FORM C

Province of

British Columbia

(This area for Land Title Office Use)

1. Application: (Name, address, phone number and signature of applicant, applicant’s solicitor or agent)

2. Parcel Identifier(s) and Legal Description(s) of Land:

PID:

009-675-167

District Lot 1127, Sayward District

3. Nature of Interest:*

DESCRIPTION

DOCUMENT REFERENCE

PERSON ENTITLED TO INTEREST

(page and paragraph)

Section 219 Covenant

Entire instrument

Transferee

Section 218 Statutory Right of Way

Section 9

Transferee

Rent Charge

Section 11

Transferee

4. Terms: Part 2 of this instrument consists of (select one only)

(a)

Filed Standard Charge Terms

____ D.F. No.

(b)

Express Charge Terms

Annexed as Part 2

(c)

Release

____ There is no Part 2 of this instrument

A selection of (a) includes any additional or modified terms referred to in item 7 or in a schedule annexed to this

instrument. If (c) is selected, the charge described in Item 3 is released or discharged as a charge on the land described

in Item 2.

5. Transferor(s):*

128 Tiber bay Road

Mansons Landing, Cortes Island BC

V0P 1K0

6. Transferee(s): (Including occupation(s), postal address(es) and postal code(s))*

TLC THE LAND CONSERVANCY OF BRITISH COLUMBIA, a society registered in

British Columbia (Registration No. S-36826), 2709 Shoreline Dr, Victoria BC V9B 1M5

AND

REGIONAL DISTRICT OF COMOX-STRATHCONA, 600 Comox Road, Courtenay, BC

V9N 3P6

7. Additional or Modified Terms:*

N/A

Page 2 of 54

FORM C

Province of

British Columbia

8. Execution(s): **

This instrument creates, assigns, modifies, enlarges, discharges or governs the priority of the

interest(s) described in Item 3 and the Transferor(s) and every other signatory agree to be bound by this instrument, and

acknowledge(s) receipt of a true copy of the filed standard charge terms, if any.

EXECUTION DATE

Officer Signature(s):

Y M D

Party(ies) Signature(s)

05

ECO INITIATIVES (INC) by its

authorized signatory(s)

____________________________

print name

(as to signature)

05

TLC THE LAND CONSERVANCY OF

BRITISH COLUMBIA by its authorized

signatory(s)

William Turner

print name

05

THE REGIONAL DISTRICT OF

COMOX-STRATHCONA by its

authorized signatory(s)

print name

print name

(as to both signatures)

OFFICER CERTIFICATION: Your signature constitutes a representation that you are a solicitor, notary public or other

person authorized by the Evidence Act, R.S.B.C. 1979, c. 116 to take affidavits for use in British Columbia and certifies

the matters set out in Part 5 of the Land Title Act as they pertain to the execution of this instrument.

*

If space is insufficeint, enter “SEE SCHEDULE” and attach schedule in Form E.

**

If space is insufficient, continue executions on additional pages in Form D

Page 3 of 54

TERMS OF INSTRUMENT - PART 2

The Agreement is dated for reference the __ day of , 2005 is

BETWEEN:

(the “Owner”)

AND:

TLC THE LAND CONSERVANCY OF BRITISH COLUMBIA, (Reg. No. S-36826)

(“TLC”)

AND:

WHEREAS:

A.

The Owner is the registered owner of the Land;

B.

The Land contains significant amenities, including flora, fauna and natural

features, of great importance to the Owner, to the Covenant Holders, and to the

public;

C.

A statutory right of way pursuant to s. 218 of the Land Title Act of British

Columbia in favour of the Covenant Holders is necessary for the operation and

maintenance of the undertakings of the Covenant Holders;

D.

TLC The Land Conservancy of British Columbia has been designated by

the then Minister of Environment, Lands and Parks as a person authorized to

accept covenants under s. 219 of the Land Title Act of British Columbia and as a

person authorized to accept statutory rights of way pursuant to s. 218 of the Land

Title Act of British Columbia;

E.

The Regional District of Comox-Strathcona has been designated by the

then Minister of Environment, Lands and Parks as a person authorized to accept

covenants under s. 219 of the Land Title Act of British Columbia and as a person

authorized to accept statutory rights of way pursuant to s. 218 of the Land Title

In consideration of the payment of two dollars ($2.00) now paid by the Covenant

Holders to the Owner (the receipt and sufficiency of which is acknowledged by

the Owner), and in consideration of the promises exchanged below, the parties

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agree as follows, in accordance with sections 218 and 219 of the Land Title Act

(British Columbia):

1. Definitions and Interpretation

1.1 In this Agreement:

(a)

“Adaptive Management” means the rigorous combination of

management, research, and monitoring so that credible information

is gained and management activities can be modified by

experience.

(b)

"Amenity" includes any natural, scientific, environmental, wildlife,

plant life or cultural value relating to the Land;

(c)

“Business Day” means, a day on which the Land Title Office in New

Westminster, BC is open.

(d)

"Covenant Holder" means, unless the context otherwise requires,

TLC The Land Conservancy of British Columbia or the Regional

District of Comox-Strathcona, singularly;

(e)

“Covenant Holders” means, unless the contest otherwise requires,

TLC The Land Conservancy of British Columbia and the Regional

District of Comox-Strathcona, collectively;

(f)

"CPI" means the All-Items Consumer Price Index published by

Statistics Canada, or its successor in function, for Vancouver,

British Columbia, where 2005 equals 100;

(g)

“Ecosystem-based Forest Management Area” means that part of

the Land that is used for sustainable forest management as shown

in Schedule D.

(h)

“Ecosystem-based Forest Plan” means a plan for Ecosystem-based

Forestry that, without limitation:

(i) has been prepared by a registered professional forester with

experience in Ecosystem-based Forestry;

(i)

"Ecosystem-based Forestry" means a low-impact approach to

forest management that maintains a fully functioning forest within

the natural historic range of spatial and temporal variability. Its

practices favour native tree and plant species which provide for the

needs of wildlife and their habitats.

(j)

“Land" means the parcel of land legally described as: PID 009-675-

167, District Lot 1127, Sayward District ;

(k)

"Natural State” means the state of the Land as described in the

Report with:

(i) such gradual changes thereto as occur over time as a result of

natural processes, including windthrow and usual seasonal

flooding and erosion; and

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(ii) such changes thereto as may from time to time take place as a

result of the use of the Land in compliance with the provisions of

this Instrument;

(l)

"Notice of Enforcement" means a notice of enforcement given in

this Agreement;

(m) "Old Growth Forest" means a mature forest ecosystem containing a

broad diversity of plant, fungi, bacteria and animal species and

relatively untouched by humans;

(n)

"Owner" means ECO INITIATIVES INC. and includes any

Successor of the Owner in this Agreement;

(o)

“Protected Area” means that part of the Land that is used biological

conservation purposes as shown in Schedule D.

(p)

“Regional District of Comox-Strathcona” means the Regional

District of Comox-Strathcona, an office of the regional government

and includes its permitted successors and assignees as provided in

Section 13;

(q)

"Rent Charge" means the rent charge granted by the Owner under

section 11;

(r)

"Rent Charge Amount" means the amount set out in section 11.2,

the payment of which is secured by the Rent Charge;

(s)

"Report" means the baseline documentation report that describes

the Land and the Amenities in the form of text, maps, photographs

and other records of the Land and the Amenities as of the date of

registration of this Agreement. A copy of which is attached to this

Agreement as Schedule A.;

(t)

“Residential Use Area” means that part of the Land that is used for

low impact dwellings and gardens as shown in Schedule D.

(u)

“Service Corridor” means the area that services, driveways or

access from Tiber Bay Road may be located.

(v)

"Successor" means a person who, at any time after registration of

this Agreement, becomes the registered owner of the Land or any

part of the land by any means, including a beneficial owner;

(w) “sustainable” is a state in which its integrity, composition and

functioning is maintained in perpetuity; andZ

(x)

"TLC The Land Conservancy of British Columbia" means a society

registered in British Columbia (Registration No.S-36826) and

includes its permitted successors and assignees as provided in

Section 13.

1.2 Where this Agreement says something is in the "sole discretion" of a

party, that thing is within the sole, absolute and unfettered discretion of that party.

1.3 This Agreement shall be interpreted in accordance with the laws of British

Columbia and the laws of Canada applicable in British Columbia.

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1.4 This Agreement is comprised of the recitation of the parties, the recitals to

this Agreement, the Schedules to this Agreement and Part 1 of the Land Title Act

of British Columbia Form C to which this Agreement is attached.

1.5 In this Agreement:

(a)

reference to the singular includes a reference to the plural, and vice

versa, unless the context requires otherwise;

(b)

where a word or expression is defined in this Agreement, other

parts of speech and grammatical forms of the same word or

expression have corresponding meanings;

(c)

reference to a particular numbered section or article, or to a

particular lettered Schedule, is a reference to the correspondingly

numbered or lettered article, section or Schedule of this Agreement;

(d)

article and section headings have been inserted for ease of

reference only and are not to be used in interpreting this

Agreement.

(e)

the word "enactment" has the meaning given to it in the

Interpretation Act (British Columbia) on the reference date of this

Agreement;

(f)

reference to any enactment is a reference to that enactment as

consolidated, revised, amended, re-enacted or replaced, unless

otherwise expressly provided;

(g)

reference to a "party" or the "parties" is a reference to a party, or

the parties, to this Agreement and their respective successors,

assigns, trustees, administrators and receivers; and

(h)

reference to a "day", "month" or "year" is a reference to a calendar

day, calendar month, or calendar year, as the case may be, unless

otherwise expressly provided.

2. Representations and Warranties

2.1 The Owner warrants that the facts set out in Recital A are true as of the

date of this Agreement.

2.2 TLC The Land Conservancy of British Columbia represents and warrants

that the facts set out in Recital D are true as of the date of this Agreement.

2.3 The Regional District of Comox-Strathcona represents and warrants that

the facts set out in Recital E are true as of the date of this Agreement

2.4 The parties each agree that Recitals B and C are true as of the date of this

Agreement.

3. Intent of Agreement

3.1 The parties each agree that the intent of this Agreement is as follows, and

that this Agreement is to be interpreted, performed and applied

accordingly:

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(a)

to protect, conserve, maintain and enhance the Land and

Amenities in a Sustainable state, and to preserve the Protected

Area in a Natural State;

(b)

to prevent any occupation or use of the Land that will significantly

impair or interfere with the Sustainable state of the Land or the

Amenities and to prevent any use of the Protected Area that will

significantly impair or interfere with their Natural State; and

(c)

to permit the development and practice of Ecosystem-Based

Forestry in the Ecosystem-based Forest Management Area.

(d)

to permit the creation of small-footprint dwellings and outbuildings

whilst maintaining and protecting any sensitive areas from building

activity.

3.2 This Agreement shall be perpetual to reflect the public interest in the

protection, conservation, maintenance and enhancement of the Land and

preservation of the Protected Area.

4. Baseline Documentation Report

4.1 The parties agree that the Land and the Amenities are described in the

Report, a copy of which is on file with each of the parties at the addresses set out

in this Agreement, an overview of which is attached as Schedule A to this

Agreement.

4.2 The parties agree that the Report is intended to serve as an objective

information baseline for monitoring compliance with the terms of this Agreement

and the parties each agree that the Report and Schedule A provide an accurate

description of the Land and the Amenities at the date of this Agreement.

4.3 The parties each acknowledge that the flora and fauna on the Land will

evolve through natural succession over time and, unless otherwise expressly

stated, references to the Report in this Agreement are intended to take into

account the natural succession of the flora and fauna over time, without human

intervention other than as expressly permitted by this Agreement.

5. Restrictions on the Land

5.1 Except as expressly permitted in this Agreement, the Owner shall not do

anything, omit to do anything, allow anything to be done, or allow the omission of

anything, that does or could reasonably be expected to destroy, impair, diminish,

negatively affect, or alter the Land or the Amenities from the condition described

in the Report. Without restricting the above:

(a)

the Land shall not be subdivided;

(b)

the Owner shall not, except with the prior written approval of the

Covenant Holders, in their sole discretion, perform or allow the

performance of any of the restricted activities or uses of the Land

set out in Schedule B to this Agreement;

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(c)

No easements or Rights of Way may be registered on the land

except those found in Section 7 and 9;

(d)

No activity or action on the Land or use of the Land shall be

performed or permitted which may be expected to be detrimental or

adverse to ground and surface water conservation in quantity,

quality, or timing in flow;

(e)

No hunting, fishing or trapping, for commercial or sport purposes

shall be performed or permitted on the Land;

(f)

No firearms of any kind shall be discharged or permitted to be

discharged on the Land;

(g)

No removal, exploration for, or deposit in any soil, gravel, or rock in

the Land;

(h)

No depositing in or on the Land any fill, soil, rock, rubbish, ashes,

garbage, waste or other material foreign to the Land except that

which is allowed by this Agreement in Schedule B and C;

(i)

No recreational access to 4 wheel drive vehicles or all terrain

vehicles;

(j)

No commercial activity is allowed on the Land except where it is

related to materials produced on the Land or to the purposes of

ecosystem-based forestry or home-based commercial ventures that

do not affect the land base; and

(k)

No camping shall be allowed.

6. Dispute Resolution

6.1 If there is a disagreement regarding a breach of this Agreement which has

occurred or is threatened, or if there is disagreement as to the meaning of this

Agreement, the Owner or either of the Covenant Holders may give notice to the

other parties requiring a meeting of all parties within 15 Business Days of receipt

of the notice. The parties must attempt to resolve the disagreement, acting

reasonably and in good faith, within 20 Business Days of receipt of the notice.

6.2 If the parties are not able to resolve the disagreement within that time, the

parties will initiate the procedures set out in the Notice to mediate (General)

Regulations to the Law and Equity Act of BC.

7. Owner's Reserved Rights

7.1 The Owner reserves all of its rights as owner of the Land, including the

right to use, occupy and maintain the Land in any way that is not expressly

restricted or prohibited by this Agreement, so long as the use, occupation or

maintenance are consistent with the intent of this Agreement.

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7.2 The Owner may place a covenant on 5 acres of the southwest corner of

the Land to be held by the Regional District of Comox Strathcona and one other

Party (Schedule E).

7.3 A Right of Way may be placed on the northwestern lot boundary and

adjacent to Tiber Bay Road for use as a public trail in the approximate location

shown on Schedule F. This trail must be built to the established trail-building

policies of the Regional District of Comox-Strathcona.

7.4 An Easement may be placed along Tiber Bay Road (Schedule G).

7.5 Subject to Section 5.1, the rights set out in Schedule C for each area

shown on Schedule D are expressly reserved to the Owner. Each area in

Schedule D was delineated by reference to the Report and to the type of activity

permitted in the area.

7.6 Subject to section 7.5, nothing in this Agreement restricts or affects the

right of the Owner or any other party to do anything reasonably necessary to:

(a)

prevent, abate or mitigate any damage or loss to any real or

personal property; or

(b)

prevent potential injury or death to any individual.

7.7 Despite the rest of this Agreement,

(a)

in an emergency situation, such as fire or threat to human safety, a

living or dead tree on the Land may be cut down or trimmed without

the consent of the Covenant Holders, but the Owner shall notify the

Covenant Holders of the circumstances of such action within 30

days, including the actual or likely effect on the Land or the

Amenities.

7.8 If the Owner or any other party intends to do anything described in section

7.6, the Owner shall give at least 30 days' prior written notice to each Covenant

Holder, describing in reasonable detail the intended action, the reason for it, and

its likely effect on the Land or the Amenities. Despite the rest of this Agreement,

the Owner shall permit each Covenant Holder to enter upon and inspect the Land

if any such action is proposed under section 7.6. A Covenant Holder may

comment on the proposed action and the Owner and any other party must take

those comments into consideration before doing anything under that section.

8. Owner's Obligations As To Taxes and Other Matters

8.1 The Owner retains all responsibilities and bears all costs and liabilities

related to the ownership, use, occupation and maintenance of the Land, including

any improvements expressly authorized by this Agreement.

8.2 The Owner shall indemnify each Covenant Holder, their directors, officers,

employees, agents and contractors, from and against any and all liabilities,

damages, losses, personal injury or death, causes of action, actions, claims, and

demands by or on behalf of any person, arising out of any act or omission,

Page 10 of 54

negligent or otherwise, in the use, occupation and maintenance of the Land or

the Amenities by the Owner.

8.3 The Owner is liable for any and all breaches of this Agreement, but the

Owner is not liable for:

(a)

breaches of this Agreement which occur while the Owner is not the

registered owner of any interest in the Land;

(b)

injury or alteration to the Land or the Amenities resulting from

natural causes, or causes beyond the Owner's reasonable control,

including accidental fire, flood, storm, vandalism, trespass and

earth movement, but excluding injury or alteration resulting from

actions of the Owner or any other person acting with the actual or

constructive knowledge of the Owner; or

(c)

any prudent action taken by the Owner under emergency

conditions to prevent, abate, or mitigate significant injury to the

Land or the Amenities resulting from natural causes, including

accidental fire, flood, storm and earth movement.

8.4 Without limiting the above, the Owner:

(a)

is solely responsible and liable for any loss or damage, or liability of

any kind (whether civil, criminal or regulatory), in any way

connected with the existence in, on, from, to or under the Land

(whether through spill, emission, migration, deposit, storage or

otherwise) of any pollutant, contaminant, waste, special waste, or

any matter that impairs the environment ("Contaminant"); and

(b)

shall indemnify each Covenant Holder from and against any loss,

damage, liability, cause of action, action, penal proceeding,

regulatory action, order, directive, notice or requirement, including

those of any government agency, incurred, suffered, brought

against or instituted against each Covenant Holder, jointly or

severally, in any way associated with anything described in section

8.4(a).

8.5 Where the Owner is not responsible for damage or theft due to trespass or

vandalism, the Owner will take all reasonable steps to identify and prosecute the

person responsible and to seek financial restitution for the damage or theft.

8.6 The Owner shall pay when due all taxes, assessments, levies, fees and

charges of whatever description which may be levied on or assessed against the

Land and shall pay any arrears, penalties and interest in respect thereof.

8.7 The Owner shall indemnify each Covenant Holder from and against any

fee, tax, or other charge which may be assessed or levied against the Owner or

Covenant Holders pursuant to any enactment, including the Income Tax Act

(Canada) with respect to the Land or with respect to this Agreement, including

any fee, tax or other charge which may be assessed or levied against the Owner

or the Covenant Holders as a result of the amendment or termination of this

Agreement.

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8.8 Any debts or other amounts due from the Owner to the Covenant Holders

under this Agreement, if not paid within 30 days after notice, shall bear interest at

the annual interest rate that is 3 percent greater than the prime rate of interest.

For the purposes of this section, the "prime rate of interest" is the annual rate of

interest charged from time to time by the Bank of Montreal, at its main branch in

Vancouver, British Columbia, for demand Canadian dollar commercial loans

made to its most creditworthy commercial customers and designated from time to

time by the Bank of Montreal as its prime rate.

8.9 For clarity, the indemnities granted by the Owner to the Covenant Holders

under this Agreement are indemnities granted as an integral part of the section

219 Land Title Act of British Columbia covenant created by this Agreement.

9. Statutory Right of Way For Monitoring and Enforcement

9.1 The Owner grants to each of the Covenant Holders a license, and a

statutory right of way pursuant to s. 218 of the Land Title Act, permitting each of

the Covenant Holders to do the following:

(a)

to enter upon and inspect the Land:

(i)

at least once each calendar year, with the date for each

inspection to be agreed upon by the parties before August 31 each

year, but if the parties cannot agree on those days by August 31 in

any year, the Covenant Holders are entitled to enter upon and

inspect the Land in accordance with section 9.1(a)(ii); and

(ii)

at all reasonable times upon prior notice by a Covenant Holder

to the Owner of at least forty-eight (48) hours, unless, in the opinion

of a Covenant Holder, there is an emergency or other circumstance

which does not make giving such notice practicable, in the sole

discretion of the Covenant Holder;

(b)

as part of inspection of the Land, to take samples, photographs and

video recordings as may be necessary to monitor compliance and

enforce the terms of this Agreement;

(c)

to enter upon and protect, preserve, conserve, maintain, enhance,

restore or rehabilitate, in that Covenant Holder's sole discretion and

at that Covenant Holder's expense, the Land or the Amenities to as

near the condition described in the Report as is practicable if an act

of nature or human agency other than as described in section

9.1(d), destroys, impairs, diminishes or negatively affects or alters

the Land or the Amenities from the condition described in the

Report;

(d)

in accordance with section 10.1, to enter upon and protect,

preserve, conserve, maintain, enhance, restore or rehabilitate, in

that Covenant Holder's sole discretion and at that Owner's

expense, the Land or the Amenities to as near the condition

described in the Report as is practicable, if an action of the Owner

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or any other person acting with the actual or constructive

knowledge of the Owner:

(i)

destroys, impairs, diminishes, negatively affects or alters the

Land or the Amenities from the condition described in the Report;

or

(ii)

contravenes any term of this Agreement;

(e)

to carry out or evaluate, or both, any program agreed upon among

the parties for the protection, preservation, conservation,

maintenance, enhancement, restoration or rehabilitation of all or

any portion of the Land or the Amenities; and

(f)

to place survey pegs or other markings on the Land or to increase

the visibility of existing survey pegs or other markings.

9.2 The Covenant Holders may bring vehicles, as reasonably necessary,

equipment and personal property onto the Land when exercising their rights

under this Agreement.

9.3 For the purposes of sections 9.1(c) and (d), both of the Covenant Holders

have the sole discretion to protect, preserve, conserve, maintain, enhance,

restore or rehabilitate the Land or the Amenities.

10. Enforcement Remedy of the Covenant Holders

10.1 If either Covenant Holder, in its sole discretion, believes that the Owner

has neglected or refused to perform any of the obligations set out in this

Agreement or is in breach of any term of this Agreement, that Covenant Holder

may serve on the Owner a notice setting out particulars of the breach and of the

Covenant Holder's estimated maximum costs of remedying the breach. The

Owner has 60 days from receipt of the notice to remedy the breach or make

arrangements satisfactory to the Covenant Holder for remedying the breach,

including with respect to the time within which the breach shall be remedied.

10.2 If the Owner does not remedy a breach described 60 days, either

Covenant Holder is entitled to enter the Land and remedy the breach or carry out

the arrangements and the Owner shall reimburse that Covenant Holder for any

expenses incurred in doing so, up to the estimated maximum costs of remedying

the breach as set out in the notice. Expenses incurred by the Covenant Holder

under this section are a debt owed by the Owner to that Covenant Holder.

11. Rent Charge and Its Enforcement

11.1 As security for the performance of the Owner's obligations under this

Agreement, the Owner grants to the Covenant Holders a perpetual rent charge

against the Land, ranking prior to all other financial charges and encumbrances

registered against the Land, including options to purchase and rights of first

refusal. The Rent Charge is granted both under s. 219 of the Land Title Act

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(British Columbia) as an integral part of the statutory covenant created by this

Agreement and as a fee simple rent charge at common law.

11.2 The Rent Charge secures payment to the Covenant Holders by the Owner

of the sum of $5,000.00 per year per violation, subject to adjustment under

section 11.4. For clarity, only one Rent Charge Amount is payable by the Owner

for each violation, and not one to each to the Covenant Holders.

11.3 A yearly Rent Charge of $100 is due to the Covenant Holders by January

31

st

of each year, subject to adjustment under section 11.4.

11.4 The Rent Charge Amount is to be adjusted on January 1 of each year by

increasing or decreasing, as the case may be, the Rent Charge Amount by the

amount determined by multiplying the Rent Charge Amount on December 31

immediately preceding by the percentage increase or decrease, as the case may

be, in the CPI between the previous January 1 and that December 31 and adding

the amount so determined to the Rent Charge Amount as it stands on that

December 31. If Statistics Canada, or its successor in function, ceases to

publish a CPI or comparable indicator as determined by the Covenant Holder in

its sole discretion, the parties agree that the factor to be used in determining the

Rent Charge Amount for each year shall be 3%.

11.5 The Rent Charge Amount shall be increased by a sum equal to 110% of

the market value at the date of any breach of this Agreement of any flora or

fauna, soil, rock, gravel or minerals, which has been altered, damaged,

destroyed, moved, harvested or removed.

11.6 A Covenant Holder shall be entitled to recover from the Owner all

reasonable expenses incurred as a result of enforcement of the Rent Charge.

11.7 The Rent Charge is suspended unless and until the Owner is in breach of

any provision of this Agreement and has not cured the breach, or is not diligently

proceeding to cure the breach in accordance with section 10 of this Agreement.

11.8 A Covenant Holder may enforce the Rent Charge by any combination, or

all, of:

(a)

an action against the Owner for the Rent Charge Amount;

(b)

distraint against the Land to the extent of the Rent Charge Amount;

(c)

an action for appointment of a receiver in respect of the Land; or

(d)

an order for sale of the Land.

11.9 If either of the Covenant Holders wishes to enforce the Rent Charge, it

shall provide notice to that effect to the Owners and to the other Covenant

Holder. The Notice of Enforcement may be given at any time after notice

of breach is given.

11.10 The Covenant Holder receiving the Notice of Enforcement has 30 days

from receipt to send notice to the notifying Covenant Holder that it wishes

to enforce the Rent Charge jointly and if it does not do so it is deemed to

have elected not to enforce the Rent Charge.

11.11 If the Rent Charge is enforced jointly:

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(a)

reasonable expenses incurred as a result of the enforcement of the

Rent Charge shall be shared equally between the Covenant

Holders; and

(b)

the net proceeds obtained as a result of the enforcement of the

Rent Charge shall be shared equally between the Covenant

Holders,

unless otherwise agreed in writing between the Covenant Holders.

11.12 If the Covenant Holder receiving the notice of enforcement does not wish

to enforce the Rent Charge jointly, that Covenant Holder shall have no

entitlement to the Rent Charge unless otherwise agreed in writing

between the Covenant Holders.

11.13 A Covenant Holder who declines to enforce the Rent Charge jointly shall

execute all documents which may be necessary for the enforcement and

collection of the Rent Charge by the notifying Covenant Holder.

12. Successor of the Owner

12.1 This Agreement shall enure to the benefit of and be binding upon the

Owner and the Owner's Successor.

12.2 The Owner shall not lease or license the Land or any part thereof unless

the lease or license is expressly made subject to the provisions of this

Agreement and unless the lease or license expressly entitles the Owner to

terminate the lease or license and re-enter the land if the tenant or licensee

breaches any of the provisions of this Agreement.

12.3 Failure by the Owner to comply with the provisions of this section shall not

affect the enforceability of this Agreement against the Owner or any Successor.

13. Assignment of Agreement or Dissolution of a Covenant Holder

13.1 This Agreement shall be transferable by a Covenant Holder, but a

Covenant Holder may assign its rights and obligations under this Agreement only

to an entity or person qualified at the time of transfer to hold covenants under s.

219 of the Land Title Act and any applicable regulation under it. The Covenant

Holders agree that before either of them assigns its rights and obligations under

this section, it shall consult with the Owner, and consider the Owner's comments,

with respect to the proposed assignee. The Covenant Holder must give notice to

the Owner of the proposed assignment, setting out in reasonable detail the

identity of the proposed assignee and the qualifications and experience of the

proposed assignee relevant to performance by the assignee of the rights and

obligations of the Covenant Holder under this Agreement. If the Owner does not

provide comments to the Covenant Holder regarding the proposed assignee

within 10 days after receipt from the Covenant Holder to the Owner under this

section, the Owner is conclusively deemed to have declined to comment on the

proposed assignee and to have consented to the assignment. For clarity, the

Owner agrees that the Covenant Holder is only required to consult the Owner

Page 15 of 54

and that the Covenant Holder is entitled to assign its rights and obligations so

long as it has consulted the Owner.

13.2 In the event of the winding-up or dissolution of a Covenant Holder, the

Covenant Holder shall use its best efforts to assign and transfer all of its interest

under this Agreement to a person or entity authorized to accept covenants under

section 219 of the Land Title Act. If the Covenant Holder does not assign and

transfer all of its interests under this Agreement as set out in this section, it shall

be deemed to have assigned and transferred all of its interest under this

Agreement to the Regional District of Comox-Strathcona, to hold temporarily until

another Covenant Holder can be found, or if the Regional District of Comox-

Strathcona is not available, to Her Majesty the Queen in Right of the Province of

British Columbia. For clarity, the consultation process set out in section 13.1

does not apply to this section.

14. Notice

14.1 Any notice or other communication (collectively "notice") required or

permitted under this Agreement shall be:

(a)

delivered in person; or

(b)

sent by pre-paid registered mail to the address of the parties at

their respective addresses as set out in this Agreement.

14.2 If notice is delivered in person, the party receiving the notice shall forthwith

acknowledge receipt of same in writing, and the notice shall be deemed to have

been received on the earlier of the date of such acknowledgment and the date

that is 5 days after the notice is sent.

14.3 If notice is sent by pre-paid registered mail, it shall be deemed to have

been received on the fourth Business Day following the day on which the notice

was sent. The addresses of the parties' representatives for notice are as follows:

ECO INITIATIVES INC.:

128 Tiber bay Road

Mansons Landing, Cortes IslandBC

V0P 1K0

TLC THE LAND CONSERVANCY OF BRITISH COLUMBIA:

2709 Shoreline Drive

Victoria, BC V9B 1M5

600 Comox Road,

Courtenay, BC V9N 3P6

Page 16 of 54

14.4 Each party agrees to immediately give written notice to the others of any

change in its address.

14.5 If a party refuses to sign an acknowledgment of receipt of notice, the

person delivering the notice may swear an affidavit of service and the notice shall

be deemed to have been received on the date of service set out in the affidavit.

15. Mortgages

15.1 In this section, "approve" and "approval" mean approval by both Covenant

Holders of a first mortgage intended to be registered against the Land or

any portion of the Land.

15.2 If the Owner is not in breach of this Agreement, the Covenant Holders

shall approve a first mortgage if:

(a)

the mortgage does not exceed 75% of the fair market value of the

Land at the date of the approval, as determined by a qualified

appraiser; and

(b)

the mortgage is an arms-length transaction with a bona fide

mortgage lender.

15.3 The Covenant Holders may, in their Sole Discretion, inspect the Land to

determine if the Owner is in breach of any of the terms of this Agreement

before granting approval and may withhold approval if there is any breach.

15.4 The Owner shall reimburse and indemnify the Covenant Holders for all

reasonable expenses incurred by it as a result of a site visit to inspect the

Land pursuant to this section.

16. Access

16.1 Limited access to the public is allowed on specified areas on the Land as

described in the Right of Ways.

17. Notice of Covenant

17.1 The Owner agrees to allow the Covenant Holders to publicize the

existence of this Agreement in a tasteful manner.

17.2 Without restricting the generality of the foregoing, the Owner agrees to

allow the Covenant Holders to erect a plaque or other signage on the

Land, in a tasteful manner and at the Covenant Holder’s expense,

indicating that the Covenant Holders hold a covenant on the Land.

18.

18.1 The parties agree that this Agreement creates only contractual obligations

and obligations arising out of the nature of this Agreement as a covenant

under seal. Without limiting the generality of the foregoing, the parties

agree that no tort or fiduciary obligations or liabilities of any kind are

created or exist between the parties in respect of this Agreement and

nothing in this Agreement creates any duty of care or other duty on any of

the parties to anyone else. For clarity, the intent of this section is to,

Page 17 of 54

among other things, exclude tort liability of any kind and to limit the parties

to their rights and remedies under the law of contract.

19.

19.1 An alleged waiver of any breach of this Agreement is effective only if it is

an express written waiver signed by the Covenant Holders, and is only

effective to the extent of that express waiver and does not operate as a

waiver of any other breach.

20.

20.1 The obligations of the parties referred to in this Agreement as the Owner

are joint and several.

21.

21.1

Exercise or enforcement by a party of any remedy or right under or in

respect of this Agreement does not limit or affect any other remedy or right

that party may have against the other parties in respect of or under this

Agreement or its performance or breach.

22. Covenant runs with the Land

22.1

Unless it is otherwise expressly provided in this Agreement, every

obligation and covenant of the Owner in this Agreement constitutes a

personal covenant and also a covenant granted under s. 219 of the Land

Title Act (British Columbia) and a statutory right of way granted under s.

218 of the Land Title Act in respect of the Land. This Agreement burdens

the Land and runs with it and binds the successors in title to the Land.

This Agreement burdens and charges all of the Land and any parcel into

which it is subdivided by any means and any parcel into which the Land is

consolidated.

23. Registration

23.1

The Owner agrees to do everything necessary at the Owner's

expense to ensure that this Agreement, and the interests it creates, is

registered against title to the Land, with, priority over all financial charges,

liens and encumbrances registered or pending registration in the Land

Title Office at the time of application for registration of this Agreement,

including options to purchase and rights of first refusal.

24. Severance

24.1

If any part of this Agreement is held by a court to be invalid, illegal or

unenforceable, that part is to be considered to have been severed from

the rest of this Agreement and the rest of this Agreement is to remain in

force unaffected by that holding or by the severance of that part as if the

part was never part of this Agreement.

25. No other Agreements

25.1

This Agreement is the entire Agreement between the parties and it

terminates and supersedes all other Agreements and arrangements

Page 18 of 54

regarding its subject. A written instrument signed by all the parties may

only change this Agreement.

26. Binding on successors

26.1

This Agreement binds the parties to it and their respective

successors, heirs, executors and administrators.

28. This Agreement is meant to be perpetual and may only be changed by a

written instrument signed by all the parties.

29. Independent Advice

29.1

The Owner acknowledges and agrees that the Owner has sought and

obtained to the Owner's satisfaction independent advice from an

accountant or other income tax expert with respect to the income tax

implications of this Agreement and acknowledges that it does not and has

not relied on either Covenant Holder for advice in this regard and that they

have given no representation or warranty in that regard.

29.2

The Owner acknowledges and agrees that the Owner has been

advised by the Covenant Holders that the Owner should seek legal advice

as to the meaning and effect of this Agreement and the Owner further

acknowledges and agrees that no legal advisor of the Covenant Holders

have advised the Owner on the meaning or effect of this Agreement or in

connection with this Agreement.

30.1

By executing and delivering this Agreement, each of the parties

intends to create both a contract and a deed and covenant executed and

delivered under seal.

31.1

A Covenant Holders, as a corporate entity, may exercise its rights

under this Agreement through its directors, officers, employees, agents or

contractors.

As evidence of their Agreement to be bound by the above terms, the parties each

have executed and delivered this Agreement under seal by executing Part 1 of

the Land Title Act Form C to which this Agreement is attached and which forms

part of this Agreement.

32.1 Nothing contained or implied herein shall prejudice or affect the rights and

powers of the Covenant Holder, the Regional District of Comox-

Strathcona, in the exercise of its functions under any public or private

statutes, bylaws, orders and regulations, all of which may be fully and

effectively exercised in relation to the Land as if this Agreement had not

been executed and delivered by the Owner.

Page 19 of 54

SCHEDULE A

Attached to and forming part of the Covenant Agreement between

LANDOWNER’S NAME, Owner, and TLC THE LAND CONSERVANCY OF

BRITISH COLUMBIA, Covenant Holder, and REGIONAL DISTRICT OF

COMOX-STRATHCONA, Covenant Holder, dated the __ day of , 2005.

Adapted in 2005 by Nick Stanger from

B.A. Blackwell and Associates Ltd.

3057 Hoskins Road

North Vancouver, B.C.

V7J 3B5

Iverson and MacKenzie Biological Consulting Ltd.

P.O. Box 511

Lac La Hache, B.C.

V0K 1T0

May 14, 2002

Page 20 of 54

1. Donor: Weyerhaeuser Company Limited

2. Location: on Desolation Sound, west of the hamlet of Tiber Bay.

3. Easements or existing Rights-of-Way of Record: Right of Way 401775G

This baseline report documents the condition of the Property, including

description of ecosystem characteristics, wildlife characteristics, and human-

engineered features such as roads, bridges, and power-lines. In addition, key

attributes that are significant for land management and development are

described. This includes ecologically significant habitats, rare plant species,

rare wildlife species, watercourses, wetlands, and wildlife trees. The baseline

report describes conditions of the Property as of April 11, 2002.

The ecosystem, wildlife, and human-engineered features of the Property were

assessed for the purposes of this report during a site visit conducted April 10

and 11, 2002. This visit was done by Kevin Haberl of B.A. Blackwell and

Associates Ltd., North Vancouver, B.C., and by Ken MacKenzie of Iverson

and MacKenzie Biological Consulting Ltd., Lac la Hache, B.C.

Prior to field visits, aerial photographs were viewed and areas with high

potential for significant habitats were noted. All existing maps and a wildlife

observation database (Ministry of Water, Land, and Air Protection) were

reviewed. In addition, lists of rare plant and animal species

, rare plant

communities

, and a database of local element occurrences (Ministry of

Sustainable Resource Management) were reviewed. Any waterbodies,

wetlands, rocky areas or natural open areas were noted and planned for

viewing. The Property was thoroughly traversed on foot and any habitat

features seen were noted. Any permanent habitat features including caves,

cliffs, wetlands, and open water bodies were mapped and habitat quality for

each of the evaluated species was rated.

Wildlife trees were evaluated during the field evaluation and mapped into

areas of relatively consistent densities.

Ecosystem features including vegetation and soils were observed while

traversing the Property on foot, and through data collected from five plots.

The GPS locations of plots and ecological boundaries were recorded. The

plots were reconnaissance-level ecosystem assessment plots. The

information gathered from the plots included data on physiography, soils

(through excavation of a soil pit), understory vegetation and overstory tree

1

Committee on the Status of Endangered Wildlife in Canada (COSEWIC)

2

British Columbia Conservation Data Center (CDC)

Page 21 of 54

species (modified from B.C. Min. of Env., Lands, and Parks, and B.C. Min.

For. 1998). See Map 1 for the traverse route and plot locations.

An ground-truth analysis of the SW Sensitive Ecosystems Inventory polygon

was completed in February , 2005 by Bob Fuller (biologist) and is found in

Appendix D of this baseline.

The Property is a rectangular shape bounded on the west, north, and south

by a closed canopy young forest, and on the east by the ocean (Desolation

Sound). The topography is varied, from gently sloping to broken with some

depressions, and ranges in elevation from sea level to 120m along the south

edge. The waterfront along the eastern edge is generally steep and broken

with shallow soils (photo 12). Soils were observed in roadcuts, streambanks,

windthrown tree holes and at soil pits at each plot location. The soil parent

materials are predominantly glacial tills, occasionally with a glaciomarine cap

locally overlaying tills, and occasional “slopewash” finer textured materials on

the surface in receiving sites. The soils on fresh and moist sites are generally

deep and coarse textured. Drier sites (site series 02, 03) have common rock

outcrops and thin soil veneers. Root zone soil textures varied from sandy

loam to sand with coarse fragment content varying from 0 to 40%. The forest

cover is dominated by second-growth Douglas-fir (Pseudotsuga menziesii),

red alder (Alnus rubra), western redcedar (Thuja plicata) and western

hemlock (Tsuga heterophylla) with rare large “veteran” trees (Douglas-fir,

western redcedar). On rocky sites, arbutus (Arbutus menziesii) also

comprises a portion of the overstory. The majority of the forest was

established following logging in the 1920’s and 30’s. The rocky knolls along

the southern border and the eastern edge are generally old forest types

featuring open stands of Douglas-fir and arbutus. Logging has not

significantly impacted this area.

This area falls within the Eastern Very Dry Maritime Coastal Western Hemlock

biogeoclimatic variant (CWHxm1). The Property has been divided into six

different ecosystem polygons. An ecosystem polygon represents an area

featuring a characteristic structural stage (Table 1) and ecosystem or

pattern of ecosystems. Ecosystems are identified using site series

recognized in the biogeoclimatic ecosystem classification system. Refer to

Map 2 for location of the recognized ecosystem polygons.

TABLE 1. Forest structural stage classes

NV

Non-

vegetated

< 10% cover of vascular plants

3

see Green and Klinka (1994) for a description of the biogeoclimatic ecosystem classification, biogeoclimatic

variants, and site series

Page 22 of 54

HB

Herb

herb dominated communities, < 10% tree cover, < 25%

shrub cover

SH

Shrub/herb

< 20 year old forest, dominated by shrubs <10 m tall

including conifer regen, tree cover < 10%, < 20 years

PS

Pole/sapling

trees > 10 m tall and overtopping shrub and herb layer,

generally 20 to 40 years

YF

Young forest self-thinning evident, canopy layers developed,

generally 40 to 80 years

MF Mature forest co-dominant trees mature, well developed understory

often including advanced regen, generally 80-250

years

OF Old forest

old, structurally complex stands with snags and CWD,

generally >250 years

Ecosystem Polygon 1 is predominantly site series 01 (HwFd – Kindbergia site

series, slightly dry-fresh/nutrient poor-medium) with a component of site

series 05 (Cw-Sword Fern site series, slightly dry-fresh/nutrient rich) and 06

(HwCw-Deer fern site series, moist/nutrient medium). The soils consist of

loamy sand to sandy loam glacial tills, with a glaciomarine cap of sand in a

portion of the area. This site has better productivity than ecosystem polygon

6, also dominated by site series 01. There is common windthrow throughout

this area associated with localized moist soils. The overstory is a Young

Forest structural stage comprised of Douglas-fir (Fd), western hemlock (Hw),

red alder (Dr), and western redcedar (Cw).

Ecosystem Polygon 2 is predominantly site series 02 (FdPl – Cladina site

series, very dry/nutrient poor) and 03 (FdHw – Salal site series, moderately

dry/nutrient poor), with a component of site series 01. The soils are shallow

coarse loamy sand on fractured hummocky granitic bedrock. This ecosystem

polygon occupies crest and upper slope positions. This area is largely

inaccessible, and was not harvested along with the rest of the Property in the

1920’s. The overstory is a gappy Old Forest structural stage dominated by

Fd and arbutus.

Ecosystem Polygon 3 is predominantly site series 02 and 03, and is located in

crest slope positions. The soil consists of a thin dry organic veneer over

bedrock. This site has low forest productivity (photo 15). The overstory is a

gappy Young Forest structural stage comprised of Fd with a minor amount of

Cw.

Ecosystem Polygon 4 is predominantly site series 03 (FdHw – Salal site

series, moderately dry/nutrient poor) with a component of site series 02 (FdPl

– Cladina site series, very dry/nutrient poor) and poorer quality site series 01

(HwFd – Kindbergia site series, slightly dry/nutrient poor). The soils are

shallow coarse loamy sand over hummocky granitic bedrock. This site is

drier than the surrounding sites due to the shallow, coarse textured soils and

the upper slope and crest slope positions. The overstory is a generally Young

Page 23 of 54

Forest structural stage dominated by Fd with a component of Cw and a minor

amount of Hw. The Hw trees show a moderate incidence of Hemlock Dwarf

Mistletoe (Arceuthobium tsugense) infection, which is common in the Hw

throughout the area. Rare Fd veteran trees occur in this ecosystem polygon.

Ecosystem Polygon 5 is predominantly site series 06 with a component of site

series 07 (Cw-Foamflower site series, moist/nutrient rich). The soil consists

of deep glacial tills. This ecosystem polygon is generally located in lower

slope, moisture-receiving positions, resulting in moist soils. This ecosystem

polygon has a higher component of deciduous trees, particularly Dr. This site

has moderate (to high) forest productivity. The overstory is a Young Forest

structural stage comprised of Cw, Dr, and Hw with a component of Fd.

Ecosystem Polygon 6 is predominantly site series 01 (HwFd – Kindbergia site

series, slightly dry /nutrient poor) with a component of site series 03. The

soils consist of relatively shallow loamy sand to sandy loam glacial till. This

site has lower productivity than ecosystem polygon 1. The overstory is a

Young Forest structural stage comprised of Fd and Cw.

Throughout the Property, soil parent materials are predominantly glacial till

deposits. These soils are relatively coarse textured and well drained, with

local shallow areas where bedrock approaches the surface. No areas at

significant risk of erosion were found on the Property.

Rare plant species which potentially may be found on Cortes Island were

selected from the species database maintained by the Committee on the

Status of Endangered Wildlife in Canada

(COSEWIC). Species considered

outside the range represented by the study area were excluded (eg. high

elevation alpine areas, Interior of B.C.).

Rare plant communities, which potentially may be found on Cortes Island,

were obtained from the Conservation Data Center

(CDC) natural plant

community tracking lists for the CWHxm1 biogeoclimatic variant.

Ecosystem polygon 2 represents a red-listed plant community as recognized

in the CDC tracking lists. This is the CWHxm1/02 site series (FdPl -

Rhacomitrium) with a component of CWHxm1/03 site series (FdHw – Salal),

supporting an Old Forest structural stage. No significant vegetation features

were noted elsewhere on the Property. The ecosystems within the majority of

the Property are common throughout the region. These plant communities

were younger than recognized CDC red and blue listed communities.

No rare plant species were observed during the field examination, nor have

been recorded in the CDC element occurrence reports. As vegetation was not

fully developed due to the season, many of the listed species would not be

visible. However, the ecosystems in which the majority of these species are

4

COSEWIC develops and maintains a national listing of Canadian species at risk, using categories of extinct,

extirpated, endangered, threatened, and vulnerable

5

the CDC develops and maintains a provincial listing of plant communities, which have become most vulnerable. Red

listed includes plant communities that are candidates for extirpated, endangered, or threatened status in B.C. Blue listed

includes plant communities that are vulnerable in B.C.

Page 24 of 54

typically found did not occur on the Property. Coastal wood-fern (Dryopteris

arguta) has been found in the southern Gulf Islands on sites similar to the

warm aspect areas of ecosystem polygon 2. However it is a large evergreen

fern and was clearly not present on the Property.

Habitat requirements were divided into habitats used for reproduction, and

general habitat used for the remainder of life history requisites. Generally,

reproductive habitats are more restrictive to a species than the general

habitat used for foraging or other life history requisites but often the quality

of reproductive habitat depends upon proximity to and quality of adjacent

foraging habitat.

Habitats for evaluation were separated into permanent habitat and temporary

habitat attributes. Permanent habitats include such areas as cliffs, caves,

streams, wetlands and lakes (Table 2). These features were mapped

when encountered, described, areas of the habitat were estimated, and

habitat value assigned. The overall habitat rating for these permanent

habitats was then modified to reflect the quality of the surrounding

foraging habitat.

Temporary habitat attributes include such things as forest structure and

wildlife trees, and were described using structural stage (for forest structure)

and density for Wildlife Tree Classes.

TABLE 2. List of permanent habitats associated with rare species potentially

found on Cortes Island.

Wetlands

northern red-legged frog

Caves/crevices

Keen’s long-eared myotis

Large Cliffs

Peregrine falcon

Open rangeland

Peregrine falcon

Streams/Riparian

Vegetation

Keen’s long-eared myotis, northern red-legged frog,

barn owl, sharp-tailed snake

Shallow open water

northern red-legged frog

Wildlife trees were classified based upon decay class and species as per the

Wildlife Danger Tree Assessor’s Course Handbook (6th ed., 2000)(Table 3).

Signs of use increase quality rating, as does both tree height and diameter.

Western redcedar and Douglas-fir were rated as the most valuable wildlife

tree species because of the longevity of standing dead trees of these species.

Any sign of use was noted during field assessments. High value wildlife trees

are defined as Wildlife Tree Classes 3, 4, 5 and, if there is sign of wildlife use

(cavities, usually meaning that part of the tree is dead) Wildlife Tree Class 2.

Wildlife Tree Class 6 and 7 trees and, if there is no visible wildlife use, Wildlife

Page 25 of 54

Tree Class 2 trees are of lower value. This rating is based both upon the

expected longevity of the wildlife trees and on their current habitat value.

TABLE 3. Wildlife Tree Classes

1

1

Live, healthy, no obvious decay

2

Live but unhealthy, internal decay evident, declining,

deformed

3

Recently dead, wood sound, fine branches intact

4

Dead, wood relatively sound, fine branches fallen but larger

limbs intact

5

Dead, wood becoming spongy, most limbs fallen, bark

mostly intact

6

Dead, wood soft, limbs fallen, more than half the bark fallen,

greater than 2/3 of tree height remaining erect

7

Dead, wood soft, most of bark sloughed, less than 2/3 of

tree height erect

1

modified from Wildlife Danger Tree Assessor’s Course Handbook, 2000

Wildlife species and habitats evaluated on the Property were selected from

the COSEWIC lists for British Columbia. Species on the lists that are not

affected by land management practices (eg. whale species, sea otter) and

species whose known distribution does not approach Cortes Island (eg.

grizzly bear, Vancouver Island marmot) were deleted from the list of species

to be evaluated. Habitat requirements for the remaining species were then

obtained from the literature.

The Property was divided into 2 wildlife polygons differentiated by the density

of wildlife trees (see Map 3 at Appendix A). Most of the Property (wildlife

polygon 2) had low densities of high value wildlife trees but one area (wildlife

polygon 1) was not logged and had moderate to high densities. Most of these

trees are Class 2 and provide moderate to poor habitat potential for wildlife

tree users. The northwest corner of the Property has been logged in the past

but moderate densities of large live veteran trees were observed and will

serve as excellent recruitment wildlife trees.

Three streams were observed in the Property. Stream #1 enters the Property

from the west and is the continuation of a man made drainage ditch. There is

poor channel development along this stream until the stream enters a 4 to 5

m deep draw about 150 m into the Property from the eastern boundary.

Riparian vegetation is poorly developed along the entire stream length. The

stream exits the Property to the south. This stream would be classified S3 or

S6 under the Forest Practices Code stream classification, depending upon

fish presence

. Fish presence is unknown but no fish were seen at the time of

the assessment. An unused water intake was seen in this stream near the

southern Property line (see photo 13).

6

Forest Practices Code, Fish-stream identification guidebook – second edition.

Page 26 of 54

A second stream (#2) flows south through the Property. This stream flows in a

2 m deep draw but has poor riparian vegetation development. This stream

would be classified S4 or S6 depending upon fish presence. A third stream

(#3) flows into the ocean on the east side of the Property. This stream is

ephemeral, is only approximately 60 m in length and does not have a defined

channel. It would be classified S6 as fish presence is very unlikely in this

stream.

Two small wet areas were seen in the Property. One is along the Tiber Bay

Road and the other lies about 100 m south of the first. Both wet areas are

very small. The wet area by the Tiber Bay Road has an area of open water

and provides moderate habitat potential for designated species. The second

area, located within the forest, is seasonally wet but dry in the summer

months (ie. dry at time of inspection). Both sites are too small to be classified

as wetlands under the Forest Practices Code.

Several rock cliffs are found within the Property boundary, but these cliffs are

poorly fractured, wet and on cold aspect slopes, providing low habitat value.

No areas of well fractured warm aspect rock cliffs were noted.

Overall habitat value for designated species is moderate. Potential nest sites

for cavity-nesting species were found in wildlife polygon 1 but foraging habitat

is limited. A portion of old forest in a closed forest state is located within

wildlife polygon 1. This area provides high quality habitat for northern

goshawk. The more common open old forests, and the dense, generally

single-storied young forests across most of the Property provide low to

moderate habitat potential for northern goshawk. The streams have virtually

no riparian vegetation development and do not provide high quality habitat for

any of the designated species.

TABLE 4. Summary of wildlife habitat features

1 – old

forest

stream

low

OF

3

2 –

remainde

r of forest

2 streams

low

YF

1

TABLE 5. Density and distribution classes for wildlife tree assessment

1

a few sporadically occurring individuals

2

several sporadically occurring individuals

3

many uniformly distributed individuals

4

a single patch or clump

5

a few patches or clumps

6

several well-spaced patched or clumps

Page 27 of 54

Four private driveable roads are located within the Property. The main road

into Tiber Bay (“Tiber Bay Road”) is a wide, regularly graded loose surface

access road. A second road (“Mary Point Road”) goes south through the

western end of the Property and splits just within the Property boundary. The

western fork here is signed as a private road, and provides access to a

residence immediately outside the Property boundary. Waterlines from this

residence are associated with Stream #1 within the Property (photo 13). A

private sawmill near Tiber Bay, located outside the Property boundary, is

accessed by a short spur road (“Mill Road”) on the south edge of the

Property. A driveable hydro powerline road is located on the extreme west

edge of the Property and may enter the Property in places.

In addition to the private roads noted above, there is evidence of a number of

logging roads that once provided additional access within the Property.

These historic logging roads are now at various levels of decay. The routes

followed by these former roads are shown on Map 4 at Appendix A.

The following summarizes the observed human engineered features:

1. Tiber Bay Road

2. Mary Point Road

3. Southwest Private Road

4. Hydro Road on western boundary

5. Mill Road

6. Waterlines associated with Stream #1.

7. Hydro line along Tiber Bay Road and along Hydro Road on western

boundary.

There is one bridge within the Property. Stream #2 is crossed by the Mary

Point Road over a log bridge.

There are hydro lines within the Property, running the length of the Tiber Bay

Road parallel to the road and along the Hydro Road along the western

boundary.

This section describes important features from the ecosystem and wildlife

characteristics, which are relevant for land management and development.

Ecologically significant habitat

Page 28 of 54

The portions of the Property within ecosystem polygon 2 (coincides with

wildlife polygon 1) comprises ecologically significant habitat that

encompasses a red-listed plant community representing the CWHxm1/Fd-

Pl – Cladina site series with an old forest structural stage. This area also

provides high quality habitat for northern goshawk.

Rare plant species

No rare plant species were found on the Property.

Rare wildlife species

A northern Goshawk was observed in the Property. The goshawk was

flying through a young forest canopy and did not display any territorial

behaviour suggesting that the bird was not nesting in the immediate area.

Watercourses

Three watercourses were found on the Property. Two were permanent

streams (streams #1 and #2) classified as S3/S6 or S4/S6, respectively

depending upon fish presence. Fish presence is unknown in these

streams and no fish were seen at the time of the assessment.

Wetlands

No wetlands were found on the Property.

Wildlife trees

The majority of the Property has low densities of wildlife trees and large veteran

trees. Wildlife polygon 1 has greater numbers of wildlife trees although

most of these trees are Class 2 and provide moderate to poor habitat

potential for wildlife tree users.

Wildlife trees are critical features for several of the wildlife species of interest.

In addition, high value wildlife trees are one of the important attributes

generally lacking throughout most second-growth forests that dominate the

CWHxm1.

Wildlife trees are dynamic and can fall down or decay and become unsuitable

for cavity nesting species. Predicting the time at which these changes will

occur is difficult because of the many variables affecting wildlife tree longevity

including tree size and species, storm events, lightning, moisture, wildlife

feeding damage rate and type, species of decay fungi and other variables. By

considering wildlife trees to be one aspect of stand structure and allowing for

the recruitment of new standing dead trees over time, habitat values can be

maintained.

Logging practices that provided for retention of at least 20% of harvest areas

outside of leave areas in patches of greater than 0.25 ha should be sufficient

to retain most of the existing wildlife trees identified and will allow for the

recruitment of wildlife trees into the future.

To maintain wildlife trees, the retention patches should be centered on high

value wildlife trees. High value wildlife trees are those, which have existing

cavities, are the largest on the site and are in Wildlife Tree Classes 2, 3, 4, or

5 (Table 3). Snags of Wildlife Tree Class 6, or 7 may have cavities and may

be used by cavity nesting species but generally have a lower expected

Page 29 of 54

lifespan than trees of lower Wildlife Tree Classes. In the absence of suitable

high value wildlife trees, Wildlife Tree Class 2 trees without cavities or Wildlife

Tree Class 6 or 7 trees with good cavities may have to suffice. Trees in the

remainder of the retention patch will then serve as recruitment wildlife trees.

The photographic documentation was completed during the site visit conducted

April 10 and 11, 2002, and is found in the offices of all parties. In addition, an

aerial photograph of the Property taken in 2001 is appended in Appendix C.

The locations of the photographs are detailed on Map 4 with the numbers 1 to

and including 20 thereon corresponding to the locations at which photographs

were taken.

The following four maps of the Property are attached to this report in Appendix A:

Map 1: Traverse Route and Plot Location

Map 2: Ecosystem Polygons

Map 3: Wildlife Polygons

Map 4: Photo Locations

Disclaimer: Cartographic information including Property boundaries, road

locations, power lines, streams, and contours from Weyerhaeuser Company Ltd.

GIS databases, obtained through Olympic Resource Management, Vancouver,

B.C. Polygon boundaries, plot locations, traverse routes, waterlines, and refined

stream locations based on consultants field estimations. These are not surveyed

locations.

This Property should be monitored for compliance with the Conservation

Covenant once per year at a minimum.

To the extent that this document conflicts with the Conservation Covenant, the

text of the fully executed Conservation Covenant shall control.

Page 30 of 54

Appendix A

Maps

Page 31 of 54

Page 32 of 54

Page 33 of 54

Page 34 of 54

Appendix B

Vegetation List

Understory plant species observed in plot data

yarrow

arbutus (madrone)

Arctostaphylos columbiana hairy manzanita

green spleenwort

deer fern

slough sedge

sitka sedge

prince’s-pine

Douglas’ water hemlock

coastal reindeer

dragon cladonia

dusky fork moss

salal

small bedstraw

rattlesnake-plantain

oceanspray

step moss

common rush

Oregon beaked moss

twinflower

running clubmoss

skunk cabbage

dull Oregon-grape

Pacific crab apple

single delight

falsebox

freckle pelt

flat moss

coastal leafy moss

red-stemmed feathermoss

juniper haircap moss

sword fern

bracken fern

lanky moss

fan moss

black gooseberry

baldhip rose

Page 35 of 54

salmonberry

trailing blackberry

yellow-ladle liverwort

Wallace’s selaginella

satin-flower

common green sphagnum

hardhack

three-leafed foamflower

red huckleberry

Page 36 of 54

Appendix C

Aerial Photograph

Page 37 of 54

Appendix D

Ground-truth of Sensitive Ecoystems of District Lot 1127

Robert Fuller, B.Sc.

District Lot 1127 is located on east side of Cortes Island at the north end of the

Strait of Georgia. The lot is located adjacent to the ocean on the northwest side

of Tiber Bay; Tiber Bay Road, which provides access to Tiber Bay, bisects the

property. The project area is located at the northern end of the Strait of Georgia

Ecosection and within the Eastern Very Dry Maritime Coastal Western Hemlock

biogeoclimatic variant (CWHxm1).

A baseline assessment of the property

was completed in April 2002 prior to the

placement of the Conservation Covenant by The Nature Trust of British Columbia

on the subject lot owned by Weyerhaeuser Ltd. The property was divided and

mapped into six different ecosystem polygon types as a result of the assessment.

Two portions of the property, represented by ecosystem polygon 2, were

designated as “Leave Areas” (protected areas) in The Nature Trust Covenant.

These two polygons where designated as older forest

1

.

The current owner has proposed that five home sites be placed within one of the

areas designated as a “Leave Area”.

Cortes Island is located within the Sensitive Ecosystems Inventory (SEI) of the

Sunshine Coast and Adjacent Islands project area. This inventory identifies rare

and fragile terrestrial ecosystems along the Sunshine Coast and adjacent

islands. Sensitive terrestrial ecosystems include old forest, woodland,

herbaceous terrestrial, riparian and wetland areas. Mature forest, cliff and

seasonally flooded areas are also identified as important ecosystems

. Five

sensitive ecosystem polygons have been mapped wholly or partially within DL

1127. The rock outcrop area that contains the proposed five home construction

sites lies within Sunshine Coast SEI polygon number 6816. The label for this

polygons is as follows: 60% conifer woodland (FdPl – Rhacomitrium site series)

stage 5; 30% conifer woodland (FdHw – Salal site series) stage 5; and 10%

herbaceous terrestrial stage 2. The land area covered within DL 1127 by The

Nature Trust “Leave Area” on the east side of Tiber Bay Road and SEI polygon

6816 are similar although their boundaries are not identical.

An assessment of the area covered by SEI polygon 6816 within DL 1127 was

completed during a site visit conducted on February 21 and 22, 2005. Ms. A

1

Blackwell and Associates Ltd. and Iverson and MacKenzie Biological Consulting Ltd., 2002.

2

BC Conservation Data Centre. Sensitive Ecosystems Inventory of the Sunshine Coast and Adjacent Island

Page 38 of 54

Mortifee identified the location of the proposed home building sites during a tour

of the site. Ecosystem features were observed while traversing the vicinity of SEI

polygon 6816 on foot; the perimeter of the polygon was also traversed in order to

assess the potential ecological and SEI boundaries. Information was collected

on physical site characteristics and vegetation at reconnaissance level

inspections during the assessment.

The boundary of SEI polygon 6816 has been modified slightly, as a result of ground

truthing, to create two polygons containing woodland ecosystems in the area between

Tiber Bay Road and the shoreline (see accompanying air photograph). One of these

woodland polygons, approximately 3.6 ha in size, is located entirely within DL 1127. A

separate woodland polygon (about 3.8 ha in size) straddles the southern boundary and

occupies approximately 1.6 ha of the property. Together these polygons occupy

approximately 5.2 ha of the property and 7.4 ha in total. These woodland ecosystems

are situated on hummocky bedrock outcrops that slope steeply off to the east towards

the ocean. Terrain within the area is undulating to hummocky; slopes on the west side

near Tiber Bay Road are gentle to moderate while those on the east side are moderately

steep to steep with some cliff faces.

Although the general area was logged in the 1920’s and 30’s

, this bedrock outcrop area

appears not to have been logged at the time, as stumps were evident around the

perimeter but not within the polygon. However, the woodland area has been subject to

past disturbances as evident by the presence of many fire-scarred mature trees and

snags. The woodland is in the early mature structural stage; a 49cm diameter Douglas-

fir growing on a poor site was found to be approximately 85 years in age. Some larger

Douglas-firs up to one meter in diameter are present in the polygon.

The polygon is dominated by two site series, the FdPl – Rhacomitrium

(CWHxm1/02) and the FdHw –Salal (CWHxm1/03). The FdPl – Cladina site

series occurs on crest and upper slope positions on bedrock outcrops with very

shallow and shallow soils. Sites are very dry and nutrient very poor to poor. It has

an open tree canopy that is dominated by Douglas-fir (Pseudotsuga menziesii)

and lodgepole pine (Pinus contorta); small arbutus are scattered in the sub-

canopy especially on the warmer southeast aspects. The low shrub and herb

understorey are generally poorly developed and contain low covers of salal

(Gaultheria shallon), baldhip rose (Rosa gymnocarpa), red huckleberry

(Vaccinium parvifolium), dull Oregon-grape (Mahonia nervosa), western fescue

(Festuca occidentalis), oatgrass (Danthonia sp.), sword fern (Polystichum

munitum), twinflower (Linnaea borealis) and early hairgrass (Aira praecox). The

generally very developed and moderately diverse moss layer consists of

Dicranum sp., step moss (Hylocomium splendens), red stemmed feathermoss

(Pleurozium schreberi), juniper haircap moss (Polytrichum juniperinum), Oregon

beaked moss (Kindbergia oregana), electrified cat’s-tail moss (Rhytidiadelphus

triquetrus), Peltigera sp., Cladina sp., and Cladonia lichens. Cladina lichens are

occasionally dominant on the crest positions. Some roadside rock moss

1

Blackwell and Associates Ltd. and Iverson and MacKenzie Biological Consulting Ltd.,

2002.

Page 39 of 54

(Rhacomitrium canescens) is present on rock substrate in the canopy gaps

above the east facing slopes.

The FdHw – Salal site series occurs also occurs on crest and upper slope positions with

moderately dry moisture regimes and poor nutrient regimes. Soils are generally shallow

to bedrock (20 –100 cm). Douglas-fir is dominant in the tree canopy; western redcedar

(Thuja plicata) and lodgepole pine may be present especially in the sub-canopy. The low

shrub layer is generally dominated by salal; dull Oregon-grape, red huckleberry, baldhip

rose and western redcedar are also present as associates. The well developed moss

layer is dominated by a mixture of step moss, red-stemmed feathermoss, Oregon

beaked moss and lanky moss (Rhytidiadelphus loreus). This ecosystem is more

common on the slopes of the polygon.

The FdPl – Rhacomitrium (CWHxm1/02) is red-listed by the BC CDC while the FdHw –

Salal (CWHxm1/03) is blue-listed

.

A small amount (10% or less) of SEI polygon 6816 consists of herbaceous terrestrial

(HB) ecosystem as shown on the label.

Mature forest ecosystems are present in the area immediately adjacent to the woodland

ecosystems on the west (between the Tiber Bay Road and the woodland), north, and

east boundaries of the woodland. A strip of mature forest connects the two woodland

polygons on their western ends. The area situated in between the two woodland areas

on the southern property boundary is young forest (as shown on the Sunshine Coast SEI

mapping). The mature forest consists of the red-listed Western hemlock - Douglas-fir /

Oregon beaked-moss (CWHxm1/01) and mature, forested FdHw – Salal (CWHxm1/03)

ecosystems.

3

BC Species and Ecosystems Explorer. 2003. Victoria, British Columbia, Canada. Available:

http://srmapps.gov.bc.ca/apps/eswp/

Page 40 of 54

Page 41 of 54

SCHEDULE B

Attached to and forming part of the Covenant Agreement between ECO

INITIATIVES INC., Owner, and TLC THE LAND CONSERVANCY OF BRITISH

COLUMBIA, Covenant Holder, and REGIONAL DISTRICT OF COMOX-

STRATHCONA, Covenant Holder, dated the __ day of 2005.

1.1 In respect to those areas identified on the Plan as the Residential Use

Areas, except with prior written permission of the Covenant Holders, at the

Covenant Holder’s sole discretion, The owner(s) shall not:

(a)

lease, or rent any portion of the land for any purpose; and

(b)

create septic areas outside of the allocated septage treatment sites

as outlined in the attached map (Schedule D).

2.1 The following restrictions apply to all the Land found within Residential

Area 1:

(a)

No more than seven dwellings are permitted;

(b)

Each dwelling, its outbuildings, and garden must not exceed 2500

square feet; and

(c)

Any new buildings or structures are limited to those which are

reasonably necessary to the sustainable use of the land provided

they do not interfere with the stewardship of the Land as set out in

this Agreement and must be in quiet harmony with the natural

features of the land.

2.2 The Owner must never apply or introduce any herbicide, insecticide or

pesticide.

2.3 The following restrictions apply to that portion of the Land not in the

Service Corridor and at a distance of greater that 20 metres or one tree

height from the residence, except where the Covenant Holders at its sole

discretion, have approved of an action in writing:

(a)

no other acts may be carried out on or in respect of Land which, in

the opinion of the Covenant Holders, acting reasonably, may have

a detrimental impact on the Land;

Page 42 of 54

(b)

no component of the Land, including soil, gravel or rock, may be

disturbed, explored, or moved for commercial purposes from the

Land; and

no native plant or tree, living or dead may be damaged, pruned,

cut, harvested or otherwise interfered with, except as allowed under

Schedule C, and

no grazing of domestic animals;

see also S5.0 Restrictions on the Land, preceding.

3.1 The following restrictions apply to all the Land found within Residential

Area 2:

(a)

No more than four dwelling is permitted;

(b)

The dwelling, its outbuildings, and garden must not exceed 5000

square feet;

(c)

Any new buildings or structures are limited to those which are

reasonably necessary to the Sustainable use of the land provided

they do not interfere with the stewardship of the Land as set out in

this Agreement and must be in quiet harmony with the natural

features of the land;

(d)

Waterfront access is limited to a small pathway or wooden

infrastructure that is no wider than 1.5 metres; and

(e)

No dock or pier structure may be built.

3.2 The Owner must never apply or introduce any herbicide, insecticide or

pesticide.

3.3 The following restrictions apply to that portion of the Land not in the

Service Corridor and at a distance of greater that 20 metres or one tree

height from the residence, except where the Covenant Holders at its sole

discretion, have approved of an action in writing:

(a)

no grazing of domestic animals;

(b)

no other acts may be carried out on or in respect of Land which, in

the opinion of the Covenant Holders, acting reasonably, may have

a detrimental impact on the Land;

Page 43 of 54

(c)

no component of the Land, including soil, gravel or rock, may be

disturbed, explored, or moved for commercial purposes from the

Land; and

(d)

no native plant or tree, living or dead may be damaged, pruned,

cut, harvested or otherwise interfered with, except as allowed under

Schedule C.

4.1 The following restrictions apply to all the Land found on the house sites as

surveyed points of Residential Area 3 (Schedule D):

(a)

No more than four dwellings are permitted;

(b)

Each dwelling, its outbuildings, and garden must not exceed 3500

square feet;

(c)

Any new buildings or structures are limited to those which are

reasonably necessary to the Sustainable use of the land provided

they do not interfere with the stewardship of the Land as set out in

this Agreement and must be in quiet harmony with the natural

features of the land;

(i) All paths must be constructed with either permeable materials or

wooden boardwalks.

(ii) Driveways must be built with permeable materials except as

required to reduce environmental impact.

(iii) Gardens should be minimum impact to the local environment

and should be predominantly native species.

(d)

No removal of entire trees for viewscape is allowed;

(e)

Service Corridors must not exceed 2.5 metres wide within the

Protected Area; and

(f)

No exposed fires may be lit.

4.2 The Owner must never apply or introduce any herbicide, insecticide or

pesticide.

4.3 The following restrictions apply to that portion of the Land not in the

Service Corridor and at a distance of greater that 20 metres or one tree

height from the residence, except where the Covenant Holders at its sole

discretion, have approved of an action in writing:

(a)

no grazing of domestic animals;

Page 44 of 54

(b)

no other acts may be carried out on or in respect of Land which, in

the opinion of the Covenant Holders, acting reasonably, may have

a detrimental impact on the Land;

(c)

no component of the Land, including soil, gravel or rock, may be

disturbed, explored, or moved for commercial purposes from the

Land; and

(d)

no native plant or tree, living or dead may be damaged, pruned,

cut, harvested or otherwise interfered with, except as allowed under

Schedule C.

5.

5.1 In respect to those areas identified in Schedule D as Ecosystem-based

Forest Area, except with prior written permission of the Covenant Holders,

at the Covenant Holder’s sole discretion, the following restrictions apply:

(a)

no acts may be carried out on or in respect of the Ecosystem-based

Forestry Area which, in the opinion of the Covenant Holders, acting

reasonably, may have a detrimental impact on the composition,

structure and functioning of the Ecosystem-Based Forestry Area;

and

(b)

the Owner shall be prohibited from constructing any dwelling

houses, accessory buildings or any other structures within the

Ecosystem-Based Forestry Area.

5.2 The Owners shall provide a plan within one year of the registration of this

agreement at the Land Titles Office (the "Ecosystem-Based Forest Plan"),

which includes both a development plan and a forest management plan.

The forest management component will include a forest inventory and

description of the character and condition of the forest in the Ecosystem-

Based Forest Management Area. The development component will

include all development to the Land. The Plan will explain how the

purpose of the covenant will be achieved, and will detail uses and the

types of activities for the Ecosystem-Based Forest Management Area for a

fifty-year period. The following restrictions apply to the Ecosystem-Based

Forest Management Plan and its actions:

(a)

The Ecosystem-Based Forest Management Plan will be revised as

often as necessary or within five years of registration, whichever

comes first, and not less frequently than every ten years;

(i) The Ecosystem-Based Forest Management Plan and every

revision to it shall be submitted to TLC The Land Conservancy

of British Columbia for approval. The Land Conservancy will

have 60 Business Days to comment on and to evaluate the

Management Plan. If The Land Conservancy fails to comment

Page 45 of 54

on the Management Plan The Land Conservancy of British

Columbia will be deemed to have approved of it.

(ii) Only TLC The Land Conservancy of British Columbia needs to

approve the plan.

(b)

The Ecosystem-Based Forest Management Plan shall be

consistent with the purpose and details of this Covenant;

(c)

The Ecosystem-Based Forest Management Plan must be prepared

by a registered professional forester who has experience in

Ecosystem-based Forestry

(d)

The Ecosystem-based Forest Management Plan must always

include the following standards and principles:

(i) Use Adaptive Management forestry where consistent monitoring

of indicator species ensure the success of the Sustainable

nature of the management;

a. include, without limitation, trees, and sufficient trees to

transition to mature snags and wildlife trees in due course

as existing snags and mature trees decay and lose their

wildlife values, in accordance with the wildlife tree

management information provided in the Baseline Report;

(ii) ensure no clear-cutting or removal of tree patches great than 35

meters in diameter;

(iii) ensure an annual cut that is less than 75% of the actual 5 year

annual increment growth over any 5 year period including

windfalls, and removal of trees due to road or dwelling

construction;

(iv) ensure an annual allowable cut will be evenly distributed

throughout the Ecosystem-Based Forest Management Area and

be representative of the plant communities including:

a. the annual cut is spread among tree species

b. the annual cut is spread among tree age class

(v) ensure an accurate log book of any timber removal including the

location, environmental conditions such as weather, species

type, and scaled volume. These records must be made

available to the Covenant Holders and all dwelling owners with

reasonable notice;

(vi) create an annual report that outlines financial value added,

hours of employment created, and other benefits to the local

community and the local economy;

(vii) retain or encourage any old-growth characteristics, and seed

trees;

Page 46 of 54

(viii) any cutting of trees shall, along with encouraging the

development of an increased frequency of Douglas-fir where

appropriate, ensure that the trees cut are proportionate to the

species in the stand in question;

(ix) Trees removed shall be representative of the species mixture in

the stand, with the exception of Douglas Fir where appropriate,

which shall be the favoured leave tree; when trees are cut, all

bucking, limbing, and topping shall occur in the forest, and any

parts of the cut tree not used shall remain distributed on the

forest floor where the tree was cut; and

(x) use the existing system of skid trails/skid roads for removal of

any trees from the Ecosystem-Based Forestry Area, and any

new skid trails constructed shall not exceed 5% of the

Ecosystem-Based Forestry Area.

6.1 In respect to those areas identified in Schedule D as Protected Area,

except with prior written permission of the Covenant Holders, at the

Covenant Holder’s discretion, the following restrictions apply:

(a)

no introduction of non-indigenous flora or fauna;

(b)

no buildings or structures of any kind shall be built;

(c)

no trade or business shall be carried on within the Protected Area;

(d)

no road, driveway, walkway, bicycle, or other path, parking area,

dock, or ramp shall be erected, placed or maintained, or permitted

to be erected, except that foot trails, fire lanes and other means of

access existing at the date of the Agreement may be maintained

Substantially in their existing condition, and except as permitted in

Schedule C.

(e)

no indigenous flora or fauna shall be removed, destroyed or cut, or

be permitted to be removed, destroyed or cut, except as may be

necessary to maintain existing foot trails not exceeding one meter

in width, fire lanes or other means of access as permitted.

Page 47 of 54

SCHEDULE C

Attached to and forming part of the Covenant Agreement between ECO

INITIATIVES INC., Owner, and TLC THE LAND CONSERVANCY OF BRITISH

COLUMBIA, Covenant Holder, and REGIONAL DISTRICT OF COMOX-

STRATHCONA, Covenant Holder, dated the __ day of , 2005.

1.

1.1 In respect to those areas identified on the Plan as the Residential Use

Area, the Owner reserves the following rights:

(a)

to maintain, replace or enhance any permitted residence on the

property within the restricted square footage size;

(b)

to maintain, replace or enhance a Service Corridor including a

driveway from Tiber Bay Road to the proposed residences,

provided that all services must be located within the said corridor

and that the said corridor must not exceed 10 metres in width;

(c)

to build, maintain, replace or enhance improvements related to the

residence in an area extending not more than 20 metres from the

residence in any direction;

(d)

to improve, enhance, restore and rehabilitate the natural

environment under federal, provincial, and local regulations with:

(i) consultation with a registered professional biologist, or

registered professional forester and prior approval of TLC The

Land Conservancy of British Columbia, not to be unreasonably

withheld; and

(ii) completed in a manner planned and approved.

(e)

to build, maintain, replace or enhance improvements related to

trailways, pathways and benches;

(f)

to harvest firewood as required for residential use only within 50

metres around the dwellings in all directions; and

(g)

to light exposed fires in service corridors and roads only.

1.2 The Owner specifically reserves the following rights for Service Corridors:

(a)

to construct, maintain, replace or enhance wells or other water

sources and a septic system or other method of waste disposal

such that:

Page 48 of 54

(i) all piping is laid in the Service Corridor as reserved in 1.1

excepting those places that make this impossible; and

(b)

to build, maintain, replace or enhance electrical, telephone or other

energy sources in the Service Corridor as reserved in 1.1.

2.

2.1 In respect to those areas identified on the Plan as the Ecosystem-Based

Forestry Area, the Owner reserves the following rights:

(a)

to conduct commercial activities that are not detrimental to the Land

and Amenities and are consistent with maintaining the Land and

Amenities in a sustainable state.

(b)

to improve, enhance, restore and rehabilitate the natural

environment under federal, provincial, and local regulations with:

(i) consultation with a registered professional biologist or registered

professional forester and prior approval of TLC The Land

Conservancy of British Columbia, not to be unreasonably

withheld; and

(ii) completed in a manner planned and approved.

(c)

to enter into an agreement with The Trust for Sustainable Forestry

to manage the forest in the interest of all dwelling owners with:

(i) Consultation with all dwelling owners on the Land pertaining to

any concerns regarding the Ecosystem-Based Forest

Management Plan; and

(ii) Approval and consultation with the Covenant Holders on

forestry activity on the Land.

3.

3.1 In respect to those areas identified on the Plan as the Protected Area, the

Owner reserves the following rights:

(a)

to improve, enhance, restore and rehabilitate the natural

environment under federal, provincial, and local regulations with:

(i) consultation with a registered professional biologist or registered

professional forester and prior approval of TLC The Land

Conservancy of British Columbia, not to be unreasonably

withheld; and

(ii) completed in a manner planned and approved.

Page 49 of 54

SCHEDULE D

Attached to and forming part of the Covenant Agreement between ECO

INITIATIVES INC., Owner, and TLC THE LAND CONSERVANCY OF BRITISH

COLUMBIA, Covenant Holder, and REGIONAL DISTRICT OF COMOX-

STRATHCONA, Covenant Holder, dated the __ day of , 2005.

Page 50 of 54

This map uses the updated knowledge based on the ground-truth analysis as per

Appendix D of Schedule A.

Page 51 of 54

SCHEDULE E

Attached to and forming part of the Covenant Agreement between ECO

INITIATIVES INC., Owner, and TLC THE LAND CONSERVANCY OF BRITISH

COLUMBIA, Covenant Holder, and REGIONAL DISTRICT OF COMOX-

STRATHCONA, Covenant Holder, dated the __ day of , 2005.

Page 52 of 54

SCHEDULE F

Attached to and forming part of the Covenant Agreement between ECO

INITIATIVES INC., Owner, and TLC THE LAND CONSERVANCY OF BRITISH

COLUMBIA, Covenant Holder, and REGIONAL DISTRICT OF COMOX-

STRATHCONA, Covenant Holder, dated the day of 2005.

Page 53 of 54

SCHEDULE G

Attached to and forming part of the Covenant Agreement between ECO

INITIATIVES INC., Owner, and TLC THE LAND CONSERVANCY OF BRITISH

COLUMBIA, Covenant Holder, and REGIONAL DISTRICT OF COMOX-

STRATHCONA, Covenant Holder, dated the day of 2005.

Page 54 of 54