EXHIBIT 10.26
MEMORANDUM OF AGREEMENT
BETWEEN
PRESTEA GOLD RESOURCES LIMITED
AND
BOGOSO GOLD LIMITED
AND
PRESTEA GOLDFIELDS LIMITED
AND
STATE GOLD MINING COMPANY LIMITED
AND
GHANA MINEWORKERS UNION OF THE TUC (GHANA)
AND
THE REPUBLIC OF GHANA
DATED MARCH 14, 2002
MEMORANDUM OF AGREEMENT made the 14 day of March, 2002 between:
Prestea Gold Resources Limited a company registered under the laws of
the Republic of Ghana (hereafter referred to as "PGR"),
Bogoso Gold Limited a company registered under the laws of the Republic
of Ghana (hereafter referred to as "BGL"),
Prestea Goldfields Limited a company registered under the laws of the
Republic of Ghana (hereafter referred to as "PGL"),
State Gold Mining Company Limited a Public Limited Liability Company
registered under the laws of Ghana of P. O. Box 3634 Accra in the
Greater Accra Region (hereinafter referred to as "SGMC"),
Ghana Mineworkers Union of the TUC (Ghana) as the majority shareholder
of PGR and as representative of the unionised employees of PGR
(hereinafter referred to as "GMWU"), and,
The Republic of Ghana, acting through the Minister of Mines
(hereinafter referred to as "Government"),
WHEREAS:
A. In 1994 Government, acting through the Divestiture Implementation
Committee divested its interest in PGL to JCI Limited and accordingly
the Government also granted a 30 year gold Mining Lease to the said
Company over the Prestea Concession Area (the "JCI Mining Lease").
B. Pursuant to the said divestiture a certain Project Development and
Prestea Main Agreement respectively dated September 13, 1995 and May
20, 1996 were made between JCI Limited, Barnato Exploration Limited,
Barnex (Prestea) Limited (collectively the "JCI Group") the Government,
SGMC and PGL (the "Prestea Agreements") whereby certain specific rights
were acquired and obligations assumed by the parties thereto in
relation to the Prestea Concession Area including the right of the JCI
Group to acquire at its sole discretion all or any of the Underground
Mining Assets.
C. In accordance with the Prestea Agreements the JCI Group assumed
management of the Underground Mine until September 16, 1998 when the
JCI Group informed the Government that it could no longer operate the
Underground Mine economically and therefore ceased same whilst
retaining the JCI Mining Lease.
D. SGMC is the beneficial owner of the Underground Mining Assets through
its 100% owned and controlled subsidiary PGL which is the legal owner
of the Underground Mining Assets.
E. In December 1998, PGR upon application to the Government through the
Divestiture Implementation Committee obtained the consent and approval
of the Government, the JCI Group, and SGMC to take over and operate the
Underground Mine using therefor
MEMORANDUM OF AGREEMENT PAGE 2
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the Underground Mining Assets on an interim basis and subject
specifically to the rights vested in the JCI Group under the subsisting
Prestea Agreements.
F. In October 2000 or thereabouts some differences arose between the
Government and the JCI Group in relation to the subsisting Prestea
Agreements, the JCI Mining Lease and the competing interests of third
parties including PGR, PSGL and BGL in relation to the Prestea
Concession Area.
G. In an effort to find a compromise solution to the major issues relating
to the Prestea Concession Area, the Government by letter dated March
29, 2001 appointed the then Chief Executive Officer of the Ghana
Chamber of Mines, Mr. Bentum Williams as Mediator with a specific
mandate to find a negotiated solution that would harmonise the
interests of the JCI Group, PGR, PSGL and BGL in the Prestea Concession
Area and also ensure sustainable mining operations within the Prestea -
Bogoso area. The Mediator issued a final report to the Government dated
May 21, 2001 which said report is attached as Schedule "A" making
therein specific recommendations in relation to the Prestea Concession
Area which said recommendations were subsequently accepted by
Government and provide the basis for the entry into and implementation
of new commercial arrangements relating to the Prestea Concession Area
among various parties.
H. In furtherance of the new commercial arrangements, (i) Golden Star
Resources Ltd ("Golden Star"), the parent of BGL, entered into the
Barnex Agreement whereby Golden Star committed to pay approximately $12
million in Golden Star stock and royalties to Barnato Exploration
Limited, (ii) BGL entered into the Investment Agreement with PGR
whereby PGR surrendered its then rights over the Prestea Concession
Area in favour of the grant of the PGR Mining Lease and cash payments
of up to $4.0 million from BGL, of which $2.1 million has been paid,
and (iii) the parties to the Prestea Agreements decided to terminate
the Prestea Agreements on mutually agreed terms and conditions to
facilitate the entry into and implementation of various new agreements
relating to the Prestea Concession Area with a view to permitting the
co-existence of underground mining operations and surface mining
operations.
I. PGR was granted the PGR Mining Lease by the Government on June 29, 2001
conferring on PGR the exclusive right to conduct underground gold
mining operations within the Prestea Concession Area below a depth of
150 metres below sea level for a period of thirty (30) years effective
from the date of the said PGR Mining Lease as specifically defined in
the said PGR Mining Lease.
J. Similarly, BGL was granted the BGL Mining Lease by the Government on
June 29, 2001 conferring on the company the exclusive right to conduct
surface gold mining operations over the Prestea Concession Area for a
period of thirty (30) years effective from the date of the said BGL
Mining Lease as specifically defined in the said BGL Mining Lease.
K. PGR and BGL have with the consent and approval of the Government
entered into the Investment Agreement to promote jointly both surface
and, if feasible, underground gold mining operations on the Prestea
Concession Area.
L. Pursuant to the Investment Agreement, BGL has paid $2.1 million to PGR
and the parties have entered into the Joint Operating Agreement.
MEMORANDUM OF AGREEMENT PAGE 3
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M. PGR, PGL and SGMC have entered into the Licence Agreement, whereby PGR
has the right to utilize the Underground Mining Assets in return for
the payment of rent to PGL.
N. PGR discontinued underground gold mining operations on January 21, 2002
due to an industrial action.
O. PGR is highly indebted with total liabilities to creditors (excluding
employee liabilities) of approximately $10.5 million and has been
operating at a loss.
P. Government intends to use best endeavours to cause the creditors of
PGR, in so far as it is able, to enter into an arrangement with PGR.
IN CONSIDERATION OF THE MUTUAL COVENANTS IN THIS MEMORANDUM OF AGREEMENT, THE
PARTIES AGREE AS FOLLOWS:
ARTICLE 1 - DEFINITIONS AND INTERPRETATIONS
1.0 As used in this Agreement:
"AGREEMENT" means this Memorandum of Agreement and all schedules and instruments
in amendment or confirmation of it; "hereof', "hereto", and "hereunder" and
similar expressions mean and refer to this Memorandum of Agreement and not to
any particular Article, Section, Subsection or other subdivision; "Article",
"Section", "Subsection" or other subdivision of this Memorandum of Agreement
followed by a number means and refers to the specified Article, Section,
Subsection or other subdivision of this Memorandum of Agreement;
"APPLICABLE LAW" means all applicable laws of the Republic of Ghana, including,
without limitation, the PNDCL 153;
"ASSESSMENT" means the assessment of the Underground Mine more fully described
in Article 4.2;
"BACK PAY" means the salary arrears of approximately $1,500,000 owed to the PGR
Employees and PGR Casual Employees for the five month period from August 20,
2001 to January 20, 2002;
"BGL" means Bogoso Gold Limited, a company incorporated under the laws of Ghana
having its registered office at 32 Akosombo Road, Airport Residential, Accra,
Ghana;
"BGL MINING LEASE" means the mining lease dated June 29, 2001 attached as
Schedule "C" issued by the Government to BGL pursuant to Section 45 of the PNDCL
153;
"BUSINESS DAY" means any day other than a Saturday, Sunday or official public
holiday in the city of Accra, Ghana or in the city of Denver, U.S.A.;
"CARE & MAINTENANCE" means the continued operation, following the cessation of
active mining operations in the Underground Mine, of the Underground Mine
dewatering pumps to keep the Underground Mine dewatered as well as the routine
and periodic maintenance of essential mine equipment to ensure that its
mechanical condition does not deteriorate;
"DECISION TO MINE" means the decision to start commercial production from the
underground but excludes any production that may occur as result of sweeping and
vamping operations conducted during the assessment period;
MEMORANDUM OF AGREEMENT PAGE 4
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"DEED OF WARRANTY" means the Deed of Warranty dated December 17, 1987 between
BGL (formerly known as Canadian Bogosu Resources Limited) and Government and
bearing registration number AC6099c/87;
"DOLLARS" or "$" means the currency that is from time to time, legal tender for
the payment of all private and public debts in the United States of America;
"EFFECTIVE DATE" means March 15, 2002;
"ENVIRONMENTAL INDEMNITY" means the environmental indemnity agreement between
PGR and Government executed on December 21, 2001 attached as Schedule "E";
"EXPLOITATION COMPANY" means the business entity or legal structure through
which the JV Parties shall hold the JV Assets and conduct Operations pursuant to
the Joint Venture Agreement. The Exploitation Company shall be determined by the
JV Parties giving due regard to the tax, legal liability, and other
considerations of each JV Party, as well as any necessary Government approvals;
"FEASIBILITY STUDY" means a comprehensive description of the construction,
development, mining, processing, and marketing plan for a mine to exploit
Minerals from the PGR Mining Lease in such form and substance as would
reasonably be required by a commercial bank involved in project finance, in
making an investment decision to place such a mine into production. The
Feasibility Study shall include the confirmation of Ore Reserves by the conduct
of detailed drilling works, hydrological and geo-technical works, environmental
studies, and, if deemed necessary by the Manager, the mining of one or more bulk
samples of mineralisation for metallurgical studies which may require the
construction of one or more shafts, the construction of an incline, or works
associated with a trial mine. The Feasibility Study shall contain estimates of
both capital and operating costs and shall analyse how to proceed with mining
operations to economically and commercially extract the target Mineral(s),
identify the optimum structure for the mining venture, and include reference to
relevant marketing and financial aspects;
"FORCE MAJEURE" means any cause, whether foreseeable or unforeseeable, beyond a
Party's reasonable control, including, without limitation, labour disputes
(however arising and whether or not employee demands are reasonable or within
the power of such Party to grant); acts of God; laws, regulations, orders,
proclamations, instructions or requests of any government or governmental
entity; judgments or orders of any court; inability to obtain on reasonably
acceptable terms any public or private license, permit or other authorization;
curtailment or suspension of activities to remedy or avoid an actual or alleged,
present or prospective violation of federal, state or local environmental
standards; acts of war or conditions arising out of or attributable to war,
whether declared or undeclared; riot, civil strife, insurrection or rebellion;
fire, explosion, earthquake, storm, flood, sinkholes, drought or other adverse
weather condition; delay or failure by suppliers or transporters of materials,
parts, supplies, services or equipment; contractor' or subcontractors' shortage
of, or inability to obtain, labour, transportation, materials, machinery,
equipment, supplies, utilities or services; accidents; breakdown of equipment,
machinery or facilities; or any other cause whether similar or dissimilar to the
foregoing;
"GMWU" means the Ghana Mineworkers Union of the TUC (Ghana);
"GOVERNMENT" means the duly constituted government of the Republic of Ghana or
any political subdivision thereof, whether Central, Regional, District or local,
or any judicial body, agency or instrumentality of any such government or
political subdivision;
MEMORANDUM OF AGREEMENT PAGE 5
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"INVESTMENT AGREEMENT" means the Agreement between PGR and BGL executed on
November 16, 2001, as amended and supplemented by letters dated December 4,
2001, January 31, 2002 and March 4, 2002;
"JOINT OPERATING AGREEMENT" means the Joint Operating Agreement between PGR and
BGL executed on January 31, 2002 attached as Schedule "F";
"JV" means the joint venture, either unincorporated or incorporated, as more
fully described in Article 5, between Government, PGR and BGL formed to assess,
redevelop and operate the Underground Mine;
"JV PARTIES" means collectively, BGL, PGR and Government and "JV PARTY" means
any one of them;
"JOINT VENTURE AGREEMENT" means the more detailed joint operating agreement
which will set out the basis upon which the JV Parties shall, through the
formation of the Exploitation Company, mutually evaluate, develop, mine,
extract, produce, use, sell and export of Minerals and associated mineral
resources and, accordingly, hold all mining rights, mining claims, water rights,
surface lands, licenses and permits, other than as described herein;
"JOINT VENTURE ASSET" means the following:
a) all interests, rights, and privileges (whether absolute or conditional,
whether existing or future) in real property, mineral rights, and
surface lands falling with the Prestea Concession Area, including,
without limitation, all licenses, permits, leases, concessions, and
other entitlements, but excluding the BGL Mining Lease;
b) all minerals, Product, and materials of commercial value produced or
derived from the PGR Mining Lease under this Agreement;
c) all equipment acquired by the JV and used in the Operations; all
inventory; all personalty, tangible and intangible, consumable and
non-consumable, obtained by the Joint Venture in connection with the
conduct of Operations, including, without limitation, all geological
data, surveys, assays, analysis and other data and information acquired
in the course of Operations covered by this Agreement, excluding,
however, all such items which are specifically intended to remain the
separate property BGL for its surface mining operations or are rented
or leased to or for the benefit of the JV;
"LICENCE AGREEMENT" means the Licence Agreement between SGMC, PGL and PGR dated
January 16, 2002 attached as Schedule "G";
"MANAGER" means the person or entity with overall management responsibility for
the JV in accordance with this Agreement and the Joint Operating Agreement,
which for as long as BGL has a participating interest of greater than or equal
to 30%, shall be BGL. The Manager shall be bestowed with power sufficient to
undertake, manage, direct and control all day-to-day activities and decisions
reasonably necessary to fulfil the purposes of this Agreement, and such
activities shall be performed in accordance with international mining industry
practice. The Joint Venture Agreement, or a separate management agreement, will
specify with more particularity the Manager's responsibilities, rights and
obligations;
"MANAGEMENT COMMITTEE" shall have the meaning ascribed to it in Article 5. The
Management Committee will (i) review the conduct of Operations by the Manager,
(ii) determine the policies, nature, and content of work programs and budgets
for Operations, (iii) give general directions to the manner in which the Manager
must carry out Operations,
MEMORANDUM OF AGREEMENT PAGE 6
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(iv) approve budgets, and (v) have any other functions as may be mutually agreed
upon by the JV Parties under the terms of the Joint Operating Agreement;
"MINING LEASE", "MINERAL OPERATIONS", "MINING OPERATIONS", "MINERAL RIGHT" and
"MINERALS" shall have the meanings given to such terms in PNDCL 153;
"NI 43-101" means Canada's National Instrument 43-101 titled Standards of
Disclosure for Mineral Projects;
"OPERATIONS" means all activities carried out in connection with the
prospecting, exploring, evaluation, development, and mining of Minerals falling
within the PGR Mining Lease, including, without limitation, prospecting,
exploration, the development of a mine, the mining, extraction, treatment,
storage and processing of Minerals, distribution and sale of Product, the
acquisition and relinquishment of properties or the construction of any
improvements, personalty, fixtures or equipment reasonably necessary therefor,
and any other activities or operations related to or necessary for exploration,
development, and mining of Minerals in the PGR Mining Lease;
"ORE RESERVES" shall have the meaning contained in NI 43-101;
"PARTICIPATING INTERESTS" means an undivided ownership interest held by PGR, BGL
and Government under this Agreement and the Joint Venture Agreement and which
entitles the holder to that share of the Joint Venture or the Exploitation
Company and the JV Assets thereof and which requires the holder (other than
Government) to contribute to that share of the costs and expenses of the
development and operations thereof;
"PARTIES" means, collectively, BGL, PGR, PGL, SGMC, GMWU and Government and
"PARTY" means any one of them;
"PGL" means Prestea Goldfields Limited a company incorporated under the laws of
Ghana having its registered office at 9, Switchback Road, Cantonments, Accra,
Ghana;
"PGR" means Prestea Gold Resources Limited, a company incorporated under the
laws of Ghana having its registered office at PO Box 30, Prestea, Western
Region, Ghana;
"PGR CASUAL EMPLOYEES" means those part-time or full-time employees of PGR
classed as casual as at January 21, 2002;
"PGR EMPLOYEES" means all the permanent, full-time employees of PGR, both junior
staff and senior staff, as at January 21, 2002;
"PGR MINING LEASE" means the mining lease dated June 29, 2001 attached as
Schedule "D" issued by the Government to PGR pursuant to Section 45 of the PNDCL
153;
"PLANT-NORTH" means the area marked as "Plant-North" on Schedule "B";
"PNDCL" means the Minerals and Mining Law, 1986 (PNDCL 153) of Ghana, as
amended;
"PRESTEA CONCESSION AREA" means the area of the Prestea concession covering an
area of 129.05 km(2) comprising both the PGR Mining Lease and the BGL Mining
Lease as shown in the map attached as Schedule "B";
"PRESTEA PROCESSING PLANT" means the processing plant owned by PGL situated on
the Prestea Concession Area and marked as such on the map at Schedule "B";
"PRICEWATERHOUSECOOPERS" means the independent accounting firm of
PricewaterhouseCoopers having its registered office in Ghana at Gulf House, 4th
Floor, Tetteh Quarshie Roundabout, Legon Road, Accra, Ghana, or such other firm
of independent, internationally recognized accountants agreed in writing between
the JV Parties;
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"PRODUCT" means gold and other associated mineral substances produced by the JV
from ore mined from the PGR Mining Lease;
"PSGL" means Prestea Sankofa Gold Limited, a company incorporated in accordance
with the laws of Ghana operating on the Prestea Concession Area in accordance
with a mining lease granted by Government over certain tailings and mineralised
waste materials;
"RESTRICTED ACCOUNT" means that restricted operating account of PGR with Ghana
Commercial Bank, Kwame Nkrumah Circle Branch, Accra, Ghana (account number
214103), which requires signatories from both PGR and BGL;
"SEVERANCE BENEFIT" means the agreed severance benefit being Eighteen (18) days
(based on 27 working days per month) per year of service up to the Effective
Date to be paid to the PGR Employees as provided for in Article 3;
"SGMC" means State Gold Mining Company Limited a Public Limited Liability
Company registered under the laws of Ghana of P. O. Box 3634 Accra in the
Greater Accra Region;
"UNDERGROUND MINE" means the Prestea underground mining operation; and
"UNDERGROUND MINING ASSETS" means those underground mining assets owned by PGL
located at Prestea as set out in the First Schedule of the License Agreement.
1.2 Any reference in this Agreement to gender shall include all genders,
and words importing the singular number only shall include the plural
and vice versa.
1.3 The division of this Agreement into Articles, Sections, Subsections and
other subdivisions and the insertion of headings are for convenience of
reference only and shall not affect or be utilized in the construction
or interpretation of this Agreement.
1.4 Any Article, Section, Subsection or other subdivision of this Agreement
or any other provision of this Agreement which is, or becomes, illegal,
invalid or unenforceable shall be severed from this Agreement and be
ineffective only to the extent of such illegality, invalidity or
unenforceability and shall not affect or impair the remaining
provisions hereof.
1.5 This Agreement constitutes the entire agreement between the Parties
pertaining to the subject matter hereof and supersedes all prior
agreements, understandings, negotiations and discussions, whether oral
or written, of the Parties, unless otherwise stated herein.
1.6 This Agreement may only be amended, modified or supplemented by a
written agreement signed by all of the Parties.
1.7 No waiver of any of the provisions of this Agreement by any Party shall
be deemed to constitute a waiver of such provision by any other Party
or a waiver by such Party of any other provision, (whether or not
similar), nor shall such waiver constitute a continuing waiver unless
otherwise expressly provided in writing duly executed by the Party to
be bound thereby.
1.8 Where the word "including" or "includes" is used in this Agreement it
means "including (or includes) and without limitation".
1.9 Any references herein to any law, by-law, rule, regulation, order or
act of any government, governmental body or other regulatory body shall
be construed as a reference thereto as enacted at the date hereof as
such law, by-law, rule, regulation, order of or act may be amended,
re-enacted or superseded from time to time.
MEMORANDUM OF AGREEMENT PAGE 8
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ARTICLE 2 - PURPOSE AND LEGAL EFFECT
2.1 The Parties hereto hereby irrevocably agree to carry out the following
subject only to the terms and conditions of this Agreement:
(a) Securing funding from BGL for the payment of (i) the Back Pay
to the PGR Employees and PGR Casual Employees, and (ii) the
Severance Benefit to the PGR Employees;
(b) Putting the Underground Mine on Care & Maintenance while the
Assessment is carried out to determine if the future operation
of the Underground Mine is economically viable;
(c) Consolidating the management of the Underground Mine with the
mining operations of BGL by forming a JV between BGL, PGR and
Government;
(d) Effecting the immediate decommissioning and demolition of the
Prestea Processing Plant so that BGL may progress its surface
mining plans; and
(e) Government, SGMC and PGL agreeing to undertake certain acts or
things to the extent permitted by Applicable Law to facilitate
the surface mining by BGL on the BGL Mining Lease.
2.2 This Agreement will govern the rights and obligations of the Parties
and will be binding on the Parties.
2.3 Until superseded by the Joint Venture Agreement, the terms and
conditions set forth in this Agreement will govern the rights and
obligations of, and shall be binding on, the JV Parties. If a Joint
Venture Agreement is executed, the portions of this Agreement related
to the Joint Venture Agreement will be superseded. The Joint Venture
Agreement will contain the terms set forth in this Agreement and such
other terms as the JV Parties mutually agreed upon. The JV Parties will
in good faith endeavour to cause the Joint Venture Agreement to be
executed within thirty (30) Business Days of the Decision to Mine.
2.4 The Investment Agreement shall no longer have any binding effect on the
parties to such Investment Agreement.
2.5 For the avoidance of doubt the following agreements in which PGR is a
party shall continue to have effect, however PGR's rights and
obligations under such agreements shall, subject to the approval of
Government (which is deemed to have been granted by Government as party
to this Agreement), be transferred , as contemplated herein:
(a) Joint Operating Agreement shall be transferred to the JV,
(b) Environmental Indemnity shall be transferred to the JV,
(c) Licence Agreement shall be transferred to the JV, and
(d) PGR Mining Lease shall be transferred to BGL to be held by BGL
for the benefit of the JV until the earlier of (i) BGL
electing to terminate this Agreement, and (ii) the
Exploitation Company is formed.
MEMORANDUM OF AGREEMENT PAGE 9
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ARTICLE 3 - PGR EMPLOYEES
3.1 Immediately upon the receipt of the consent of Government for the
transfer of the PGR Mining Lease to BGL, as more fully described in
Article 7.3 and 9.3 and provided PGR have delivered the settlement
agreement as more fully described in 5.1 and 7.4:
(a) BGL, on behalf of the JV, shall pay to the Restricted Account,
in immediately available funds, $1,600,000, to be applied to
the payment of the Back Pay as described below.
(b) PGR, under the supervision of PricewaterhouseCoopers, shall
immediately distribute the Back Pay.
(c) Once all Back Pay has been paid, PGR shall provide the JV with
a written statement from PricewaterhouseCoopers detailing the
amount paid to each of the PGR Employees and PGR Casual
Employees and verifying that no further Back Pay entitlements
are owed.
(d) Any funds remaining from the $1,600,000 provided by the JV not
required to pay Back Pay shall be retained in the Restricted
Account.
3.2 The Parties agree that the employment of all PGR Employees and PGR
Casual Employees shall be severed and that the PGR Employees shall be
entitled to the Severance Benefit. PricewaterhouseCoopers shall audit
the Severance Benefit calculation to be provided by PGR.
3.3 Immediately upon the completion of the demolition of the Prestea
Processing Plant and the receipt by BGL of all approvals and consents
necessary to commence mining at Plant-North:
(a) BGL, on behalf of the JV, shall pay to the Restricted Account,
in immediately available funds, $800,000, to be applied to the
payment of the Severance Benefit;
(b) PGR, under the supervision of PricewaterhouseCoopers, shall
immediately distribute the Severance Benefit to the PGR
Employees;
(c) once all Severance Benefits have been distributed to the PGR
Employees, PGR shall provide the JV with a written statement
from PricewaterhouseCoopers detailing Severance Benefit made
to each bona fide PGR Employee and verifying that PGR has no
unpaid Severance Benefit liabilities; and
(d) any funds remaining from the total $2,400,000 of funding
provided by the JV shall be retained in the Restricted
Account.
ARTICLE 4 - CARE & MAINTENANCE
4.1 The Parties agree that effective immediately upon the signing of this
Agreement:
(a) the Underground Mine shall be placed on Care & Maintenance
under the direction of the Manager;
(b) the JV shall keep the Underground Mine dewatered and secure;
and
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(c) the JV shall employ such number of employees required for the
Care & Maintenance and shall give preference to the PGR
Employees provided that such PGR Employees have the requisite
skills.
4.2 The JV shall conduct an Assessment to determine the (i) safety
conditions and practices at the Underground Mine, (ii) environmental
practices at the Underground Mine, (iii) resource potential of the PGR
Mining Lease, and (iv) economic viability of a new mining operation on
the PGR Mining Lease. The broad principles covering the Assessment are
as follows:
(a) the Assessment will be carried out by the JV primarily using
consultants;
(b) the Assessment will be funded by the JV which shall be sole
funded by BGL;
(c) the Assessment is expected to take twenty-four (24) months but
could be longer or shorter depending on the findings; and
(d) during the Assessment, the JV Parties will receive regular,
quarterly reports on the progress of the Assessment as well as
copies of any definitive reports on the various aspects of the
Assessment.
4.3 Upon the completion of the Assessment the JV Parties and provided that
the Feasibility Study demonstrates that such redevelopment of the
Underground Mine is economically justified, the JV Parties shall
consider the redevelopment of the Underground Mine and make a Decision
to Mine.
4.4 Upon the Decision to Mine, or earlier by mutual agreement, the JV
Parties will enter into the Joint Venture Agreement and establish the
Exploitation Company in Ghana.
4.5 Upon the establishment of the Exploitation Company, BGL shall transfer
the PGR Mining Lease to the Exploitation Company.
ARTICLE 5 - FORMATION OF JOINT VENTURE
5.1 On the Effective Date, the JV Parties shall form the JV by:
(a) PGR contributing (i) the PGR Mining Lease, (ii) its mining
assets and inventory, (iii) its interest in certain
agreements, as detailed in Article 7.2, and (iv) its Back Pay
and Severance Benefit obligations totalling not more than
$2,400,000 to the JV;
(b) BGL obligating $2,400,000 to the JV;
(c) The Government approving the transfer of the PGR Mining Lease
to BGL, to be held by BGL for the benefit of the JV until the
earlier of (i) BGL electing to terminate this Agreement, and
(ii) the Exploitation Company is formed;
(d) PGR transferring, for the duration of the JV, the rights and
obligations of PGR under the Joint Operating Agreement, the
Environmental Indemnity, and the Licence Agreement to the JV;
and
(e) PGR delivering, within seven (7) calendar days of the
Effective Date, a settlement agreement between PGR and its
employees accepting the Back Pay and Severance Benefit (as
more fully described in Article 3) as a full and final
settlement for the termination of their employment with PGR.
MEMORANDUM OF AGREEMENT PAGE 11
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5.2 Upon the Decision to Mine, or earlier by mutual agreement, the JV
Parties will enter into the Joint Venture Agreement. The JV Parties
undertake to negotiate the definitive Joint Venture Agreement in good
faith.
5.3 Except as otherwise provided in this Agreement, all JV Assets held or
acquired by the Manager in fulfilment of its obligations for the Joint
Venture, or by a JV Party, are beneficially owned by the JV Parties in
undivided shares as tenants-in-common in proportion to their respective
Participating Interests from time to time, and the Parties hereby waive
all rights of partition and of sale in lieu of partition (including as
arise under Law) with respect to that property. The JV Parties hereby
agree that, notwithstanding any provision hereof to the contrary, if
they are jointly and severally liable in Ghana and elsewhere under this
Agreement, they must indemnify and hold each other harmless, subject to
this Agreement, to the extent they incur liability in respect thereof
in excess of their Participating Interest share of that liability.
5.4 None of the JV Parties will have any liability for any indebtedness or
liabilities of the other JV Parties.
5.5 As long as BGL's Participating Interest is equal to or greater than
30%, BGL will have the continuing right to act as Manager of the JV.
The Manager shall be responsible for the day-to-day management,
conduct, and control of the Operations, subject to approved work plans
and budgets and the direction of the Management Committee referred to
below. The JV Parties shall in good faith negotiate and specify the
powers and obligations of the Manager which shall be included in the
Joint Venture Agreement.
5.6 Notwithstanding anything contained herein to the contrary, the Manager
will not be liable to any JV Party for any act or omission resulting in
damages or loss except to the extent caused by or attributable to the
Manager's wilful misconduct or gross negligence.
5.7 The Manager will be entitled to charge a management fee of 2% of
expenditure. The purpose of this fee will not be to provide the Manager
with a profit, but to allow the Manager to recover indirect costs it
incurs in fulfilling its obligations as Manager. As a result, the JV
Parties must review the fee annually and the fee will be adjusted
annually if unanimously approved by all JV Parties and if the JV
Parties unanimously determine it to be insufficient or excessive. This
management fee will be considered to be an ordinary operating expenses
of the JV and will therefore be paid by each JV Party in accordance
with its Participating Interest.
5.8 Except as otherwise provided in this Agreement, until completion of the
Feasibility Study all final decisions relating to Operations shall be
made and undertaken by BGL, but reasonable consultation on these
decisions prior to their execution will be held with the JV Parties,
and the agreement or disagreement of the JV Parties formally recorded.
Upon completion of the Feasibility Study, all decisions relating to the
conduct of Operations and relating to the Joint Operating Agreement
shall be made by the Management Committee, a governing body to be
appropriately structured to serve the type of business entity chosen
under the Joint Venture Agreement. Prior to execution of the Joint
Venture Agreement, the JV Parties hereby designate their respective
representatives on the Management Committee to be as follows:
(a) for BGL: Managing Director
(b) for PGR: Chairman, and
MEMORANDUM OF AGREEMENT PAGE 12
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(c) for Government one representative.
5.9 The JV Parties shall have on the Management Committee a number of votes
proportionate to their respective Participating Interest, regardless of
the number of representatives, and each shall designate one person or
an alternate to cast such votes.
5.10 All decisions of the Management Committee will be taken by simple
majority vote. BGL, if continuing to hold a 30% or greater interest in
the project, shall determine, at its sole election, whether to proceed
with the Feasibility Study.
5.11 Prior to completion of the Feasibility Study, it is the intention of
the JV Parties that the Management Committee shall hold informal but
periodic reviews (at least quarterly unless otherwise agreed to by the
JV Parties) of Operations. Following completion of the Feasibility
Study, the Management Committee shall hold quarterly meetings in Accra,
Ghana, or such other mutually agreed place. Although the JV Parties
contemplate holding meetings to review work plans and budgets for each
phase of work undertaken, the JV Parties do not contemplate holding
regular formal meetings prior to completion of the Feasibility Study.
Meetings may be held by telephone.
5.12 As of the Effective Date BGL will have a 45% Participating Interest,
PGR will have a 45% Participating Interest, and Government will have a
10% Carried Interest.
5.13 Notwithstanding anything contained in this Agreement, the JV Parties
agree that, in addition to the initial $2,400,000 contribution to the
JV, BGL shall be entitled to and obligated to be the sole provider of
funding for (i) the Care & Maintenance, (ii) the Assessment, and (iii)
the completion of a Feasibility Study.
5.14 From the Effective Date until the completion of the Feasibility Study,
or in the event that a JV Party (other than Government) following the
completion of the Feasibility Study fails to advance funds as required
under this Agreement or the Joint Operating Agreement, then its
Participating Interest will be diluted in accordance with the following
formula:
PC#1 + PC#2 + PC#3
------------------
JV#1 + JV#2 + JV#3 times 90%; where
PC#1 means JV Party's initial contributions (deemed to be $2.4 million
for both BGL and PGR);
PC#2 means JV Party's additional contributions;
PC#3 means the amount, if any, that the JV Party elects to contribute
to the approved work plan and budget;
JV#1 means the initial contributions of all JV Parties (deemed to be
$4.8 million);
JV#2 means the additional contributions of all JV Parties; and
JV#3 means the amount that all JV Parties elect to contribute to the
approved work plan and budget.
5.15 For the avoidance of doubt, the Governments interest shall not be
diluted and at all times shall be 10%.
5.16 If a JV Party (other than Government) fails within a reasonable period
to make a contribution or cash call which it previously committed to
make under an approved work plan and budget, it shall be in default and
shall be diluted on a straight line basis to a minimum 10%
participating interest at which time the diluted JV Party will be
assigned a 2.5% net profits interest.
MEMORANDUM OF AGREEMENT PAGE 13
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5.17 For a period of ninety (90) Business Days after the completion of the
Feasibility Study, BGL shall have the right, at it sole election, to
acquire the rights and obligations of PGR in the Joint Venture for a
total consideration of $6.5 million.
5.18 BGL may withdraw from this Agreement upon completion of the Assessment
and determining that the redevelopment of the underground mine is not
viable to the extent that the project is not bankable with a reputable
international financial institution.
5.19 In the event that any JV Party (other than Government) elects to enter
into voluntary insolvency or becomes insolvent in accordance with the
Bodies Corporate (Official Liquidations) Act 1963 (Act. 180), the
insolvent party shall be deemed to have retired from the JV and their
rights and obligations under this agreement shall be forfeited. In the
event of retirement, the rights and obligation of the retiring party
shall be assumed by the remaining JV Parties (other than Government) in
proportion to their holdings in the JV at the time of retirement.
ARTICLE 6 - BGL'S SURFACE MINING OPERATIONS
6.1 The Parties agree that BGL shall be entitled to continue its
development of the BGL Mining Lease.
6.2 The Parties undertake to use their utmost endeavours to assist BGL to
implement the infrastructure mitigation plan incorporated in the Joint
Operating Agreement.
ARTICLE 7 - UNDERTAKINGS BY PGR
7.1 PGR hereby agrees that the notice required under Clause 5.4 (d) (i) of
the Joint Operating Agreement for the decommissioning and demolition of
the Prestea Processing Plant has been given and that such demolition
may commence immediately upon the Effective Date.
7.2 PGR hereby agrees to and assigns its rights and obligations in the
Joint Operating Agreement, Licence Agreement and Environmental
Indemnity to the JV.
7.3 PGR hereby agrees to the transfer of the PGR Mining lease to BGL, to be
held by BGL for the benefit of the JV until the earlier of (i) BGL
electing to terminate this Agreement, and (ii) the Exploitation Company
is formed.
7.4 PGR hereby undertakes to deliver, within seven (7) calendar days of the
Effective Date, a settlement agreement between PGR and its employees
accepting the Back Pay and Severance Benefit (as more fully described
in Article 3) as a full and final settlement for the termination of
their employment with PGR.
7.5 PGR undertakes to meet with its creditors to arrive at a settlement.
This could be an agreement by the creditors to wait until some future
time when the underground mine is redeveloped or an agreement by the
creditors to take shares in PGR in lieu of the monies owed to them.
ARTICLE 8 - UNDERTAKINGS BY SGMC AND PGL
8.1 SGMC and PGL hereby agree that the notice required in Clause 5 of the
Licence Agreement to demolish the assets described in Fourth Schedule
to the Licence
MEMORANDUM OF AGREEMENT PAGE 14
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Agreement has been given and that immediately upon the Effective Date,
BGL may commence such demolition.
8.2 SGMC and PGL hereby agree that the rights and obligations of PGR under
the Licence Agreement shall be assigned to the JV.
ARTICLE 9 - UNDERTAKINGS BY GOVERNMENT
9.1 Government hereby agrees with the commencement of the Infrastructure
Mitigation Plan as contemplated in the Joint Operating Agreement.
9.2 Government hereby agrees to the assignment by PGR of its rights and
obligations in the Environmental Indemnity to the JV.
9.3 Government hereby agrees to the transfer of the PGR Mining lease to
BGL, to be held by BGL for the benefit of the JV until the earlier of
(i) BGL electing to terminate this Agreement, and (ii) the Exploitation
Company is formed.
9.4 Government hereby agrees to the transfer of the PGR Mining lease from
BGL to the Exploitation Company once such a company is formed.
9.5 Government hereby agrees to the modification of the Deed of Warranty to
include the BGL Mining Lease and the PGR Mining Lease and undertakes to
do all acts and things necessary to perfect such modification or to
replace such Deed of Warranty with a new deed of warranty containing
the same terms and conditions.
9.6 Government hereby undertakes to use its best endeavours to cause its
agencies and utilities to expedite, to the extent possible under law,
any consents and approvals required for BGL to exercise its mining
rights on the BGL Mining Lease.
9.7 Government undertakes to use its best endeavours to assist BGL in
curtailing any illegal mining on the Prestea Concession Area.
9.8 Government hereby undertakes to cause its agencies to segregate the
Prestea town power from the power supply for the Underground Mine.
9.9 Government, being the majority creditor as a result of, but not limited
to, statutory liabilities owed by PGR and debts accrued by PGR to VRA
and SGMC, hereby undertakes to use best endeavours in so far as it is
able to cause the creditors of PGR to enter into an arrangement with
PGR. This arrangement will result in either an agreement to defer
settlement until such future date as the underground mine may be
redeveloped or an agreement to exchange their indebtedness in PGR for
equity in PGR.
ARTICLE 10 - UNDERTAKINGS BY BGL
10.1 BGL hereby agrees to the assignment to the JV of the rights and
obligations of PGR under the Joint Operating Agreement.
10.2 BGL hereby agrees to the transfer of the PGR Mining Lease from PGR to
BGL and undertakes to hold the PGR Mining lease for the benefit of the
JV and to immediately transfer the PGR Mining Lease to the Exploitation
Company once such Exploitation Company has been formed.
10.3 BGL hereby agrees to the initial commitment of $2,400,000 of funding to
the JV in two tranches to be paid to PGR for the payment of the Back
Pay and the Severance
MEMORANDUM OF AGREEMENT PAGE 15
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Benefit. The two tranches are (i) $1,600,000 on the completion of the
conditions detailed in clause 5.1 (c). (d) and (e) and (ii) $800,000
upon the demolition of the Prestea Processing Plant and the receipt by
BGL of the necessary approvals and consents to commence mining at
Plant-North.
10.4 BGL hereby agrees to provide sufficient funding to the JV to cover the
costs of the Care & Maintenance, the Assessment, and the Feasibility
Study.
10.5 BGL hereby undertakes to carry out the Assessment in a timely fashion
and in accordance with the standards of NI 43-101.
ARTICLE 11 - UNDERTAKINGS BY GMWU
11.1 GMWU, as the majority shareholder of PGR, hereby agrees to the
undertakings by PGR and undertakes to do all acts and things and to
sign all such documents and other agreements necessary to effect the
agreements in this Agreement.
11.2 GMWU, as the representative of the unionised employees of PGR, hereby
agrees to the Back Pay and Severance Benefit settlement contemplated in
Article 3 of this Agreement and undertakes to have this agreement
ratified by such unionised employees of PGR within seven (7) calendar
days of the signing of the Effective Date.
ARTICLE 12 - DISPUTE RESOLUTION
12.1 Any dispute, controversy or claim arising under or in connection with
this Agreement, and which cannot be resolved within sixty (60) days of
attempted negotiations between the Parties, shall be settled by
arbitration in accordance with this section.
12.2 Matters subject to arbitration shall be settled by arbitration in
accordance with the rules and regulations of the London Court of
International Arbitration in effect on the date of this Agreement.
12.3 The place of arbitration shall be Accra, Ghana or such other place as
the parties may agree.
12.4 The language of the arbitration shall be English.
12.5 The arbitration shall be the sole and exclusive forum for resolution of
the dispute or controversy and the award shall be final and binding.
12.6 A Party may demand arbitration by delivering a written notice thereof
to the other Party setting forth a complete, concise statement of the
issue(s) in dispute, the amount involved and the remedy requested.
12.7 The arbitrators shall render a written decision within six months after
having been appointed.
12.8 Notwithstanding anything herein, the arbitral panel shall have the
power to decide any dispute ex aequo et bono, with the objective of
deciding such matters fully in accordance with the intent of the
Parties as indicated by this Agreement.
12.9 The arbitrators shall have the right to award or include in their award
any relief, which they deem proper in the circumstances, including,
without limitation, money damages (with interest on unpaid amounts from
date due), specific performance, injunctive relief and legal fees and
costs in accordance with this section.
MEMORANDUM OF AGREEMENT PAGE 16
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12.10 The arbitrators shall not have the authority to award exemplary,
punitive, consequential or special damages and each Party shall be
limited to the recovery of any actual damages sustained by it.
12.11 The number of arbitrators shall be three. One arbitrator shall be
nominated by each of the Parties and shall then agree on the
appointment of a third arbitrator, who shall be disinterested in the
dispute and shall have no connection with any Party.
12.12 All arbitrators shall be persons having relevant experience relevant to
the disputed matter.
12.13 Unless the three arbitrators have been appointed within thirty (30)
days after the date on which either Party requests the settlement of
any dispute by arbitration pursuant to this Section, the London Court
of International Arbitration shall appoint the three arbitrators
referred to above. The appointing authority may appoint from among
nationals of any country, whether or not a Party is a national of that
country.
ARTICLE 13 - REPRESENTATIONS AND WARRANTIES
13.1 BGL and PGR each represent and warrant to each of the other Parties
that:
(a) it is a body corporate duly incorporated, organized and
validly subsisting under the laws of its incorporating
jurisdiction;
(b) it has full power and authority to carry on its business and
to enter into this Agreement;
(c) neither the execution and delivery of this Agreement nor the
consummation of the transactions hereby contemplated conflict
with, result in the breach of or accelerate the performance
required by any agreement to which it is a party;
(d) the execution and delivery of this Agreement does not violate
or result in the breach of its constating documents or of the
laws of any applicable jurisdiction; and
(e) this Agreement has been duly authorized by all necessary
corporate action of its directors and shareholders and
constitutes a legal, valid and binding obligation enforceable
against it in accordance with its terms.
ARTICLE 14 - GENERAL
14.1 Further Assurances
Each of the Parties will from time to time execute and deliver all
further documents and instruments and do all acts and things as the
other Party may reasonably require to effectively carry out or better
evidence or perfect the full intent and meaning of this Agreement.
14.2 Legal Fees
Each of the Parties hereto will pay their respective legal and
accounting costs and expenses incurred in connection with the
preparation, execution and delivery of this Agreement, and all other
documents and instruments executed pursuant hereto and any other costs
and expenses whatsoever and howsoever incurred.
MEMORANDUM OF AGREEMENT PAGE 17
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14.3 Confidentiality
No Party shall disclose the making of this Agreement nor its terms nor
any other agreement referred to in this Agreement (except those matters
set out in the press release in the agreed form) unless agreed in
writing by the other Parties (such agreement not to be unreasonably
withheld) and each Party shall procure that each of its Related Persons
shall not make any such disclosure without the prior consent of the
other Parties unless disclosure is:
(a) to its professional advisers; or
(b) required by law; or
(c) required by the rules or standards of any stock exchange,
securities regulator that a Party is a reporting issuer of or
such other regulatory body agreed between the Parties and
disclosure shall then only be made by that Party:
(i) after it has taken all such steps as may be
reasonable in the circumstances to agree the contents
of such announcement with the other Parties before
making such announcement and provided that any such
announcement shall be made only after notice to the
other Parties; and
(ii) to the person or persons and in the manner required
by law or the rules of the stock exchange, securities
regulator or such other regulatory body or as
otherwise agreed between the Parties.
The restrictions contained in Clause 14.3 shall apply without limit of
time.
14.4 Entire Agreement
Unless otherwise provided herein, this Agreement constitutes the entire
agreement among the Parties with respect to the subject matter hereof
and cancels and supersedes any prior understandings and agreements
between the Parties hereto with respect thereto.
14.5 Amendments and Waiver
No modification of or amendment to this Agreement will be valid or
binding unless set forth in writing and duly executed by all of the
Parties and no waiver of any breach of any term or provision of this
Agreement will be effective or binding unless made in writing and
signed by the Party purporting to give the same and, unless otherwise
provided, will be limited to the specific breach waived.
14.6 Assignment
BGL may assign in whole or in part its rights and obligations under
this Agreement to any of its affiliates that are ultimately controlled
by GSR. In such event, BGL will remain liable for all its obligations
under this Agreement after such assignment as if such assignment had
not taken place. Except as provided herein, neither BGL nor PGR may
assign any of their rights or obligations hereunder without the prior
written consent of the other party, which consent may not be
unreasonably withheld.
MEMORANDUM OF AGREEMENT PAGE 18
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14.7 Pre-emptive Rights
Except as provided for in Clause 5.17, or by Applicable Law, no JV
Party shall be entitled to sell its interest in the Joint Venture until
the Decision to Mine. Thereafter, if any JV Party receives a binding
written proposal from a third party, the remaining JV Parties shall be
entitled, for a period of sixty (60) Business Days following
notification of the intended sale, to acquire the interest being sold
at the same price offered by the third party.
14.7 Benefit of the Agreement
This Agreement will enure to the benefit of and be binding upon the
respective successors of the Parties.
14.8 Notices
Any demand, notice or other communication to be given in connection
with this Agreement must be given in writing by personal delivery or by
electronic means of communication addressed to the recipient as
follows:
(a) To PGR:
Prestea Gold Resources Limited
PO Box 701
Accra Ghana
Attention: Chairman
Facsimile No.: +233 21 66 5563
(b) To BGL:
Bogoso Gold Limited
32 Akosombo Road
Airport Residential Area
PO Box 16075, Airport Post Office
Accra Ghana
Attention: Managing Director
Facsimile No.: +233 21 77 7700
(c) To SGMC:
State Gold Mining Company Limited
C/O Minerals Commission
9, Switchback Road, Cantonments
PO Box 3634
Accra Ghana
Attention: Chief Executive
Facsimile No.: +233 21 77 2903 or 77 3324
MEMORANDUM OF AGREEMENT PAGE 19
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(d) To PGL:
Prestea Goldfields Limited
C/O Minerals Commission
9, Switchback Road, Cantonments
PO Box 3634
Accra Ghana
Attention: Chief Executive
Facsimile No.: +233 21 77 2903 or 77 3324
(e) To GMWU:
Ghana Mineworkers Union
PO Box 701
Accra Ghana
Attention: General Secretary
Facsimile No.: +233 21 66 5563
(f) To Government:
Ministry of Mines
Private Mail Bag
Ministries Post Office
Accra Ghana
Attention: Minister of Mines
Facsimile No.: +233 21 66 6801
MEMORANDUM OF AGREEMENT PAGE 20
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or to such other address, individual or electronic communication number
as may be designated by notice given by either Party to the other. Any
demand, notice or other communication given by personal delivery will
be conclusively deemed to have been given on the day of actual delivery
thereof and, if given by electronic communication, on the day of
transmittal thereof if given during the normal business hours of the
recipient and on the Business Day during which such normal business
hours next occur if not given during such hours on any day.
14.9 Governing Law
This Agreement is governed by and must be construed in accordance with
the laws of Ghana.
14.10 Attornment
For the purpose of all legal proceedings this Agreement shall be deemed
to have been performed in Ghana and the courts of Ghana will have
jurisdiction to entertain any action arising under this Agreement. Each
Party hereby attorns to the jurisdiction of the courts of Ghana.
14.11 Counterparts
This Agreement may be executed in any number of counterparts, each of
which will be deemed to be an original and all of which when taken
together constitute one and the same agreement.
14.12 Execution by Facsimile Transmission
Delivery of this Agreement may be made by facsimile transmission. A
copy of this Agreement duly executed in several counterparts by the
Parties and delivered by facsimile transmission constitutes a valid and
binding agreement.
14.13 Force Majeure
The obligations of the Parties will be suspended for the duration of a
Force Majeure event.
14.14 Default
A Party shall be in default under this Agreement if, at any time such
Party is in breach of any of its material obligations under this
Agreement and which continues for seven (7) days after notice by a
non-defaulting Party specifying such breach.
For the purposes of Clause 5.18 a breach of material obligations shall
include but not be limited to breach of the obligations contained in
Articles 7, 8, 9,10 and 13 and shall be enforceable by application to a
court having jurisdiction over the Parties
[SIGNING PAGES FOLLOW]
MEMORANDUM OF AGREEMENT PAGE 21
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In witness whereof the Parties have executed this Agreement as of the date first
above written:
BOGOSO GOLD LIMITED
By: /s/ Peter Bradford
-------------------------------------------------
Name: Peter Bradford
Title: Chairman
By: /s/ Richard Gray
-------------------------------------------------
Name: Richard Gray
Title: Managing Director
PRESTEA GOLD RESOURCES LIMITED
By: /s/ Robert Cole
-------------------------------------------------
Name: Robert Cole
Title: Chairman
By: /s/ Jerome Essilfie
-------------------------------------------------
Name: Jerome Essilfie
Title: Mine Manager and Director
PRESTEA GOLDFIELDS LIMITED
By: /s/ E.K. Ofosu-Offei
-------------------------------------------------
Name: E.K. Ofosu-Offei
Title: Ag. Chief Executive
By: /s/ Kwasi Anokye-Yesuo
-------------------------------------------------
Name: Kwasi Anokye-Yesuo
Title: Group Management Accountant
MEMORANDUM OF AGREEMENT PAGE 22
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STATE GOLD MINING COMPANY LIMITED
By: /s/ E.K. Ofosu-Offei
-------------------------------------------------
Name: E.K. Ofosu-Offei
Title: Ag. Chief Executive
By: /s/ Kwasi Anokye-Yesuo
-------------------------------------------------
Name: Kwasi Anokye-Yesuo
Title: Group Management Accountant
GHANA MINEWORKERS UNION (AS MAJORITY SHAREHOLDER OF PGR AND AS REPRESENTATIVE
OF THE UNIONIZED EMPLOYEES OF PGR)
By: /s/ John Brimpong
-------------------------------------------------
Name: John Brimpong
Title: National Chairman
By: /s/ Robert Cole
-------------------------------------------------
Name: Robert Cole
Title: General Secretary
REPUBLIC OF GHANA
By: /s/ Hon Kwadwo Adjei-Darko
-------------------------------------------------
Name: Hon Kwadwo Adjei-Darko
Title: Minister of Mines
By: /s/ Mrs Ernestina Tekpertey
-------------------------------------------------
Name: Mrs Ernestina Tekpertey
Title: Chief Director
MEMORANDUM OF AGREEMENT PAGE 23
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The following Schedules are attached to and made a part of this Agreement:
A. Final Report of the Mediator to the Government dated May 21, 2001;
B. Prestea Concession Area Map;
C. BGL Mining Lease;
D. PGR Mining Lease;
E. Environmental Indemnity;
F. Joint Operating Agreement; and
G. Licence Agreement.