corporations duly incorporated and in good standing under the laws of the jurisdiction in which they are incorporated, continued or amalgamated;

(b) the Issuer and its subsidiaries, if any, are duly registered and licenced to carry on business in the jurisdictions in which they carry on business or own property where required under the laws of that jurisdiction;

(c) the authorized and issued capital of the Issuer is as disclosed to the Purchaser, and the outstanding shares of the Issuer are fully paid and non-assessable;

(d) the Issuer will reserve or set aside sufficient shares in its treasury to issue the Shares and such common shares, on receipt of full payment therefor, will be duly and validly issued as fully paid and non-assessable;

(e) except as qualified by the disclosure in all prospectuses, filing statements and press releases filed with the Commissions (the “Disclosure Record”), the Issuer is the beneficial owner of the properties, business and assets or the interests in the properties, business or assets referred to in the Disclosure Record, all agreements by which the Issuer holds an interest in a property, business or assets are in good standing according to their terms, and the properties are in good standing under the applicable laws of the jurisdictions in which they are situated;

(f) the Disclosure Record, subscription form and all other written or oral representations made by the Issuer to the Purchaser in connection with the Private Placement is and will be accurate in all material respects and does and will omit no fact, the omission of which does or will make such representations misleading or incorrect;

(g) the financial statements most recently filed with the Commissions have been prepared in accordance with Canadian generally accepted accounting principles, accurately reflect the financial position and all material liabilities (accrued, absolute, contingent or otherwise) of the Issuer as of the date thereof, and no adverse material changes in the financial position of the Issuer have taken place since the date thereof, save in the ordinary course of the Issuer’s business;

(h) the Issuer has complied and will comply fully with the requirements of all applicable corporate and securities laws and administrative policies and directions, including, without limitation, the Applicable Legislation in relation to the issue and trading of its securities and in all matters relating to the Private Placement;

(i) there is not presently any material change, as defined in the Applicable Legislation, relating to the Issuer or change in any material fact, as defined in the Applicable Legislation, relating to any of the Shares which has not been or will not be fully disclosed in accordance with the requirements of the Applicable Legislation;

(j) the issue and sale of the Shares by the Issuer does not and will not conflict with, and does not and will not result in a breach of, any of the terms of the Issuer’s incorporating documents or any agreement or instrument to which the Issuer is a party;

(k) neither the Issuer nor any of its subsidiaries is a party to any actions, suits or proceedings which could materially affect its business or financial condition, and to the best of the Issuer’s knowledge no such actions, suits or proceedings are contemplated or have been threatened except as disclosed in the Disclosure Record;

(l) there are no judgments against the Issuer or any of its subsidiaries, if any, which are unsatisfied, nor are there any consent decrees or injunctions to which the Issuer or any of its subsidiaries, if any, is subject;

(m) this Agreement has been or will be by the Closing, duly authorized by all necessary corporate action on the part of the Issuer, and the Issuer has full corporate power and authority to undertake the Private Placement;

(n) the Issuer is not in default of any of the requirements of the Applicable Legislation or any of the administrative policies or notices of the Commissions;

(o) no order ceasing or suspending trading in securities of the Issuer nor prohibiting the sale of such securities has been issued to and is outstanding against the Issuer or its directors, officers or promoters or against any other companies that have common directors, officers or promoters and no investigations or proceedings for such purposes are pending or threatened;

(p) the Issuer satisfies and will satisfy all necessary requirements under the Exemptions in order to permit the sale of the Shares to Purchasers who are qualified to purchase the Shares under the Exemptions, pursuant to this Private Placement; and

(q) the Issuer has not issued during the preceding 12-month period and is not concurrently issuing any security or securities to more than 24 purchasers, including the purchasers who will purchase under the Private Placement, under the Exemption at section 128(h) of the B.C. Rules.

4.4 The representations and warranties contained in this Section will survive the Closing.

4.5 The Purchaser hereby acknowledges that all warranties, conditions, representations or stipulations, whether express or implied and whether arising hereunder or under prior agreement or statement or by statute or at common law are expressly those of the Issuer. The Purchaser acknowledges that no information or representation concerning the Issuer has been provided to the Purchaser by the Issuer other than those contained in this Agreement and the Disclosure Record and that the Purchaser is relying entirely upon this Agreement and the Disclosure Record.

5.     CLOSING

5.1 The Closing will take place within fifteen business days after receipt by the Issuer of final approval of the Private Placement by the Exchange. The Purchaser acknowledges that, although Shares may be issued to other purchasers under the Private Placement concurrently with the Closing, there may be other sales of Shares under the Private Placement, some or all of which may close after the Closing. The Purchaser further acknowledges that there is a risk that insufficient funds may be raised on the Closing to fund the Issuer’s objectives and that further closings may not take place after the Closing.

5.2 The Purchaser will deliver to the Issuer this subscription agreement, duly executed, and payment in full for the total price of the Shares to be purchased by the Purchaser.

5.3 At Closing, the Issuer will deliver to the Purchaser the certificates representing the Shares purchased by the Purchaser registered in the name of the Purchaser or its nominee.

5.4 The Purchaser will also deliver to the Issuer, along with this Subscription Agreement:

(a) a fully executed a BCF #45-903F1 or BCF #45-903F2, attached hereto as either Appendix IIA (if the Purchaser is an individual) or Appendix IIB (if the Purchaser is not an individual), whichever is applicable to the Purchaser, if required under the applicable Exemption;

(b) if the Purchaser is not an individual, a fully executed Corporate Placee Registration Form (the “Form”) as set out in Appendix I(A), unless the Form is already on file with the Exchange and the Exchange has been advised of any changes in the information provided in the Form, prior to the Purchaser participating in the Private Placement;

(c) if the Purchaser is a “portfolio manager”, a fully executed additional undertaking and certification in the form set out in Appendix I(B); and

(d) if the Purchaser is relying on the exemption contained in British Columbia Instrument #72-503, a fully executed acknowledgement in the form attached as Exhibit I to this Appendix III.

5.5 If the Closing does not occur within 180 days after the date of execution of this Subscription Agreement, this Subscription Agreement may be terminated by either party by delivering notice of termination to the other, and the Issuer shall return the Subscription Funds to the Purchaser. The obligation of the Issuer to repay the loan will be cancelled upon the occurrence of the Closing and delivery by the Issuer of the certificate(s) representing the Shares to the Purchaser.

6.     HOLD PERIOD

6.1 The Purchaser acknowledges that the Shares will be subject to restrictions on resale until such time as the earlier to occur of:

             (a) a period of four months has elapsed from the date of issue of the Shares; or

             (b) an appropriate discretionary order is obtained pursuant to applicable securities laws.

6.2 The certificates representing the Shares will bear a legend denoting the restrictions on transfer imposed by the Applicable Legislation and by the policies of the Exchange. The Purchaser agrees to sell, assign or transfer the Shares only in accordance with the requirements of applicable securities laws and such legends.

7.     MISCELLANEOUS

7.1 The Purchaser hereby authorizes the Issuer to correct any minor errors in, or complete any minor information missing from the Corporate Placee Registration Form (Appendix I(A)), Portfolio Manager: Additional Undertaking and Certification (Appendix I(B)), BCF #45-903F1 (Appendix (IIA)) or BCF #45-903F2 (Appendix II(B)), which has been executed by the Purchaser and delivered to the Issuer.

7.2 The Issuer will be entitled to rely on delivery by facsimile machine of an executed copy of this subscription, and acceptance by the Issuer of such facsimile copy will be equally effective to create a valid and binding agreement between the Purchaser and the Issuer in accordance with the terms hereof.

7.3 This agreement is not assignable or transferable by the parties hereto without the express written consent of the other party hereto.

7.4 Time is of the essence of this Agreement and will be calculated in accordance with the provisions of the Interpretation Act (British Columbia).

7.5 Except as expressly provided in this Agreement and in the agreements, instruments and other documents contemplated or provided for herein, this Agreement contains the entire agreement between the parties with respect to the Shares and there are no other terms, conditions, representations or warranties whether expressed, implied, oral or written, by statute, by common law, by the Issuer, or by anyone else.

7.6 The parties to this Agreement may amend this Agreement only in writing.

7.7 This Agreement enures to the benefit of and is binding upon the parties to this Agreement and their successors and permitted assigns.

7.8 A party to this Agreement will give all notices to or other written communications with the other party to this Agreement concerning this Agreement by hand or by registered mail addressed to the address given above.

7.9 This Agreement is to be read with all changes in gender or number as required by the context.

7.10 This Agreement will be governed by and construed in accordance with the laws of British Columbia, and the parties hereto irrevocably attorn and submit to the jurisdiction of the courts of British Columbia with respect to any dispute related to this Agreement.

END OF APPENDIX III

EXHIBIT I

Additional Acknowledgements, Representations, and Warranties
of the Purchaser for use of British Columbia Instrument #72-503 Exemption

The Purchaser acknowledges, represents, certifies and warrants as at the date of execution of the subscription agreement of the Purchaser and at the closing of the Offering of common shares (the “Securities”) of Canplats Resources Corporation (the Issuer), that:

(a) no prospectus has been filed by the Issuer with the British Columbia Securities Commission in connection with the issuance of the Securities, the issuance is exempted from the prospectus requirement of the Securities Act (British Columbia) (the “Act”) or any regulations (the “Regulations”) promulgated under the Act and that:

(i) the Purchaser is restricted from using most of the civil remedies available under the Act and Regulations;

(ii) the Purchaser may not receive information that would otherwise be required to be provided to the Purchaser under the Act and the Regulations; and

(iii) the Issuer is relieved from certain obligations that would otherwise apply under the Act and the Regulations;

(b)     the Purchaser is not a resident of British Columbia and that:

(i) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities;

(ii) there is no government or other insurance covering the Securities;

(iii) there are risks associated with the purchase of the Securities;

(iv) there are restrictions on the Purchaser’s ability to resell the Securities and it is the responsibility of the Purchaser to find out what those restrictions are and to comply with them before selling the Securities; and

(v) from the requirements to provide the Purchaser with a prospectus and to sell securities through a person registered to sell securities under the Act and, as a consequence of acquiring securities pursuant to this exemption, certain protections, rights and remedies provided by the Act, including statutory rights of rescission or damages, will not be available to the Purchaser;

(c) the Purchaser is purchasing the Securities as principal and no other person, corporation, firm or other organization will have the beneficial interest in the Securities;

EX-99.003

FLOW-THROUGH SHARES
PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT

THIS AGREEMENT dated for reference this 16th day of July, 2002

BETWEEN

R.E. Gordon Davis
5555 Newton Wynd
Vancouver, B.C.
V6G 1H6

(the “Purchaser”);

AND

CANPLATS RESOURCES CORPORATION, Suite 1180,
999 West Hastings Street, Vancouver, British Columbia, V6C 2W2

(the “Issuer”).

Subject and pursuant to the terms set out in Appendix III attached hereto, the Purchaser hereby irrevocably subscribes for, and on Closing will purchase from the Issuer, the following securities at the following price:

80,000      Flow-Through Shares;
$0.15        per Flow Through Share for a total purchase price of $12,000.

NUMBER OF SECURITIES IN THE ISSUER HELD EITHER DIRECTLY OR INDIRECTLY:

         821,500 common shares .
_____________________________________________________________

The Purchaser hereby directs the Issuer to issue, register and deliver the certificates representing the Flow-Through Shares as follows:

Registration Instructions:	Delivery Instructions:
__________________________	__________________________
Name to appear on certificate	Name and account reference, if applicable
R.E. Gordon Davis
__________________________	__________________________
Account reference, if applicable	Contact Name
__________________________	__________________________
Address	Address
5555 Newton Wynd
Vancouver, B.C     V6G 1H6
__________________________	__________________________
	(Telephone Number)

EXECUTED by the Purchaser this 31st day of July, 2002.

WITNESS:	EXECUTION BY PURCHASER:
"Linda J. Sue"	"R.E. Gordon Davis"
__________________________	__________________________
Signature of Witness	Signature of individual (if Purchaser is an individual)
__________________________	__________________________
Name of Witness	Authorized Signatory (if Purchaser is not an individual)
#1180-999 W. Hastings St. Vancouver, B.C. V6C 2W2
__________________________	__________________________
Address of Witness	Name of Purchaser (please print)
__________________________	__________________________
	Name of Authorized Signatory (please print)
	__________________________
	Address of Purchaser (residence if an individual)
	__________________________

ACCEPTED this 2nd day of August, 2002.
CANPLATS RESOURCES CORPORATION
Per:
"Robert Quartermain"
_______________________________
Authorized Signatory

APPENDIX 1 (A)

FORM 4D1

CORPORATE PLACEE REGISTRATION FORM

Where subscribers to a private placement are not individuals, the following information about the placee must be provided. This Form will remain on file with the Exchange. The corporation, trust, portfolio manager or other entity (the “Placee”) need only file it once, and it will be referenced for all subsequent private placements in which it participates. If any of the information provided in this Form changes, the Placee must notify the Exchange prior to participating in further placements with Exchange listed companies.

1.     Name of Placee:

2.     Address of Placee’s Head Office:

3.     Jurisdiction of Incorporation or Creation:

4. If the Placee will be purchasing securities as principal, but not as a portfolio manager, please check the box and include the names and addresses of persons having a greater than 10% beneficial interest in the Placee:   

5. The undersigned acknowledges that it is bound by the provisions of applicable Securities Law, including provisions concerning the filing of insider reports and reports of acquisitions (See for example, sections 87 and 111 of the Securities Act (British Columbia) and sections 141 and 147 of the Securities Act (Alberta).

6. For Placees which are portfolio managers or trusts purchasing pursuant to an exemption from the prospectus requirements prescribed by British Columbia Securities Law and are required pursuant to the applicable exemption to be purchasing as agent for accounts that are fully managed by it, please check the box and complete the Additional Undertaking and Certification in Form 4D2.  

Dated at ______________________ on _________________________________.

           _________________________________________

           (Name of Purchaser — please print)

           _________________________________________

           (Authorized Signature)

           _________________________________________

           (Official Capacity — please print)

           _________________________________________

(please print name of individual whose
signature appears above, if different
from name of purchaser printed above)

THIS IS A PUBLIC DOCUMENT

APPENDIX 1 (B)

FORM 4D2

Portfolio Manager:

Additional Undertaking and Certification

If the undersigned is a portfolio manager purchasing as agent for accounts that are fully managed by it, pursuant to an exemption from the prospectus requirements prescribed by British Columbia Securities Law, the undersigned acknowledges that it is bound by the provisions of the Securities Act (British Columbia) (the “Act”), and undertakes to comply with all provisions of the Act relating to ownership of, and trading in, securities including, without limitation, the filing of insider reports and reports pursuant to Section 111 of the Act. If any of the information provided in this Form changes, the portfolio manager undertakes to notify the Exchange prior to participating in further private placements with Exchange listed companies.

If the undersigned carries on business as a portfolio manager in a jurisdiction outside of Canada, the undersigned certifies that:

a) it is purchasing securities of the Issuer on behalf of managed accounts for which it is making the investment decision to purchase the securities and has full discretion to purchase or sell securities for such accounts without requiring the client’s express consent to a transaction;

b) it carries on the business of managing the investment portfolios of clients through discretionary authority granted by those clients (a “portfolio manager” business) in [jurisdiction], and it is permitted by law to carry on a portfolio manager business in that jurisdiction;

c) it was not created solely or primarily for the purpose of purchasing securities of the Issuer;

d) the total asset value of the investment portfolios it manages on behalf of clients is not less than $20,000,000; and

e) it has no reasonable grounds to believe, that any of the directors, senior officers and other insiders of the Issuer, and the persons that carry on investor relations activities for the Issuer has a beneficial interest in any of the managed accounts for which it is purchasing.

Dated at________________________on ____________________________.

           _________________________________________

           (Name of Purchaser — please print)

           _________________________________________

           (Authorized Signature)

           _________________________________________

           (Official Capacity — please print)

           _________________________________________

(please print name of individual whose
signature appears above, if different
from name of purchaser printed above)

APPENDIX II A

This is the form required under section 135 of the Securities Rules or, where required, under an order issued under section 76 of the Securities Act.

BCF #45-903F1

(formerly, Form 20A(IP))

Securities Act

ACKNOWLEDGMENT OF INDIVIDUAL PURCHASER

1. I have agreed to purchase from CANPLATS RESOURCES CORPORATION (the “Issuer”) 80,000 flow-through shares (the “Securities”) of the Issuer.

2. I am purchasing the Securities as principal and, on closing of the agreement of purchase and sale, I will be the beneficial owner of the Securities.

3. I [circle one] have/have not received an offering memorandum describing the Issuer and the Securities.

4. I acknowledge that:

(a) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities, AND

(b) there is no government or other insurance covering the Securities, AND

(c) I may lose all of my investment, AND

(d) there are restrictions on my ability to resell the Securities and it is my responsibility to find out what those restrictions are and to comply with them before selling the Securities, AND

(e) I will not receive a prospectus that the British Columbia Securities Act (the “Act”) would otherwise require to be given to me because the Issuer has advised me that it is relying on a prospectus exemption, AND

(f) because I am not purchasing the Securities under a prospectus, I will not have the civil remedies that would otherwise be available to me, AND

(g) the Issuer has advised me that it is using an exemption from the requirement to sell through a dealer registered under the Act, except purchases referred to in paragraph 5(g), and as a result I do not have the benefit of any protection that might have been available to me by having a dealer act on my behalf.

5.     I also acknowledge that: [circle one]

(a) I am purchasing Securities that have an aggregate acquisition cost of $97,000 or more, OR

(b) my net worth, or my net worth jointly with my spouse at the date of the agreement of purchase and sale of the security, is not less than $400,000, OR

(c) my annual net income before tax is not less than $75,000, or my annual net income before tax jointly with my spouse is not less than $125,000, in each of the two most recent calendar years, and I reasonably expect to have annual net income before tax of not less than $75,000 or annual net income before tax jointly with my spouse of not less than $125,000 in the current calendar year, OR

(d) I am registered under the Act, OR

(e) I am a spouse, parent, brother, sister or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer, OR

(f) I am a close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer, OR

(g) I am purchasing securities under section 128(c) ($25,000 — registrant required) of the Rules, and I have spoken to a person_____________________________ [Name of Registered Person] (the “Registered Person”) who has advised me that the Registered Person is registered to trade or advise in the Securities and that the purchase of the Securities is a suitable investment for me.

6. If I am an individual referred to in paragraph 5(b), 5(c), or 5(d), I acknowledge that, on the basis of information about the Securities furnished by the Issuer, I am able to evaluate the risks and merits of the Securities because: [circle one]

(a) of my financial, business or investment experience, OR

(b) I have received advice from a person ______________________________ [Name of adviser] (the “Adviser”) who has advised me that the Adviser is:

(i) registered to advise, or exempted from the requirement to be registered to advise, in respect of the Securities, and

(ii) not an insider of, or in a special relationship with, the Issuer.

The statements made in this report are true.

DATED the 31st day of July, 2002.

"R.E. Gordon Davis"

Signature of Purchaser

R.E. Gordon Davis

Name of Purchaser

5555 Newton Wynd

Vancouver, B.C   V6G 1H6

Address of Purchaser

APPENDIX II B

This is the form required under section 135 of the Rules and, if applicable, by an order issued under section 76 of the Securities Act.

BCF 45-903F2

(Formerly, Form 20A (NIP))

Securities Act

Acknowledgment of Purchaser that is not an individual

1.     I have agreed to purchase from CANPLATS RESOURCES CORPORATION (the “Issuer”) __________________________________ flow-through shares (the "Securities") of the Issuer.

2. The Purchaser is purchasing the Securities as principal, or is a trust Issuer, insurer or portfolio manager acting on behalf of fully managed accounts and is deemed to be purchasing as principal under section 74(1) of the British Columbia Securities Act (the “Act”).

3. On closing of the agreement of purchase and sale, the Purchaser will be the beneficial owner of the Securities, except where the Purchaser is a trust Issuer, insurer or portfolio manager acting on behalf of fully managed accounts under section 74(1) of the Act.

4. The Purchaser [circle one] has/has not received an offering memorandum describing the Issuer and the Securities.

5. The Purchaser acknowledges that:

(a) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities, AND

(b) there is no government or other insurance covering the Securities, AND

(c) the Purchaser may lose all of its investment, AND

(d) there are restrictions on the Purchaser’s ability to resell the Securities and it is the responsibility of the Purchaser to find out what those restrictions are and to comply with them before selling the Securities, AND

(e) the Purchaser will not receive a prospectus that the Act would otherwise require be given to the Purchaser because the Issuer has advised the Purchaser that the Issuer is relying on a prospectus exemption, AND

(f) because the Purchaser is not purchasing the Securities under a prospectus, the Purchaser will not have the civil remedies that would otherwise be available to the Purchaser, AND

(g) the Issuer has advised the Purchaser that the Issuer is using an exemption from the requirement to sell through a dealer registered under the Act, except purchases referred to in paragraph 6(b), and as a result the Purchaser does not have the benefit of any protection that might have been available to the Purchaser by having a dealer act on the Purchaser’s behalf.

6.     The Purchaser acknowledges that:

(a) it is a “sophisticated purchaser” as described in paragraph 2 in the attached Appendix A [circle the applicable subparagraph in paragraph 2 in Appendix A]; OR

(b) the Securities were purchased under section 128(c) ($25,000 — registrant required) of the Rules and an authorized signatory of the Purchaser has spoken to a person [Name of Registered Person] (the “Registered Person”) who has advised the authorized signatory that the Registered Person is registered to trade or advise in the Securities and that the purchase of the Securities is a suitable investment for the Purchaser; OR

(c) the Purchaser is a corporation, all the voting securities of which are beneficially owned by one or more of:

(i) a close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer, OR

(ii) a senior officer or director of the Issuer, or of an affiliate of the Issuer , OR

(iii) a spouse, parent, brother, sister, or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer.

7. If the Purchaser is referred to in paragraph 6(a), the Purchaser acknowledges that, on the basis of information about the Securities furnished by the Issuer, the Purchaser is able to evaluate the risks and merits of the Securities because: [circle one]

(a) of the financial, business or investment experience of the Purchaser, OR

(b) the Purchaser has received advice from a person [Name of adviser](the “Adviser”) who has advised the Purchaser that the Adviser is:

(i) registered to advise, or exempted from the requirement to be registered to advise, in respect of the Securities, AND

(ii) not an insider of, or in a special relationship with, the Issuer.

The statements made in this report are true.

DATED the ________________ day of ____________________________, 2002.

Signature of Authorized Signatory of Purchaser

Name and Office of Authorized Signatory of Purchaser

Name of Purchaser

Address of Purchaser

Please turn to Appendix A, which is attached to and forms a part of this BCF #45-903F2.

APPENDIX A TO BCF #45-903F2

[Circle the applicable subparagraph in paragraph 2.]

“Sophisticated purchaser” means a purchaser that, in connection with a distribution, gives an acknowledgment under section 135 of the Rules to the Issuer, where the Issuer does not believe, and has no reasonable grounds to believe, that the acknowledgment is false, acknowledging both that:

1. the purchaser is able, on the basis of information about the investment furnished by the Issuer, to evaluate the risks and merits of the prospective investment because of:

(a) the purchaser’s financial, business or investment experience, OR

(b) advice the purchaser receives from a person who is registered to advise, or is exempted from the requirement to be registered to advise, in respect of the security that is the subject of the trade (the “Security”) and who is not an insider of, or in a special relationship with, the Issuer of the Security; AND

2.     the purchaser is one of the following [circle one]:

    (a)        a person registered under the Securities Act, OR

    (b)        an individual who:

(i) has a net worth, or net worth jointly with the individual’s spouse, at the date of the agreement of purchase and sale of the Security, of not less than $400,000, OR

(ii) has had in each of the 2 most recent calendar years, and reasonably expects to have in the current calendar year:

- annual net income before tax of not less than $75,000, OR

- annual net income before tax, jointly with the individual's spouse, of not less than $125,000; OR

    (c)        a corporation, partnership or trust that:

(i) has net assets of not less than $400,000, OR

(ii); has had in each of the 2 most recent calendar years, and reasonably expects to have in the current calendar year, net income before tax of not less than $125,000, OR

(d) a corporation in which all of the voting shares are beneficially owned by sophisticated purchasers or of which the majority of the directors are sophisticated purchasers, OR

(e) a general partnership in which all of the partners are sophisticated purchasers, OR

(f) a limited partnership in which a majority of the general partners are sophisticated purchasers, OR

(g) a trust in which all of the beneficiaries are sophisticated purchasers or the majority of the trustees are sophisticated purchasers.

APPENDIX III

THE PARTIES to this Agreement therefore agree:

1.     PURCHASE AND SALE OF FLOW-THROUGH SHARES

On the Closing, the Purchaser will purchase from the Issuer 80,000 flow-through shares at a price of $0.15 per flow-through share and the Issuer will deliver to the Purchaser certificates representing the flow-through shares.

2.     DEFINITIONS

2.1     In this Agreement, which includes the cover page and all of the Appendices, the following words have the following meanings unless otherwise indicated:

(a)	“1933 Act” means the Securities Act of 1933 (United States of America), as amended;
(b)	“Alberta Act” means the Securities Act, (Alberta) S.A. 1981, c. S-6.1, as amended;
(c)	“Alberta Commission” means the Alberta Securities Commission;
(d)	“Alberta Rules” means the rules made under the Alberta Act;
(e)	“Applicable Legislation” means the B.C. Act and the Alberta Act, together with the regulations and rules made and promulgated thereunder and all administrative policy statements, blanket orders and rulings, notices, and other administrative directions issued by the Commissions;
(f)	“B.C. Act” means the Securities Act, (British Columbia) R.S.B.C. 1996, as amended; (g) (h) “B.C. Rules” means the rules made under the B.C. Act;
(g)	“B. C. Commission” means the British Columbia Securities Commission;
(h)	“B.C. Rules” means the rules made under the B.C. Act;
(i)	“CEDOE” means Canadian exploration and development overhead expense as prescribed for the purposes of section 66(12.6) of the Income Tax Act;
(j)	“CEE” means Canadian exploration expense as defined in paragraph 66.1(6) of the Income Tax Act;
(k)	“Closing” means the closing of the purchase and sale of the Shares under this Subscription Agreement;
(l)	“Closing Date” means the day the Shares are issued to the Purchaser;
(m)	“Commissions” means the B.C. Commission and Alberta Commission;
(n)	“Exchange” means the Canadian Venture Exchange Inc.;
(o)	“Exemptions” means the exemptions from the prospectus requirements under sections 74(2)(4) and 74(2)(9) of the B.C. Act, section 128(h) of the B.C. Rules, British Columbia Instrument #72-503 and sections 107(1)(d) and (z) of the Alberta Act;
(p)	“Exploration Account” means a segregated account maintained at a chartered Canadian bank for the purposes of receiving amounts of subscription of Shares pursuant to the Offering and of disbursing funds to finance conduct of the Exploration Program;
(q)	“Exploration Program” means a program to determine the existence, location, extent and quality of mineral resources in the Property and may include, without limitation, soil sampling, grid preparation, induced-polarization surveys and line-cutting, surveying and diamond drilling;
(r)	“Income Tax Act” means the Income Tax Act (Canada) as amended from time to time;

(s) “Offering” means the offering of the Shares that are “flow-through shares” for the purposes of the Income Tax Act under this form of Agreement;

(t) “Property” means resource property or properties in Canada beneficially owned by the Issuer or in which the Issuer has an interest or the right to acquire an interest;

(u) “Private Placement” means the offering of the Shares;

(v) “Purchaser” means the person named as “Purchaser” in this Subscription Agreement and wherever Purchaser is used in the plural, it shall connote all persons who are a “Purchaser” under this form of Subscription agreement and who subscribe for Shares under the Offering;

(w) “Purchaser’s Subscription Funds” means the amount subscribed for by the Purchaser under the Offering;

(x) “Qualified Expenditures” means CEE (other than CEDOE) in excess of amounts of “assistance” as such term is defined in subsection 66(15) of the Income Tax Act;

(y) “Regulation S” means Regulation S promulgated under the 1933 Act; and

(z) “Shares” means the flow-through common shares in the share capital of the Issuer, as presently constituted, to be issued under the Offering; and

(aa) “Termination Date” means the date that is twenty-four months after the end of the month in which this Subscription Agreement is executed by the parties.

2.2    A reference to persons:

(a) “dealing” or “acting” at or not at “arm’s length” shall be construed as a reference to dealing or acting at or not at “arm’s length” for the purposes of the Income Tax Act; and

(b) who or which are “related” shall be construed as a reference to persons who would be “related” for the purposes of the Income Tax Act.

2.3    In this Agreement, the following terms have the meanings defined in Regulation "S": "Directed Selling Efforts", "Foreign Issuer", "Substantial U.S. Market Interest", "U.S. Person" and "United States".

3.     PURCHASE AND SALE OF COMMON SHARES

3.1     The Purchaser, as principal, hereby subscribes for and agrees to purchase that number of Shares indicated on the Agreement to which this Appendix III is attached at a price of $0.15 (Cdn.) per Share, for that aggregate purchase price indicated on the Agreement to which this Appendix III is attached (the “Subscription Funds”).

3.2     The Purchaser shall pay the Subscription Funds to the Issuer on the date of execution of this Agreement (the “Payment Date”). The Subscription Funds shall be held as a non-interest bearing loan by the Issuer until the Closing Date.

3.3     This Agreement, when executed by the Purchaser and delivered to the Issuer, will constitute a subscription for the Shares which will not be binding on the Issuer until accepted by the Issuer by executing the Agreement in the space provided above.

3.4     Within 15 business days of receipt by the Issuer of final approval by the Exchange of the Private Placement, the Private Placement shall close (the “Closing”) by the issuance of certificates for the Shares 3.5     The issue of the Shares will not restrict or prevent the Issuer from obtaining any other financing or from issuing additional securities or rights.

3.5     The issue of the Shares will not restrict or prevent the Issuer from obtaining any other financing or from issuing additional securities or rights.

3.6 The Issuer will, upon receipt of the Purchaser’s Subscription Funds, deposit such funds (together with all other subscription funds received by the Issuer from this Offering) into the Exploration Account.

3.7 After the Closing, the Issuer will have the right to draw on the Exploration Account and will apply 100% of the principal of the Exploration Account to carry out and complete programs (a “Program”) of exploration on a resource property or properties in Canada beneficially owned by the Issuer or in which the Issuer has an interest or the right to acquire an interest.

3.8 In carrying out an Exploration Program the Issuer will use its best efforts to incur after the Closing, Qualifying Expenditures in an amount equal to the aggregate of Purchaser’s Subscription Funds for all Purchasers so that such Qualifying Expenditures can be renounced. The Issuer shall, in any event, cause Qualifying Expenditures to be incurred in the aggregate equal to the aggregate of Purchaser’s Subscription Funds for all Purchasers prior to the Termination Date.

3.9 The Issuer shall within the period set out below and in accordance with the provisions of the Income Tax Act and draft amendments thereto, renounce in favour of the Purchaser and others who have entered into this form of Subscription Agreement amounts of Qualified Expenditures incurred by it under Programs from the date of this Subscription Agreement to the Termination Date, as follows for persons dealing with the Issuer at “arm’s length”:

Period of Renunciation	Effective Date of Renunciation	Exploration Expenses to be Renounced
On or before March 31 of the year following the year (the "Base Year") in which this Agreement was made	December 31, 2002	Any and all Qualified Expenditures incurred from the date of this Agreement to the end of February of the year following the Base Year between March 1 and December 31 of the year following the Base Year
On or before March 31 of the year following the Base Year	December 31, 2002	Any and all Qualified Expenditures incurred or planned to be incurred
On or before March of the calendar year following the Termination Date	Earliest possible calendar year	Any and all Qualified Expenditures not previously renounced.

3.10 The Issuer shall within the period set out below and in accordance with the provisions of the Income Tax Act and draft amendments thereto, renounce in favour of the Purchaser and others who have entered into this form of Subscription Agreement amounts of Qualified Expenditures incurred by it under Programs from the date of this Subscription Agreement to the Termination Date, as follows for persons not dealing with the Issuer at “arm’s length”:

Period of Renunciation	Effective Date of Renunciation	Exploration Expenses to be Renounced
On or before March 31 of the year following the Base Year	December 31, 2002	Any and all Qualified Expenditures incurred from the date of this Agreement to the end of the Base Year
On or before March of the calendar year following the Termination Date	Earliest possible calendar year	Any and all Qualified Expenditures not previously renounced.

3.11 Renunciations shall be made to persons who are Purchasers pro rata in accordance with the respective amounts of Purchaser’s Subscription Funds for each of the Purchasers although the Issuer may renounce different amounts of Qualifying Expenditures to Purchasers who do not and those who do act at arm’s length with the Issuer so that members of these two groups receive renunciations of Qualified Expenditures as early as possible rateably. The aggregate Qualified Expenditures renounced to the Purchaser will not exceed the consideration paid by the Purchaser for the Shares.

3.12 The Purchaser acknowledges that if the Issuer renounces Qualified Expenditures pursuant to paragraph 3.11, effective December 31, 2002, incurred or planned to be incurred in the year following the Base Year and does not incur all or part of the Qualified Expenditures which it planned to incur during the specified period, the Issuer will be required to reduce the amount of Qualified Expenditures renounced pursuant to such provision and, as a result, the Purchaser:

    (a)     may become subject to increased income tax liabilities for the year in respect of which the excess renunciation was made; and

    (b)     may be required to file appropriate amendments to the Purchaser’s income tax return for that and other years.

3.13 If, before the Issuer renounces the full amount of Qualified Expenditures to the Purchaser in accordance with sections of this Agreement, the Issuer amalgamates or otherwise merges with one or more companies, any shares issued to or held by the Purchaser as a replacement of the Shares as a result of such amalgamation or merger, will qualify, whether by virtue of subsection 87(4.4) of the Income tax Act or otherwise, as “flow-through shares” as described in subsection 66(15) of the Income tax Act and in particular will not be prescribed shares as defined in section 6202.1 of the regulations to the Income Tax Act.

3.14 The Issuer represents and warrants to, and covenants with, the Purchaser that:

(a) all expenditures renounced by the Issuer to the Purchaser pursuant to this Subscription Agreement will be Qualified Expenditures;

(b) the Purchaser’s Shares will be, at the time of issue, “flow-through shares” within the meaning of Section 66(15) of the Income Tax Act;

(c) on the date provided as the effective date in each renunciation of Qualifying Expenditures pursuant to this Subscription Agreement, the Issuer will have cumulative CEE, within the meaning of paragraph 66.1(6) of the Income Tax Act, in an amount sufficient to make the renunciation to the Purchaser valid;

(d) in respect of each renunciation made by the Issuer pursuant to this Subscription Agreement, the Issuer will file on a timely basis all prescribed forms and other documents necessary to ensure valid and effective renunciation with the Minister of National Revenue on or before the last day of the month after the month in which the renunciation is made;

(e) the Issuer has complied or will comply with the provisions of the Income Tax Act relating to the filing of this Subscription Agreement including, without limitation, the obligation to file a copy of a “selling instrument” within the meaning of subsection 66(15), a copy of the agreement to be issued and the prescribed form on or before the last day of the month following the earlier of:

(i) the month in which this Agreement was entered into;

(ii) the month in which any “selling instrument” was first delivered to a potential purchaser;

(f) the Issuer will file, before March of the year following a particular year, any return required to be filed under Part XII.6 of the Income Tax Act in respect of the particular year, and will pay any tax or other amount owing in respect of the return on a timely basis;

(g) where an amount that the Issuer has purported to renounce to the Purchaser effective December 31 of the Base Year pursuant to section 3.11 or 3.12 exceeds the amount that it can renounce on that effective date because it did not actually incur Qualified Expenditures within the required period of time, and at the end of the year following the Base Year the Issuer knew or ought to have known of all or a part of such excess renunciation, the Issuer will file a statement in prescribed form before March of the second year following the Base Year, all as required by subsection 66(12.73) of the Income Tax Act;

(h) the Issuer is and will at all material times remain a “principal-business corporation” as that expression is defined in subsection 66(15) of the Income Tax Act;

(i) the Issuer is not a Joint Exploration Corporation;

(j) the Issuer will not, other than as required by this Subscription Agreement, renounce any CEE or otherwise do anything that will reduce its cumulative Canadian Exploration Expense otherwise than pursuant to this Agreement or other agreements in the same form in the course of the Offering until it has renounced to Purchasers the full amount of Qualified Expenditures required to be so renounced pursuant to this Offering.

4.     WARRANTIES AND DISCLAIMER

4.1     The Purchaser acknowledges, represents, warrants and covenants to and with the Issuer that, as at the date given above and at the Closing:

(a) no prospectus has been filed by the Issuer with the Commission in connection with the issuance of the Shares, the issuance is exempted from the prospectus requirements of the Applicable Legislation and that:

(i) the Purchaser is restricted from using most of the civil remedies available under the Applicable Legislation;

(ii) the Purchaser may not receive information that would otherwise be required to be provided to him under the Applicable Legislation; and

(iii) the Issuer is relieved from certain obligations that would otherwise apply under the Applicable Legislation;

(b) the Purchaser, wherever resident, is:

(i) purchasing sufficient Shares so that the aggregate acquisition cost of the Shares to the Purchaser is not less than $97,000, the Purchaser is not a corporation, partnership, trust, fund, association, or any other organized group of persons created solely, or used primarily, to permit the purchase of the Shares (or other similar purchases) by a group of individuals whose individual share of the aggregate acquisition cost of the Shares is less than $97,000, and the Purchaser is either:

(A) purchasing the Shares as principal and no other person, corporation, firm or other organization will have a beneficial interest in the Shares; or

(B)         if not purchasing the Shares as principal, is

(I) duly authorized to enter into this subscription and to execute all documentation in connection with the purchase on behalf of each beneficial purchaser, it being acknowledged that the Issuer may in the future be required by law to disclose on a confidential basis to securities regulatory authorities the identity of each beneficial purchaser of Shares for whom the Purchaser may be acting; and is

(a) a trust company, insurance company or financial institution that has been authorized to do business under the Financial Institutions Act (British Columbia);

(b) an adviser who manages the investment portfolio of clients through discretionary authority granted by one or more clients and who is registered as a portfolio manager under the B.C. Act or is exempt from such registration;

(c) a trust company or insurer, authorized under the laws of a province or territory of Canada other than British Columbia to carry on business in such province or territory; or

(d) a portfolio manager registered or exempt from registration under the laws of a province or territory of Canada, other than British Columbia, or a jurisdiction other than Canada and has provided the Issuer with an additional undertaking and certification in the form set out in Appendix I(B);

  and it is purchasing the Shares as an agent or trustee for accounts that are fully managed by it, and the aggregate acquisition cost of the Shares purchased for all the accounts managed by it is not less than $97,000; or

(II) is acting as agent for one or more disclosed principals, each of which principals is purchasing as a principal for its own account, not for the benefit of any other person, and not with a view to the resale or distribution of all or any of the Shares and each of which principals complies with subsection 4.1(b)(i) hereof; and

and if the Purchaser is an individual, the Purchaser has executed, prior to the execution of this Agreement, and delivered to the Issuer, a BCF #45-903F1 attached hereto as Appendix II(A);

OR

    (ii)        purchasing as principal and the Purchaser is:

(A) an employee, senior officer or director of the Issuer or of an affiliate of the Issuer and the Purchaser has not been induced to make this subscription by expectation of employment or continued employment; or

(B) a trustee on behalf of a person referred to in subparagraph (ii)(A) above; or

(C) an issuer all the voting securities of which are beneficially owned by one or more of the persons referred to in subparagraph (ii)(A) above;

OR

    (iii)        purchasing as principal and the Purchaser:

(A) is a spouse, parent, brother, sister, child or close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer; or

(B) is a company, all the voting securities of which are beneficially owned by one or more of a senior officer or director of the Issuer, or of an affiliate of the Issuer, or a spouse, parent, brother, sister, child or close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer; and

(C) the Purchaser has executed, prior to the execution of this Agreement, and delivered to the Issuer a BCF #45-903F1 or BCF #45-903F2, as applicable, attached hereto as Appendix II(A) (if the Purchaser is an individual) or Appendix II(B) (if the Purchaser is not an individual), respectively; or

OR

(iv) purchasing Shares under British Columbia Instrument #72-503 and the Purchaser has executed and delivered to the Issuer, the additional acknowledgements, representations and warranties set out in Exhibit I to this Appendix III; or

OR

(v) the Purchaser is the Business Development Bank of Canada, a bank, credit union, trust company or extra-provincial trust corporation authorized to carry on business under the Financial Institutions Act (British Columbia), a corporation that is a subsidiary of a bank and to which the Loan Companies Act (Canada) applies, the B.C. Community Financial Services Corporation established under the Community Financial Services Act (British Columbia), and insurance company or an extra-provincial insurance corporation licensed to do business under the Financial Institutions Act (British Columbia), a subsidiary wholly owned (except for voting securities required by law to be owned by directors of that subsidiary) of any of the foregoing, the government of Canada or a province, or a municipal corporation, public board or commission in Canada;

OR

(vi) the Purchaser is purchasing as principal, is not an individual and is designated as an exempt purchaser in an order made by the Executive Director of the B.C. Commission.

    (c)        the Purchaser, if resident in Alberta, is:

(i) purchasing as principal sufficient Shares so that the aggregate acquisition cost of the Shares to the Purchaser is not less than $97,000, the Purchaser is not a corporation, partnership, trust, fund, association, or any other organized group of persons created solely, or used primarily, to permit the purchase of the Shares (or other similar purchases) by a group of individuals whose individual share of the aggregate acquisition cost of the Shares is less than $97,000; or

(ii) is purchasing as principal and is:

(A) a senior officer or director of the Issuer; or

(B) a senior officer or director of an affiliate of the Issuer; or

(C) a spouse, parent, brother, sister or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer; or

(D) a company, all the voting securities of which are beneficially owned by one or more of a senior officer or director of the Issuer, or of an affiliate of the Issuer, or a spouse, parent, brother, sister or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer; or

(E) a close friend or business associate of a promoter of the Issuer, or a company all the voting securities of which are beneficially owned by a single close friend or single business associate of a promoter of the Issuer;

    (d)        the Purchaser has not received a copy of an offering memorandum;

    (e)        to the best of the Purchaser’s knowledge, the Shares were not advertised;

    (f)        no person has made to the Purchaser any written or oral representations:

    (i)        that any person will resell or repurchase the Shares;

    (ii)        that any person will refund the purchase price of the Shares;

    (iii)        as to the future price or value of any of the Shares;

    (g)        this subscription has not been solicited in any other manner contrary to the Applicable Legislation or the 1933 Act;

(h) the Purchaser is not a “control person” of the Issuer as defined in the Applicable Legislation, will not become a “control person” by virtue of this purchase of any of the Shares, and does not intend to act in concert with any other person to form a control group of the Issuer;

(i) the offer was not made to the Purchaser when he was in the United States and at the time the Purchaser’s buy order was made, the Purchaser was outside the United States;

(j) the Purchaser is at arm’s length with the Issuer, unless the Issuer is advised to the contrary prior to the Closing;

(k) the Purchaser acknowledges that the Shares have not been registered under the 1933 Act and may not be offered or sold in the United States unless registered under the 1933 Act and the securities laws of all applicable states of the United States or an exemption from such registration requirements is available, and that the Issuer has no obligation or present intention of filing a registration statement under the 1933 Act in respect of the Shares;

(l) the Purchaser is not a U.S. Person;

(m) the Purchaser is not and will not be purchasing Shares for the account or benefit of any U.S. Person;

(n) the Purchaser (or others for whom it is contracting hereunder) has been advised to consult its own legal and tax advisors with respect to applicable resale restrictions and tax considerations, and it (or others for whom it is contracting hereunder) is solely responsible for compliance with applicable resale restrictions and applicable tax legislation;

(o) the Purchaser has no knowledge of a “material fact” or “material change” (as those terms are defined in the Applicable Legislation) in the affairs of the Issuer that has not been generally disclosed to the public, save knowledge of this particular transaction;

(p) the offer made by this subscription is irrevocable (subject to the Purchaser’s right to withdraw his subscription and to terminate his obligations as set out in this Agreement) and requires acceptance by the Issuer;

(q) the Purchaser has the legal capacity and competence to enter into and execute this Agreement and to take all actions required pursuant hereto and, if the Purchaser is a corporation it is duly incorporated and validly subsisting under the laws of its jurisdiction of incorporation and all necessary approvals by its directors, shareholders and others have been given to authorize execution of this Agreement on behalf of the Purchaser;

(r) the entering into of this Agreement and the transactions contemplated hereby will not result in the violation of any of the terms and provisions of any law applicable to, or the constating documents of, the Purchaser or of any agreement, written or oral, to which the Purchaser may be a part or by which he is or may be bound;

(s) this Agreement has been duly executed and delivered by the Purchaser and constitutes a legal, valid and binding agreement of the Purchaser enforceable against the Purchaser;

(t) the Purchaser has been independently advised as to the applicable hold period imposed in respect of the Shares by securities legislation in the jurisdiction in which the Purchaser resides and confirms that no representation has been made respecting the applicable hold periods for the Shares and is aware of the risks and other characteristics of the Shares and of the fact that the Purchaser may not be able to resell the Shares except in accordance with the applicable securities legislation and regulatory policies;

(u) the Purchaser, and any beneficial purchaser for whom the Purchaser is acting, is resident in the province or jurisdiction set out on the cover page of this Agreement;

(v) the Purchaser is capable of assessing the proposed investment as a result of the Purchaser’s financial experience or as a result of advice received from a registered person other than the Issuer or any affiliates thereof;

(w) if required by applicable securities legislation, policy or order or by any securities commission, stock exchange or other regulatory authority, the Purchaser will execute, deliver, file and otherwise assist the Issuer in filing, such reports, undertakings and other documents with respect to the issue of the Shares as may be required;

(x) the Purchaser acknowledges that the offering of securities under this Private Placement is restricted to purchasers in Canada that are resident in British Columbia and Alberta only, and in such other jurisdictions outside of Canada and the United States, where such securities may be lawfully offered for sale; and

(y) the Purchaser agrees that the above representations, warranties and covenants in this subsection will be true and correct both as of the execution of this subscription and as of the Closing Date.

4.2 The foregoing representations, warranties and covenants are made by the Purchaser with the intent that they be relied upon by the Issuer in determining its suitability as a purchaser of Shares, and the Purchaser hereby agrees to indemnify the Issuer against all losses, claims, costs, expenses and damages or liabilities which any of them may suffer or incur as a result of reliance thereon. The Purchaser undertakes to notify the Issuer immediately of any change in any representation, warranty or other information relating to the Purchaser set forth herein which takes place prior to the Closing.

4.3 The Issuer represents and warrants that, as of the date given above and at the Closing:

(a) the Issuer and its subsidiaries, if any, are valid and subsisting corporations duly incorporated and in good standing under the laws of the jurisdiction in which they are incorporated, continued or amalgamated;

(b) the Issuer and its subsidiaries, if any, are duly registered and licenced to carry on business in the jurisdictions in which they carry on business or own property where required under the laws of that jurisdiction;

(c) the authorized and issued capital of the Issuer is as disclosed to the Purchaser, and the outstanding shares of the Issuer are fully paid and non-assessable;

(d) the Issuer will reserve or set aside sufficient shares in its treasury to issue the Shares and such common shares, on receipt of full payment therefor, will be duly and validly issued as fully paid and non-assessable;

(e) except as qualified by the disclosure in all prospectuses, filing statements and press releases filed with the Commissions (the “Disclosure Record”), the Issuer is the beneficial owner of the properties, business and assets or the interests in the properties, business or assets referred to in the Disclosure Record, all agreements by which the Issuer holds an interest in a property, business or assets are in good standing according to their terms, and the properties are in good standing under the applicable laws of the jurisdictions in which they are situated;

(f) the Disclosure Record, subscription form and all other written or oral representations made by the Issuer to the Purchaser in connection with the Private Placement is and will be accurate in all material respects and does and will omit no fact, the omission of which does or will make such representations misleading or incorrect;

(g) the financial statements most recently filed with the Commissions have been prepared in accordance with Canadian generally accepted accounting principles, accurately reflect the financial position and all material liabilities (accrued, absolute, contingent or otherwise) of the Issuer as of the date thereof, and no adverse material changes in the financial position of the Issuer have taken place since the date thereof, save in the ordinary course of the Issuer’s business;

(h) the Issuer has complied and will comply fully with the requirements of all applicable corporate and securities laws and administrative policies and directions, including, without limitation, the Applicable Legislation in relation to the issue and trading of its securities and in all matters relating to the Private Placement;

(i) there is not presently any material change, as defined in the Applicable Legislation, relating to the Issuer or change in any material fact, as defined in the Applicable Legislation, relating to any of the Shares which has not been or will not be fully disclosed in accordance with the requirements of the Applicable Legislation;

(j) the issue and sale of the Shares by the Issuer does not and will not conflict with, and does not and will not result in a breach of, any of the terms of the Issuer’s incorporating documents or any agreement or instrument to which the Issuer is a party;

(k) neither the Issuer nor any of its subsidiaries is a party to any actions, suits or proceedings which could materially affect its business or financial condition, and to the best of the Issuer’s knowledge no such actions, suits or proceedings are contemplated or have been threatened except as disclosed in the Disclosure Record;

(l) there are no judgments against the Issuer or any of its subsidiaries, if any, which are unsatisfied, nor are there any consent decrees or injunctions to which the Issuer or any of its subsidiaries, if any, is subject;

(m) this Agreement has been or will be by the Closing, duly authorized by all necessary corporate action on the part of the Issuer, and the Issuer has full corporate power and authority to undertake the Private Placement;

(n) the Issuer is not in default of any of the requirements of the Applicable Legislation or any of the administrative policies or notices of the Commissions;

(o) no order ceasing or suspending trading in securities of the Issuer nor prohibiting the sale of such securities has been issued to and is outstanding against the Issuer or its directors, officers or promoters or against any other companies that have common directors, officers or promoters and no investigations or proceedings for such purposes are pending or threatened;

(p) the Issuer satisfies and will satisfy all necessary requirements under the Exemptions in order to permit the sale of the Shares to Purchasers who are qualified to purchase the Shares under the Exemptions, pursuant to this Private Placement; and

(q) the Issuer has not issued during the preceding 12-month period and is not concurrently issuing any security or securities to more than 24 purchasers, including the purchasers who will purchase under the Private Placement, under the Exemption at section 128(h) of the B.C. Rules.

4.4 The representations and warranties contained in this Section will survive the Closing.

4.5 The Purchaser hereby acknowledges that all warranties, conditions, representations or stipulations, whether express or implied and whether arising hereunder or under prior agreement or statement or by statute or at common law are expressly those of the Issuer. The Purchaser acknowledges that no information or representation concerning the Issuer has been provided to the Purchaser by the Issuer other than those contained in this Agreement and the Disclosure Record and that the Purchaser is relying entirely upon this Agreement and the Disclosure Record.

5.     CLOSING

5.1 The Closing will take place within fifteen business days after receipt by the Issuer of final approval of the Private Placement by the Exchange. The Purchaser acknowledges that, although Shares may be issued to other purchasers under the Private Placement concurrently with the Closing, there may be other sales of Shares under the Private Placement, some or all of which may close after the Closing. The Purchaser further acknowledges that there is a risk that insufficient funds may be raised on the Closing to fund the Issuer’s objectives and that further closings may not take place after the Closing.

5.2 The Purchaser will deliver to the Issuer this subscription agreement, duly executed, and payment in full for the total price of the Shares to be purchased by the Purchaser.

5.3 At Closing, the Issuer will deliver to the Purchaser the certificates representing the Shares purchased by the Purchaser registered in the name of the Purchaser or its nominee.

5.4 The Purchaser will also deliver to the Issuer, along with this Subscription Agreement:

(a) a fully executed a BCF #45-903F1 or BCF #45-903F2, attached hereto as either Appendix IIA (if the Purchaser is an individual) or Appendix IIB (if the Purchaser is not an individual), whichever is applicable to the Purchaser, if required under the applicable Exemption;

(b) if the Purchaser is not an individual, a fully executed Corporate Placee Registration Form (the “Form”) as set out in Appendix I(A), unless the Form is already on file with the Exchange and the Exchange has been advised of any changes in the information provided in the Form, prior to the Purchaser participating in the Private Placement;

(c) if the Purchaser is a “portfolio manager”, a fully executed additional undertaking and certification in the form set out in Appendix I(B); and

(d) if the Purchaser is relying on the exemption contained in British Columbia Instrument #72-503, a fully executed acknowledgement in the form attached as Exhibit I to this Appendix III.

5.5 If the Closing does not occur within 180 days after the date of execution of this Subscription Agreement, this Subscription Agreement may be terminated by either party by delivering notice of termination to the other, and the Issuer shall return the Subscription Funds to the Purchaser. The obligation of the Issuer to repay the loan will be cancelled upon the occurrence of the Closing and delivery by the Issuer of the certificate(s) representing the Shares to the Purchaser.

6.     HOLD PERIOD

6.1 The Purchaser acknowledges that the Shares will be subject to restrictions on resale until such time as the earlier to occur of:

             (a) a period of four months has elapsed from the date of issue of the Shares; or

             (b) an appropriate discretionary order is obtained pursuant to applicable securities laws.

6.2 The certificates representing the Shares will bear a legend denoting the restrictions on transfer imposed by the Applicable Legislation and by the policies of the Exchange. The Purchaser agrees to sell, assign or transfer the Shares only in accordance with the requirements of applicable securities laws and such legends.

7.     MISCELLANEOUS

7.1 The Purchaser hereby authorizes the Issuer to correct any minor errors in, or complete any minor information missing from the Corporate Placee Registration Form (Appendix I(A)), Portfolio Manager: Additional Undertaking and Certification (Appendix I(B)), BCF #45-903F1 (Appendix (IIA)) or BCF #45-903F2 (Appendix II(B)), which has been executed by the Purchaser and delivered to the Issuer.

7.2 The Issuer will be entitled to rely on delivery by facsimile machine of an executed copy of this subscription, and acceptance by the Issuer of such facsimile copy will be equally effective to create a valid and binding agreement between the Purchaser and the Issuer in accordance with the terms hereof.

7.3 This agreement is not assignable or transferable by the parties hereto without the express written consent of the other party hereto.

7.4 Time is of the essence of this Agreement and will be calculated in accordance with the provisions of the Interpretation Act (British Columbia).

7.5 Except as expressly provided in this Agreement and in the agreements, instruments and other documents contemplated or provided for herein, this Agreement contains the entire agreement between the parties with respect to the Shares and there are no other terms, conditions, representations or warranties whether expressed, implied, oral or written, by statute, by common law, by the Issuer, or by anyone else.

7.6 The parties to this Agreement may amend this Agreement only in writing.

7.7 This Agreement enures to the benefit of and is binding upon the parties to this Agreement and their successors and permitted assigns.

7.8 A party to this Agreement will give all notices to or other written communications with the other party to this Agreement concerning this Agreement by hand or by registered mail addressed to the address given above.

7.9 This Agreement is to be read with all changes in gender or number as required by the context.

7.10 This Agreement will be governed by and construed in accordance with the laws of British Columbia, and the parties hereto irrevocably attorn and submit to the jurisdiction of the courts of British Columbia with respect to any dispute related to this Agreement.

END OF APPENDIX III

EXHIBIT I

Additional Acknowledgements, Representations, and Warranties
of the Purchaser for use of British Columbia Instrument #72-503 Exemption

The Purchaser acknowledges, represents, certifies and warrants as at the date of execution of the subscription agreement of the Purchaser and at the closing of the Offering of common shares (the “Securities”) of Canplats Resources Corporation (the Issuer), that:

(a) no prospectus has been filed by the Issuer with the British Columbia Securities Commission in connection with the issuance of the Securities, the issuance is exempted from the prospectus requirement of the Securities Act (British Columbia) (the “Act”) or any regulations (the “Regulations”) promulgated under the Act and that:

(i) the Purchaser is restricted from using most of the civil remedies available under the Act and Regulations;

(ii) the Purchaser may not receive information that would otherwise be required to be provided to the Purchaser under the Act and the Regulations; and

(iii) the Issuer is relieved from certain obligations that would otherwise apply under the Act and the Regulations;

(b)     the Purchaser is not a resident of British Columbia and that:

(i) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities;

(ii) there is no government or other insurance covering the Securities;

(iii) there are risks associated with the purchase of the Securities;

(iv) there are restrictions on the Purchaser’s ability to resell the Securities and it is the responsibility of the Purchaser to find out what those restrictions are and to comply with them before selling the Securities; and

(v) from the requirements to provide the Purchaser with a prospectus and to sell securities through a person registered to sell securities under the Act and, as a consequence of acquiring securities pursuant to this exemption, certain protections, rights and remedies provided by the Act, including statutory rights of rescission or damages, will not be available to the Purchaser;

(c) the Purchaser is purchasing the Securities as principal and no other person, corporation, firm or other organization will have the beneficial interest in the Securities;

EX-99.004

PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT

THIS AGREEMENT dated for reference this 16th day of July, 2002

BETWEEN

R.E. Gordon Davis
5555 Newton Wynd
Vancouver, B.C.
V6G 1H6

(the “Purchaser”);

AND

CANPLATS RESOURCES CORPORATION, Suite 1180,
999 West Hastings Street, Vancouver, British Columbia, V6C 2W2

(the “Issuer”).

Subject and pursuant to the terms set out in Appendix III attached hereto, the Purchaser hereby irrevocably subscribes for, and on Closing will purchase from the Issuer, the following securities at the following price:

50,000      Common Shares;
$0.10        per Common Share for a total purchase price of $5,000.

NUMBER OF SECURITIES IN THE ISSUER HELD EITHER DIRECTLY OR INDIRECTLY:

         821,500 common shares .
_____________________________________________________________

The Purchaser hereby directs the Issuer to issue, register and deliver the certificates representing the Common Shares as follows:

Registration Instructions:	Delivery Instructions:
__________________________	__________________________
Name to appear on certificate	Name and account reference, if applicable
R.E. Gordon Davis
__________________________	__________________________
Account reference, if applicable	Contact Name
__________________________	__________________________
Address	Address
5555 Newton Wynd
Vancouver, B.C     V6G 1H6
__________________________	__________________________
	(Telephone Number)

EXECUTED by the Purchaser this 31st day of July, 2002.

WITNESS:	EXECUTION BY PURCHASER:
"Linda J. Sue"	"R.E. Gordon Davis"
__________________________	__________________________
Signature of Witness	Signature of individual (if Purchaser is an individual)
__________________________	__________________________
Name of Witness	Authorized Signatory (if Purchaser is not an individual)
#1180-999 W. Hastings St. Vancouver, B.C. V6C 2W2
__________________________	__________________________
Address of Witness	Name of Purchaser (please print)
__________________________	__________________________
	Name of Authorized Signatory (please print)
	__________________________
	Address of Purchaser (residence if an individual)
	__________________________

ACCEPTED this 2nd day of August, 2002.
CANPLATS RESOURCES CORPORATION
Per:
"Robert Quartermain"
_______________________________
Authorized Signatory

APPENDIX 1 (A)

FORM 4D1

CORPORATE PLACEE REGISTRATION FORM

Where subscribers to a private placement are not individuals, the following information about the placee must be provided. This Form will remain on file with the Exchange. The corporation, trust, portfolio manager or other entity (the “Placee”) need only file it once, and it will be referenced for all subsequent private placements in which it participates. If any of the information provided in this Form changes, the Placee must notify the Exchange prior to participating in further placements with Exchange listed companies.

1.     Name of Placee:

2.     Address of Placee’s Head Office:

3.     Jurisdiction of Incorporation or Creation:

4. If the Placee will be purchasing securities as principal, but not as a portfolio manager, please check the box and include the names and addresses of persons having a greater than 10% beneficial interest in the Placee:   

5. The undersigned acknowledges that it is bound by the provisions of applicable Securities Law, including provisions concerning the filing of insider reports and reports of acquisitions (See for example, sections 87 and 111 of the Securities Act (British Columbia) and sections 141 and 147 of the Securities Act (Alberta).

6. For Placees which are portfolio managers or trusts purchasing pursuant to an exemption from the prospectus requirements prescribed by British Columbia Securities Law and are required pursuant to the applicable exemption to be purchasing as agent for accounts that are fully managed by it, please check the box and complete the Additional Undertaking and Certification in Form 4D2.  

Dated at ______________________ on _________________________________.

           _________________________________________

           (Name of Purchaser — please print)

           _________________________________________

           (Authorized Signature)

           _________________________________________

           (Official Capacity — please print)

           _________________________________________

(please print name of individual whose
signature appears above, if different
from name of purchaser printed above)

THIS IS A PUBLIC DOCUMENT

APPENDIX 1 (B)

FORM 4D2

Portfolio Manager:

Additional Undertaking and Certification

If the undersigned is a portfolio manager purchasing as agent for accounts that are fully managed by it, pursuant to an exemption from the prospectus requirements prescribed by British Columbia Securities Law, the undersigned acknowledges that it is bound by the provisions of the Securities Act (British Columbia) (the “Act”), and undertakes to comply with all provisions of the Act relating to ownership of, and trading in, securities including, without limitation, the filing of insider reports and reports pursuant to Section 111 of the Act. If any of the information provided in this Form changes, the portfolio manager undertakes to notify the Exchange prior to participating in further private placements with Exchange listed companies.

If the undersigned carries on business as a portfolio manager in a jurisdiction outside of Canada, the undersigned certifies that:

a) it is purchasing securities of the Issuer on behalf of managed accounts for which it is making the investment decision to purchase the securities and has full discretion to purchase or sell securities for such accounts without requiring the client’s express consent to a transaction;

b) it carries on the business of managing the investment portfolios of clients through discretionary authority granted by those clients (a “portfolio manager” business) in [jurisdiction], and it is permitted by law to carry on a portfolio manager business in that jurisdiction;

c) it was not created solely or primarily for the purpose of purchasing securities of the Issuer;

d) the total asset value of the investment portfolios it manages on behalf of clients is not less than $20,000,000; and

e) it has no reasonable grounds to believe, that any of the directors, senior officers and other insiders of the Issuer, and the persons that carry on investor relations activities for the Issuer has a beneficial interest in any of the managed accounts for which it is purchasing.

Dated at________________________on ____________________________.

           _________________________________________

           (Name of Purchaser — please print)

           _________________________________________

           (Authorized Signature)

           _________________________________________

           (Official Capacity — please print)

           _________________________________________

(please print name of individual whose
signature appears above, if different
from name of purchaser printed above)

APPENDIX II A

This is the form required under section 135 of the Securities Rules or, where required, under an order issued under section 76 of the Securities Act.

BCF #45-903F1

(formerly, Form 20A(IP))

Securities Act

ACKNOWLEDGMENT OF INDIVIDUAL PURCHASER

1. I have agreed to purchase from CANPLATS RESOURCES CORPORATION (the “Issuer”) 50,000 common shares (the “Securities”) of the Issuer.

2. I am purchasing the Securities as principal and, on closing of the agreement of purchase and sale, I will be the beneficial owner of the Securities.

3. I [circle one] have/have not received an offering memorandum describing the Issuer and the Securities.

4. I acknowledge that:

(a) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities, AND

(b) there is no government or other insurance covering the Securities, AND

(c) I may lose all of my investment, AND

(d) there are restrictions on my ability to resell the Securities and it is my responsibility to find out what those restrictions are and to comply with them before selling the Securities, AND

(e) I will not receive a prospectus that the British Columbia Securities Act (the “Act”) would otherwise require to be given to me because the Issuer has advised me that it is relying on a prospectus exemption, AND

(f) because I am not purchasing the Securities under a prospectus, I will not have the civil remedies that would otherwise be available to me, AND

(g) the Issuer has advised me that it is using an exemption from the requirement to sell through a dealer registered under the Act, except purchases referred to in paragraph 5(g), and as a result I do not have the benefit of any protection that might have been available to me by having a dealer act on my behalf.

5.     I also acknowledge that: [circle one]

(a) I am purchasing Securities that have an aggregate acquisition cost of $97,000 or more, OR

(b) my net worth, or my net worth jointly with my spouse at the date of the agreement of purchase and sale of the security, is not less than $400,000, OR

(c) my annual net income before tax is not less than $75,000, or my annual net income before tax jointly with my spouse is not less than $125,000, in each of the two most recent calendar years, and I reasonably expect to have annual net income before tax of not less than $75,000 or annual net income before tax jointly with my spouse of not less than $125,000 in the current calendar year, OR

(d) I am registered under the Act, OR

(e) I am a spouse, parent, brother, sister or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer, OR

(f) I am a close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer, OR

(g) I am purchasing securities under section 128(c) ($25,000 — registrant required) of the Rules, and I have spoken to a person_____________________________ [Name of Registered Person] (the “Registered Person”) who has advised me that the Registered Person is registered to trade or advise in the Securities and that the purchase of the Securities is a suitable investment for me.

6. If I am an individual referred to in paragraph 5(b), 5(c), or 5(d), I acknowledge that, on the basis of information about the Securities furnished by the Issuer, I am able to evaluate the risks and merits of the Securities because: [circle one]

(a) of my financial, business or investment experience, OR

(b) I have received advice from a person ______________________________ [Name of adviser] (the “Adviser”) who has advised me that the Adviser is:

(i) registered to advise, or exempted from the requirement to be registered to advise, in respect of the Securities, and

(ii) not an insider of, or in a special relationship with, the Issuer.

The statements made in this report are true.

DATED the 31st day of July, 2002.

"R.E. Gordon Davis"

Signature of Purchaser

R.E. Gordon Davis

Name of Purchaser

5555 Newton Wynd

Vancouver, B.C   V6G 1H6

Address of Purchaser

APPENDIX II B

This is the form required under section 135 of the Rules and, if applicable, by an order issued under section 76 of the Securities Act.

BCF 45-903F2

(Formerly, Form 20A (NIP))

Securities Act

Acknowledgment of Purchaser that is not an individual

1.     I have agreed to purchase from CANPLATS RESOURCES CORPORATION (the “Issuer”) __________________________________ common shares (the "Securities") of the Issuer.

2. The Purchaser is purchasing the Securities as principal, or is a trust Issuer, insurer or portfolio manager acting on behalf of fully managed accounts and is deemed to be purchasing as principal under section 74(1) of the British Columbia Securities Act (the “Act”).

3. On closing of the agreement of purchase and sale, the Purchaser will be the beneficial owner of the Securities, except where the Purchaser is a trust Issuer, insurer or portfolio manager acting on behalf of fully managed accounts under section 74(1) of the Act.

4. The Purchaser [circle one] has/has not received an offering memorandum describing the Issuer and the Securities.

5. The Purchaser acknowledges that:

(a) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities, AND

(b) there is no government or other insurance covering the Securities, AND

(c) the Purchaser may lose all of its investment, AND

(d) there are restrictions on the Purchaser’s ability to resell the Securities and it is the responsibility of the Purchaser to find out what those restrictions are and to comply with them before selling the Securities, AND

(e) the Purchaser will not receive a prospectus that the Act would otherwise require be given to the Purchaser because the Issuer has advised the Purchaser that the Issuer is relying on a prospectus exemption, AND

(f) because the Purchaser is not purchasing the Securities under a prospectus, the Purchaser will not have the civil remedies that would otherwise be available to the Purchaser, AND

(g) the Issuer has advised the Purchaser that the Issuer is using an exemption from the requirement to sell through a dealer registered under the Act, except purchases referred to in paragraph 6(b), and as a result the Purchaser does not have the benefit of any protection that might have been available to the Purchaser by having a dealer act on the Purchaser’s behalf.

6.     The Purchaser acknowledges that:

(a) it is a “sophisticated purchaser” as described in paragraph 2 in the attached Appendix A [circle the applicable subparagraph in paragraph 2 in Appendix A]; OR

(b) the Securities were purchased under section 128(c) ($25,000 — registrant required) of the Rules and an authorized signatory of the Purchaser has spoken to a person [Name of Registered Person] (the “Registered Person”) who has advised the authorized signatory that the Registered Person is registered to trade or advise in the Securities and that the purchase of the Securities is a suitable investment for the Purchaser; OR

(c) the Purchaser is a corporation, all the voting securities of which are beneficially owned by one or more of:

(i) a close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer, OR

(ii) a senior officer or director of the Issuer, or of an affiliate of the Issuer , OR

(iii) a spouse, parent, brother, sister, or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer.

7. If the Purchaser is referred to in paragraph 6(a), the Purchaser acknowledges that, on the basis of information about the Securities furnished by the Issuer, the Purchaser is able to evaluate the risks and merits of the Securities because: [circle one]

(a) of the financial, business or investment experience of the Purchaser, OR

(b) the Purchaser has received advice from a person [Name of adviser](the “Adviser”) who has advised the Purchaser that the Adviser is:

(i) registered to advise, or exempted from the requirement to be registered to advise, in respect of the Securities, AND

(ii) not an insider of, or in a special relationship with, the Issuer.

The statements made in this report are true.

DATED the ________________ day of ____________________________, 2002.

Signature of Authorized Signatory of Purchaser

Name and Office of Authorized Signatory of Purchaser

Name of Purchaser

Address of Purchaser

Please turn to Appendix A, which is attached to and forms a part of this BCF #45-903F2.

APPENDIX A TO BCF #45-903F2

[Circle the applicable subparagraph in paragraph 2.]

“Sophisticated purchaser” means a purchaser that, in connection with a distribution, gives an acknowledgment under section 135 of the Rules to the Issuer, where the Issuer does not believe, and has no reasonable grounds to believe, that the acknowledgment is false, acknowledging both that:

1. the purchaser is able, on the basis of information about the investment furnished by the Issuer, to evaluate the risks and merits of the prospective investment because of:

(a) the purchaser’s financial, business or investment experience, OR

(b) advice the purchaser receives from a person who is registered to advise, or is exempted from the requirement to be registered to advise, in respect of the security that is the subject of the trade (the “Security”) and who is not an insider of, or in a special relationship with, the Issuer of the Security; AND

2.     the purchaser is one of the following [circle one]:

    (a)        a person registered under the Securities Act, OR

    (b)        an individual who:

(i) has a net worth, or net worth jointly with the individual’s spouse, at the date of the agreement of purchase and sale of the Security, of not less than $400,000, OR

(ii) has had in each of the 2 most recent calendar years, and reasonably expects to have in the current calendar year:

- annual net income before tax of not less than $75,000, OR

- annual net income before tax, jointly with the individual's spouse, of not less than $125,000; OR

    (c)        a corporation, partnership or trust that:

(i) has net assets of not less than $400,000, OR

(ii); has had in each of the 2 most recent calendar years, and reasonably expects to have in the current calendar year, net income before tax of not less than $125,000, OR

(d) a corporation in which all of the voting shares are beneficially owned by sophisticated purchasers or of which the majority of the directors are sophisticated purchasers, OR

(e) a general partnership in which all of the partners are sophisticated purchasers, OR

(f) a limited partnership in which a majority of the general partners are sophisticated purchasers, OR

(g) a trust in which all of the beneficiaries are sophisticated purchasers or the majority of the trustees are sophisticated purchasers.

APPENDIX III

THE PARTIES to this Agreement therefore agree:

1.     PURCHASE AND SALE OF COMMON SHARES

On the Closing, the Purchaser will purchase from the Issuer 50,000 common shares at a price of $0.10 per common share and the Issuer will deliver to the Purchaser certificates representing the common shares.

2.     DEFINITIONS

2.1     In this Agreement, which includes the cover page and all of the Appendices, the following words have the following meanings unless otherwise indicated:

(a)	“1933 Act” means the Securities Act of 1933 (United States of America), as amended;
(b)	“Alberta Act” means the Securities Act, (Alberta) S.A. 1981, c. S-6.1, as amended;
(c)	“Alberta Commission” means the Alberta Securities Commission;
(d)	“Alberta Rules” means the rules made under the Alberta Act;
(e)	“Applicable Legislation” means the B.C. Act and the Alberta Act, together with the regulations and rules made and promulgated thereunder and all administrative policy statements, blanket orders and rulings, notices, and other administrative directions issued by the Commissions;
(f)	“B.C. Act” means the Securities Act, (British Columbia) R.S.B.C. 1996, as amended; (g) (h) “B.C. Rules” means the rules made under the B.C. Act;
(g)	“B. C. Commission” means the British Columbia Securities Commission;
(h)	“B.C. Rules” means the rules made under the B.C. Act;
(i)	“Closing” means the closing of the purchase and sale of the Shares under this Subscription Agreement;
(j)	“Closing Date” means the day the Shares are issued to the Purchaser;
(k)	“Commissions” means the B.C. Commission and Alberta Commission;
(l)	“Exchange” means the Canadian Venture Exchange Inc.;
(m)	“Exemptions” means the exemptions from the prospectus requirements under sections 74(2)(4) and 74(2)(9) of the B.C. Act, section 128(h) of the B.C. Rules, British Columbia Instrument #72-503 and sections 107(1)(d) and (z) of the Alberta Act;
(n)	“Private Placement” means the offering of the Shares;
(o)	“Purchaser” means the person named as “Purchaser” in this Subscription Agreement and wherever Purchaser is used in the plural, it shall connote all persons who are a “Purchaser” under this form of Subscription agreement and who subscribe for Shares under the Offering;
(p)	“Purchaser’s Subscription Funds” means the amount subscribed for by the Purchaser under the Offering;
(q)	“Regulation S” means Regulation S promulgated under the 1933 Act; and
(r)	(r) “Shares” means the common shares in the share capital of the Issuer, as presently constituted, to be issued under the Offering.

2.2    In this Agreement, the following terms have the meanings defined in Regulation "S": "Directed Selling Efforts", "Foreign Issuer", "Substantial U.S. Market Interest", "U.S. Person" and "United States".

3.     PURCHASE AND SALE OF COMMON SHARES

3.1     The Purchaser, as principal, hereby subscribes for and agrees to purchase that number of Shares indicated on the Agreement to which this Appendix III is attached at a price of $0.10 (Cdn.) per Share, for that aggregate purchase price indicated on the Agreement to which this Appendix III is attached (the “Subscription Funds”).

3.2     The Purchaser shall pay the Subscription Funds to the Issuer on the date of execution of this Agreement (the “Payment Date”).

3.3     This Agreement, when executed by the Purchaser and delivered to the Issuer, will constitute a subscription for the Shares which will not be binding on the Issuer until accepted by the Issuer by executing the Agreement in the space provided above.

3.4     Within 15 business days of receipt by the Issuer of final approval by the Exchange of the Private Placement, the Private Placement shall close (the “Closing”) by the issuance of certificates for the Shares 3.5     The issue of the Shares will not restrict or prevent the Issuer from obtaining any other financing or from issuing additional securities or rights.

3.5     The issue of the Shares will not restrict or prevent the Issuer from obtaining any other financing or from issuing additional securities or rights.

4.     WARRANTIES AND DISCLAIMER

4.1     The Purchaser acknowledges, represents, warrants and covenants to and with the Issuer that, as at the date given above and at the Closing:

(a) no prospectus has been filed by the Issuer with the Commission in connection with the issuance of the Shares, the issuance is exempted from the prospectus requirements of the Applicable Legislation and that:

(i) the Purchaser is restricted from using most of the civil remedies available under the Applicable Legislation;

(ii) the Purchaser may not receive information that would otherwise be required to be provided to him under the Applicable Legislation; and

(iii) the Issuer is relieved from certain obligations that would otherwise apply under the Applicable Legislation;

(b) the Purchaser, wherever resident, is:

(i) purchasing sufficient Shares so that the aggregate acquisition cost of the Shares to the Purchaser is not less than $97,000, the Purchaser is not a corporation, partnership, trust, fund, association, or any other organized group of persons created solely, or used primarily, to permit the purchase of the Shares (or other similar purchases) by a group of individuals whose individual share of the aggregate acquisition cost of the Shares is less than $97,000, and the Purchaser is either:

(A) purchasing the Shares as principal and no other person, corporation, firm or other organization will have a beneficial interest in the Shares; or

(B)         if not purchasing the Shares as principal, is

(I) duly authorized to enter into this subscription and to execute all documentation in connection with the purchase on behalf of each beneficial purchaser, it being acknowledged that the Issuer may in the future be required by law to disclose on a confidential basis to securities regulatory authorities the identity of each beneficial purchaser of Shares for whom the Purchaser may be acting; and is

(a) a trust company, insurance company or financial institution that has been authorized to do business under the Financial Institutions Act (British Columbia);

(b) an adviser who manages the investment portfolio of clients through discretionary authority granted by one or more clients and who is registered as a portfolio manager under the B.C. Act or is exempt from such registration;

(c) a trust company or insurer, authorized under the laws of a province or territory of Canada other than British Columbia to carry on business in such province or territory; or

(d) a portfolio manager registered or exempt from registration under the laws of a province or territory of Canada, other than British Columbia, or a jurisdiction other than Canada and has provided the Issuer with an additional undertaking and certification in the form set out in Appendix I(B);

  and it is purchasing the Shares as an agent or trustee for accounts that are fully managed by it, and the aggregate acquisition cost of the Shares purchased for all the accounts managed by it is not less than $97,000; or

(II) is acting as agent for one or more disclosed principals, each of which principals is purchasing as a principal for its own account, not for the benefit of any other person, and not with a view to the resale or distribution of all or any of the Shares and each of which principals complies with subsection 4.1(b)(i) hereof; and

and if the Purchaser is an individual, the Purchaser has executed, prior to the execution of this Agreement, and delivered to the Issuer, a BCF #45-903F1 attached hereto as Appendix II(A);

OR

    (ii)        purchasing as principal and the Purchaser is:

(A) an employee, senior officer or director of the Issuer or of an affiliate of the Issuer and the Purchaser has not been induced to make this subscription by expectation of employment or continued employment; or

(B) a trustee on behalf of a person referred to in subparagraph (ii)(A) above; or

(C) an issuer all the voting securities of which are beneficially owned by one or more of the persons referred to in subparagraph (ii)(A) above;

OR

    (iii)        purchasing as principal and the Purchaser:

(A) is a spouse, parent, brother, sister, child or close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer; or

(B) is a company, all the voting securities of which are beneficially owned by one or more of a senior officer or director of the Issuer, or of an affiliate of the Issuer, or a spouse, parent, brother, sister, child or close personal friend of a senior officer or director of the Issuer, or of an affiliate of the Issuer; and

(C) the Purchaser has executed, prior to the execution of this Agreement, and delivered to the Issuer a BCF #45-903F1 or BCF #45-903F2, as applicable, attached hereto as Appendix II(A) (if the Purchaser is an individual) or Appendix II(B) (if the Purchaser is not an individual), respectively; or

OR

(iv) purchasing Shares under British Columbia Instrument #72-503 and the Purchaser has executed and delivered to the Issuer, the additional acknowledgements, representations and warranties set out in Exhibit I to this Appendix III; or

OR

(v) the Purchaser is the Business Development Bank of Canada, a bank, credit union, trust company or extra-provincial trust corporation authorized to carry on business under the Financial Institutions Act (British Columbia), a corporation that is a subsidiary of a bank and to which the Loan Companies Act (Canada) applies, the B.C. Community Financial Services Corporation established under the Community Financial Services Act (British Columbia), and insurance company or an extra-provincial insurance corporation licensed to do business under the Financial Institutions Act (British Columbia), a subsidiary wholly owned (except for voting securities required by law to be owned by directors of that subsidiary) of any of the foregoing, the government of Canada or a province, or a municipal corporation, public board or commission in Canada;

OR

(vi) the Purchaser is purchasing as principal, is not an individual and is designated as an exempt purchaser in an order made by the Executive Director of the B.C. Commission.

    (c)        the Purchaser, if resident in Alberta, is:

(i) purchasing as principal sufficient Shares so that the aggregate acquisition cost of the Shares to the Purchaser is not less than $97,000, the Purchaser is not a corporation, partnership, trust, fund, association, or any other organized group of persons created solely, or used primarily, to permit the purchase of the Shares (or other similar purchases) by a group of individuals whose individual share of the aggregate acquisition cost of the Shares is less than $97,000; or

(ii) is purchasing as principal and is:

(A) a senior officer or director of the Issuer; or

(B) a senior officer or director of an affiliate of the Issuer; or

(C) a spouse, parent, brother, sister or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer; or

(D) a company, all the voting securities of which are beneficially owned by one or more of a senior officer or director of the Issuer, or of an affiliate of the Issuer, or a spouse, parent, brother, sister or child of a senior officer or director of the Issuer, or of an affiliate of the Issuer; or

(E) a close friend or business associate of a promoter of the Issuer, or a company all the voting securities of which are beneficially owned by a single close friend or single business associate of a promoter of the Issuer;

    (d)        the Purchaser has not received a copy of an offering memorandum;

    (e)        to the best of the Purchaser’s knowledge, the Shares were not advertised;

    (f)        no person has made to the Purchaser any written or oral representations:

    (i)        that any person will resell or repurchase the Shares;

    (ii)        that any person will refund the purchase price of the Shares;

    (iii)        as to the future price or value of any of the Shares;

    (g)        this subscription has not been solicited in any other manner contrary to the Applicable Legislation or the 1933 Act;

(h) the Purchaser is not a “control person” of the Issuer as defined in the Applicable Legislation, will not become a “control person” by virtue of this purchase of any of the Shares, and does not intend to act in concert with any other person to form a control group of the Issuer;

(i) the offer was not made to the Purchaser when he was in the United States and at the time the Purchaser’s buy order was made, the Purchaser was outside the United States;

(j) the Purchaser is at arm’s length with the Issuer, unless the Issuer is advised to the contrary prior to the Closing;

(k) the Purchaser acknowledges that the Shares have not been registered under the 1933 Act and may not be offered or sold in the United States unless registered under the 1933 Act and the securities laws of all applicable states of the United States or an exemption from such registration requirements is available, and that the Issuer has no obligation or present intention of filing a registration statement under the 1933 Act in respect of the Shares;

(l) the Purchaser is not a U.S. Person;

(m) the Purchaser is not and will not be purchasing Shares for the account or benefit of any U.S. Person;

(n) the Purchaser (or others for whom it is contracting hereunder) has been advised to consult its own legal and tax advisors with respect to applicable resale restrictions and tax considerations, and it (or others for whom it is contracting hereunder) is solely responsible for compliance with applicable resale restrictions and applicable tax legislation;

(o) the Purchaser has no knowledge of a “material fact” or “material change” (as those terms are defined in the Applicable Legislation) in the affairs of the Issuer that has not been generally disclosed to the public, save knowledge of this particular transaction;

(p) the offer made by this subscription is irrevocable (subject to the Purchaser’s right to withdraw his subscription and to terminate his obligations as set out in this Agreement) and requires acceptance by the Issuer;

(q) the Purchaser has the legal capacity and competence to enter into and execute this Agreement and to take all actions required pursuant hereto and, if the Purchaser is a corporation it is duly incorporated and validly subsisting under the laws of its jurisdiction of incorporation and all necessary approvals by its directors, shareholders and others have been given to authorize execution of this Agreement on behalf of the Purchaser;

(r) the entering into of this Agreement and the transactions contemplated hereby will not result in the violation of any of the terms and provisions of any law applicable to, or the constating documents of, the Purchaser or of any agreement, written or oral, to which the Purchaser may be a part or by which he is or may be bound;

(s) this Agreement has been duly executed and delivered by the Purchaser and constitutes a legal, valid and binding agreement of the Purchaser enforceable against the Purchaser;

(t) the Purchaser has been independently advised as to the applicable hold period imposed in respect of the Shares by securities legislation in the jurisdiction in which the Purchaser resides and confirms that no representation has been made respecting the applicable hold periods for the Shares and is aware of the risks and other characteristics of the Shares and of the fact that the Purchaser may not be able to resell the Shares except in accordance with the applicable securities legislation and regulatory policies;

(u) the Purchaser, and any beneficial purchaser for whom the Purchaser is acting, is resident in the province or jurisdiction set out on the cover page of this Agreement;

(v) the Purchaser is capable of assessing the proposed investment as a result of the Purchaser’s financial experience or as a result of advice received from a registered person other than the Issuer or any affiliates thereof;

(w) if required by applicable securities legislation, policy or order or by any securities commission, stock exchange or other regulatory authority, the Purchaser will execute, deliver, file and otherwise assist the Issuer in filing, such reports, undertakings and other documents with respect to the issue of the Shares as may be required;

(x) the Purchaser acknowledges that the offering of securities under this Private Placement is restricted to purchasers in Canada that are resident in British Columbia and Alberta only, and in such other jurisdictions outside of Canada and the United States, where such securities may be lawfully offered for sale; and

(y) the Purchaser agrees that the above representations, warranties and covenants in this subsection will be true and correct both as of the execution of this subscription and as of the Closing Date.

4.2 The foregoing representations, warranties and covenants are made by the Purchaser with the intent that they be relied upon by the Issuer in determining its suitability as a purchaser of Shares, and the Purchaser hereby agrees to indemnify the Issuer against all losses, claims, costs, expenses and damages or liabilities which any of them may suffer or incur as a result of reliance thereon. The Purchaser undertakes to notify the Issuer immediately of any change in any representation, warranty or other information relating to the Purchaser set forth herein which takes place prior to the Closing.

4.3 The Issuer represents and warrants that, as of the date given above and at the Closing:

(a) the Issuer and its subsidiaries, if any, are valid and subsisting corporations duly incorporated and in good standing under the laws of the jurisdiction in which they are incorporated, continued or amalgamated;

(b) the Issuer and its subsidiaries, if any, are duly registered and licenced to carry on business in the jurisdictions in which they carry on business or own property where required under the laws of that jurisdiction;

(c) the authorized and issued capital of the Issuer is as disclosed to the Purchaser, and the outstanding shares of the Issuer are fully paid and non-assessable;

(d) the Issuer will reserve or set aside sufficient shares in its treasury to issue the Shares and such common shares, on receipt of full payment therefor, will be duly and validly issued as fully paid and non-assessable;

(e) except as qualified by the disclosure in all prospectuses, filing statements and press releases filed with the Commissions (the “Disclosure Record”), the Issuer is the beneficial owner of the properties, business and assets or the interests in the properties, business or assets referred to in the Disclosure Record, all agreements by which the Issuer holds an interest in a property, business or assets are in good standing according to their terms, and the properties are in good standing under the applicable laws of the jurisdictions in which they are situated;

(f) the Disclosure Record, subscription form and all other written or oral representations made by the Issuer to the Purchaser in connection with the Private Placement is and will be accurate in all material respects and does and will omit no fact, the omission of which does or will make such representations misleading or incorrect;

(g) the financial statements most recently filed with the Commissions have been prepared in accordance with Canadian generally accepted accounting principles, accurately reflect the financial position and all material liabilities (accrued, absolute, contingent or otherwise) of the Issuer as of the date thereof, and no adverse material changes in the financial position of the Issuer have taken place since the date thereof, save in the ordinary course of the Issuer’s business;

(h) the Issuer has complied and will comply fully with the requirements of all applicable corporate and securities laws and administrative policies and directions, including, without limitation, the Applicable Legislation in relation to the issue and trading of its securities and in all matters relating to the Private Placement;

(i) there is not presently any material change, as defined in the Applicable Legislation, relating to the Issuer or change in any material fact, as defined in the Applicable Legislation, relating to any of the Shares which has not been or will not be fully disclosed in accordance with the requirements of the Applicable Legislation;

(j) the issue and sale of the Shares by the Issuer does not and will not conflict with, and does not and will not result in a breach of, any of the terms of the Issuer’s incorporating documents or any agreement or instrument to which the Issuer is a party;

(k) neither the Issuer nor any of its subsidiaries is a party to any actions, suits or proceedings which could materially affect its business or financial condition, and to the best of the Issuer’s knowledge no such actions, suits or proceedings are contemplated or have been threatened except as disclosed in the Disclosure Record;

(l) there are no judgments against the Issuer or any of its subsidiaries, if any, which are unsatisfied, nor are there any consent decrees or injunctions to which the Issuer or any of its subsidiaries, if any, is subject;

(m) this Agreement has been or will be by the Closing, duly authorized by all necessary corporate action on the part of the Issuer, and the Issuer has full corporate power and authority to undertake the Private Placement;

(n) the Issuer is not in default of any of the requirements of the Applicable Legislation or any of the administrative policies or notices of the Commissions;

(o) no order ceasing or suspending trading in securities of the Issuer nor prohibiting the sale of such securities has been issued to and is outstanding against the Issuer or its directors, officers or promoters or against any other companies that have common directors, officers or promoters and no investigations or proceedings for such purposes are pending or threatened;

(p) the Issuer satisfies and will satisfy all necessary requirements under the Exemptions in order to permit the sale of the Shares to Purchasers who are qualified to purchase the Shares under the Exemptions, pursuant to this Private Placement; and

(q) the Issuer has not issued during the preceding 12-month period and is not concurrently issuing any security or securities to more than 24 purchasers, including the purchasers who will purchase under the Private Placement, under the Exemption at section 128(h) of the B.C. Rules.

4.4 The representations and warranties contained in this Section will survive the Closing.

4.5 The Purchaser hereby acknowledges that all warranties, conditions, representations or stipulations, whether express or implied and whether arising hereunder or under prior agreement or statement or by statute or at common law are expressly those of the Issuer. The Purchaser acknowledges that no information or representation concerning the Issuer has been provided to the Purchaser by the Issuer other than those contained in this Agreement and the Disclosure Record and that the Purchaser is relying entirely upon this Agreement and the Disclosure Record.

5.     CLOSING

5.1 The Closing will take place within fifteen business days after receipt by the Issuer of final approval of the Private Placement by the Exchange. The Purchaser acknowledges that, although Shares may be issued to other purchasers under the Private Placement concurrently with the Closing, there may be other sales of Shares under the Private Placement, some or all of which may close after the Closing. The Purchaser further acknowledges that there is a risk that insufficient funds may be raised on the Closing to fund the Issuer’s objectives and that further closings may not take place after the Closing.

5.2 The Purchaser will deliver to the Issuer this subscription agreement, duly executed, and payment in full for the total price of the Shares to be purchased by the Purchaser.

5.3 At Closing, the Issuer will deliver to the Purchaser the certificates representing the Shares purchased by the Purchaser registered in the name of the Purchaser or its nominee.

5.4 The Purchaser will also deliver to the Issuer, along with this Subscription Agreement:

(a) a fully executed a BCF #45-903F1 or BCF #45-903F2, attached hereto as either Appendix IIA (if the Purchaser is an individual) or Appendix IIB (if the Purchaser is not an individual), whichever is applicable to the Purchaser, if required under the applicable Exemption;

(b) if the Purchaser is not an individual, a fully executed Corporate Placee Registration Form (the “Form”) as set out in Appendix I(A), unless the Form is already on file with the Exchange and the Exchange has been advised of any changes in the information provided in the Form, prior to the Purchaser participating in the Private Placement;

(c) if the Purchaser is a “portfolio manager”, a fully executed additional undertaking and certification in the form set out in Appendix I(B); and

(d) if the Purchaser is relying on the exemption contained in British Columbia Instrument #72-503, a fully executed acknowledgement in the form attached as Exhibit I to this Appendix III.

5.5 If the Closing does not occur within 180 days after the date of execution of this Subscription Agreement, this Subscription Agreement may be terminated by either party by delivering notice of termination to the other, and the Issuer shall return the Subscription Funds to the Purchaser. The obligation of the Issuer to repay the loan will be cancelled upon the occurrence of the Closing and delivery by the Issuer of the certificate(s) representing the Shares to the Purchaser.

6.     HOLD PERIOD

6.1 The Purchaser acknowledges that the Shares will be subject to restrictions on resale until such time as the earlier to occur of:

             (a) a period of four months has elapsed from the date of issue of the Shares; or

             (b) an appropriate discretionary order is obtained pursuant to applicable securities laws.

6.2 The certificates representing the Shares will bear a legend denoting the restrictions on transfer imposed by the Applicable Legislation and by the policies of the Exchange. The Purchaser agrees to sell, assign or transfer the Shares only in accordance with the requirements of applicable securities laws and such legends.

7.     MISCELLANEOUS

7.1 The Purchaser hereby authorizes the Issuer to correct any minor errors in, or complete any minor information missing from the Corporate Placee Registration Form (Appendix I(A)), Portfolio Manager: Additional Undertaking and Certification (Appendix I(B)), BCF #45-903F1 (Appendix (IIA)) or BCF #45-903F2 (Appendix II(B)), which has been executed by the Purchaser and delivered to the Issuer.

7.2 The Issuer will be entitled to rely on delivery by facsimile machine of an executed copy of this subscription, and acceptance by the Issuer of such facsimile copy will be equally effective to create a valid and binding agreement between the Purchaser and the Issuer in accordance with the terms hereof.

7.3 This agreement is not assignable or transferable by the parties hereto without the express written consent of the other party hereto.

7.4 Time is of the essence of this Agreement and will be calculated in accordance with the provisions of the Interpretation Act (British Columbia).

7.5 Except as expressly provided in this Agreement and in the agreements, instruments and other documents contemplated or provided for herein, this Agreement contains the entire agreement between the parties with respect to the Shares and there are no other terms, conditions, representations or warranties whether expressed, implied, oral or written, by statute, by common law, by the Issuer, or by anyone else.

7.6 The parties to this Agreement may amend this Agreement only in writing.

7.7 This Agreement enures to the benefit of and is binding upon the parties to this Agreement and their successors and permitted assigns.

7.8 A party to this Agreement will give all notices to or other written communications with the other party to this Agreement concerning this Agreement by hand or by registered mail addressed to the address given above.

7.9 This Agreement is to be read with all changes in gender or number as required by the context.

7.10 This Agreement will be governed by and construed in accordance with the laws of British Columbia, and the parties hereto irrevocably attorn and submit to the jurisdiction of the courts of British Columbia with respect to any dispute related to this Agreement.

END OF APPENDIX III

EXHIBIT I

Additional Acknowledgements, Representations, and Warranties
of the Purchaser for use of British Columbia Instrument #72-503 Exemption

The Purchaser acknowledges, represents, certifies and warrants as at the date of execution of the subscription agreement of the Purchaser and at the closing of the Offering of common shares (the “Securities”) of Canplats Resources Corporation (the Issuer), that:

(a) no prospectus has been filed by the Issuer with the British Columbia Securities Commission in connection with the issuance of the Securities, the issuance is exempted from the prospectus requirement of the Securities Act (British Columbia) (the “Act”) or any regulations (the “Regulations”) promulgated under the Act and that:

(i) the Purchaser is restricted from using most of the civil remedies available under the Act and Regulations;

(ii) the Purchaser may not receive information that would otherwise be required to be provided to the Purchaser under the Act and the Regulations; and

(iii) the Issuer is relieved from certain obligations that would otherwise apply under the Act and the Regulations;

(b)     the Purchaser is not a resident of British Columbia and that:

(i) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities;

(ii) there is no government or other insurance covering the Securities;

(iii) there are risks associated with the purchase of the Securities;

(iv) there are restrictions on the Purchaser’s ability to resell the Securities and it is the responsibility of the Purchaser to find out what those restrictions are and to comply with them before selling the Securities; and

(v) from the requirements to provide the Purchaser with a prospectus and to sell securities through a person registered to sell securities under the Act and, as a consequence of acquiring securities pursuant to this exemption, certain protections, rights and remedies provided by the Act, including statutory rights of rescission or damages, will not be available to the Purchaser;

(c) the Purchaser is purchasing the Securities as principal and no other person, corporation, firm or other organization will have the beneficial interest in the Securities;