Schedule., The Diamond Supple- Short title

AN AGREEMENT made the 16th day of March, 1954, BETWEEN THE CROWN AGENTS FOR THE COLONIES whose office is at No. 4 Mill bank in the City of Westminster acting for and on behalf of the Government of the Colony and Protectorate of Sierra Leone (hereinafter called " the Government ") of the one part and SIERRA LEONE SELECTION TRUST, LIMITED, whose registered office is situate at Selection Trust Building, Mason's Avenue, Coleman Street in the City of London (hereinafter called" the Company") of the other part. WHEREAS: (A) This Agreement is supplemental to- (i) A Deed dated the 20th day of October, 1934 (hereinafter called "the Licence") and made between Thomas Nelson Goddard, M.B.E. the then Acting Governor of the Colony and Protectorate of Sierra Leone aforesaid acting on behalf of the Government of the one part and the Company of the other part whereby the said Acting Governor acting as aforesaid granted to the Company for the term of ninety-nine years from the 1st day of July 1933 (determinable as therein provided) a sole and exclusive Licence to explore for, exploit, produce, take, dispose of and market diamond throughout the whole of the Colony and Protectorate of Sierra Leone (hereinafter called " the Colony") except as therein mentioned. (ii) An Agreement dated the 15th day of April, 1935 (hereinafter called " the Supplemental Agreement ") and made between the said Crown Agents for the Colonies acting for and on behalf of Henry Monck-Mason Moore, C.M.G., the then Governor of the Colony of the first part Consolidated African Selection Trust Limited of the second part and the Company of the third part modifying (inter alia) the provisions of the Licence to the extent therein mentioned but which modifications are not material for the purposes of this Agreement and Confirmation of Supplementary (iii) An Agreement dated the 18th day of October, 1951 (hereinafter Cap. 208. called" the 1951 Agreement") and made between the said Crown Agents for the Colonies acting for and on behalf of the Government of the one S.L.-VoL. IV-16* 2174 Cap. 209] Diamond Agreement (1954) part and the Company of the other part modifying the provisions of the Licence relating to the taxation of the Company. (B) It has been agreed that the provisions of the Licence as modified as afo:resaid shall be amended so that the Company shall be liable to both Sierra Leone income tax at the standard rate from time to time in force and the Diamond Industry Profit Tax calculated on a graduated scale. (C) It has also been agreed that the Company shall make an annual contribution for the benefit of the people of the Kono Country and especially the local population in the neighbourhood of the Company's mining areas. Now IT IS HEREBY AGREED as follows- 1. Definitions. FoR the purposes of this Agreement the following definitions shall Modifications to the Licence. unless the context otherwise requires apply- " Capital Expenditure " shall mean expenditure which is eligible for capital allowances under United Kingdom tax law from time to time in force. " Accounting Year " shall mean unless and until otherwise agreed the period commencing on the first day of July in every year and ending on the thirtieth day of June in the next succeeding year. " Licence Reserve " shall mean the General Reserve referred to in Clause 9 of the Licence. " Profit " shall mean the net Profit of the Company for an accounting year calculated in accordance with the provisions contained in the Schedule to the Licence as modified by the provisions of this 2. NoTWITHSTANDING anything contained in the Licence the following provisions shall have effect- (a) In respect of the accounting year commencing on the 1st day of July, 1953 and each subsequent accounting year the yearly rent or sum payable by the Company pursuant to Clause 3 (1) of the Licence shall be £10,000 instead of £7,000 and the said Clause 3 (1) and Clause 3 (2) and the Schedule to the Licence shall be deemed to have been amended with effect from the 1st day of July, 1953 by the deletion therefrom of" £7,000" and the insertion in place thereof of" £10,000 ". (b) In respect of profit for the accounting year commencing the 1st day of July, 1951 and every subsequent accounting year the Diamond Industry Profit Tax shall be payable by the Company in accordance with the graduated scale set out in the Schedule to this Agreement. (c) In computing profits in respect of any accounting year for the purposes of paragraph (a) of the Schedule to the Licence- (i) The Company may at its discretion deduct all or any part of the capital expenditure incurred by it during such year provided that the amount deducted in any year shall not exceed Two Hundred Thousand Pounds and shall not include any capital expenditure which has been defrayed out of the Licence Reserve and (ii) No deduction may be made for any depreciation in respect of capital expenditure which has been either deducted under the provisions of sub-clause (i) of this clause or defrayed out of the Licence Reserve. Diamond Agreement (1954) [Cap. 209 (iii) In the event of the sale by the Company of any assets the cost of which has been allowed as a charge against profits under sub-clause (i) of this clause so much of the proceeds of such sale as do not exceed the amount which has been so allowed as a deduction shall be included in computing the profits of the Company for the year in which the sale is made. (d) The Company shall be entitled if it so desires to increase the Licence Reserve to such sum not exceeding £600,000 at any one time as it may think fit by means of annual transfers from profit provided that the amount transferred in respect of any accounting year shall not exceed seven and one-half per centum of the profits of the Company for such year ascertained in accordance with paragraph (a) of the Schedule to the Licence as amended by the provisions of this Agreement, and the obligations on the Company under Clause 9 (1) of the Licence shall cease to have effect. Any such transfer shall be allowed as a deduction in computing the profit for the purposes of the Diamond Industry Profit Tax instead of the deductions allowed under paragraph (b) (i) of the Schedule to the Licence as amended by the provisions of this Agreement. The right hereby given to the Company may be exercised in respect of any accounting year at any time and from time to time not later than twelve months after the date on which the payment of Diamond Industry Profit Tax for that accounting year became due and any necessary adjustment of liability to taxation consequent upon such an exercise shall be made accordingly. (e) The Licence Reserve may be invested either in such investments as are described in Clause 9 (4) of the Licence or in other investments of such nature as may from time to time be agreed between the Government and the Company. (f) Notwithstanding that it may be available for such purpose the Company shall not apply any part of the Licence Reserve in the equalisation of dividends.