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THIS MINING LEASE AGREEMENT 

made the.J.L. day of...........................2016 BETWEEN THE GOVERNMEPEh








REPUBLIC OF GHANA (hereinafter called "the Government") acting by NIIosNMMI


the Minister of Lands and Natural Resources (hereinafter called "The Miristekekt


one part and MICROSTAR MINES & MINERALS LIMITED with registeredraenesa


216, CHRISMAN HOUSE, CANTONMENTS, P. O. BOX 52632, ACCRA, H


(hereinafter called "the Company") of the other part. , Afa





WHEREAS:





The Government is desirous of developing its mineral resources in such


will ensure that the maximum possible benefits accrue to the nation fr





exploitation of minerals and seeks companies that possess the necessary f


technical and human resources to exploit the minerals efficiently; 




The Company warrants that it has the financial, technical and human rest


required for undertaking the mining operations efficiently and has decfared


willing to engage in mining in Ghana; h,





The Government has therefore agreed to grant the Company a Mining


the terms and conditions provided for in this Agreement.





NOW THIS AGREEMENT WITNESSES AS FOLLOWS:





1. GRANT OF MINING RIGHTS





a. The authorised mineral the subject of this Mining Lease is gold (hereina


called "the Mineral").





b. The Government hereby grants to the Company mining rights to ALL that piece


of land described in the schedule hereto and more particularly





the map attached (hereinafter called "the Lease Area") for a term of


years (hereinafter called "Term") from the date of this Mining





c. The Term may be renewed from time to time in accordance with


and Mining Act, 2006 (Act 703).


d.


The Government hereby grants to the Company the exclusive


develop and produce the Mineral in the Lease Area for the


(including transportation, processing, and storing with the rights





reasonably incidental thereto) subject to the provisions of this Miningteasei



e. This Mining Lease is subject to ratification by Parliament in accordance with


Article 268(1) of the Constitution and section 5(4) of Act 703. Upon the


execution of this Mining Lease, the Company shall submit a certified true copy


of the Mining Lease to the Minister to be laid in Parliament for ratification.


f. The Company shall not however conduct any operations in a reserved area,


restricted area, protected area or designated area and shall not without the


prior written consent of the Minister conduct any operations:


i. within 100 metres of any forest reserve, river, stream, building,


installation, reservoir, dam, public road, railway or area appropriated


for a railway; or


ii. within 300 metres of a pylon; or


iii. in an area occupied by a market, burial ground, cemetery or within a


town or village or an area set apart for, used, appropriated or


dedicated to a public purpose.


g. The Company shall, in accordance with Section 69 of Act 703 and Regulation


20 of the Minerals and Mining (General) Regulations, 2012 (L.l. 2173)’


commence commercial production of the approved mineral not later than


twenty-four (24) months from the date of grant of this Mining Lease.


h. The Company shall take all practical steps to avoid damage to land, trees,


crops, buildings, structures and other property in the Lease Area. Where such


damage cannot be avoided, the Company shall provide fair and reasonable


compensation in accordance with Section 72-75 of Act 703 and the Minerals


and Mining (Compensation and Resettlement) Regulations, 2012 (L.l. 2175).


i. The Company shall permit the public to use without charge and at their sole


risk, any road constructed by the Company in the Lease Area, provided that


such use does not unreasonably interfere with the operations of the Company


and such permission shall not extend to areas designated as active mining


areas.


j. No provision in this Agreement shall be.deemed to confer any rights on the


Company which conflicts with the provisions of Act 703 or permits the


Company to dispense with the necessity of applying for and obtaining any


permit or authorisation which the Company may be required by Law or


 Regulation to be obtained in respect of any work or activity proposed to be


carried out under this Mining Lease.





2. GRANT OF RIGHTS TO THIRD PARTIES IN THE LEASE AREA


a. Subject to Clause 6(b) of this Mining Lease, the Government may grant mineral


rights to third parties to prospect for or to enter into agreements for the


production of minerals other than the Mineral in the Lease Area, provided that


any such activity shall not unreasonably interfere with the rights granted to the


Company under this Mining Lease.


b. Where a third party applies for a mineral right under paragraph (a) of this Mining


Lease for a mineral other than the Mineral the subject of this Mining Lease, the


Minerals Commission (hereinafter called "the Commission”)shall notify the


existing rights holder of the application in accordance with Regulation 176 of the


Minerals and Mining (Licensing) Regulations, 2012 (LI 2176).


c. Where the Commission gives the Company notice under this Clause, the


Company may exercise the first option to add the mineral to the existing mineral


not later than fifteen (15) days from the date of the notice, failing which the


Commission may process the application of the third party in accordance with


Law.


3. POWER OF GOVERNMENT TO EXCLUDE PARTS OF THE LEASE AREA


a. The Government may by notice in writing to the Company exclude from the


Lease Area at any time, any part which may be required for any stated public


purpose whatsoever, provided that:


i. Any part of the Lease Area so excluded shall cease to form part of the


Lease Area and no mining operations shall be conducted on the part so


excluded;


ii. No part of the Lease Area shall be excluded in respect of which the


Company has given prior notice specifying that such part is required for


mining operations or on which active operations have commenced or are


in progress (such as digging, excavation, construction, installation or other


works related to mining of the minerals the subject of this Mining Lease);


iii. The Government shall not take to itself or grant to third parties the right


to mine the Mineral from any part that is excluded under this clause.


b. The company shall be relieved of all liabilities or obligations in respect of any part


excluded under this clause except liabilities or obligations accrued prior to such


exclusion.


4. WORK OBLIGATION


The Company shall continuously operate in the Lease Area in accordance with


applicable laws and regulations and consistent with good mining practices until


such time as the reserves or deposits may be exhausted or the Mine can no longer


be economically worked or until this Agreement expires, whichever shall be


sooner.


5. CONDUCT OF OPERATION


a. The Company shall:


i. conduct all of its operations with due diligence, efficiency, safety and


economy to the maximum extent possible consistent with good mining


practices and in a proper and workmanlike manner, observing sound


technical and engineering principles and practices, using appropriate


modern and effective equipment, machinery, materials and methods;


ii. ensure conservation of resources, reclamation of land and protection of


the environment;


iii. mine the minerals using appropriate mining methods and technologies in


the Lease Area.


b. The Company shall maintain all equipment in good repair and keep all working


areas in good and safe condition and take all practical steps to:


i. prevent damage to adjoining farms and villages;


ii. avoid damage to land, trees, crops, buildings, structures and other


property in the Lease Area;


Provided that where such damage is unavoidable, the Company shall pay fair and


reasonable compensation in accordance with Section 72-75 of Act 703 and L.l.


2175.


c. The Company shall fence off effectually from the adjoining lands, all pits, shafts


and other works made or used in accordance with the Minerals and Mining


(Health, Safety and Technical) Regulations, 2012 (L.l. 2182) and the provisions of


this Mining Lease.


d. The Company shall as far as is necessary or practicable provide and maintain in


good repair and condition, roads, gates, stiles and fences for the safe occupation


of the Lease Area.


e. The Company shall provide and maintain proper and sufficient drains, culverts,


arches and passageways for carrying off any waters which shall arise or be


produced or interrupted by any of the works authorised so that the drainage of


the Lease Area may not be negatively affected.


f. This Mining Lease does not permit the Company to obtain for treatment


minerals, tailings or any ore from areas that are not part of the Lease Area,


except where such minerals, tailings or ore are produced by the Company under


another Mineral Lease.


g. This Mining Lease does not permit the Company to obtain for treatment


minerals, tailings or any ore from third parties unless such minerals, tailings or


ore are produced by a mineral right holder who has obtained the requisite


licence or permit from the Minister to do so.


6. NOTIFICATION OF DISCOVERY OF OTHER MINERALS


a. The Company shall notify the Commission and the Ghana Geological Survey of


the discovery of an occurrence of any other mineral in the Lease Area apart


from the Mineral the subject of this Mining Lease.


b. In accordance with Section 15 of Act 703, the Company shall have the first


option to apply to prospect for or mine the new minerals discovered in the


Lease Area.


c. Where the Company gives notice under this Clause, the procedure outlined


under Clause 2 of this Lease shall apply.


7. SAMPLES


a. The Company shall not during the subsistence of this Mining Lease remove,


dispose of or destroy, except in analyses, any cores or samples obtained from the


Lease Area without the prior written consent of the Ghana Geological Survey and


the Commission.


b. The Company shall provide the Ghana Geological Survey and the Commission


with such samples from the Lease Area as they may from time to time reasonably


request, and shall keep such samples as may be directed by the Chief Executive


Officer of the Commission.


8. HEALTH, SAFETY AND ENVIRONMENTAL PROTECTION


a. The Company shall comply with the provisions of L.l. 2182 and all such


reasonable directives as may from time to time be given by the Commission for


securing the health and safety of persons engaged in or connected with the


mining operations.


b. Before undertaking an activity or operation under this Mining Lease, the


Company shall obtain the necessary approvals and permits as may be required by


law from the Forestry Commission, Water Resources Commission and the


Environmental Protection Agency or any other Regulatory body.


9. POWER OF THE MINERALS COMMISSION TO EXECUTE CERTAIN WORKS:


Where the Company fails at any time to comply with any provisions of this Mining


Lease or applicable law and such failure is likely, in the opinion of the Commission,


to endanger the health or safety of persons, or result in damage to mining


equipment or other structures or installation, the Commission shall after giving the


Company reasonable notice, execute any works which are deemed necessary and


practicable in the circumstances and the Company shall be liable to pay a penalty


and the costs and expenses incurred by the Commission in carrying out such


works.





10. LIABILITY FOR DAMAGE OR INJURY AND INDEMNITY





a. No provision in this Agreement shall exempt the Company from liability for any


damage, loss or injury caused to any person, property or interest as a result of


the exercise by the Company of any rights or powers granted to it under this


Mining Lease.


b. The Company shall at all times indemnify the Government and its officers and


agents against all claims and liabilities in respect of any loss suffered by or


damage done to third parties arising out of the exercise by the Company of any


rights or powers granted to it under this Mining Lease provided that the


Company shall not so indemnify the Government, its officers and agents where


the claim or liability arises out of the wrongful or negligent acts of the


Government, its officers and agents.


11. RECRUITMENT OF EXPATRIATES, TRAINING OF GHANAIANS AND USE OF LOCAL


PRODUCTS





a. The Company shall engage expatriates for the Company's operations in


accordance with the provisions of the L.I. 2173.


b. The Company shall comply with L.L 2173 in relation to the training of Ghanaians


and procurement of local goods and services.


c. Notwithstanding any penalties provided in L.l. 2173 or any other laws for non-


compliance, the Minister may suspend the Mining Lease until the Company


complies with the provisions of the law.


12. AFFILIATED COMPANY TRANSACTIONS


a. Any transaction between the Company and an affiliated company shall be on


arm's length basis, consistent with the Transfer Pricing Regulations, 2012 (L.l.


2188) and International best practice.


b. The Company shall notify the Ghana Revenue Authority and the Commission of


any and all transactions between the Company and an affiliated company and


shall supply the details relating to such transactions to the Ghana Revenue


Authority and the Commission in accordance with any guidelines provided by the


institutions.


c. The Company shall, at the request of the Ghana Revenue Authority or the


Commission, provide such justification of costs as may be required, duly


supported by an Auditor's certificate if necessary.


13. TECHNICAL RECORDS


a. The Company shall maintain at its registered and mine offices complete technical


records of its operations in the Lease Area in such form as may from time to time


be approved by the Commission and the Ghana Geological Survey.


b. The Company shall maintain at the said offices copies of all reports and of all


tests and analyses, geological and geophysical maps, diagrams or charts relevant


to its operations. These reports and records may be examined by officials of the


Commission and the Ghana Geological Survey or acting on behalf of the


Government or authorised in writing by the Minister.


c. The Company shall maintain at the said offices correct and intelligible plans and


sections of the mining operations, including any faults or disturbances which


have been encountered in such workings and operations. All such plans and


sections shall be made, amended and completed from actual surveys conducted


for that purpose.


d. Upon expiration or termination of this Agreement or the surrender of any part of


the Lease Area, such records and data as are required to be maintained pursuant


to this Clause shall be delivered to the Commission and the Ghana Geological


Survey in accordance with Section 71 of Act 703 and same shall become the


property of the Government without charge.


14. PRODUCTION RECORDS


The Company shall maintain at its registered and Mine offices complete and


accurate records of its production in the Lease Area in such form as may from time


to time be approved by the Commission.


15. FINANCIAL RECORDS


a. The Company shall maintain at its registered and Mine offices, detailed and


complete accounts and systematic financial records of its operations as may be


required by law. The books of account shall show all revenues received by the


Company from all sources including its operations under this Mining Lease, as


well as all its expenditure.


b. The Company shall provide a clear basis for understanding and relating the


financial records and accounts to its operations.


c. The Company's books of account shall be kept in accordance with generally


accepted accounting principles.


d. The Company shall keep separately records and financial statements in terms of


Ghana currency and also in terms of U.S. Dollars or other international currency


and may record in foreign currency such claims and liabilities as arise in such


foreign currency.


e. The Company's books of account shall be audited within three (3) months after


the close of each Financial Year by a qualified auditor who is a member of a


recognised professional auditing or accounting body. Such auditing shall not in


any way imply acceptance of its results by the Government or preclude the


Government from auditing such books of account. The Company shall deliver to


the Minister without charge, copies of all or any part of such financial records as


the Minister may from time to time reasonably request.


16. REPORTS





a. The Company shall furnish a report each quarter, to the Minister, the


Commission and the Ghana Geological Survey, in such forms as may from time to


time be required, regarding the quantities of the approved minerals mined in


that quarter, quantities sold, the revenue received and royalties paid or payable


for that quarter and such other information as may be required. Such reports


shall be submitted not later than thirty (30) days after the end of each quarter.


b. The Company shall furnish a report each half-year to the Minister, the


Commission and the Ghana Geological Survey in such form as may from time to


time be required, summarising the results of its operations in the Lease Area


during the half-year and records to be kept by the Company pursuant to Clauses


14, 15 and 16 of this Mining Lease. Each report shall include a description of any


geo-scientific work carried out by the Company in that half-year and a plan


showing the Mine, installations and workings. Such reports shall be submitted


not later than forty (40) days after the half-year to which they relate.


c. The Company shall furnish a report each Financial Year in such form as may from


time to time be required to the Commission and the Ghana Geological Survey


summarising the results of its operations in the Lease Area during that Financial


Year and the records required to be kept by the Company pursuant to Clauses 14,


15, and 16 of this Mining Lease. Each report shall include a description of the


proposed operations for the following year with an estimate of the production


and revenue to be obtained from the operations. Such reports shall be submitted


not later than sixty (60) days after the end of each Financial Year.


d. The Company shall furnish the Minister, the Commission and the Ghana


Geological Survey not later than three (3) months after the expiration or


termination of this Agreement, with a report giving an account of the geology of


the Lease Area including the stratigraphic and structural conditions, together


with a geological map drawn on an approved scale.


e. The Company shall furnish the Minister and the Commission, with a report of the


particulars of any proposed alteration to .its Company's Regulations. The


Company shall also furnish the Minister and the Commission with a report on the


particulars of any fresh issues of shares of its capital stock or borrowings in excess


of an amount equivalent to the Stated Capital of the Company. All such reports


shall be in such form as may be required by the Commission and shall be


submitted not less than twenty-one (21) days (or such lesser period as the


Minister may agree) in advance of any proposed alteration, fresh issue or


borrowing, as the case may be.


f. The Company shall, not later than One hundred and eighty (180) days after the


end of each Financial Year, furnish the Minister and the Commission with a copy


each of its annual financial reports including a balance sheet, profit and loss


account, and all notes pertaining thereto, duly certified by a qualified accountant


who is a member of a recognised professional accounting body. Such certificate


shall not in any way imply acceptance of such reports by the Government or


preclude the Government from auditing the Company's books of account.


g. In accordance with Regulation 3 of L.L 2173, the Company shall furnish the


Commission and the Ghana Revenue Authority with certified copies of refinery


returns not later than thirty (30) days after a shipment of minerals.


h. The Company shall also submit monthly and annual returns and any other reports


as may be required under LI 2173.


i. The Company shall also furnish the Minister, the Commission and the Ghana


Geological Survey with such other reports and information concerning its


operations as they may from time to time reasonably require.


j. The reports required under this Clause are without prejudice to any other reports


that may be required under any applicable laws or regulations.


17. INSPECTION


a. Authorized Officers of the Commission or any person authorised by the Minister


in writing shall be entitled at all reasonable times to enter into and upon any part


of the Lease Area and the Company's registered office to:


i. examine the Mine workings, equipment, buildings, installation and any


other structures used in the mining operation;


ii. inspect the samples which the Company is required to keep in accordance


with the provisions of this Mining Lease;


iii. inspect and check the accuracy of the weights and measures and weighing


and measuring devices, used or kept by the Company;


iv. examine and make abstracts of the books and records kept by the


Company pursuant to this Mining Lease;


v. verify or ensure compliance by the Company with all applicable laws and


regulations and with its obligations under this Mining Lease;


vi. execute any works which the Commission may be entitled to execute in


accordance with the provisions of Act 703,Regulations and this Mining


Lease.


b. The Company shall make reasonable arrangements to facilitate any such work or


inspection, including making available employees of the Company to render


assistance with respect to any such work or inspection. All such works and


inspections shall be recorded by both the Authorized Officer and the Company. In


the case of the Company, such inspection shall be recorded in the reports


submitted each half year.


18. CONFIDENTIAL INFORMATION


a. Any information or material supplied by the Company to the Government


pursuant to the provisions of this Mining Lease shall be treated as confidential by


the Government, its officers and agents and shall not be revealed to third parties


except with the consent of the Company (which consent shall not be


unreasonably withheld) for a period of twelve (12) months with respect to


technical information and thirty-six (36) months with respect to financial


information from the date of submission of such information or upon


termination of this Mining Lease whichever is sooner.


b. Information already in the public domain shall not be treated as confidential


information.


c. Subject to this Clause, records, documents and information furnished or attained


pursuant to this Mining Lease shall be made available for inspection and copy by


the public, on payment of the prescribed fee.


d. The Government and persons authorised by the Government may nevertheless


use any such information received from the Company for the purpose of


preparing and publishing reports or analyses relating to minerals in Ghana and in


connection with any dispute between the parties.


19. FINANCIAL OBLIGATIONS


a. The Company shall pay all fees, charges and penalties as provided under


applicable Laws and Regulations.


b. In accordance with Section 23 of Act 703 the Company shall pay an annual


ground rent to the Office of the Administrator of Stool Lands. Payment of this


amount shall be made yearly in advance, the first year's payment having been


made on or before the issue of this Mining Lease.


c. The Company shall pay an annual mineral right fee in accordance with Section 24


of Act 703 and the applicable provisions of L.l. 2176.


d. In the event of a surrender of any part of the Lease Area pursuant to Clause 25 of


this Mining Lease, no payments shall be refunded in whole or in part for any area


so surrendered for which an annual fee or charge has been paid in advance nor


shall such payments be refunded in the event of termination.


20. ROYALTIES


a. The Company shall pay to the Government royalty as prescribed by law.


b. The Company shall pay royalty to the Government through the Ghana Revenue


Authority in the manner that may be prescribed by law.


c. Any necessary adjustments to the royalty paid in any year shall be made within


thirty (30) days of the end of that Financial Year, except that any over-payment of


royalty shall not be refunded by the Government but shall be credited against


royalty due and payable in the following year.


d. In the event of a dispute with respect to the amount of royalty payable, the


Company shall first make payment of the lower of the disputed amounts and


shall pay immediately any further royalty which shall be agreed upon or


determined by the Ghana Revenue Authority to be payable. Such further royalty


shall carry interest at the prevailing prime rate in Ghana at the time of the


resolution of the dispute or agreement to take effect from the date on which


such amount ought originally to have been paid.


21. LATE PAYMENTS


a. Notwithstanding anything to the contrary the Company shall pay as penalty for


any late payment of any amounts due to the Government under this Mining


Lease, an amount calculated at the prevailing Bank of Ghana prime rate for


every thirty (30) days' period that the amount due remains unpaid.


b. In the event that the Company fails to make payment to the Government of any


amount due under this Mining Lease, the Government without prejudice to any


other rights and remedies to which it may be entitled, may, after giving thirty (30)


days' notice in writing, enter into or upon the Lease Area and seize, distrain and


sell, all or any of the stocks of the minerals produced by the Company, and the


plant and equipment, materials and supplies belonging to the Company; and out


of the monies obtained from the sale in respect of such distress may retain and


pay all of the arrears of any amounts due and the costs and expenses incidental


to any such distress and sale and deliver up the surplus (if any) to the Company.


22. TAXATION


The Company shall pay tax in accordance with the applicable laws of Ghana.


23. FOREIGN EXCHANGE


All foreign exchange transactions by the Company shall be in accordance with the


laws of Ghana.


24. SURRENDER


a. The Company may surrender all its rights in respect of all or any part of the Lease


Area in accordance with Regulation 199 of L.L 2176.


b. The Company shall be relieved of all obligations in respect of the part or parts of


the Lease Area surrendered except those obligations which accrued prior to the


effective date of surrender.


c. The Company shall leave the part of the Lease Area surrendered and everything


in the Lease Area in a safe condition, and shall take all reasonable measures in


accordance with good mining practices to leave the surface of such part of the


Lease Area surrendered, in good and usable condition having regard to


ecological, drainage, reclamation and other environmental requirements. In the


event that the Company fails to do so, the Commission shall make such part and


everything thereon safe at the expense of the Company.


d. The Company shall, on such terms and conditions as may be agreed upon


between the Government and the Company including the payment of


appropriate compensation under applicable laws, be entitled to such wayleaves,


easements or other rights through or across the surrendered part or parts as may


 be necessary for its operations and such rights shall not form part or be included


in the calculation of the area of the retained part.





e. The Government may require that there be reserved over any part surrendered


such wayleaves, easements or other rights as will in its opinion be necessary or


convenient to any party to whom the Government may subsequently grant a


prospecting licence or mining lease.


25. EXTENSION OF TERM OF MINING LEASE


Where the Company applies for an extension of the term of the Lease in


accordance with Regulation 189 of L.l. 2176, the Company may be granted an


extension based on justifiable technical and financial reports and upon such terms


and conditions as may be granted by the Minister provided that the Company is


not in default in the performance of any of its obligations under this Lease or any


laws at the time of the application.


26. TERMINATION OF AGREEMENT BY COMPANY


The Company may, if in its considered opinion the Mine can no longer be


economically worked or for other stated reasons terminate this Mining Lease by


giving not less than nine (9) months' notice to the Government. Such termination


shall be without prejudice to any obligation or liability incurred by the Company


under this Mining Lease prior to the effective date of such termination.


27. TERMINATION OF AGREEMENT BY GOVERNMENT


a. The Government may terminate this Mining Lease where the Company:


i. fails to make any payments as required under this Mining Lease or under


any law by the due date;


ii. fails to conduct its operations in accordance with the programme of


mining operations as contained in the feasibility report submitted for


obtaining this Mining Lease;


iii. is or becomes insolvent or bankrupt or enters into any agreement or


scheme of composition with its creditors or takes advantage of any law for


the benefit of debtors or goes into liquidation, whether compulsory or


voluntary, except for the purposes of reconstruction or amalgamation;


iv. knowingly submits any false statement or gives false information to the


Government in connection with its operations;


 v. fails to submit reports on its operations for more than ninety (90) days


after the reports are due;


vi. contravenes or fails to comply with any other provisions of this Mining


Lease.





b. The procedure provided in Regulation 200 of L.l. 2176 shall be applicable where


any of the events stated in paragraph (a) occurs.


c. Upon termination of this Mining Lease by the Government, every right of the


Company under this Lease shall cease (save as specifically otherwise provided in


this Lease) but subject nevertheless and without prejudice to any obligation or


liability imposed or incurred under this Lease or applicable law prior to the


effective date of termination and to such rights as the Government may have


under the law.


d. No delay, omission or course of dealing with the Company by the Government


shall impair any of its rights under this Mining Lease or be construed to be an


acquiescence or a waiver of the right of the Government to terminate this Lease.


28. ASSETS ON TERMINATION OR EXPIRATION


a. The Company shall within six (6) months of the termination of the Mining Lease


remove the mining plant provided that the mining plant shall be removed solely


for the purpose of use by the Company or a person deriving title through the


Company, in another relevant mining activity in the Country.


b. Where the Company fails to remove the plant after the expiration of the period


specified in paragraph (a), the Minister shall give the Company two (2) months'


notice to do so. Where the Company fails to remove the mining plant after the


expiration of the period specified in the Minister's notice, the mining plant shall


vest in the Republic without further notice.


c. No provision in this Mining Lease removes or diminishes an obligation that the


Company may have under Act 703 or an applicable law or a condition of this


Mining Lease to remove a mining plant and rehabilitate the land.


d. Notwithstanding the foregoing, the Minister, may by notice to the Company


require the removal or destruction of any assets of the Company in the Leased


Area, and where the Company does not remove or destroy such assets within a


period of thirty (30) days from the date of the Minister's notice to that effect, the


Minister shall cause such removal or destruction at the expense of the Company


and the Minister shall apply appropriate penalties.


e. The Company shall take all reasonable measures to ensure that any asset to be


transferred to the Government in accordance with this paragraph shall be


maintained in substantially the same condition in which they were at the date of


the termination or the date on which the Company reasonably knew that such


termination would occur and any such assets shall not be disposed of, dismantled


or destroyed except as specifically provided for in this paragraph.


29. COMPANY'S OBLIGATIONS ON TERMINATION


a. Upon the termination or expiration of this Mining Lease, the Company shall leave


the Lease Area and everything in the area in good condition, having regard to


ecological, drainage, reclamation, environmental protection, and health and


safety requirements. In this connection, the Company shall fill up or fence and


make safe all holes and excavations in accordance with good mining practices


and to the reasonable satisfaction of the Commission.


b. The Company shall take all reasonable measures to leave the surface of the Lease


Area in usable condition and to restore all structures not the property of the


Company to their original condition. In the event that the Company fails to do so,


the Minister shall restore and make safe the Lease Area and restore all affected


structures at the expense of the Company and the Minister shall apply the


appropriate penalties.


c. The Company shall have the right to enter upon the Lease Area for the above-


mentioned purposes, subject to the rights of surface owners or others, for a


period of six (6) months from the effective date of the termination or such longer


period as the Minister may determine.


d. On the termination of this Agreement, the Company shall deliver to the Minister


the records which the Company is obliged to maintain under Act 703, this Mining


Lease and any other laws and regulations, the plans and maps of the area


covered by the mining lease, and other documents, including in electronic


format, that relate to the Lease Area.


30. FORCE MAJEURE


a. Failure on the part of the Company to comply with any of the terms and


conditions of this Mining Lease (except the obligations to make payment of


monies to the Government) shall not be grounds for cancellation or give the


Government any claim for damages in so far as such failure arises from force


majeure, the Company having taken all appropriate precautions due care and


reasonable alternative measures with the objective of avoiding such failure and


of carrying out its obligations hereunder. The Company shall take all reasonable


measures to remove such inability to fulfil the obligations under this Mining


Lease with the minimum of delay.


b. For the purpose of this clause, force majeure includes acts of God, war,


insurrection, riots, earthquakes, storm, flood, fire or other adverse weather


conditions or any other event which the Company could not reasonably be


expected to prevent or control, but shall not include any event caused by a


failure to observe good mining practices or by the negligence of the Company or


any of its employees or contractors.


c. The Company shall notify the Minister within forty-eight (48) hours of any event


of force majeure affecting its ability to fulfil the conditions of this Lease or of any


events, which may endanger the natural resources or the ecosystem of Ghana


and similarly notify the Government of the restoration of normal conditions


within forty-eight (48) hours of such restoration. This provision shall be in


addition to any requirements contained in the mining regulations.


d. The Term of this Mining Lease may be extended for a period of time equal to the


period or periods during which the Company was affected by conditions set forth


in the paragraphs (a) and (b) of this clause or for such period as may be agreed by


the parties.


31. ADVERTISEMENTS, PROSPECTUSES, ETC.


Neither the Company nor any affiliated Company shall in any manner claim or


suggest, whether expressly or by implication that the Government or any agency or


official of the Government, has expressed any opinion with respect to any mineral in


the Lease Area and no statement to this effect shall be included in or endorsed on


any prospectus, notice, circular, advertisement, press release or similar document


issued by the Company or any affiliated Company for the purpose of raising capital.


32. CO-OPERATION OF THE PARTIES


Each of the parties undertake that it will from time to time do all such acts and


make, enter into, execute, acknowledge and deliver at the request of the other


party, such supplemental or additional instruments, documents, agreements,


consents, information or otherwise as may be reasonably required for the purpose


of implementing or further assuring the rights and obligations of the other party


under this Mining Lease.


33. NOTICE


Any application, notice, consent, approval, direction, instruction or waiver shall be in


writing and shall be delivered by hand or by registered mail. Delivery by hand shall


be deemed to be effective from the time of delivery and delivery by registered mail


shall be deemed to be effective from such time as it would in the ordinary course of


registered mail be delivered to the addressee.


34. ARBITRATION AND SETTLEMENT OF DISPUTES


a. Any dispute between the parties in respect of the interpretation or enforcement


of the provisions of this document shall be settled in accordance with the


Alternative Dispute Resolution Act, 2010 (Act 798). Notwithstanding paragraph


(a), the parties may by mutual agreement, submit any dispute for settlement by


arbitration under the Arbitration Rules of the United Nations Commission on


International Trade Law ("UNCITRAL Rules").


b. Any arbitration under the UNCITRAL Rules shall be by three (3) arbitrators unless


the parties agree to a single arbitrator. The place of arbitration shall be Accra,


Ghana and the proceedings shall be in English. Ghana Law shall be the law


applicable to the proceedings.


c. No provision of this Clause shall prevent either of the parties from requesting any


judicial authority to order provisional measures prior to the initiation of


arbitration proceedings or during the proceedings for the preservation of their


respective rights.


35. ASSIGNMENT, MORTGAGE, ETC.


a. The Company shall not transfer, assign, or mortgage an interest in the Mining


Lease, or enter into a joint venture agreement in respect of the Mining Lease, or


deal in the Mining Lease in any manner without the prior written consent of the


Minister.


b. The Minister may impose such conditions as he deems fit when giving such


consent.


c. No assignment of the Mining Lease shall relieve the Company of its obligations


under this Mining Lease except to the extent that those obligations are actually


assumed by the Assignee.


d. During the term of this Mining Lease, no shares of the capital stock of the


Company may be transferred except in accordance with Act 703 and applicable


laws.


36. EXPORTATION, SALE AND DISPOSAL OF MINERALS


a. The Company shall not export, sell or dispose of the mineral the subject of this


Mining Lease without a licence to export, sell or dispose of the mineral granted


by the Minister.


b. An application for a licence to export, sell or dispose of the mineral shall be made


in accordance with Regulation 3 of the Minerals and Mining (General)


Regulations, 2012 (L.I. 2173).


37. OFFENCES


The provisions relating to offences under Act 703 are applicable to this Mining


Lease. For the avoidance of doubt, where the contravention of a provision of this


Mining Lease constitutes an offence under Act 703 or the applicable Regulations


the provisions of Act 703 shall apply.


38. HEADINGS


The headings given to Clauses in this Agreement are for convenience only and shall


not affect the construction or interpretation of this document.


39. GOVERNING LAW


This Agreement shall be governed and construed in accordance with the laws of


Ghana.


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THIS IS THE PLAN I REFERRED TO


I





IN THE ANNEXED MINING LEASE AGREEMENT


DATED THIS )) DAY OF M A- 201 6


 THE SCHEDULE ABOVE REFERRED TO:


All that piece or parcel of land containing an approximate area of 9.24km2


lying to the North of Latitudes 6° 53' 30"N, 6° 53' 15"N and 6° 53' 00"N; and


to the South of Latitudes 6° 54' 15"N, 6° 54' 00"N, 6° 53' 45"N and 6° 53'


30"N; and to the West of Longitudes 2° 10' 15"W, 2° 13' 45"W, 2° 13'


30"W, 2° 13' 15"W, 2° 13' 00"W, 2° 12' 30"W, 2° 12' 15"W and 2° 12' 00"W;


and to the East of Longitudes 2° 15' 00"W, 2° 14' 30"W, 2° 13' 45"W, 2° 13'


30"W, 2° 13' 15"W and 2° 13' 00"W; in the Ahafo Ano North District of the


Ashanti Region of the Republic of Ghana which piece or parcel of land is


more particularly delineated on the plan annexed hereto for the purposes


of identification and not of limitation.


IN WITNESS of which the Parties have respectively executed the original and


counterparts of this Mining Lease on the date first above written.








SIGNED, SEALED AND DELIVERED


ON BEHALF OF THE REPUBLIC OF GHANA:





By NII OSAH MILLS, Minister for Lands and


Natural Resources, for and on behalf of the





Government of Ghana who by his execution


warrants to the other party that he is duly


authorised and empowered to enter into this


Agreement. IER


OF LANDS


AN RESUURCES


IN THE PRESENCE OF:











AMDS.








SIGNERS RED:.....








By nl IIIM---


Managing Director of MICROSTAR MINES & MINERALS LIMITED


who by his execution warrants to the other party that he i


duly authorized and empo

















IN THE PRESENCE OF:








a=v12D35


yo/)(D











DIRECTOR/SECRETARY


 OATH OF PROOF





of Minerals Commission MAKE OATH and SAY that on


the day of .A...................2016, I was present and saw NII OSAH


MILLS, the Minister of Lands and Natural Resources duly execute the Instrument now


produced to me and Masked "A" and thathesaid NII OSAH MILLS can read and write.


Sworn at Accra this..... day of c) \U---- 2016


Before Me






































• 9,’*








COURT GHANA


On the.n


M"clock in the


. noon this Instrument was proved before me by the Oath of the


within-named S5s.......Rana.......to have been duly executed by the


within-named NII OSAH MILLS


 Dated this day of 2016














GOVERNMENT OF THE REPUBLIC OF GHANA








5


mi w AND


2


E1











E


C EMICROSTAR MINES & MINERALS LIMITED

















MINING LEASE























TERM : TEN (10) YEARS


COMMENCEMENT : 1 | / os I 301 6








EXPIRY DATE : [0 ( o/ a-09-6


FILE NO : RL.6/132











SOLICITOR RT OF GHANA


p. O. BOX


. MAAMPRCBI-ACCRA


TEL: 0264 .1 04