Section 11: GENERAL PROVISIONS

(a) Directors The Government shall have the right to nominate two Directors to the Board of the Company. (b) Assignment The Company shall have the right to assign all or any portion of the rights, privileges and franchises including fiscal provisions and tax benefits and immunities granted to the Company, such assignment to include all obligations under this Agreement to a Sierra Leone Corporation. An assignment if made and the insurance, ownership, transfer or redemption of securities, shares or stock, bonds, notes and other evidence of ownership and indebtedness issued by the Company in connection with such assignment, shall be exempt from the payment of any tax, levy, duty or fee, exclusive of stamp or registration duties whether national or local. Provided that whenever an assignment is in the form of a security for a loan, the Mining Leases, Additional Mining Leases and Prospecting Licences and any rights and interests under them shall not be assigned without the prior written consent of the Minister of such assignment thereof, which consent shall not be withheld unreasonably. Except as provided in this paragraph, the Company shall not assign this Agreement or any rights, privileges or franchise included herein without the prior written consent of the Government signified by endorsement on the instrument of assignment, which consent shall not be withheld unreasonably. Whenever a prior written consent is signified, the Minister shall notify that it has been so signified by Order published in the *Gazette*. (c) Notices (1) All orders, approvals, declarations, notices and communications of any kind between the Minister or any other representative of the Government and the Company shall be in writing and the contracting parties shall not under any circumstances be permitted to allege or to rely upon any oral order, approval, declaration, notice or communication. 34 No. 4 Sierra Rutile Agreement (Ratification) Act 2002 (2) All orders, approvals, declarations, notices and communications from the Government to the Company shall be delivered to the representative of the Company in Freetown. (3) All declarations, notices and communications from the Company to the Government shall, unless otherwise required by law or by the terms of this Agreement or unless the Government shall otherwise direct by written notice to the Company, be mailed or delivered to the Director of Mines at his office in Freetown. (d) Prior Consent or Approval Whenever, under the terms of this Agreement the right of the Company or of the Government, as the case may be, to do or perform any act or thing is conditioned on the prior consent of the other party to the Agreement, or of an official or representative of such other party, it is hereby stipulated and agreed by and between the parties hereto that the requisite consent or approval will not in any instance be unreasonably withheld. (e) Limitation of Application of Minerals Act and other Acts (1) The provisions of the Minerals Act and the Rules made under it, including the provision of any official forms prescribed by such rules, shall be binding upon and inure to the benefit of the Company except such provisions thereof as may be inconsistent with any of the express or implied terms or conditions of this Agreement. (2) Any such inconsistency referred to in paragraph (1) shall be resolved by giving effect to the provisions of this Agreement. (3) In the event that the Government enacts any legislation or changes any administrative rule or practice which under the laws of Sierra Leone is binding upon the Company and which results in more onerous obligations being placed upon the Company than those subsisting at the Effective Date (save for any financial obligations that are the subject of Clause 6(i)(3), then without prejudice to any other right the Company may have against the Government, the Government shall hold the Company harmless in respect of the increased cost of performing the more onerous obligation. (f) Revocation by the Government If and whenever any sum of money payable hereunder by the Company as rent or royalty shall be in arrears for the space of six (6) months after the date on which it becomes due and payable, or if there shall be any breach or nonobservance by the No. 4 Sierra Rutile Agreement (Ratification) Act 2002 35 Company of any of the terms of any licence or lease granted herein or hereunder, or if the licencee or lessee thereunder shall become bankrupt or make or enter into any arrangement or composition with its creditors, or if a receiver is appointed for the licencee or lessee or if it shall enter into liquidation whether compulsorily or voluntarily (except a voluntary liquidation of a solvent company for the purpose of reconstruction) then and in any such case, the Government may revoke the licence or lease in question and thereupon the same and all rights thereunder granted pursuant to this Agreement shall cease and determine but subject nevertheless and without prejudice to any obligation or liability imposed by or incurred under the terms and conditions thereof. Provided always that save as to the non-payment of rent or taxes the aforesaid power shall not be exercised unless and until notice has been given to the licencee or lessee specifying the particular breach complained of and if the breach is capable of remedy, requiring the licencee or lessee to remedy the breach and in any case requiring the licencee or lessee to make compensation in money for the breach if such breach is compensable, and the licencee or lessee fails within a reasonable time thereafter to remedy the breach if it is capable of remedy and to make reasonable compensation in money to the satisfaction of the Government for the breach. (g) Force Majeure (1) Failure on the part of either the Company or the Government to fulfil any of the terms and conditions of this Agreement shall not give rise to a claim by the other party or be deemed to be a breach of the Agreement insofar as the failure arises from *force majeure*, and if through *force majeure* the fulfilment by either the Company or the Government of any of the terms and conditions of this Agreement is delayed, then subject to Clause (g)(2) the period of such delay shall be added to the periods fixed by this Agreement. (2) For the avoidance of doubt, the Company's payment obligations shall be suspended for the duration of any ***force majeure*** event except in respect of any monies due at the date of the occurrence of the ***force majeure*** event, which shall remain due and payable. (3) In this clause the expression *"force majeure"* includes without limitation an act of God, war (declared or undeclared), insurrection, riot, civil commotion, tide, storm, tidal wave, flood, lightning, explosion, fire, earthquake, terrorist activity or other hostilities of the types and any other happening which the party affected could not reasonably prevent or control and the expression "the Agreement" includes not only terms and conditions of this Agreement, but also terms and conditions of the Mining Leases. 36 No. 4 Sierra Rutile Agreement (Ratification) Act 2002 (h) Amendment In the event that the Government and the Company mutually agree to amend any of the provisions of this Agreement, such amendment may be effected by agreement between the parties evidenced by an instrument in writing. Any such amending agreement shall take effect without further ratification or cofirmation by Parliament save to the extent that it may be inconsistent with any law in force in Sierra Leone at the time when such agreement between the parties is executed. (i) Interpretation and Arbitration (1) Except as may be otherwise herein expressly provided, this Agreement shall be construed, and the rights of the Government and the Company hereunder shall be determined, according to the Laws of Sierra Leone and such rules of international law as may be applicable. (2) The parties shall in good faith endeavour to reach an amicable settlement of all differences of opinion or disputes which may arise between them in respect to the execution, performance and interpretation of termination of this Agreement, and in respect of the rights and obligations of the parties deriving therefrom. (3) In the event that the parties shall be unable to reach an amicable settlement of such dispute within a period of three (3) months from entering into negotiations thereon, either party may submit the matter to the exclusive jurisdiction of a Board of three (3) Arbitrators who shall be appointed and carry out their mission in accordance with the Arbitration Rules and Regulations of the International Chamber of Commerce (ICC). The venue of the arbitration shall be London. The English language shall be used in the proceedings. The award and any decision of the Arbitration Board shall be binding upon either Party having the same force and effect as a judgement of a Court of last resort of the party's concerned country. (j) Termination of Principal and Supplemental Agreements Upon the coming into effect of this Agreement in accordance with Clause 12 hereof, the Principal Agreement and the Supplemental Agreement (including all related side letters and minutes) shall thereupon terminate, save that any rights and obligations thereunder which shall have arisen or accrued prior to such termination shall be deemed to be rights and obligations which have arisen or accrued under this Agreement. No. 4 Sierra Rutile Agreement (Ratification) Act 2002 37 (k) Amendment of the Mining Leases Upon the coming into effect of this Agreement in accordance with Clause 12 hereof Mining Leases shall be deemed to be hereby amended as required to conform to the financial and other provisions of this Agreement. References therein to the Principal Agreement and to the Supplemental Agreement shall accordingly be construed as reference to this Agreement. (l) Import and Export Inspection Fees (1) Except as otherwise provided in this Agreement, the Company shall, with effect from the Effective Date, pay an inspection fee in respect of all goods imported by or on behalf of the Company into Sierra Leone at a rate not to exceed 1.5% (one and a half percent) of the CIF price of the imported goods. (2) With effect from the Effective Date, the Company shall pay an inspection fee in respect of all goods exported by or on behalf of the Company from Sierra Leone at a rate not to exceed 0.25% (one quarter of one percent) of the gross sales price of such goods, free alongside the Sierra Leone port of shipment. (m) Deductibility of Losses (1) The Company may make a claim requiring that the amount of any loss incurred by the Company during any of the nine Financial Years ending prior to December 31, 1999, and the amount of loss incurred by the Company during any subsequent period, or any portion thereof, after December 31, 1999 shall be carried forward and, as far as may be, deducted from or set off against profits (of whatever description, including whether from operating or other revenues or capital transactions) on which the Company is charged any tax in any subsequent years. (2) The Government may instruct an independent firm of accountants to assist it in verifying the losses that have been incurred by the Company during the Financial Years ending December 31, 1995 through December 31, 1999 and the Company will provide all such information, including copies of documents and other papers, that such accountants may reasonably request. The cost of the independent firm of accountants shall be borne by the Government. 38 No. 4 Sierra Rutile Agreement (Ratification) Act 2002 (n) Deductibility of Outgoings and Expenses (1) The Company has advised the Government that it proposes moving its head office function to Sierra Leone not later than December 31, 2003. (2) Notwithstanding the provisions of Section 103 of the Minerals Act and the provisions of the Income Tax Act, 2000, the Company, in computing its chargeable income shall: (a) for all financial years up to the Financial Year ending December 31, 2003, be entitled to deduct all Group Office Expenses wholly, exclusively and necessarily incurred in carrying out its activities; (b) with effect from the Financial Year commencing January 1, 2004, be entitled to deduct Group Office Expenses, where the Group Office functions are carried on outside Sierra Leone, subject to the following limitations: (i) for the Financial Years commencing January 1, 2004 and January 1, 2005, such deductions shall not exceed 5% (five percent) of the Company's turnover for the period; and (ii) for any Financial Year commencing after December 31, 2005, such deduction shall not exceed 1.5% (one and a half percent) of the Company's turnover for the relevant period. (3) For the avoidance of doubt, the above provisions shall not in anyway restrict the Company's ability when computing its chargeable income for any period, to deduct all outgoings and expenses that are exclusively and necessarily incurred by the Company whether inside or outside Sierra Leone in carrying out its activities during the relevant period, except that the Company shall not be entitled to deduct more than 2.5% (two and a half percent) of its turnover for the relevant period in respect of marketing commissions and fees. (o) Road Users Fuel Levy (1) Notwithstanding the provisions of the Road Users Charges Act, 1994, the Company shall, with effect from January 1, 2003, be liable for road users fuel levy applicable to users generally in respect of petrol or diesel consumed by the Company's vehicles on highway roads. This liability shall be the Company's sole liability in respect of such tax. For the avoidance of doubt, off-highway usage and usage in respect of power generation shall not attract any road users fuel levy. No. 4 Sierra Rutile Agreement (Ratification) Act 2002 39 (2) For the purpose of calculating the amount of road users fuel levy payable by the Company for the Financial Year ending December 31, 2003, the tax shall be based on actual consumption of the Company's vehicles on highway roads and for periods thereafter upon a percentage rate of total petrol and diesel purchases made by the Company during the relevant period, such percentage rate to be agreed between the Government and the Company on the basis of actual usage. (p) Port Charges and Harbour Dues (1) The Sierra Leone Ports Authority may levy port charges in respect of vessels carrying solely the Company's goods as follows: (i) compulsory pilotage will be payable by the Company in respect of any such vessels entering and leaving any Sierra Leone port of shipment at a rate not exceeding US$1200 (or its Leone equivalent) per vessel; (ii) bouyage fees will be payable by the Company at a rate not exceeding US$0.10 (or its Leone equivalent) multiplied by the gross registered tonnage of the relevant vessel; and (iii) light dues will be payable by the Company at a rate not exceeding US$0.10 (or its Leone equivalent) multiplied by the gross registered tonnage of the relevant vessel. (2) With effect from but not prior to the Effective Date the Sierra Leone Ports Authority may levy harbour dues at a maximum rate of US$1 (or its Leone equivalent) per ton of rutile carried on behalf of the Company by vessels leaving any Sierra Leone port of shipment. Neither the Company nor its carriers or agents will be liable for harbour dues in respect of ilmenite or any other goods carried on behalf of the Company by vessels leaving any Sierra Leone port of shipment. (3) With effect from but not prior to the Effective Date the Sierra Leone Ports Authority may levy a freight levy in respect of goods exported by or on behalf of the Company from any Sierra Leone port of shipment at the following rates: (i) in respect of rutile and zircon, a maximum rate of US$1 (or its Leone equivalent) per ton; (ii) in respect of ilmenite, a maximum rate of US$0.25 (or its Leone equivalent) per ton; and 40 No. 4 Sierra Rutile Agreement (Ratification) Act 2002 (iii) in respect of all other goods, a maximum rate of US$1.20 (or its Leone equivalent) per ton. (4) The Company will not be liable for freight levy in respect of any mining machinery, plant, equipment, consumable mining stores and goods imported by or on behalf of the Company through any Sierra Leone port. (5) The Company's liability under the provisions of this Clause is in substitution for and not in addition to any liability that might otherwise be imposed, either hereto before or hereafter, on its carriers or agents, and whether by the Sierra Leone Ports Authority or any other Public Body, in respect of the aforementioned matters. (6) In the event that the Sierra Leone Ports Authority or other responsible public body fails to provide any of the services for which the Company is required to pay port charges, harbour dues and any other amounts pursuant to this Clause, including, but not limited to, positioning and lighting of buoys, and the Company incurs any costs or expenses in providing or obtaining such services, the Company shall be entitled to deduct such costs and expenses from any amounts that are otherwise payable to the Sierra Leone Ports Authority or any other public body pursuant to this Clause. (q) Security (1) The Government and the Company recognise that an effective security regime is important to ensure the safety of the Company's assets and personnel. (2) In order to achieve an effective security regime, the Company may create and maintain a security force to provide a deterrent, defence and reaction capability to incidents. (3) The Company may import such arms and ammunition that are appropriate to such a security force subject only to the prior approval of the Government and the security force may carry and use such arms and ammunition for the purpose of carrying out its functions. (r) Reporting (1) Without prejudice to any reporting obligations under this Agreement, the Company shall provide to the Government not later than the end of March of each year after resumption of its operations a report showing: No. 4 Sierra Rutile Agreement (Ratification) Act 2002 41 (i) market developments for the Company's products over the previous twelve month period; (ii) how the Company has responded to such developments; and (iii) how the market is expected to develop over the following year. (2) The Company shall notify the Government of the contract price for any long-term contract for the sale of rutile, ilmenite or zircon the Company enters into, within thirty days of entering into the contract. (3) The Company shall instruct its auditors to provide a quarterly report to the Government confirming that during the relevant quarter: (i) all sales have been made to unconnected parties, or otherwise to connected parties at prices based on or equivalent to arm's length sales to unconnected parties and in accordance with such terms and conditions on which agreements would be made if the parties had not been connected; (ii) all sales other than those on the spot market have been made under long-term contracts; and (iii) all royalties arising from such sales have been correctly calculated and have either been paid or accrued as appropriate under the agreed terms of payment. (s) Communications The Government shall procure SIERRATEL or its successors, the Minister of Transport and Communications, or other appropriate bodies to give effect to the arrangements reached between the Company and SIERRATEL contained in a letter from SIERRATEL to the Company dated February 26, 1997 and shall ensure that the consent of SIERRATEL or its successors, the Minister of Transport and Communications, or other appropriate bodies, where required under the terms of such letter, shall not be unreasonably withheld or delayed. 42 No. 4 Sierra Rutile Agreement (Ratification) Act 2002 (t) FOREIGN CONTRACTORS (1) In order to assist the Company to undertake the Refurbishment Works, all and any third party contractors, including their sub-contractors and their respective employees and agents, shall, to the extent that they are engaged in such Refurbishment Works, be exempt from all local taxes, including payroll tax, immigration and labour fees, withholding tax, PAYE and income tax. (2) In the event of any such contractor, or any of their employees, being engaged by the Company to carry out both Refurbishment Work and other work, whether pursuant to the same contract or otherwise, the Government and the Company will agree as to the percentage of the contractors and their employees work which is Refurbishment Work and entitled to the above exemption. (3) The Company shall promptly notify the Government of the employment of any contractor to carry out Refurbishment Works and shall certify to the Government that the contractor and its named employees are entitled to the above exemption. (u) EXPORTATION OF SURPLUS EQUIPMENT The Government will grant any permit and permission of whatever nature necessary for the Company to export from Sierra Leone any mining machinery, plant, equipment, consumable mining stores, goods and surplus equipment of whatever description imported by it for the conduct of its prospecting, mining, processing and transport operations contemplated by this Agreement. (v) CONFIDENTIALITY The Government will keep confidential all information provided to it by the Company, whether before or after the date of this Agreement and confirms that it shall not disclose such information to any third party without the Company's prior written consent. No. 4 Sierra Rutile Agreement (Ratification) Act 2002 43 (w) GOVERNMENT ASSISTANCE The Government will extend to the Company all reasonable assistance to enable and facilitate the Company to carry out its functions and achieve its objectives in the best and most efficient manner and, without limitation, to enjoy its rights and privileges under this Agreement. The Government shall, and shall procure all relevant public bodies to, make such lawful orders and administrative acts as may be desirable from time to time for this purpose. (x) AMENDMENT OF THE MINING LEASES All Mining Leases shall be deemed to have been amended as required to give effect to the financial and other provisions of this Agreement.