Lvdia Consolidated 8901-01' Lakefieid Research Mineralogy,' - Diamonds

Lakefieid Research Project 8901-017

Indicator Mineral Microscopy and Scanning Electron Microscope Analysis - Samples 2,3, and 4

Summarv

October 18, 1996

J. G. Davison. M.Se. Senior Mineralogist

Lakefieid Research Limited has completed the processing and qualitative compositional analysis as requested for three groups of mineral grains provided as selected by JvA. Please find attached report covering the mineralogical examination and scanning electron microscope - energy dispersive xray analysis of potential indicator mineral grains selected from the three groups by Lakefieid Research Limited.

No diamonds were identified in the three groups of mineral grains, two suspect grains were analysed by SEM-EDS.

A total of 56 potential indicator mineral grains were analysed by qualitative SEM-EDS. Three grains of pyrope garnet exhibiting low CaO and elevated MgO and Cr2O3 contents require quantitative electron microprobe analysis to confirm the presence of peridotitic Iherzolitic (G9) or harzburgitic (GIO) pyrope garnets; four grains of almandine-pyrope garnet require quantitative electron microprobe analysis including detailed Na2O analysis to confirm the presence of eclogitic almandine-pyrope (G5) garnet. The garnets typically were restricted to compositions of crustal metamorphic almandine, almandine-grossular and spessartine- almandine. These garnets fall outside the fields attributed to peridotitic Cr-pyrope or eclogitic almandine-pyrope garnets.

A single ilmenite grain contained slightly elevated levels of MgO and Cr2O3 ; further analysis by EMPA is recommended. Rare clinopyroxene exhibited only CaO-rich and chrome-poor compositions: clearly none of these grains fall within the requisite compositional field.

A total of eight grains (as noted in italics) should be submitted for quantitative electron microprobe analysis.

31C12NE0027 W9690.00087 TUDOR 010

Lydia Consolidated 8901-017 Lakefield Research Mineralogy - Diamonds

Introduction

Three groups of mineral grains provided as selected by JvA were submitted to the Lakefield Research Limited Mineralogy Group for the separation, identification and characterization of any contained diamonds and potential diamond indicator minerals.

Procedures

Each of the three samples was submitted for binocular microscopy; any potential indicator minerals were selected and mounted for scanning electron microscopy. A total of 56 potential indicator mineral grains were analysed by qualitative SEM-EDS.

Lydia Consolidated 8901-01 ~ Lakefield Research Mineralogy' - Diamonds

Results

No diamonds were identified in the three groups of mineral grains, two suspect grains were analysed by SEM-EDS.

A total of 56 potential indicator mineral grains were analysed by qualitative SEM-EDS.

The analytical data were characterized as follows:* Group l

* l. Ca-rich clinopyroxene* 2 . Ilmenite (minor Cr, Mg - submit for EMPA)* 3 . Pyrope (Cr present - submit for EMPA)* 4. Almandine* 5 . A lmandine* 6 . Almandine-pyrope (submit for EMPA)* 7. Almandine* 8 . Almandine-pyrope t submit for EMPA)* 9 . Almandine-pyrope (submit for EMPA)* 10. Andradite* 11. Andradite

* Group 2* l. Andradite-grossular* 2. Andradite-grossular* 3. Andradite-grossular* 4. Andradite-grossular* 5 . A lmandine* 6. Almandine-grossular* 7. Almandine

* Group 3* l. Ca-rich clinopyroxene* 2. Ca-rich ciinopyroxene* 3. Almandine* 5. Almandine* 6. Pyrope (submit for EMPA)* 7. Pyrope (submii for EMPA)* 10. Almandine-grossular* 11. Almandine-grossular* 1 2. A imandine.* 13. Almandine* \ A. A lmandine* 15. Aimandine-spessartine* 16. Aimandine* i 7. Almandine* l R. Almandine* i c/. AimanCiru -grossular' 20. Almandine

Lydia Consolidated 8901-01 7 Lakefield Research Mineralogy- - Diamonds

* Group 3 (continued)* 22. Almandine* 23. Almandine-spessartine* 24. Almandine* 25. Almandine* 27. Almandine* 28. Almandine* 29. Almandine* 30. Almandine* 31. Andradite* 32. Almandine-spessartine* 33. Almandine* 34. Almandine-spessartine* 35. Andradite-spessartine* 36. Almandine* 37. Andradite* 38. Almandine (spessartine^* 39. Almandine (spessartine)* 40. Almandine (spessartine)* 41. Almandine* 42. Almandine-pyrope (submit for EMPA)

A total of eight grains (as noted in italics) should be submitted for quantitative electron microprobe analysis.

Three grains of pyrope garnet exhibiting low CaO and elevated MgO and Cr2O3 contents require quantitative electron microprobe analysis to confirm the presence of peridotitic lherzolite (G9) or harzburgite (GIO) pyrope garnets; four grains of almandine-pyrope garnet require quantitative electron microprobe analysis including detailed Na^O analysis to confirm the presence of eclogitic almandine-pyrope (G5) garnet. SEM-EDS analyses for TWO pyrope garnets are appended.

The garnets typically were restricted to compositions of crustal metamorphic almandine, aimandine-grossular and spessartine-almandine. These garnets fall outside the fields attributed to peridotitic Cr-pyrope or eclogitic almandine-pyrope garnets.

A single ilmenite grain contained slight!} elevated levels of MgO and Cr2 O3 ; further analysis by EMPA is recommended.

Rare clinopyroxene exhibited only CaO-rich and chrome-poor compositions: clear!} none of these grains fall within the requisite compositional field.

Lvdia Consolidated 8901-01 ~ Lakefield Research Mineralogy- - Diamonds

Scanning Electron Microscope (SEM-EDS) - Garnet

f——5 F" : ! : :

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6901-017 PYROPE GARNET

8901-617 PYROPE GflRNET *2

rdid Consolidated diamondA DIVISION OF VON ANHALT INDUSTRIES INC.

R.R.3 Blezard Line Indian River, Ontario

Canada KOL2BO Tel. (41 6) 322-4345 Fax (705) 295-41 39

October 28, 1996 Indian River , Ontario, Canada KOL 2BO

folding*48 Par-La-Ville Road, Suite 709

Hamilton HMIIBemuda

Fax (809) 292-6587

Re : Brief report of york outlining

#1. The nature of the rocks and mineralization exposed:

#from report # LR 8900-914, samples numbers LCM 95-2-to-6 rocks exposed were:

a). Quartz-Biotite schistb) . Biotite Argillitec). Glaciolacustrine fine sand and siltd). Quartz-Biotite-carbonate Schist

Also, provided is a picture of the surveyed area before extensive exploration took place; before the area was opened.

#2. Assay results, with appropriate certificates, of any samples taken:

#enclosed are 2(two) reports from Lakefield Research dated July 5, 1995 respectively October 18, 1996.More reports are expected and will be provided to this and other offices .

#3. The type of equipment used:

For the project #3 were the contractors were Mr. Clark J. Brown and Mr. l i in i 'H LiTi; L the following machines were used:

&CL -^ttttjpovxa). John Deere 690- Hihoe (picture encloed)b). Link-Belt Hihoe (picture enclosed)c). Diamond core air drilling (picture enclosed)d). 2 (two) rock truckse). bulldozer f ) .water pump g) . chain-saws h). air compressor

#4. The dates that the equipment was used and the operators:

#the dates the project #3 took place are from June 15, 1996 to late September 1996. The work is still to be finished at a later

date. _________________________________________________________

fonsolidfltcd ^/Mnmond Wines ofA DIVISION OF VON ANHALT INDUSTRIES INC.

Quarter* folding*R R 3 Blezard Line 48 Par-La-Ville Road, Suite 709

Indian River, Ontario Hamilton HMII Canada KOL2BO Bemuda

Tel. (41 6) 322-4345 F8* (809) 292-6587 Fax (705) 295-4 139

M2 - 17, Macdonald Block 900 Bay Street Toronto, Ontario M7A 1C3

Roy Denomme Mining Recorder Sudbury/Southern Ontario Mining Divisions

Dear Sir:

Subject: Notice of DeficiencySubsection 10( 2 ) (a) ( iii ) ( iv) Ontario Regulation 116/91

DEFICIENCIES

WORK REPORT W9690. 00087

Physical Labour

As requested by your office the following information is being provided :(a) The make of bulldozer that was used by Rallison Excavating is CASCO XS

(b) The compressor was rented on a monthly basis at a rate of |850 per month and tax.

Type of compressor is SULLAIR with 3x50' air hose, one rock drill l 11 , 2' steel l' 1 , 4' steel l", 6' steel l", 30lb breaker (chisel. The compressor was used every day -except Sundays- since the time it was rented, which is November 15, 1995 until the month of June, and it was operated 8-9 hours daily. The operators were: Jurgen, Prinz von Anhalt; Emilia, Princess of Anhalt; Chris Chandler, Dean Demell, Dawn Demell. In addition to the rental supplies were purchased from the same rental place: Lakefield Rental .

(c) The water pump was rented on a monthly basis and with it came the following:- 316F 3" Flyght Rimp at $344.00 per month- 50 'x 3" Discharge Hose at $144.00 per month- 220 Adapter n/1- 618-C 8800 Watt Generator at $550.00 per month- l impellon purchased for the pump at $474.00 _______________

din Consolidated diamond Wines of CanadaA DIVISION OF VON ANHALT INDUSTRIES INC.

48 Par-La-Ville Road. Suite 709 Hamilton HMII

Bemuda Fax (809) 292-6587

R.R.3 Blezard Line Indian River. Ontario

Canada KOL2BO Tel. (416)322-4345 Fax (705) 295-41 39

Page 2Roy DenommeMining Recorder

The pump was rented for a period of three months and it was used every day with exception of Sundays and 3Saturdays.

Due to the fact that it was used in the winter time and spring it was necessary to have it on at all times about 7-8 hours per day .The operators were: Jurgen, Prinz von Anhalt; Chris Chandler, Dean Demell and Donald Bott .

We trust this information is explicit and that the work will now be recorded.

(~--"' Emilia, Princess of Anhalt

FROM : DON HNHftLT INDUSTRIES INC PHONE NO. Dec. 31 1996 01:06PM PI

gdifl fonsoHdfltcd ffiamond Wjines of J&-

R.R.3 Blezard UnaIndian River, Ontario

Canada KOL2BOTel. (416) 322-4346Fax (706) 296-413ft

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A DIVISION OF VON ANHALT INDUSTRIES INC.

46 Par-La-Vills Road, Suite 70S Hamilton HMII

Pax (809) 292-6587

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FROM : UON PlNHRLT INDUSTRIES INC PHONE NO. Dec. 31 1996 01:06PM P2

R.R.3 BlozardIndian River, Ontario

Canada KOL2BOTo). (416)322-4345Fax (706)286-4138

Wtincs of founds J!td.A DIVISION OF VON ANHALT INDUSTRIES INC.

48 Par-L*-Ville Road, Suite 709 Hamilton HMll

Bemuds Fax (809) 282-3687

J

souTii:r,;:; TARIO MINING DIVISION DECEIVED

Df C 3 'i 1996AM PM

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A,UST BE RETURNED NOT LATER THAN TIME

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MTIME , IN /\t

/UL.(^5 MRECEIVED PICK-UP BY

LAKEFIELD 652-3160

Lakcficld Rental fr Sales Ltd.MAILING ADDRESS: P.O. BOX 389, LAKEFIELD, ONT. KOL 2HO

G.S.T. No. R102941317

LAKEFIELD 652-3160

RENTED TO.

STREET ——

CITY

CUSTOMER ORDER NO.

LICENSE PHONE: HOME OFFICE

QUANTITY DESCRIPTION HOURLYRENTAL RATE

MIN. DAY WEEK MONTH TOTAL

A

SHORTAGE OR BREAKAGE

CONTRACT AGREEMENT

l we. or either of us. do hereby cert'f y thai we have this date received from LAKEFIEL.D RENTAL LTD the equipment and/or articles, hst*d and identified m mis. contract , -it is unoer stood ana agreed tha' this personal property is leased to us by said LAKEFIELD RENTAL LTD. and will be used by the lessee of the designated address lor the slated period and solely for the purpose for which sa id equipment was manufactured and intended, and subject

it is further understood and agreed that this equipment will not be the consent of the lessor

emoved from the address herein listed for use at any other address without

We further agree that said property was personally inspected and examined by us and found to be in first class condition when received We further agree that we hold LAKEFI ELD RENTAL LTD harmless frorn any liability whatsoever resulting from the gsc of said equip ment and further agree mat said property will be used solely by the lessee and/or persons herein designated and no other persons without the consent o* the lessor of said equipmentWe further agree that we will discontinue the use ol a ny ot said equipment should same at any time while in our possession became unsafe or ma state of disrepair, and will immediately notify LAKEFIELD RENTAL LTD. of said facts and the lessor in consideration of the mutualconvenants, agree thai it will with reasonable dispatch after receiving said notice replace said equipment with other equipment in goodworking conditionThe lessee further agrees that upon the termination of this lease agreement, as stated upon the face, hereof, the lessee will immediately returnthe rented merchandise or equipment and an attachments and parts belonging thereto to the office of LAKEFIELD RENTAL LTD. in thesame condition same was received, ordinary wear and Depreciation excepted, and agree to pay for any damage resulting to said equipment, orits value for loss or theft in the event the lessor must resort to litigation to be reimbursed tor damage caused to said equipment, or for loss ortheft, lessee agrees to pay all attorney's tees, court costs, or other expense which, becomes necessary to compensate lessor tor his repairing orhaving the equipment repaired or replacedin the event the lessee intends to extend the rental ot the equipment beyond the date ongmatly agreed upon, it is understood and agree-* tnat thelessee will immediately notify the lessor of said desire and obtam their approval and terms for said extension, within 24 hours, and ttv lessor mits discretion may enter and laKe all steps necessary to repossess the equipmentWe further agree that all charges for rental will De paid in advance, or immediately upon return ot merchandise, or upon receipt o, elementfor same and that all collection fees attorney fees, court costs, or any expense involved in the collection or rental charges will be borne bylessee

if RENTER does not return the equipment within 48 hours of the return date specified on this agreement or notify Lessor pt the location of saidequipment, then Lessor may presume that the Renter withholds said equipment illegally, and a charge of theft will be laid against the lesseeThe lessor at its own discretion may revert all charges to daily rate if monthly statement or invoice is not paid on due date, and the lessee shallbe responsible tor payment ot rental until the equipment has been returnedt have read the Terms and Conditions of this Rental Contract Agreement and agree thereto.

FUELDAMAGE

WAIVER INSURANCEDELIVERY

PICK UP

SUB TOTAL

G.S.T.

P.S.T.31

TOTAL

DEPOSIT

BALANCE

PLEASE NOTE: Repair charges it any will be invoiced later when costs have been determined m PER MONTH SERVICE CHARGE ON OVERDUE ACCOUNTS

MINIMUM CASH INVOICE $2.00 MINIMUM CHARGE INVOICE S5.00

DAMAGE WAIVERWhen a premium is charged, coverage against damage lo rented equipment from the perils setout below is provided to the lessee on such eouipment in the possession of the lessee during theterms ot the lease. The insurer's right ol subrogation is waivedPERILS COVERED AGAINSTFire, lightning, cyclone tornado or windstorm, explosion llood. collapse of bridges, strandingsintung, collision derailment or overturning ot land conveyancesDamage from the following risks is suDiect toS25.00 deductible vandalism, malicious

DELIVER TO

SIGNATURE.

Rent All CentreCobourg

30 Elgin Street West (90SJ372-6131

(348461 ONTARIO LIMITED)Peterborough

570 Ashburnham Drive(705)343-3000

RENTALS ARE CASH IN ADVANCE

Port Hope Highway * 2 East (905)885-2448

NIAL CUNIKAUI

121457n

CASH CHARGE G.S.T. *R106171978

s

tQl"|J0MENT ARTICLE RENTED DAY WEEKEND WEEK 4 WEEKS AMOUNT

r

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r

SALES

S—- C ~

LABOUR SHARPENINGUSED EQUIP. SALE

SALEDELIVERY

SUBTOTAL

ONTARIO SALES TAX

CONDITIONS UNDER WHICH TOOLS ft OTHER EQUIPMENT ARE RENTED -The lessee agrees to rent from the lessor the equipment herein described at the rate shown, subject to the terms herein containedThe equipment shall be returned on or before the return date specified herein or upon demand at any time by the lessor.The equipment shall remain the properly of the lessor who may inspect the same at any place a t a ny t ime.Use of the equipment by the lessee i s at h is own risk and he agrees to i ndemnify and save the lessor harmless f rom all claims for damage.liability, loss or injury whatsoever lo persons or property in any way connected with use of the equipment.The lessee will re-imburse the lessor lor any damage or loss t o the equipment, reasonable wear and tear only exceptedAccrued rental charges can not be applied against the purchase price or cost of repairs of such damaged or lost equipment.The lessee will not loan, sub-let or in BOY oiher way dispose of or encumber ihe equipment.The lessee will pay all necessary costs incurred to recover the equipment including bailiff and solicitor costs THE LESSEE HAS READTHE ABOVE AND AGREES THERE ARE NO OTHER TERMS OR CONDITIONS RESPECTING THE RENTAL OF THE EQUIPMENT.

The lessee shall assume all r rented equipment.

AGENT FOR LESSEE

ADDRESS

PHONE NO.

WE RENT TIME - WE CHARGE FOR ALL TIME OUT INCLUDING SATURDAYS, SUNDAYS AND HOLIDAYS 2K I NTEREST PEfi'^iOMTH ON OVERDUE ACCOUNTS.Your prompt return will save you money. A cleaning charge will be rnaefe-orritemsjceturned unclean.

•1 HAVE READ THE RENTAL COhnmCT.

RETURN COPY

UST BE RETURNED NOT LATER

LAKEFIELD 652-3160

RENTED TO i

STRFFT

CITY

THAN TIME

uuV^nlz /ftTIME f ' TO RECEI\

Lakefield Rental t Sales Ltd.MAILING ADDRESS: P.O. BOX 389, LAKEFIELD, ONT. KOL2HO

G.S.T. No. R102941317

/ED PICK-UP BY

LAKEFIELD 652-3160

CUSTOMER DRHFR NO

lir.FNRF PHONE: HOME /V^ ~ C^ 57 OFFICE ~ C/^ ~ ^/Z ~7

QUANTITY

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CONTRACT AGREEMENT

listed and identified m thii contract

RENTAL RATE HOURLY WIN. DAY WEEK MONTH

i ( d4(JtL

(Jj^Jij^ ^fadi

/O/ -,. , f Q— v-^\U^J'X. ———————6

D RENTAL LTD the equipment and/or articles,

D RENTAL LTD. and win be used by the lessee of

to the terms and conditions herein It is further understood and agreed that this equipment will not be removed from the address herein listed tor use at any other address without the consent ot the lessor We further agree that said property was personally inspected and examined by us and found to be in first class condition when received

ment and furt consent of tne We further agr a state of disn convenants, at working condiThe lessee furt

same condition its value for lo theft, lessee ag having the eqi in the event th* lessee will imrr Us discretion n- We further agr tor same and t lessee if RENTERdo equipment, the The lessor at it be responsible i have read the

er agree thai said property will be used solely by the lessee and/or person lessor ol said equipment

ee that we will discontinue the use oJ any of said equipment should same at e pa-r, and will immediately notify LAKEFIELD RENTAL LTD. of saic ree that it will with reasonable dispatch after receiving said notice rep ion

her agrees thai upon the ter m ma t ion of this tease agreement, as stated upor

same was received, ordinary wear and depreciation excepted, and agree tc s or theft In the event the lessor must resort to litigation to be reimburses

ipmenf repaired or replaced lessee intends to extend the rental of the equipment beyond the date origin* ediately nolify Ihe lessor of said desire and obtain their approval and terms ay enter and take all steps necessary to repossess the equipment

ee that all charges for rental will be paid m advance, or immediately upon hat ali collection fees, attorney tees, court costs, or any expense involved

fi Lessor may presume that the Renter withholds said equipment illegally s own discretion may revert all charges to daily rate if monthly statement o or payment of rental until The equipment has been returned Terms and Conditions of this Rental Contract Agreement and agree thereto

s herein designated and no other persons w

ny time while m our possession became un facts and the lessor in consideration of t h

lace said equipment with other equipmen

the face, hereof, the lessee will immediat the Office ot LAKEFIELD RENTAL LI pay for any damage resulting to said equi for damage caused to said equipment, or

tily agreed upon, it is understood and agree for said extension, within 24 hours, and tht

return of merchandise, or upon receipt ot in the collection or rental charges will be

-its agreement or notify Lessor of the locat and a charge of theft will be laid against t

r invoice is not paid on due date, and the le

.

ithout the

sate or in e mutual t tn good

•ly return •D. m the Dmenf, or or loss or pairing or

d that the lessor in

tatement born* by

on of said he lessee. sue shall

WAIV

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D/ 'ER INSU

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P

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FUEL\MAGE RANCELIVERY

ICKUP

SUB TOTAL

G.S.T.

P.S.T.

TOTAL

DEPOSIT

BALANCE

-EASE NOTE: Repair voiced later when costs D PER MONTH SER /6RDUE ACCOUNTS.

INIMUM CASH 1

TOTAL

6cb

/30

2z.^

^^H^67

^970

DO

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DCDC

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32(oL

charges if any will be have been determined VICE CHARGE ON

NVOICE $2.00MINIMUM CHARGE INVOICE S5.00

DAMAGE WAIVERWhen a premium is charged, coverage against damage to rented equipment from the perils setout below is provided 10 me lessee on such equipment m the possession of the lessee during theterms ot the iwse The insurer c right of subrogation a waivedPERILS COVERED AGAINSTFire, lightning, cyclone, tornado or wmdsiocm, explosion, flood, collapse ol bridges, stranding.sinking, collision derailment or overturning ol land conveyancesDamage from the following risks is subject to 125DO deductible vandalism, maliciousmiscntef, collision and upset or overturn, excluding theft and mysterious disappearance

DELIVER TO

/lUST BE RETURNED NOT LATER THAN TIMEOUT ,{ 7,

TIME IN

RECEIVED PICK-UP BY

LAKEFIELD 652-3160

Lakefield Rental fr Sales Ltd.MAILING ADDRESS: P.O. BOX 389, LAKEFIELD, ONT. KOL 2HO

., G.S.T. No. R102941317

LAKEFIELD 652-3160

RENTED TO.

STREET —-

CITY____

-i,

CUSTOMER ORDER NO.

LICENSE. PHONE: HOME .OFFICE.

QUANTITY DESCRIPTION RENTAL RATE HOURLY MIN. DAY WEEK MONTH TOTAL

HORTAGE OR BREAKAGE

CONTRACT AGREEMENTl, we, or either of us do herebv eerily that we nave this date received from LAKEFIELD RENTAL LTD the equipment and/or articles,listed and identified m this contract *it is understood and agreed t hat this personal property -s leased to us by said LAKEFIELD RENTAL LTD. and will be used by the lessee ofthe designated address tor the stated period and solely for the purpose for which said equipment was manufactured and intended, and subjectto the terms and conditions neremit is further understood and agreed that this equipment will nol be removed from the address herein listed for use at any other address withoutthe consent of the lessorWe further agree that said property was personally inspect ea and examined by us and found to be in first class condition when received.We further agree that we hold LA K E FI ELD RENTAL LTD harmless from any liability whatsoever resulting from the use of said equipment and further agree that said property will be used solely by the lessee and/or persons herein designated and no other persons without theconsent o) the lessor of said equipment

s s tate of disrepair, and will immediately notify LAKEFIELD RENTAL LTD. of said facts and the lessor in consideration of the mutual

working condition

The lessee further agrees thai upon the termination of this lease agreement, as stated upon the face, hereof, the lessee will immediately return the rented merchandise or equipment and all attachments and parts belonging thereto to the office of LAKEFI ELD RENTAL LTD. in the same condition same was received, ordinary wear and depreciation excepted, and agree to pay for any damage resulting to said equipment, or its value for loss or theft in the event the lessor must resort to litigation to be reimbursed for damage caused to said equipment, or tor loss or

having the equipment repaired or replacedin the event the lessee intends to extend the rental of the equipment Deyond the date originally agreed upon, it is understood and agreed that thelessee will immediately notify the lessor of said desire and obtain their approval and terms for said extension, within 24 hours, and the lessor inits discretion may enter and taKe all steps necessary to repossess The equipmentWe further agree that all charges for rental will be paid in advance, or immediately upon return of merchandise, or upon receipt of statementfor same and that all collection fees attorney tees, court costs, or any expense involved in the collection or rental charges will be borne bylesseeit RENTER does not return the equipment within 48 hours of the return date specified on this agreement or notify Lessor of the location of sardequipment then Lessor may presume that the Renter withholds said equipment illegally, and a charge of theft will be laid against the lessee.The lessor at its own discretion may revert all charges to daily rate if monthly statement or invoice is not paid on due date, and the lessee shallbe responsible tor payment of rental until the equipment has been returned

DAMAGE WAIVERWhen a premium 15 charged, coverage against damage to rented equipment from the perils setoui below is provided 10 the lessee on sucn equipment in the possession of the lessee during the rt d iwrrt T f~\terms of the lease The insurer's right ol suWogatton is waived U tLIVtM IU -^-^^^——^^-————PERILS COVERED AGAINSTFire, lightning, cyclone, to*nado or windstorm explosion, flood, collapse of bridges, stranding,sinHmg, collision derailment 01 overturning of land conveyances ^"—^ jf^Damage from the following risks .s subiect toS25.00 deductible vandalism, mahoous CIPKIATI 1RP A S /i S S mischief, collision and upset or overturn, excluding theft and mysterious disappearance Olv*INr\ l UliL. * *~^ ^ \^ -jLi**

FUELDAMAGE

WAIVER INSURANCEDELIVERY

PICK UP

SUBTOTAL

G.S.T.

P.S.T.4o 2.0

TOTAL

DEPOSIT

BALANCE

"7J 75

PLEASE NOTE: Repair charges il any w ill be invoiced later when costs have been determined 2S, PER MONTH SERVICE CHARGE ON OVERDUE ACCOUNTS.

MINIMUM CASH INVOICE S2.00 MINIMUM CHARGE INVOICE $5.00

ProposalCALDER CONSTRUCTION INC.

QST wn 100726593 R R. #1

WARSAW, ONTARIO KOL 3AO (705) 639-5571 Fax (705) 639 1067

'l ifya-f'.iBi.'.'iiGi! i

CODE

ha i eby suixnl! specifications and estimatas lor: Exert vat-Ion-'

C^ean dUit g Hoo4z -rock ^oi ptepdAajtioM/Jto Ex.eava.te. cuU. 61a,6t ^o/im a i ea rtpp-t-ox.. 50 ' x.50 ' x,3 V nppox.. 1 00 ' x-20 ' t.amp 20-25 aagte -inXo Load with. e.n&AVtdl .Lnto-~x.6Hh tiVLdk K In fl.iea. pi,ou,ided .

. oa-t toad with, feu.ttdoze^t g <tx.da.ua to^.^ctnd i tom h-UE. 0,6 t itt .ihoX; ^xoc/t ^ iom i Lte ^ o^t wet po-a-tion-i

#2 1,500. 00

. 00

. 4,5" ft 3". pit g tamp

Loadlivg 2 pit

e i

detonation

^15,520.00

7 -4 2-T ^ 5 O, O O

g 6(t-t.t 2, 200. pO

56,670.003,966.90

60 ,636.90

.' JUOjwse l imoby to furnish material and labour - complete in accoidance- with abovn specifications, for tho sum of:

dollars (ft ,. . ion! (o bo inadfi as follows: r i.;'

,v\ o itit'i'lni :'J (ji-nianiBecl lo be as ^pacillod All WMI./IO bo coinplwlad in a Vi'aiiTiH'ii'ike Miapiidr eacc-Kiiny lo stanclDiii prtnlloes Ai/1 olteiatlon or deviHiion itoin uh'r/o rfincH'caiipns Invoivlng oxlia costs will be eydculoii only upon will le'i oidvis find l"lll become en oxiia cliargc ovor andf abova (ho eslinialfr Ali PD'i'O 1 -s-ntf f 'intii.flpMi upon stri)i*?, or.-; Idonis ot do!i\wf hoyond our cunliol Ov.'net l-.i c.airj li.o, '.vliiJftoiin and^/fi 'i^^st/Jy InRiiyincci. Our woikois BIB 1'illy (un'C-Kd t y W'

AKcnhlnoe oiand ooiidiilons are

Authorized Signature

Note: Thifi proposal may be withdiawn by us if not accepted wilhin

above prices, specifications satislactory and are horoby accepted. You are

authorized to do the work as specified. Payment will be made as outlined above.

Oato of Acceptance:..

Signatur

Signature

Js**k /^\ i d-f''/L v l k/f

l.__E.

l *O,ooo

sr^uJ V

c

ITTREEVE

GLLMOUR

KOL 1WO

ANDREW j. MCMURRAYCLERK

TREASURER (613) 474-2583

ONT.

Emilia Von Anhalt, RR#3Blezzard LINE Indian River Ont. KOL 2BO 11/19/96

Dear Emilia,

This letter will serve to inform you that the road joining

the Wolf Lake road at lot 11 in the first Concession of Tudor

Township is not a Township road and might be simply an access

road and as such would be under the Road Access Act of the St

atutes of Ontario.

Sincerely,

Andrew McMurraty , A.McM/ r

12 M 10 9 8 7 6 5 4

VI. 120)

RALLISON EXCAVATINGR. R. #4

BANCROFT, ONTARIOKOL ICO

(613) 332-2902, (613) 332-1066

SOLD TO: LYDIA CONSOLIDATED MINES C/0 JURGEN VON ANHALT R. R. #3 BLEZARD LINE INDIAN RIVER, ONTARIO KOL 2BO 705-295-4129

INVOICE #14094

Nov 18/96 Nov 19/96 Nov 20/96 Nov 21/96

Nov 22/96

Nov 25/96

Nov 'Nov Nov Nov Dec Dec Dec Dec Dec Dec

27/9628/9629/9630/962/963/964/965/966/969/96

Dec 9/96

Nov 29/96

8-5 8 1/2 hours Work on Road 7-5 9 1/2 hours @ 3140/hour 7-5 10 hours @ 3140/hr no lunch 7-12:30 5 1/2 hours Rock removal 1-5 4 hours @ 3100.00 Rock to Road 7-S 9 1/1 hOUIS S lGG/hQttlE ROCfc to

Equipment Rental - Backhoe

SUB-TOTAL

Received on Account - Cash

7-5 9 1/2 hours @ 3100/hr Rock to Road7-5 9 1/2 hours @ $140/hr7-5 9 1/2 hours @ $140/hr7-4 9 hours @ $140/hr7-5 9 1/2 hours @ $140/hr7-5 9 1/2 hours @ 3140/hr7-5 9 1/2 hours @ $140/hr7-5 9 1/2 hours @ $140/hr7-5 9 1/2 hours @ $140/hr7-5 9 1/2 hours @ 3140/hr

52,000.001,330.001,400.00

770.00400.00950,00

150.00

57,000.00

4,500.00

950.001,330.001,330.001,260.001,330.001,330.001,330.001,330.001,330.001.330.00

SUB-TOTAL

Received on Account - Cash Canadian Received on Account - 3500 American

Balance owing as of December 9/96

Received on Account -Butterfield Bank - U.S.A. Exchange amount on cheque

315.350.00

1,000.00650.00

313.700.00

3,500.00

1,163.75

PENDING CLEARANCE OF CHEQUE FOR S 3, 50 O BALANCE OWING WOULD BE 39.036.25

wsoiidflted ffiamond Wines oA DIVISION OF VON ANHALT INDUSTRIES INC.

R.R.3 Blezard Line Indian River, Ontario

Canada KOL2BQ Tel. (416)322-4345 Fax (705) 295^139

48 Par-La-Ville Road. Suite 709 Hamilton HMII

Bemuda Fax (809) 292-6587

Page #2

There is work being done at the site now and will continue all winter long and spring.

#5. An uncoloured map of the workings is provided.

DcJtb A -hrrttct

0

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J

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fct-cu^i^ 9 iJ2i /•a!/-/

y fWy^tZudU'

/-nr

y

STATEMENT

C. J. BROWN DRILLING A BLASTINGala 885192 Ontario Inc.

R.R. l BANCROFT, ONTARIO KOL ICO

(613) 332-4549 Mobile (613) 969-7567

^

PLEASE DETACH AND RETURN WITH YOUR REMITTANCE

INVOICE NUMBER ; DESCRIPTION CHARGES BALANCE

BALANCE FORWARD

^........sS^TZI^j^

J^L^^^-J^LL

^U^&US-J^M^i^^^S^^

J-&L&,'^QM^..dti^.a.3*.^..,J,..)..., /y .- -. V" i/jiA vf f f\ f^

ftu^jd&Mat^^— -o*--Tk eft j*c^ f j^f y s /"

.,.,,......S..y75ife5...:.,,.,..........J........,..,..Z.^.f::..'.,.....,,.,..

^—^A^-^^^L?..'*7l ^^- ..flg(^M^..J!ML..J^.d^....,.....

MifltZSim

C. J . BROWN DRILLING 8. BLASTING

LYDIA INTERNATIONAL CORPORATION LTD.Publishing Division

Del-Bern House, 11 Victoria Avenue, P.O. Box N-4851, Nassau, Bahamas Fax:(809)326-2845

YrU

.

- \o., l O— \ O

y ~10

y 9 --t? li

Ministry ofNorthern Developmentand Mines

)ntario

Report of Work Conducted After Recording Claim

Mining Act

Transaction Number

wersonal Information collected on this form is obtained under the authority of the Mining Act. This information will be used for correspondence. Questions about iis collection should be directed to the Provincial Manager, Mining Lands, Ministry of Northern Development and Mines, Fourth Floor, 159 Cedar Street, udbury, Ontario, P3E 6A5, telephone (705) 670-7264!

istructlons: - Please tyr- Refer to tl

Recorder.- A separat- Technical- A sketch,

31C12NE0027 W9690 00087 TUDOR 900

ssment work or consult the Mining

.y this form.

lecorded Holder(s)

vcn^Client No.

Telephone No.

lining Division Township/AreaTA&Q

r/Vj^/c? M or G Plan No.

Dates Work Performed

York Performed (Check One Work Group Only)Work Group

XGeotechnical Survey

Physical Work, Including Drilling

Rehabilitation

Other Authorized Work

Assays

Assignment from Reserve

Type

\

rotal Assessment Work Claimed on the Attached Statement of Costs OMYote: The Minister may reject for assessment work credit all or part of the assessment work submitted if the recorded

holder cannot verify expenditures claimed in the statement of costs within 30 days of a request for verification.

Persons and Survey Company Who Performed the Work (Give Name and Address of Author of Report)Name Address

C T- ' -&&UAN&R/tovoH

/Q4U-/ LTD.\e^

y-**"'

(attach a schedule If necessary)

Certification of Beneficial Interest * See Note No. 1 on reverse side1 certify that at the time the work was performed, the claims covered in this work report were recorded in the current holder's name or held under a beneficial interest by the current recorded holder.

Date

vecgtfflft^-wRecorded Holder or Agppt (Signature)

fs 1 'lx l .1

' 7

Certification of Work Reporti certify (hat i have a personal knowledge of the facts set forth in this Work report, having performed the work or wilnessed same during and/or afterits completion and annexed report is true.

Name and Address of Person Certifying

Date Notice for Amendents Sent

Telepone No.

For Office Use Only SOUTHERN ONTARIO MINING DIVISIONTotal Value Cr. Recorded Dale Recorded

OH, M TT

:elved

AM

UfcC j 9 1996

7.8,9.10.11,12,1,8.3,4.5^

Ontario

Ministry ofNorthern Developmentand Mines

fv ,(ere du Developpement du Nord et des mines

Statement of Costs for Assessment Credit

Etat des couts aux fins du credit devaluation

Mining Act/Loi sur les mines

Transaction No./N 0 de transaction

Personal information collected on this form is obtained under the authority of the M ining Act. This information will be used to maintain a record and ongoing status of the mining claim(s). Questions about this collection should be directed to the Provincial Manager, Minings Lands, Ministry of Northern Development and Mines, 4th Floor, 159 Cedar Street, Sudbury, Ontario P3E 6A5, telephone (705) 670-7264.

Les renseignements personnels contenus dans la presente formule sont recueillis en vertu de la Loi sur les mines et serviront a tenir a jour un registre des concessions minieres. Adresser toute quesiton sur la collece de ces renseignements au chef provincial des terrains miniers, ministere du Developpement du Nord et des Mines, 159, rue Cedar, 4e 6tage, Sudbury (Ontario) P3E 6A5, telephone (705) 670-7264.

1. Direct Costs/Gouts directs

Type

Wages Salaires

Contractor'sand Consultant'sFeesDroits de('entrepreneuret de I'expert-conseil

Description

Labour Main-d'oeuvre

Field Supervision Supervision sur le terrain

Type

P5

Supplies UsedFournlturesutilisees

Equipment Rental Location de materiel

Type

OPS

Type

POM f

Amount Montant

40

5

Total Direct Costs Total des couts directs

Totals Total global

2. Indirect Costs/Couts indirects* * Note: When claiming Rehabilitation work Indirect costs are not

allowable as assessment work.Pour le remboursement des travaux de rehabilitation, les couts indirects ne sont pas admissibles en (ant que travaux devaluation.

Type

Transportation Transport

Food and Lodging Nourriture et hebergementMobilization and Demobilization Mobilisation et demobilisation

Description

Type

t&sifl^ 'iwa^&ff

UrDl '

Amount Montant

!X*

f/, boo

\t5cvv"

Sub Total of Indirect Costs Total partiel des couts Indirects

Amount Allowable (not greater than 20^ of Direct Costs) Montant admissible (n'exc6dant pas 20 96 des couts directs)Total Value of Assessment Credit Valeur totale du credit (Total of Direct and Allowable d'evaluationInrilrprt costs) (Total des cortis directs

Totals Total global

^-

3/I&705/0-rp

46/600

It. li 3

loM.M^et Indlrects admlsslbles

Note: The recorded holder will be required to verify expenditures claimed in this statement of costs within 30 days of a request for verification. If verification is not made, the Minister may reject for assessment work all or part of the assessment work submitted.

Note : Le titulaire enregistr6 sera tenu de verifier les defenses demandees dans le present etat des couts dans les 30 jours suivant une demande b cet effet. Si la verification n'est pas effectuee, le ministre peut rejeter tout ou une partie des travaux devaluation prSsentes.

Filing Discounts Remises pour depot

1 . Work filed within two years of completion is claimed at 10007o of the above Total Value of Assessment Credit.

1. Les travaux deposes dans les deux ans suivant leur achevement sont rembourses a 100 "/o de la valeur totale susmentionnee du credit d'evaluation.

2. Work filed three, four or five years after completion is claimed at 5007o of the above Total Value of Assessment Credit. See calculations below:

Total Value of Assessment Credit Total Assessment Claimed

x 0.50 =

2 . Les travaux d6pos6s trois, quatre ou cinq ans aprfes leur achevement sont rembours6s a 50 "/o de la valeur totale du credit devaluation susmentionn6. Voir les calculs ci-dessous.

Valeur totale du credit devaluation

x 0,50 -

Evaluation totale demanctee

Certification Verifying Statement of Costs Attestation de l 'etat des coOts

l hereby certify:that the amounts shown are as accurate as possible and these costs were incurred while conducting assessment work on the lands shown on the accompanying Report of Work form.

that as L-(Recorded Holder, f

to make this certification

•in Company)

J'atteste par la presente :que les montants indiqu^s sont le plus exact possible et que ces d6penses ont et6 engagees pour effectuer les travaux d'evaluation sur les terrains indiques dans la formule de rapport de travail ci-joint.

l am authorized Et qu'a titre de je suis autoris6(titulaire enregistre, representant, poste occupe dans la compagnie)

a faire cette attestation.

6

Signature

0212 (04/91)

Date

Nota : Dans cette formule, lorsqu'il 06signe des personnes, le masculin est utilisS au sens neutre.

Ontario

Ministry of Ministere du M2-17, Macdonald Block Northern Development Developpement du Nord 900 Bay street and Mines et des Mines Toronto, Ontario

M7A 1C3

Telephone: (416) 314-3782 Fax: (416) 314-3789

April 28, 1997

Jurgen Prinz von AnhaltEmilia Princess von AnhaltR.R. #3Blezard LineIndian River, OntarioKOL 2BO

Dear Sir and Madam:

Re: Approval of Work Report #W9690.00087 Township of Tudor_____^___^_____^_

Further to our letter of February 18, 1997, we have recorded the approval of work report #W9690.00087 as of April 22, 1997. The assessment work has been recorded as shown on the attached assessment work credit form.

If you require additional information please do not hesitate to contact this office.

Yours very truly,

Mining RecorderSudbury7Southern OntarioMining Divisions

/d j

Att.

ASSESSMENT WORK CREDIT FORM

DATE: April 22, 1997 TRANSACTION NUMBER: W9690.00087

RECORDED HOLDER: Jurgen Prinz von AnhaltEmilia Princess von Anhalt

TOWNSHIP: TudorCLIENT NUMBER: 300883/300933

Level of Assessment Credit to be approved $81,498

CLAIM VALUE OF VALUE OF WORK VALUE OF WORKNUMBER WORK DONE APPLIED ASSIGNED RESERVE

SO 1195077 $ 81,498 $ 24,000 O $ 57,498

TOTAL S 81,498 $ 24,000 O $ 57,498

THE TOWNSHIPLimerick

•til ConMd luftM. Cnklt l,itn

10 9 li DOR20 19 . 18 17 16 15 129 28

COUNTY OF HASTINGS

MINING DIVISION

SCALD I-INCH*40 CHAINSLEGEND

PATENTED LANDCROWN LAND SALE LEASESLOCATED LAND LICENSE OF OCCUPATION MINING RIGHTS ONLY SURFACE RIGHTS ONLYROADSIMPROVED ROADS KING'S HIGHWAYS RAILWAYS POWER. LINES MARSH OR MUSKEGMINESCANCELLED ' TRAILS PATENTED S.RJb

(Q) s R o as

NOTESThis MapHs Not To JJfr Used FOR SUFh/EV PURPOSES.

Lot And Coneettion Lint* Showw1 Htrton Arc Projected From The B*tt I nformation* AvoHithl* But Their True Petition Is Not Guarantee d. For Official Survey Purposes Consult Tn* Original Survey Plans And Field Notes Of Records In The Ministry of Notjrol Rasources

400 Surfoce right* reservation1 otcmg tt* •wrw* n of oil lokee ond rhrers. .

R) 3.RA NOT OPEN FOB STAKING UNDERSUBSECTION 3O(B), MINING ACT, R.S.O. 1990 M.R.O. - lilNtNG WGHTS OV*LY S.R.O. - SURFACE RIGHTS ONLY MBS - MININQ a SURFACE RIGHTS

ORDER li DATE . WSP. PILE

."',

'W- :' '•- ?if':-"/ ^ ;-

- t . ":1 -*-13...—-;**f-

*73 O0*73

THE INFORMATION THAT APPEARS ON THIS MAP HAS BEEN COMPILED FROM VARIOUS SOURCES, AND ACCURACY 18 NOT GUARANTEED. THOSE WISHING TO STAKE MIN ING CLAIMS SHOULD CON SULT WITH THE MINING RECORDER. MINISTRY OF NORTHERN DEVELOP MENT AMD MINES. FOR AD DITIONAL INFORMATION ON THE STATUS OF THE LANDS SHOWN HEREON.

34 33

/Modpc Twp