MOUNT WORK - HARTLAND LICENSE AGREEMENT:

This Agreement entered into this 1st day of January, 2002.

BETWEEN:

The Capital Regional District
524 Yates Street
Victoria BC V8W 2S6
(herein "the District")

AND:

The South Island Mountain Bike Society
P.O. Box 215
2680 Quadra Street
Victoria V8T 4E4
(herein "the Society")

WHEREAS:

A. The District is the registered owner of Mount Work Regional Park (herein "the park"), within the District of the Highlands and the Municipality of Saanich, in the Province of British Columbia.

B. The District has designated a portion of the park (shown as the License Area on the attached Schedule A) as an area for mountain biking, horse riding, and hiking, more particularly known and described as:

A portion of Sections 55, a portion of the east half of Section 64, a portion of Section 65, all of Section 66, and the east half of Section 79, called

Mount Work-Hartland (herein "the License Area").

C. The Society, with permission of the District, will construct and maintain certain improvements permitted by this agreement in the area so designated.

Now therefore this license witnesseth that the parties hereto mutually covenant, agree, and acknowledge as follows:

1. DEFINITIONS

a. "Special Use" means any commercial or non commercial service, activity or event which attracts or requires participants or spectators, and includes, but is not restricted to, a race, competition, tournament, group training or group lesson, or bicycle show.

b. "Mountain Bike" means any non-motorized bicycle with tires able to maneuver on rough/gravel, non-paved surfaces and terrain.

2. TERM

This agreement will be in effect for a period of three (3) years commencing the 1st day of January 2002.

3. COVENANTS OF THE SOCIETY

The Society will:

Liaison

3.1 Appoint two representatives to serve as liaison persons between the Society and the District, and provide names, addresses, and telephone numbers of these representatives. They will be appointed for terms of not less than six (6) months.

General Use

3.2 Ensure that the License Area is open and available to all mountain bike groups and individuals, and the general public, and in the case of special use, to other clubs and groups.

3.3 Abide by the following conditions when using the License Area, Hartland Landfill, or any other part of the park and when granting a Park Use Permit (PUP) for mountain bike use will impose these conditions upon permit holders:

a. All mountain bikes will be under the effective control of their riders at all times;

b. All training will take place within the License Area;

c. All training will cease when the Society is advised by the District that in the opinion of the Parks Administrator such training:

i. Interferes with the enjoyment of other park visitors;

ii. Creates excessive noise;

iii. Involves the use of motorized vehicles;

iv. Causes significant impact to the natural environment.

3.4 All groups or individuals booking the License Area will submit a proof of general public liability insurance to the Society which will be sufficient for bookings throughout the year.

3.5 When using the License Area ensure that the members of the Society and all participants under a PUP, follow all rules, regulations and administrative policies and bylaws of the District. The rules of the License Area will be posted at the Hartland Road entrance to the License Area and other entrances to the License Area as needed, in a manner approved by the Parks Administrator. The Society is responsible for patrolling its own members’ use and events and monitoring other groups booking the License Area. The Society is responsible for notifying the Parks Administrator immediately of any misconduct by a group or individual using the License Area. Cooperation between the Society, the Parks Administrator, all mountain bikers, horse riders, hikers and the general public, is vital to the management of the License Area.

3.6 Use of the Hartland Landfill, (noted as separate from Mount Work-Hartland, or the License Area) is by courtesy of CRD Environmental Services. Use of this area is subject to all the conditions of the License Area as set out in this agreement.

Improvements and Maintenance

3.7 Not commence any improvements or construction on the License Area except where authorized by the Parks Administrator in writing. Authorized improvements must meet CRD Parks standards, including delivery of construction plans and/or drawings for approval by the Parks Administrator a minimum of thirty (30) working days prior to commencement of improvements.

3.8 Any improvements to trails within the Hartland Landfill will be undertaken by CRD Parks in consultation with CRD Environmental Services.

3.9 Agrees and acknowledges that if maintenance as set out below is undertaken, the standard of maintenance will be determined by the Supervisor of Operations Services or Park Foreman responsible for the License Area in consultation with the Society.

3.10 Maintain the License Area as follows:

a. maintain the Green, Blue, and Red trails within the License Area only (as shown in Schedule C) to CRD Parks-approved standards, using hand tools only

: prune shrubs and trees when they interfere with safe passage

: assist in prevention of trail erosion in areas identified with CRD Parks

: provide garbage collection on trails on a monthly basis

b. monitor trail conditions of the Green, Blue, and Red trails

: advise CRD Parks on potential trail closures and complete closure of

trails as required by CRD Parks

: provide trail condition information on the Society’s web site, including

areas of blowdown identified as hazardous

: monitor the technical training area on a monthly basis to ensure that the area is in a good state of maintenance and repair — that the structures/obstacles are sound, have not been altered, adhere to approved design specifications, are maintained to ensure user safety, tighten all mechanical fixtures (nails, bolts) and ensure there is no structural failure of building materials — and submit reports to CRD Parks on the first day of each month.

c. provide to Society volunteers orientation and training consistent with CRD Parks volunteer orientation and training programs

d. advise the District on visitor use issues, trail development and maintenance

e. advise the District on potential hazards to user safety on the License Area

3.11 Be responsible for improvements including maintenance as set out in this agreement unless the Parks Administrator specifically agrees otherwise in writing.

Reporting

3.12 Submit an annual report to the Parks Administrator by 1 March each year, to include a financial statement setting out income earned from special use of the License Area, a summary of activities and attendance during the preceding year, a list of all special events and activities to be held in the coming year, and proof of public liability insurance as required by this agreement.

3.13 On or before 31 January of each year, submit to the Parks Administrator particulars of any development or improvement work (excluding usual maintenance) at the License Area to be undertaken in the coming year.

The License Area Booking, Fees and Revenue

3.14 Be responsible for booking all events at the License Area and will use a Park Use Permit (PUP) approved by the Parks Administrator.

3.15 Require all individuals and groups requesting the use of the License Area to pay fees set by the Society in consultation with the Parks Administrator. Fees will be subject to change as determined by the Society and the Administrator. If a concession is being operated by a club at the License Area during special use, an additional fee may be charged.

3.16 Charge a fee for use of the License Area for private instruction. Fees will be subject to change as determined by the Society in consultation with the Parks Administrator. Private instruction can only be booked when no special use is scheduled.

3.17 To pay to the District an annual license fee of 5 percent of the gross revenue earned by the Society through special use of the License Area, including PUP fees, in the twelve months immediately preceding each payment date. Annual payment shall be due on January 31st each year during the term of the agreement.

Parking

3.18 Monitor parking of vehicles at all entrances to the License Area to assist the District in identifying parking capacities and future needs. The Society is responsible for informing CRD Parks, and users of the License Area, of events which could cause parking congestion.

Signing

3.19 Obtain the approval of the Parks Administrator prior to the installation of any signs on the License Area.

3.20 Post or require special use organizers to post a sign indicating that non participants are not permitted on specified trails while any event or formal training is in progress.

4. INDEMNITY AND INSURANCE

4.1 The Society covenants and agrees with the District to indemnify and save harmless the District and its officers, employees, officials, agents, servants, volunteers and representatives from and against any and all claims, including claims under Workers' Compensation legislation, demands, awards, judgments, actions and proceedings by whosoever made, brought or prosecuted in respect of loss of or damage to or destruction of property or personal injuries, including death, and from and against any and all loss of, damage to or destruction of property and from and against any and all fines, delays, expenses and costs suffered or incurred by the District by reason of:

(a) the negligence of or any wilful act or omission of the Society, its invitees and licensees or any of them caused by or arising out of the operation of the License Area or exercising any right, licence or privilege or doing anything which is required or permitted by reason of this agreement or caused by or arising from any matter or thing done, permitted or omitted to be done with respect to the use of the License Area or otherwise;

(b) any failure of the Society to perform or observe the covenants and conditions herein contained on the part of the Society to be observed and performed; or

(c) any failure of the Society to comply with any statute, bylaw, order or regulation applicable to the exercise of the rights and licences hereby granted or any of them.

4.2 The obligations of the Society to indemnify and hold harmless the District with respect to liability by reason of any matter arising during the term of this agreement shall survive the termination of this agreement.

4.3 The Society covenants and agrees that it shall acquire and maintain at all times, and provide a copy to the District of, a policy issued by an insurance company or companies registered and licensed to operate in the Province of British Columbia, satisfactory to the District acting reasonably, of comprehensive legal liability insurance insuring the District, its officers, employees and servants, against all the liability arising out of the operation, maintenance, use or existence of the License Area, including the contractual liability to indemnify the District under the terms of paragraph 4.1 with inclusive limit of not less than FIVE MILLION ($5,000,000.00) DOLLARS per occurrence for bodily injury and property damage. Such insurance shall contain endorsements attesting that:

(a) the District is included or listed as an additional insured under the policy;

(b) the policy contains a "cross-liability" clause reading as follows:

"This policy, subject to the limits of liability stated herein, shall apply to each insured in the same manner and to the same extent as if a separate policy had been issued to each. Any act or omission on the part of one of the insured under this policy shall not prejudice the rights or interest of the other insured";

(c) the policy extends to cover the contractual obligations assumed by the Society under the terms of paragraph 4.1;

(d) the insurers have received a copy of this agreement and are fully aware of the contractual obligations assumed by the Society including, without limitation, those with respect to the operations and use of the License Area and that the insurance so issued covers such obligations;

(e) such policy or policies shall not be terminated, cancelled or materially altered unless written notice of such termination, cancellation or material alteration is give by the insurers to the District not less than 30 days before the effective date of same; and

(f) there is a waiver of subrogation in favour of the District.

4.4 The Society agrees that, if the Society fails to take out and keep in force any insurance required pursuant to paragraph 4.3, the District shall have the right, but not the obligation to take out and maintain such policy of insurance and to pay such premium as may be required therefor and, in such event the Society shall pay to the District within 30 days after the date of demand therefore, such premium costs, provided always that in taking out or keeping in force such insurance, the District shall give reasonable consideration to the suggestions and comments of the Society or its insurance consultants.

4.5 The Society covenants and agrees that the amount of insurance required to be effected by the Society under any of the provisions of this agreement shall not be construed to limit or restrict and shall in no manner limit or restrict the liability of the Society under this agreement.

4.6 The Society shall deliver to the District, on the date hereof and not less than 30 days prior to the expiry of each insurance policy to be acquired by the Society, evidence satisfactory to the District that the Society has acquired for the next year the insurance coverage as required pursuant to section 4.3.

5. COVENANTS OF THE DISTRICT

The District shall:

5.1 Permit the Society, its members, employees, agents and officers to enter the License Area for the purpose of carrying out the obligations of the Society under this agreement.

5.2 Authorize the Society to improve, maintain, and use the License Area, including booking of all special use, in accordance with this agreement.

5.3 Agree to manage the License Area for the general benefit of District residents and allow the use of the License Area in accordance with District policies and bylaws.

5.4 Provide such services to the Society as the District, at the sole discretion of the Parks Administrator, is able to provide, either at cost or, at the option of the Parks Administrator, at the normal charge out rate of CRD Parks, payable by the Society.

5.5 Agree to provide particulars of any concerns reported to CRD Parks regarding Society use of the License Area.

6. MUTUAL COVENANTS

The Society and the District covenant, agree, and acknowledge that:

6.1 License Area improvements and facilities are the property of the District, unless otherwise authorized.

6.2 If the Society is in breach of any provision of this agreement, the District may give written notice of the breach to the Society, and if the breach does not cease or is not otherwise corrected within thirty (30) days of the delivery of such notice to the partners, then the District may forthwith terminate this agreement.

6.3 Use of the License Area by the Society is restricted to the hours that the park is open to the public under District regulations and policies.

6.4 The Society’s use of trails within the Hartland Landfill under this agreement may be withdrawn at any time at the sole discretion of the District and the Society shall cease use of those trails immediately upon receipt of written notice from the District.

6.5 Operating guidelines to carry out and implement this agreement may be prepared and adopted as needed by the Parks Administrator in consultation with the Society.

6.6 This agreement shall remain in effect after the conclusion of its term on a month to month basis unless terminated in writing by either party.

IN WITNESS WHEREOF the parties hereto have caused these presents to be executed as of the day and year written below.

THE CORPORATE SEAL OF THE CAPITAL REGIONAL DISTRICT

was hereunto affixed this day of

2002, in the presence of:

CHAIR

SECRETARY

SIGNED, SEALED AND DELIVERED

for and on behalf of the

SOUTH ISLAND MOUNTAIN BIKE SOCIETY

this day of

2002, in the presence of:

PRESIDENT

VICE PRESIDENT