The license was issued on 27/02/2004, the date of execution of the agreement, but it only became effective (including for purposes of the term of validity of the agreement) from the "Operational Date", understood as the day following the date in which the Government of Liberia and African Aura Resources Limited conduct a joint security visit in the exploration area, and execute a "safe to operate in" declaration. The Operational Date is not informed in the agreement nor in any of its exhibits.
The coordinates of the mineral exploration area of African Aura Resources Limited in the Grand Cape Mount County are the following: Point A - Easting 280000, Northing 800000; Point B - Easting 280000, Northing 820000; Point C - Easting 300000, Northing 820000; and Point D - Easting 300000, Northing 800000, totalizing a 400 square KM (98,840 acres) area.
Gold and Associated Minerals (being any mineral, metal element or precious or semi-precious stone(s) other than gold which is found, discovered, mined, removed, extracted or otherwise produced from the exploration area as an incident to the African Aura Resource's acitivies in exploiting a gold deposit).
Until the earlier of (a) such time as the African Aura Resources Limited has completed the exploration activities, or (b) 3 years after the Operational Date, with an extension for another 2 years at the option of African Aura Resources Limited, plus any period of renewal to which the Government my agree.
Exploration license that also encompasses pilot mining rights, understood as the right to produce gold and/or other minerals under a pilot mining plan to be approved by the Minister of Lands, Mines and Energy.
African Aura Resources shall take preventive, corrective and/or restorative measures to ensure that the environment (streams, water bodies, dry lands and the atmosphere) is protected from pollution, contamination and damages as result of the operation, and, eventually, that such pollution, contamination and/or damages are rectified. Furthermore, the terrain in general shall be restored and left in a usable state for purposes which are economically or socially desirable.
African Aura Resources may remove, extract and use for exploration purposes any water in the area, provided that the society is not deprived of a constant and reasonable source of water. It may not interfere with the water rights set up by any other entity with the government.
African Aura Resources shall maintain all documents and information obtained or compiled by it as result of its mining operations at its principal office in Liberia. The operator is allowed to move such data to other locations and to foreign countries (provided that such occurs for purposes of studies and evaluations and with the Government's prior consent). The Government shall be informed of the operations and acitivities carried out in the Exploration Area, and is entitled to monitor exploration and pilot mining activities, including by means of on-site inspections by Government officials (with prior notice and at reasonable times). Additionally, within 30 days after the end of each quarter, the operator shall provide the Government with a report on all operations and activities for that calendar quarter, including minerals recovered and sold. An annual report in the same terms shall also be presented in up to 90 days following the end of each financial year. African Aura Resources' books and accounts shall be audited within 3 months after the end of each financial year, by an internationally recognized independent auditor, and such report shall be made available to the Government of Liberia (and provided that such audit shall not preclude the Government's right to conduct such an audit, or to make an inspection of its books and records, in which case the Government shall bear the associated costs). Government may inspect books and premises of the Operator, with reasonable notification, and Operator shall make personnel available to assist the Government.
African Aura Resources is subject to all taxes, fees, duties, excises and other charges imposed by Liberian Laws of general application, except as may be otherwise provided by other laws and administrative regulations granting exemptions from custom duties and excise taxes. African Aura Resources may also remove, extract and use for exploration purposes any water, gravel, sand, clay, stone and timber, free of any tax or charge.
African Aura Resources shall, additionally, pay exploration fees and surface rental to the Government of Liberia, as follows: (a) for the grant or renewal of the exploration license, an annual payment of US$ 5,000 shall be made; (b) annual rental payments of US$ 0,18 per acre of unssurendered portions of the Exploration Area, and US$ 3.00 per acre for all areas operated under pilot mining, are also due to the Government of Liberia.
An amount corresponding to 3% of the selling prices (F.O.B. Monrovia) of the Gold discovered during exploration and produced under pilot mining shall be due as Royalties, and paid to the Government of Liberia within 30 days of exports. A Royalty will also be due in reference to the production of Associated Minerals and Other Minerals in the exploration area, but the amount shall be negotiated and agreed upon by the parties.
African Aura Resources shall provide for meetings on a regular basis with the local communities for the purposes of considering and making recommendations to the operator and the Government, with respect to matters of community interest, such that it shall not hinder the Operator's work.
No foreign unskilled employees shall be hired and, to the maximum extent feasible, African Aura Resources shall employ Liberian citizens at all levels, and provide training to them on a continuing basis. Additionally, at least one professional from the Liberian Ministry of Lands, Mines & Energy shall be seconded to African Aura Resources' operations, at the operator's expenses, and its proposals to the operator in reference to the conduction of the operations shall not be unreasonably rejected by African Aura Resources.
If the operator requires the use of privately owned property within the Exploration Area and cannot come to an agreement with the owner, it may request the Government to exercise its right of eminent domain, and shall reimburse the Government of any compensation paid to the owner.
African Aura Resources undertakes at its cost to conduct the construction, installation and improvement of all or any part of the infrastructure, and such infrastructure shall be maintained and operated by the operator in a reasonably good manner. Infrastructure shall be understood, for purposes of the agreement, as assets of the following types: (a) immovable transportation and communication facilities; (b) immovable port facilities; (c) immovable power, water and sewerage facilities; (d) immovable public welfare facilities (including schools, hospitals and public halls); (e) miscellaneous immovable facilities used primarily in connection with the operation of other facilities; and (f) movable facilities and equipment affixed to and used as an integral part of the immovable facilities described above.
The Government reserves the right, on reasonable notice to the Operator, to construct roads, highways, railroads, telegraph and telephone lines, and other lines of communication within the Exploration Area.
During the exploration, African Aura Resources shall spend no less than US$ 2.00 per acre during each calendar year as exploration costs. Exploration shall commence no later than 120 days counted as from the Operational Date, and shall not be interrupted at any time.
All disputes arising out of the agreement shall be exclusively and finally settled by binding arbitration, pursuant to the Convention on Settlement of Investment Disputes between States and Nationals of Other States, and in accordance with the rules of the International Centre for Settlement of Investment Disputes established under the auspices of the International Bank for Reconstruction and Development. Each of the parties in arbitration shall appoint one arbitrator, and the third one shall be appointed by the Secretary-General of the Centre. If one of the parties requests so, the matters subject to arbitration shall be referred to resolution to a single referee, appointed by the Secretary-General of the Centre. The arbitration shall take place in Washington DC or such other place as the parties agree and shall be conducted in English.Liability of the Operator under the agreement is limited to the net book value of its investment in Liberia at the time of any award. Neither party shall be liable for consequential, exemplary or punitive damages.
Not applicable to the agreement as a whole or to the parties relationship, but all reports prepared or furnished by African Aura Resources to the Government shall be considered confidential and shall not be disclosed without the operator's previous consent. Additionally, financial information about the operator shall be deemed as confidential for a term of 1 year, counted as from the date of submission of such information, provided that the Government is allowed to use this information in general reports, and also in case a dispute arises against the operator.
Laws of Liberia and by such rules and principles of generally accepted international law as may be applicable, particularly with regard to an investment by nationals of one country in another country. In the event of conflict between the terms of the agreement and any law, the terms of the agreement will prevail.