DEFERRED TERMS AGREEMENT
RELATING TO THE PROVISION OF PLANT AND SPARE PARTS
TO A POWER GENERATION COMPLEX AT
MORILA, REPUBLIC OF MALI
BY AND BETWEEN
SOCIETE DES MINES DE MORILA S.A.
AND
ROLLS-ROYCE POWER VENTURES LIMITED
TABLE OF CONTENTS
SECTION 1
DEFINITIONS AND RULES OF INTERPRETATION....................................................... 2
SECTION 2
INITIAL CONDITIONS............................................................................16
SECTION 3
DESIGN........................................................................................17
SECTION 4
PLANT.........................................................................................19
SECTION 5
BALANCE OF PLANT AND MINE MODIFICATIONS.......................................................20
SECTION 6
TITLE.........................................................................................22
SECTION 7
SITE CONDITION................................................................................24
SECTION 8
COMMISSIONING OF FACILITY.....................................................................25
SECTION 9
SPARE PARTS...................................................................................27
SECTION 10
INCENTIVE REGIME..............................................................................28
▇▇▇▇▇▇▇ ▇▇
▇▇▇▇, ▇▇▇▇▇ AND LUBE OIL......................................................................32
SECTION 12
ACCOUNTING....................................................................................34
SECTION 13
INSURANCE.....................................................................................37
SECTION 14
INSURABLE/NON-INSURABLE EVENTS................................................................39
SECTION 15
FINAL PAYMENT.................................................................................45
SECTION 16
TERMINATION...................................................................................46
SECTION 17
DISPUTE RESOLUTION............................................................................58
SECTION 18
TRANSFER OF RIGHTS AND OBLIGATIONS............................................................61
SECTION 19
ADJUSTMENT DUE TO CHANGE IN LAW...............................................................61
SECTION 20
INTELLECTUAL PROPERTY.........................................................................63
SECTION 21
MISCELLANEOUS.................................................................................63
EXHIBIT 1............................................................................................68
Form of Randgold Guarantee....................................................................68
EXHIBIT 2............................................................................................75
Offshore Account Arrangements.................................................................75
EXHIBIT 3............................................................................................83
Parts 1, 2 and 3 Plant, Balance of Plant and Existing Facility...............................83
Part 4 Technical Requirements................................................................94
EXHIBIT 4............................................................................................100
Part 1 Shipment Schedule.....................................................................100
Part 2 Spare Parts Schedule..................................................................101
Part 3 Spare Parts Inventory.................................................................103
Part 4 Order Form............................................................................104
EXHIBIT 5............................................................................................105
Insurances....................................................................................105
1. Insurance to be obtained and maintained by MORILA.............................................105
EXHIBIT 6............................................................................................120
Part 1 Reusable..............................................................................120
Part 2 Salvage...............................................................................122
EXHIBIT 7............................................................................................123
Part 1 Facility Design Programme.............................................................123
EXHIBIT 8............................................................................................125
Part 1 Guaranteed Contracted Capacity........................................................125
Part 2 Fuel Efficiency Rate..................................................................126
Part 3 Lube Oil Consumption Rate.............................................................130
EXHIBIT 9............................................................................................133
Part 1 Completion Tests......................................................................133
Part 2 Fuel Specification....................................................................135
Part 3 Water Specification...................................................................137
Part 4 Lube Oil Specification................................................................138
EXHIBIT 10...........................................................................................139
Part 1 Plant Payment.........................................................................139
Part 2 BOP Payment...........................................................................141
Part 3 Spare Parts Payment...................................................................143
Part 4 Payment Adjustments...................................................................144
Part 5 Existing Facility Payment.............................................................150
Part 6 Fixed Spare Parts Payment.............................................................151
Part 7 Payment Mechanism.....................................................................153
Part 8 Table of Termination Prices where MORILA Default or where MORILA
accelerates payment in accordance with Section 15.3...........................................157
Part 9 Table of Termination Prices where Mopps Default.......................................159
Part 10 Table of Termination Prices where no Default.........................................161
Part 11 CTF Termination Price................................................................163
EXHIBIT 11...........................................................................................165
Notices.......................................................................................165
EXHIBIT 12...........................................................................................166
Key Milestones and Key Milestone Dates........................................................166
EXHIBIT 13...........................................................................................169
Fixed Default Amount..........................................................................169
EXHIBIT 14...........................................................................................170
Step-In and Acknowledgement Agreement in relation to the Morila Mining Project................170
EXHIBIT 15...........................................................................................178
Site..........................................................................................178
DEFERRED TERMS AGREEMENT
This Deferred Terms Agreement (this "Agreement") is dated as of [ ]
1999, between ROLLS-ROYCE POWER VENTURES LIMITED registered in and in accordance
with the laws of England under number 2916875 for and on behalf of a majority
owned subsidiary of it which is to be incorporated under the name MORILA POWER
PLANT SALES LIMITED (or such other name as may be required by the relevant
authorities in the jurisdiction in which such subsidiary is to be incorporated
and registered) (and the term "Mopps" shall mean Rolls-Royce Power Ventures
Limited until notice is given under Section 2.4 wherefrom it shall mean Morila
Power Plant Sales Limited) and SOCIETE DES MINES DE MORILA S.A. ("MORILA"), a
majority owned subsidiary of Randgold Resources Limited registered in and in
accordance with the laws of the Republic of Mali under number 15430. Each of
Mopps and MORILA is referred to herein as a "Party" and collectively, as the
"Parties".
RECITALS
WHEREAS MORILA holds a concession for gold mining at MORILA, Republic of Mali in
respect of which MORILA intends to own and operate a mining facility and
associated property (the "Mine") and wishes to acquire, on deferred terms,
generating and other equipment consisting of the Facility and made up of the
Plant and the Balance of Plant.
WHEREAS MORILA has entered into or intends to enter into a contract (the "Energy
Support Agreement") with Operations d'Energie de Morila SA (the "Operator") for
the operation of the Facility on terms satisfactory to Mopps and, on that basis,
Mopps is prepared to warrant the Availability and Fuel Efficiency Rate of the
Plant.
WHEREAS Mopps has agreed on the terms set out in this Agreement to: (i) design
the Facility; (ii) supply the Plant; (iii) assist in the procurement of certain
parts of the Balance of Plant; and (iv) until expiration of the Term, provided
that the Energy Support Agreement remains in force, supply the Spare Parts.
NOW, THEREFORE, in consideration of the mutual benefits to be derived herefrom
and the undertakings contained herein Mopps and MORILA hereby agree as follows:
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SECTION 1
DEFINITIONS AND RULES OF INTERPRETATION
1.1 DEFINITIONS
Whenever the following terms appear in the Agreement, they shall have
the meanings stated below unless the context otherwise requires:
"ABANDONMENT" means the cessation by either Party of
the performance of its obligations under
this Agreement or a material part
thereof, for a period of 6 consecutive
months or more.
"AFFILIATE" of any Party means a person (other than a
natural person) that directly or
indirectly controls or is under the
common control with or is controlled by
such Party.
"AGREEMENT" means this agreement including the
recitals and Exhibits hereto parts to the
Exhibits.
"APPLICABLE LAW" means any law, statute, decree, rules,
judgment, regulation order or, code which
is applicable to or affects the Project
or the supply of all or any of the Plant,
the Balance of Plant, the Existing
Facility, the Commissioning of the
Facility and the supply of Spare Parts
limited to the laws and statutes of the
Republic of Mali and, to the extent that
the same may be relevant, the Republic of
Cote d'Ivoire and environmental policies
and guidelines of either or both the
World Bank and IFC.
"AVAILABLE" means that the Facility is able to
deliver electrical energy at the bus-bar
specified in Part 4 of Exhibit 3 and
Availability shall be construed
accordingly.
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"BALANCE OF PLANT" means the equipment and plant listed in
Part 2 of Exhibit 3.
"BASE DATE" means 14 days following satisfaction of
the Suspensive Conditions.
"BOP PAYMENT" means the payment set out in Part 2 of
Exhibit 10.
"BOP WARRANTIES" means those warranties given to MORILA in
relation to either or both the design and
construction of the Balance of Plant by
one or more of the Contractors.
"BUSINESS DAY" means a calendar day other than a
Saturday, a Sunday, a national holiday in
the Republic of Mali or a day on which
banks are authorised by law or executive
order to be closed in the Republic of
Mali.
"CATASTROPHIC TECHNICAL means a Fault or Faults occurring in at
FAILURE" least three (3) Units which renders
the Facility inoperable to a level at or
below that set out in Section 10.2.4
"CHANGE IN LAW" means any of the following events
occurring after the date of execution of
this Agreement as a result of, or in
connection with, any action or inaction
by any Competent Authority:
(a) a change in, or repeal of an existing
Applicable Law (including any change
in taxes other than a change in rate
of any current taxes applicable to
Mopps as of the date of this
Agreement);
(b) an enactment or making of a new
Applicable Law (including any change
in taxes other than a change in rate
of any current tax applicable to
Mopps as of the date of this
Agreement);
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(c) a cancellation or non-renewal of or
change in the conditions applicable
to any authorisation granted by a
Competent Authority to MORILA, the
Contractors or any personnel supplied
by Mopps as technical support, unless
due to the failure by Mopps to comply
with its obligations under this
Agreement; or
(d) a change in the manner in which an
Applicable Law is applied or
interpreted by a Competent Authority
provided always that if an assumption
as to an interpretation made by Mopps
which was verified with a Competent
Authority or based upon information
released by such Competent Authority
and is found to be materially
incorrect, then the same shall not
constitute a Change in Law.
"COMMISSIONING" means the procedure by which it is proved
that the Facility is capable of
delivering electrical energy, ending with
passing the Completion Tests.
"COMMISSIONING means the date on which Commissioning of
COMMENCEMENT DATE" the Facility is commenced.
"COMPETENT AUTHORITY" means with respect to the Republic of
Mali and, to the extent that it may be
relevant, the Republic of Cote d'Ivoire,
any ministry, department, political
sub-division, instrumentality, agency,
authority, corporation or other
organisation under the direct or indirect
control of the government of such
country, court of competent jurisdiction
or other body exercising legislative,
executive, regulatory, administrative or
judicial or quasi judicial functions
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or at any time asserting any form of
jurisdiction or de facto control over the
Parties in relation to the Facility or
any aspect of this Agreement (or any
transaction or agreement contemplated
herein).
"COMPLETION TESTS" means those tests set out in Part 1 of
Exhibit 9.
"CONSENTS" means all permits, authorisations,
licences, exemptions, clearances,
consents or similar decision of any kind
which are required for the construction,
installation, Commissioning, testing or
completion of the Facility.
"CONSIDERATION" means the financial consideration for the
transfer of title in the Existing
Facility from MORILA to Mopps as referred
to in Section 6.2.
"CONSTRUCTION PHASE" means the period commencing from the
date of execution of this Agreement and
terminating on the last Relevant
Commercial Operations Date in time.
"CONTRACTOR" means any third party with whom MORILA
enters into a contractual arrangement to
carry out any or all of any work,
services or supply of equipment required
for the Project in accordance with this
Agreement.
"CPI" means the Consumer Price Index for the US
City Average for All Items as published
by the Bureau of Labor Statistics.
"CTF TERMINATION PRICE" means that Termination Price payable on
termination of this Agreement as a
consequence of a Catastrophic Technical
Failure.
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"CUT-OFF DATE" means the date falling 6 weeks after the
date of this Agreement.
"DEFERRED PAYMENT PERIOD" means the period during which payments
are payable to Mopps under this
Agreement.
"EF DEBT" means the debt falling due from Mopps to
MORILA in relation to the Existing
Facility equal to the amount of the
Consideration.
"EF DEBT REPAYMENT" means an amount equal to 1/120 of the
Consideration and relates to the Existing
Facility only.
"ENERGY SUPPORT AGREEMENT" means the contract of even date entered
into by MORILA and the Operator.
"EXISTING FACILITY" means the equipment and plant listed in
Part 3 of Exhibit 3.
"EXISTING FACILITY means the payment as set out in Part 5 of
PAYMENT" Exhibit 10.
"EXISTING FACILITY means those warranties held by MORILA in
WARRANTIES" relation to the Existing Facility in
respect of either or both its design and
construction.
"FACILITY" means the Plant, Balance of Plant and
Existing Facility.
"FACILITY DESIGN" means the design which meets the
Technical Requirements, prepared by
Mopps, provided to MORILA and to which
MORILA shall not have objected or shall
have approved in accordance with
Section 3.
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"FACILITY DESIGN PROGRAMME" means the programme set out in Exhibit 7.
"FAULT" means a problem with a Unit which
prevents it from producing 5.5MW or more.
"FINAL PAYMENT" means the last payment to be paid by
MORILA to Mopps in accordance with
Section 15.
"FINAL PAYMENT DATE" means the date that full and final
payment has been made by MORILA to Mopps
pursuant to Section 15 or Section
16.16.4.
"FIRST UNIT" means the first Unit in time to be
delivered pursuant to Section 4.
"FIXED DEFAULT AMOUNT" means the amount or amounts as calculated
in accordance with Exhibit 13.
"FIXED SPARE PARTS means the payment set out in Part 6 of
SERVICES PAYMENT" Exhibit 10.
"FRENCH FRANCS OR FFR" means the lawful currency of the Republic
of France or such other lawful currency
that replaces it.
"FUEL" means that fuel supplied by MORILA in
accordance with Section 11.1.
"FUEL EFFICIENCY ADJUSTMENT has the meaning set forth in Part 4 of
PAYMENTS" Exhibit 10.
"FUEL EFFICIENCY RATE" has the meaning set forth in Part 2 of
Exhibit 8.
"FUEL SPECIFICATION" means that level of Fuel quality as set
out in Part 2 of Exhibit 9 which is
capable of being treated by the
centrifuge or other equipment to be
supplied as part of the Balance of Plant.
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"GOOD UTILITY PRACTICE" means the exercise of that degree of
skill, diligence, prudence, foresight and
operating practice which would reasonably
and ordinarily be expected from a skilled
and experienced manufacturer engaged in
the same type of undertaking under the
same or similar circumstances as in this
Agreement.
"GRM" means the Government of the Republic of
Mali
"GUARANTEED CONTRACTED means the lesser of the electrical
CAPACITY" demand required by the Mine and the
electrical capacity specified in Part 1
of Exhibit 8 whether or not the Mine is
capable of receiving it.
"GUARANTEED FUEL has the meaning set forth in Part 2 of
EFFICIENCY RATE" Exhibit 8.
"GUARANTEED LUBE OIL has the meaning set forth in Part 3 of
CONSUMPTION RATE" Exhibit 8.
"IFC" means the International Finance
Corporation of Washington D.C., United
States of America.
"INSURABLE EVENT" means all events and consequences of an
event against which the Parties agree it
is reasonable to expect to be covered,
and which shall be covered, by the
insurances listed in Exhibit 5.
"KEY MILESTONE" means the key stages in the works as
identified in Exhibit 12.
"KEY MILESTONE DATE" means the dates for achievement of each
Key Milestone, as set out in Exhibit 12.
-8-
"LUBE OIL CONSUMPTION has the meaning set forth in Part 4 of
ADJUSTMENT PAYMENTS" Exhibit 10.
"LUBE OIL SPECIFICATION" means that level of lube oil quality as
set out in Part 4 of Exhibit 9.
"LUBE OIL CONSUMPTION RATE" has the meaning set forth in Part 3 of
Exhibit 8.
"MINE" has the meaning set forth in the
Recitals.
"MINE MODIFICATIONS" means those modifications to be carried
out to the Mine to enable the Mine to
accept electrical energy from, and to
facilitate the delivery of Fuel, lube oil
and water to, the Facility.
"MOPPS EVENT OF DEFAULT" has the meaning set forth in
Section 16.11.
"MOPPS' LENDERS" means the banks, institutions or
organisations or any agent or trustees
therefor making loans, credit facilities
or funding arrangements available to or
providing debt finance to the Project.
"MOPPS TERMINATION EVENT" has the meaning set forth in
Section 16.9.
"MORILA EVENT OF DEFAULT" has the meaning set forth in
Section 16.6.
"MORILA'S LENDERS" means the banks, institutions or
organisations or any agent or trustees
therefor making loans, credit facilities
or funding arrangements available to, or
providing debt finances for, MORILA.
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"MORILA TERMINATION EVENT" has the meaning set forth in
Section 16.4.
"NON-INSURABLE EVENT" means any event or circumstances or
combination of events or circumstances
which, or the effects of which,
materially and adversely, affect the
performance of that Party of its
obligations under or pursuant to this
Agreement provided:
(i) that no such event or circumstance or
combination thereof shall constitute
a Non-Insurable Event if its effects
could reasonably have been prevented
by the affected Party through the
exercise of its reasonable diligence
and reasonable care; and
(ii) no Insurable Event shall constitute
a Non-Insurable Event unless
insurance in respect of that event
shall not be available in the market
on reasonable and commercial terms.
"OFFSHORE ACCOUNT means those arrangements set out in
ARRANGEMENTS" Exhibit 2.
"OPERATIONAL PHASE" means the period ending on the Final
Payment Date unless this Agreement is
terminated earlier and commencing on the
Relevant Commercial Operations Date.
"OPERATOR" has the meaning set forth in the second
recital of this Agreement.
"ORDER FORM" means a form substantially in the form
set out in Part 4 of Exhibit 4.
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"PAYMENT MECHANISM" means the mechanism set out in Part 7 of
Exhibit 10.
"PLANT" means the equipment listed in Part 1 of
Exhibit 3.
"PLANT PAYMENT" means the payment set out in Part 1 of
Exhibit 10
"PROJECT" means the construction, installation,
Commissioning and testing of the Facility
in accordance with this Agreement.
"QUARTER DAY" means the 1st January, 1st April, 1st
July and 1st October in any year.
"RATE OF INTEREST" means a rate per annum equal to LIBOR
plus 2% where LIBOR means, in respect of
a Business Day the three month US Dollar
interbank rate as published in the
Financial Times on that Business Day.
"RELEVANT COMMERCIAL means, subject to Section 8.3, the date
OPERATIONS DATE" on which a Unit (and those parts of the
Facility which are required for operation
of that Unit and which have not
themselves already passed the Completion
Tests) passes the Completion Tests.
"RELEVANT TARGET COMMERCIAL means the Relevant Commercial Operations
OPERATIONS DATE" Date calculated in accordance with Part 1
of Exhibit 8.
"REUSABLE" means plant and equipment which can be
re-used for generation at another
location and includes, but is not limited
to, the equipment and plant listed in
Part 1 of Exhibit 6.
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"SALVAGE" means plant and equipment which can be
used for purposes other than generation,
such as fill for contractors' work and
includes, but is not limited to, the
equipment and plant listed in Part 2 of
Exhibit 6.
"SHIPMENT SCHEDULE" means the schedule set out in Part 1 of
Exhibit 4.
"SITE" means the lands, spaces, waterway, roads
and any surface and wayleaves required
for the Facility shown or identified as
such on the plan referred to in Exhibit
15.
"SOURCING" means in relation to an element of the
Balance of Plant, the identification
through competitive tendering, or as may
otherwise be agreed between the Parties
pursuant to Section 5, of the supplier of
that element, and the term "Sourced"
shall be construed accordingly.
"SPARE PARTS" means those items of Plant and other
equipment to be supplied by Mopps
pursuant to Section 9 of this Agreement.
"SPARE PARTS INVENTORY" means the inventory set out in Part 3 of
Exhibit 4.
"SPARE PARTS PAYMENT" means the payment set out in Part 3 of
Exhibit 10.
"SPARE PARTS SCHEDULE" means the schedule set out in Part 2 of
Exhibit 4.
"SPOT FUEL EFFICIENCY" has the meaning set forth in Part 2 of
Exhibit 8.
"SPOT FUEL EFFICIENCY TEST" has the meaning set forth in Part 2
of Exhibit 8.
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"SPOT LUBE OIL CONSUMPTION" has the meaning set forth in Part 3 of
Exhibit 8.
"SPOT LUBE OIL CONSUMPTION has the meaning set forth in Part 3 of
TEST" Exhibit 8.
"STEP-IN AND means the agreement appearing in Exhibit
ACKNOWLEDGEMENT AGREEMENT" 14.
"SUSPENSIVE CONDITIONS" means those conditions to be satisfied by
MORILA as set out in Section 2.1.
"TECHNICAL REQUIREMENTS" means those requirements set out in Part
4 of Exhibit 3.
"TERM" means the period commencing on the last
Relevant Commercial Operations Date in
time and ending on the date falling ten
years thereafter.
"TERMINATION PRICE" means the relevant amounts calculated in
accordance with Parts 8, 9, 10 and 11 of
Exhibit 10 as the case may be.
"TEST CERTIFICATES" means the certificates issued pursuant to
Section 8.4.
"UNIT" means any one of the five new Rolls-▇▇▇▇▇
▇▇▇▇▇ 5012 medium speed generating sets
to be supplied by Mopps to MORILA
pursuant to the Shipment Schedule.
"US DOLLARS OR US$" means the lawful currency of the United
States of America.
"WATER SPECIFICATION" means that level of water quality as set
out in Part 3 of Exhibit 9.
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1.2 RULES OF INTERPRETATION
(a) The headings and references to them in this Agreement shall not
be deemed to be part of this Agreement or be taken into
consideration in the interpretation or construction of this
Agreement.
(b) References to Sections, Paragraphs, Parts and Exhibits are
references to sections, paragraphs and parts of, and exhibits to,
this Agreement. Where in an Exhibit there is a reference to a
paragraph number, unless expressly stated otherwise, it shall be
a reference to a paragraph number in that Exhibit.
(c) Words importing persons or parties shall include firms,
partnerships, corporations and any organisations having legal
capacity. Where the context so requires, words importing the
singular only shall also include the plural and vice versa and
words importing the masculine shall be construed as including the
feminine or the neuter or vice versa.
(d) Wherever in this Agreement provision is made for the giving or
issuing of any notice, endorsement, consent, declaration,
approval, certificate or determination by any person unless
otherwise specified, such notice, endorsement, consent,
declaration, approval, certificate or determination shall be in
writing and words such as "notify", "endorsed", "consent",
"declare", "approved", "certifying" or "determined" shall be
construed accordingly.
(e) References to any enactment (including any subordinate
legislation) are to be construed as references to that enactment
as for the time being amended or modified or to any enactment for
the time being replacing or amending the same.
(f) References to any agreement or document include (subject to all
relevant approvals) a reference to that agreement or
-14-
document as amended, supplemented, substituted, novated or
assigned.
(g) Any reference to a public organisation shall be deemed to include
a reference to any successor to such public organisation or any
organisation or entity which has taken over any of the functions
and responsibilities of such public organisation.
(h) The words in this Agreement shall bear their natural meaning. The
parties have had the opportunity to take legal advice on this
Agreement and no term shall, therefore, be construed contra
proferentem.
(i) The text of this Agreement as signed by the Parties (and amended
from time to time in accordance with Section 21.1) shall be the
exclusive, original and decisive text for the purpose of the
interpretation or construction of this Agreement. No translation
shall be taken into consideration in the interpretation or
construction of this Agreement.
(j) Except where otherwise specifically provided in this Agreement,
all correspondence, notices, drawings, designs, test reports,
certificates, specifications and information shall be in the
English language. All operating and maintenance instructions,
name and rating plates, identification labels, instructions and
notices to the public and staff and all other written and printed
matter required for operation and maintenance shall be executed
in the English or French language.
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SECTION 2
INITIAL CONDITIONS
2.1 SUSPENSIVE CONDITIONS
This Agreement shall come into immediate effect upon the execution
hereof save that the obligations of Mopps under Sections 4, 8, and 9
shall come into effect only
2.1.1 when MORILA has produced to Mopps in the form and substance
satisfactory to it:
(i) evidence of the issue of the decree ratifying the
convention between GRM and MORILA as to the establishment
and exploitation of the Mine; and
(ii) the form of guarantee from Randgold Resources Limited and
Randgold & Exploration Company Limited, or from such
other party or parties determined in accordance with
Section 16.6.6, substantially in the terms set out in
Exhibit 1.
2.2 FAILURE TO SATISFY SUSPENSIVE CONDITIONS
If MORILA shall fail to satisfy or procure the satisfaction of the
Suspensive Conditions set out in Section 2.1 prior to the Cut-off
Date, or such other date as is agreed in writing by the Parties, then
Mopps may in its absolute discretion either waive such Suspensive
Condition or terminate this Agreement in accordance with Section
16.3.1(a).
2.3 LENDERS' ISSUES
In the event that either MORILA's Lenders, Mopps' Lenders or both (as
the case may be) propose any amendments to, or make any comments on,
this Agreement within 30 Business Days following satisfaction of the
Suspensive Conditions set out in Section 2.1, which may materially
affect the financing of the Project, the Mine or both (as the case
may be), the relevant Party shall give notice to the other Party of
such proposed amendments or comments and the Parties shall meet
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within 10 Business Days of such notice and shall use reasonable
commercial endeavours to agree any amendments to this Agreement and,
if the Parties so agree, to amend this Agreement in accordance with
Section 21.1.
2.4 RATIFICATION BY MORILA POWER PLANT SALES LIMITED
If and when the majority owned subsidiary of Rolls-Royce Power
Ventures Limited to be called Morila Power Plant Sales Limited (or
such other name as may be required by the relevant authorities in the
jurisdiction in which such subsidiary is to be incorporated and
registered) is properly incorporated and registered, Rolls-Royce
Power Ventures Limited shall cause the said subsidiary to give notice
to MORILA and therefrom the said subsidiary shall be responsible to
MORILA for the obligations of Mopps under this Agreement and shall be
entitled to the benefits hereunder to the exclusion of Rolls-Royce
Power Ventures Limited.
2.5 OFFSHORE ACCOUNT ARRANGEMENTS
The Parties shall take all steps necessary to give effect to the
Offshore Account Arrangements as set out in Exhibit 2.
SECTION 3
DESIGN
3.1 SUPPLY OF FACILITY DESIGN
To the extent that the same shall not have been delivered prior to
the date hereof, Mopps shall supply to MORILA as soon as is
practicable but in any event in accordance with the Facility Design
Programme designs for the Facility to such extent as will enable
MORILA to procure the Balance of Plant. Within 10 Business Days of
receipt of the relevant part of the designs MORILA shall notify Mopps
of either or both any clashes between the design of the Facility and
the design of the Mine and any failure of that design to meet the
Technical Requirements in Part 4 of Exhibit 3. Within 10 Business
Days of such notification Mopps shall resubmit the amended design of
the Facility and the provisions of this Section 3.1 shall apply to
such resubmitted design. If within 10 Business Days of the submission
of any design MORILA shall not have objected
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to the same or has signified to Mopps its approval of such design
then the same shall be incorporated in the Facility Design.
3.2 MORILA CONSENTS
MORILA shall, at its own cost and in a timely manner, obtain any
Consent required to carry out the Project in conformity with the
Facility Design and the provisions of this Agreement
3.3 BALANCE OF PLANT
MORILA shall procure from the consultant nominated by Mopps prior to
the date of this Agreement of all shop drawings and other fabrication
detail designs to be carried out by the Contractors.
3.4 REVIEW OF DOCUMENTS
3.4.1 Any design documents and other related design information to
be prepared by the Contractors in connection with the
Facility shall be submitted to Mopps who shall only raise
objection on the grounds of safety, operability or
non-compliance with the Facility Design. Any objection
together with reasons shall be raised within 10 days of
receipt by Mopps of the same.
3.4.2 Where any document or information has been provided to Mopps
pursuant to this Section 3.4, MORILA shall ensure that any
such design document or information shall not be implemented
until the time has expired for raising an objection thereto
or, if an objection is raised, until any revised design has
been submitted to Mopps and the period for non-objection has
passed (again without there being any objection).
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3.5 MINE MODIFICATIONS DESIGN
The Parties recognise that in order to obtain efficiency in design
MORILA shall retain the same consultant engaged to carry out the
design pursuant to Section 3.3 to design the Mine Modifications.
SECTION 4
PLANT
4.1 DELIVERY
Subject to the provisions of Sections 6 and 13, Mopps shall deliver
to MORILA all the Plant ex works at the place of manufacture in
accordance with the Shipment Schedule in order for MORILA to arrange
transit of the Plant to the Site.
4.2 NOTIFICATION
On each and every occasion on which a shipment of Plant, including
for the avoidance of doubt the First Unit, shall be ready for
collection by MORILA, Mopps shall furnish to MORILA not later than 15
Business Days before the expected date of that shipment of Plant and
where practical by electronic data interchange:
4.2.1 a pro-forma invoice for that shipment detailing the Plant
and showing its value expressed in Ffr at the rate ruling on
the last Business Day immediately before its preparation;
4.2.2 the date such Plant will be ready for collection;
4.2.3 the location of the works from which the shipment is to be
made being in any of the United Kingdom, Finland or South
Africa;
4.2.4 where the Plant shall have been packaged, details of its
packaging; and
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4.2.5 any other details which MORILA shall reasonably require to
facilitate delivery of the shipment to Site and to enable
MORILA to achieve permission from the relevant customs
authorities for that purpose.
4.3 NOTIFICATION OF TRANSIT
Within 10 Business Days of the arrival of each shipment of the Plant
at the Site MORILA shall notify Mopps, or cause Mopps to be notified,
of:
4.3.1 details of the Plant included in that shipment;
4.3.2 the date on which such delivery arrived at the Site; and
4.3.3 in the case of any damage having occurred in transit,
sufficient documentary evidence of such damage as Mopps
shall reasonably require in order to claim against either or
both insurers and shippers of that shipment.
4.4 MORILA shall be responsible for the safe storage at the Site of each
shipment of Plant until the Balance of Plant is ready to receive the
same.
SECTION 5
BALANCE OF PLANT AND MINE MODIFICATIONS
5.1 OBLIGATIONS OF MORILA
MORILA shall:
5.1.1 supply the Balance of Plant pursuant to Part 2 of Exhibit 3;
and
5.1.2 procure the installation of the Plant and the Balance of
Plant under the supervision of the Operator; and
5.1.3 require the Operator to Commission the Facility, and provide
sufficient labour (and related resources) to enable the
Operator to do so,
in accordance with the Facility Design.
5.2 KEY MILESTONES
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MORILA shall carry out the Balance of Plant so that each stage is
completed to the level required to achieve the relevant Key Milestone
by the relevant Key Milestone Date as set out in Exhibit 12. Where
work is required to be carried out to the Existing Facility then
provided that the same is carried out in accordance with the Facility
Design MORILA shall be deemed to have been authorised by Mopps to
have procured those works notwithstanding that title in the Existing
Facility shall have passed to Mopps.
5.3 SOURCING BY MOPPS
There appears in Part 2 of Exhibit 3 those items of the Balance of
Plant the supply of which are to be Sourced by Mopps. In respect of
those items unless the Parties otherwise agree in writing, Mopps
shall carry out competitive tender procedures on terms agreed between
the Parties in relation to such supply and shall furnish to MORILA a
report on the tenders received with a recommendation as to the
preferred tender and the reasons for that preference.
5.4 PROCUREMENT
Notwithstanding the provisions of Section 5.3 all the Balance of
Plant shall be procured by MORILA and where the provisions of Section
5.3 apply unless there shall be a mathematical error in the
recommendation given under Section 5.3 as a consequence of which the
recommendation shall be amended, MORILA shall enter into a contract
with each supplier so recommended in substantially the same terms as
submitted by MORILA to Mopps prior to the commencement of the
competitive tender procedures.
5.5 MINE MODIFICATIONS
The Parties recognise the benefit of engaging the same Contractors to
carry out the Mine Modifications as are engaged to carry out the
Balance of Plant works. If the costs thereof when aggregated with the
costs of the Balance of Plant do not exceed the sum appearing in
Section 12.1.1 then the costs of executing the Mine Modifications at
MORILA's option may be included in the costs of the Balance of Plant
so as to avoid separate accounting by the said Contractors. The
Parties agree, however, that Mopps shall have no liability for the
Mine Modifications
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including, for the avoidance of doubt, no liability for operation
and maintenance of the Mine Modifications, and notwithstanding the
provisions of Section 6, ownership in the Mine Modifications shall
remain with MORILA.
5.6 PROJECT MANAGEMENT
MORILA shall engage the Operator to monitor and supervise the
execution of the works for the Balance of Plant and to assist MORILA
in the management of the procurement of the Balance of Plant and to
assist in the Commissioning of the Facility.
5.7 BOP AND EXISTING FACILITY WARRANTIES
MORILA shall to the extent that they are assignable and after
assignment enforceable by Mopps assign the BOP Warranties and
Existing Facility Warranties to Mopps or, if they are not so
assignable and enforceable, seek to enforce the same for the benefit
of Mopps on request by Mopps.
SECTION 6
TITLE
6.1 SURPLUS ITEMS
There are at the Site certain existing structure and components
currently used in connection with the generation of electricity. To
the extent that these structures and components do not form part of
the Existing Facility, MORILA shall cause the same to be removed as
part of the works for the Balance of Plant when they have been
declared redundant by Mopps . Title in those structures and
components shall remain vested in MORILA.
6.2 EXISTING FACILITY
Title in the Existing Facility shall pass from MORILA to Mopps on
satisfaction of all of the Suspensive Conditions referred to in
Section 2.1, however responsibility for the operation and maintenance
of the Existing Facility shall remain with MORILA until the last
Relevant Commercial Operations Date in time. The
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Consideration for such transfer shall be US$ 0 (Zero) accountable in
accordance in with Section 12.1.3.
6.3 TITLE IN THE BALANCE OF PLANT
Title in the Balance of Plant or any part thereof shall pass from
MORILA to Mopps on the date that the same shall pass the Completion
Tests.
6.4 RESERVATION OF TITLE
6.4.1 Notwithstanding any terms implied by law or by business
convention no title in any of the Plant nor in any of the
Spare Parts shall pass to MORILA unless and until the Final
Payment Date has occurred. Until then, notwithstanding the
fact that any or all of the Plant may be physically attached
to the Balance of Plant or that any of the Spare Parts may
be attached to the Plant or Balance of Plant, the Plant and
the Spare Parts shall be deemed to be Reusable and title in
the Plant and the Spare Parts shall remain vested in Mopps.
6.4.2 Notwithstanding any terms implied by law or by business
convention following the transfer of title in either or both
of the Balance of Plant and the Existing Facility no title
in any of the Balance of Plant or the Existing Facility as
the case may be shall pass to MORILA unless and until the
Final Payment Date has occurred.
6.5 REUSABLE AND SALVAGE
The Parties recognise that under the mining convention between MORILA
and GRM there is an obligation for MORILA to remove all assets
including the Facility upon expiry or earlier termination of that
convention and accordingly the same does not fall within domain
public. As between the Parties the assets incorporated in the
Facility are identified as between Reusable and Salvage.
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6.6 RESTRICTION ON DEALING
Until the Final Payment Date MORILA shall not be entitled to nor
shall it purport to sell transfer lease, charge, assign by way of
security or otherwise deal in or encumber the Facility and the
relationship between Mopps and MORILA in respect of the Facility
including any proceeds of sale or other consideration therefor shall
be a fiduciary one.
SECTION 7
SITE CONDITION
7.1 GROUND AND SITE CONDITION
MORILA shall satisfy itself and, to the extent it shall not have done
so at the date hereof, cause to be carried out as part of the Balance
of Plant works, studies as to the nature of the climatic,
hydrological and general conditions of the Site, the nature of the
ground and subsoil, the form and nature of the Site, the risk of
injury or damage to property adjacent to the Site and to occupiers of
such property, the nature of the materials (whether natural or
otherwise) to be excavated, the nature of the design, work and
materials necessary for the execution of the works; and shall provide
written information to Mopps in relation to the above.
7.2 RELIANCE ON INFORMATION
Mopps shall be entitled to rely on the information provided by MORILA
pursuant to Section 7.1 unless there shall be a manifest error in
that information in which case, Mopps shall notify MORILA within 28
days of receipt of the same and, unless the Parties otherwise agree,
MORILA shall cause the study to be re-executed.
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7.3 AS FOUND CONDITIONS
If, whilst the same is being carried out, the works for the Balance
of Plant shall reveal that the ground or other conditions as found
are not those which were revealed by the information provided by
MORILA pursuant to Section 7.1 then MORILA shall notify Mopps who
shall, to the extent necessary, amend the design in accordance with
the procedures contained in Section 3.1 and MORILA shall issue a
variation or change order under the relevant contract for the Balance
of Plant. The costs so incurred shall be added to and become part of
the BOP Payment and the additional amounts properly payable by MORILA
to the Contractors in respect thereof shall be recoverable by MORILA
in accordance with Section 12.1.1.
SECTION 8
COMMISSIONING OF FACILITY
8.1 MINE AND OPERATOR'S STAFF
MORILA shall be responsible for ensuring that prior to the
Commissioning Commencement Date (i) the Mine is capable of taking
load from the Facility; and (ii) the relevant staff of the Operator
are available on the Site to supply the copy Test Certificates in
accordance with Section 8.4.
8.2 COMMISSIONING
Where Commissioning is to be carried out in respect of sections of
the Facility capable of generation and supply of energy to the Mine,
the provisions of this Section 8 shall apply in respect of each such
section of the Facility mutatis mutandis.
8.3 RELEVANT COMMERCIAL OPERATIONS DATE
The Relevant Commercial Operations Date shall be deemed to have been
achieved on the earlier of:
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8.3.1 15 weeks after notification that the relevant shipment of
Plant is ready for collection in accordance with Section
4.2;
8.3.2 8 weeks after the date on which MORILA notifies Mopps that
the relevant Unit is ready to start the Completion Tests;
and
8.3.3 the date on which the relevant Unit passes the Completion
Tests,
provided always that to the extent the Relevant Target Commercial
Dates of the relevant Units shall not have expired, the periods under
Sections 8.3.1 and 8.3.2 above shall be extended day for day in
respect of any failure to pass the Completion Tests due to any
default by Mopps.
8.4 TEST CERTIFICATE
MORILA shall cause the Operator to supply to Mopps and MORILA copy
Test Certificates to confirm that the Facility has achieved the
Technical Requirements set out in Part 4 of Exhibit 3 and has passed
the Completion Tests.
8.5 MANUALS AND RECORDS
Prior to the Relevant Commercial Operations Date Mopps shall provide
at the request of MORILA to the Operator draft operation and
maintenance manuals and shall assist MORILA in the preparation of
draft as-built drawings. Not later than 6 months after the last
Relevant Commercial Operations Date in time Mopps shall provide to
the Operator operation and maintenance manuals and upon submission to
it by MORILA of the draft as-built drawings will review the same with
a view to assisting it in the finalisation of the as-built drawings.
In addition Mopps shall furnish to MORILA proformas of the operation,
maintenance, Plant running and other records which would ordinarily
be kept in accordance with Good Utility Practice.
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SECTION 9
SPARE PARTS
9.1 INITIAL SPARE PARTS
9.1.1 Prior to the date to be calculated in accordance with
Section 8.3 Mopps shall supply to MORILA the Spare Parts
detailed in the Spare Parts Inventory as set out in Part 3
of Exhibit 4. Unless the Parties shall otherwise agree Mopps
shall supply all Spare Parts ex works (in which case, the
provisions of Section 4.1 shall apply mutatis mutandis).
9.1.2 Following each Relevant Commercial Operations Date, or such
other date agreed by the Parties, in the event that a Spare
Part is required for any of that Unit, its associated Plant
and related Balance of Plant by MORILA, MORILA shall cause
the Operator to deliver an Order Form to Mopps substantially
in the form set out in Part 4 of Exhibit 4. Mopps shall use
its reasonable endeavours to deliver ex works the Spare
Parts detailed in such order within the time periods for
such delivery in accordance with the Spare Parts Schedule.
9.2 STORAGE FACILITIES
MORILA shall provide storage facilities which, in the reasonable
opinion of Mopps are sufficient to store the Spare Parts detailed in
the Spare Parts Inventory in a secure and safe manner so as to
prevent damage to the Spare Parts and to the standard required in
order that when the same have been incorporated in the Plant they can
be used in accordance with Good Utility Practice.
9.3 SPARE PARTS PAYMENT
Mopps shall be entitled to receive the Spare Parts Payment and the
Fixed Spare Parts Payment in accordance with Section 12.
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SECTION 10
INCENTIVE REGIME
10.1 BASIS OF REGIME
The payment regime under Section 12.2 will be subject to an incentive
regime based upon a Guaranteed Contracted Capacity, Guaranteed Fuel
Efficiency Rate and Guaranteed Lube Oil Consumption Rate, provided
that:
10.1.1 the Energy Support Agreement remains extant; or
10.1.2 in the event that the Energy Support Agreement is
terminated, a replacement contract is entered into by MORILA
after termination of the Energy Support Agreement, and:
(a) MORILA shall have notified Mopps of the identity of the
operator pursuant to such replacement contract prior to
the commencement of the term; and
(b) Mopps shall have approved of such operator in writing
prior to the commencement of such term (such approval
to be based on a reasonable evaluation of such
operator's competency and experience in respect of
operation of electricity generating facilities of the
same type, kind and quality as the Facility).
10.2 AVAILABILITY OF GUARANTEED CONTRACTED CAPACITY
10.2.1 Subject to Section 10.1, during the Deferred Payment Period
and subject to the terms and conditions of this Agreement,
Mopps shall guarantee that the Facility shall be Available
in accordance with the Guaranteed Contracted Capacity.
10.2.2 MORILA shall require the Operator to furnish to Mopps within
3 Business Days of the end of each month a statement showing
the meter readings for energy produced during that month
(such meter readings, unless adjusted in accordance with the
Energy Support Agreement, shall
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be final and binding on both Parties) together with a
report showing the scheduled and non-scheduled outages
occurring during that month.
10.2.3 If the Facility has not provided Availability in accordance
with the Guaranteed Contracted Capacity pursuant to Section
10.2.1 Mopps shall pay MORILA liquidated damages for the
shortfall in Availability of the Guaranteed Contracted
Capacity calculated in accordance with Part 4 of Exhibit 10.
Such damages shall be deductible from the payments otherwise
to be made by MORILA to Mopps pursuant to Section 12 to the
extent that the calculation of such damages is undisputed by
the Parties. If either Party wishes to dispute that the
calculation of such damages is not in accordance with the
formula or that any of the inputs other than the definition
of LD are incorrect, it shall notify the other Party in
writing of the existence of such dispute within 14 days. The
dispute shall be resolved in accordance with the provisions
of Section 17 and all amounts subsequently agreed or
determined to be due and payable shall be paid by Mopps to
MORILA within seven days of resolution or determination of
such dispute.
10.2.4 If following the last Relevant Commercial Operations Date in
time the Availability of the Facility shall either fall
below 16.5 MW for a continuous period exceeding 30 days or
shall fall below 14 MW for a continuous period exceeding 5
days due to a Catastrophic Technical Failure then:
(i) MORILA shall reduce the load of the Mine by inter alia
closing down such parts of the Mine as are necessary
for that purpose;
(ii) Mopps shall, at Mopps' cost, seek to acquire temporary
emergency hire generating sets sufficient to meet the
load referred to above and to install the same at the
Site within 21 days of the reduction of the load in
accordance with paragraph (i) above;
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(iii) if Mopps shall be unable or unwilling to acquire the
emergency hire generating sets in accordance with
paragraph (ii) above then without prejudice to its
other rights hereunder MORILA may seek to obtain
emergency hire generating sets in substitution for
those to be otherwise acquired by Mopps;
(iv) Mopps shall use all prudent and commercial endeavours
to cause the reinstatement of the Facility back to not
less than the lower of the two figures appearing under
that designation in Part 1 of Exhibit 8 but if it
shall fail so to do within a period of 9 months
following the reduction in load under paragraph (i)
above then either Party may give notice to the other
and such notice shall be treated as if it were a
notice by MORILA pursuant to Sections 16.11.2 and
16.12.1;
(v) Until either Mopps shall have caused the reinstatement
of the Facility back to not less than the level of
Guaranteed Contracted Capacity referred to in
paragraph (iv) above, or notice shall have been given
pursuant to paragraph (iv) above, the maximum
liability of Mopps shall not exceed an amount
equivalent to 12 x PPo where PPo is as defined in Part
1 of Exhibit 10.
10.3 GUARANTEED FUEL EFFICIENCY RATE
10.3.1 Subject to Section 10.1, during the Deferred Payment Period
and subject to the terms and conditions of this Agreement,
Mopps shall guarantee to MORILA the Guaranteed Fuel
Efficiency Rate for the Facility.
10.3.2 Within 20 Business Days of each Quarter Day following a
Relevant Commercial Operations Date MORILA shall cause the
Operator to calculate the Fuel Efficiency Rate of the
Facility in accordance with the procedure set out in Part 2
of Exhibit 8.
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10.3.3 MORILA shall ensure that the Operator shall monitor the
devices to be used to measure the ambient temperature and
will incorporate those readings accurately in any
calculation referred to in Section 10.3.2. If Mopps shall
request MORILA for copies of those readings MORILA will
ensure that the Operator delivers to Mopps the same within
10 Business Days of that request.
10.3.4 If the results of the calculation carried out pursuant to
Section 10.3.2 above are different from the Guaranteed Fuel
Efficiency Rate then the variation shall be calculated in
accordance with Part 2 of Exhibit 8.
10.4 GUARANTEED LUBE OIL CONSUMPTION RATE
10.4.1 Subject to Section 10.1, during the Deferred Payment Period
and subject to the terms and conditions of this Agreement,
Mopps shall guarantee to MORILA the Guaranteed Lube Oil
Consumption Rate for the Facility.
10.4.2 Within 20 Business Days of the end of each 12 month period
following a Relevant Commercial Operations Date MORILA shall
cause the Operator to calculate the Lube Oil Consumption
Rate of the Facility in accordance with the procedure set
out in Part 3 of Exhibit 8.
10.4.3 MORILA shall ensure that the Operator shall monitor the
devices to be used to measure the ambient temperature and
will incorporate those readings accurately in any
calculation referred to in Section 10.4.2. If Mopps shall
request MORILA for copies of those readings MORILA will
ensure that the Operator delivers to Mopps the same within
10 Business Days of that request.
10.4.4 If the results of the calculation carried out pursuant to
Section 10.4.2 above are different from the Guaranteed Lube
Oil Consumption Rate then the variation shall be calculated
in accordance with Part 3 of Exhibit 8. In the event that
the result of such calculation is positive then MORILA shall
be entitled to invoice Mopps for the Lube Oil Consumption
Adjustment Payment. In the event that the result of such
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calculation is negative Mopps shall be entitled to invoice
MORILA for the Lube Oil Consumption Adjustment Payment.
SECTION 11
FUEL, WATER AND LUBE OIL
11.1 SUPPLY
MORILA shall be responsible for the supply of:
11.1.1 Fuel in accordance with the Fuel Specification;
11.1.2 water in accordance with the Water Specification;
11.1.3 lube oil in accordance with the Lube Oil Specification; and
11.1.4 other consumables except for those set out in the list of
Spare Parts referred to in Part 3 of Exhibit 4.
11.2 TESTING
11.2.1 MORILA shall ensure that prior to the discharge from the
road tanker on delivery of Fuel to the Facility the Operator
carries out tests on that Fuel pursuant to the Energy
Support Agreement to verify the fact that all Fuel meets the
Fuel Specification as set out in Part 2 of Exhibit 9.
11.2.2 MORILA shall ensure that the Operator carries out random
tests on the supply of water at intervals not exceeding
seven (7) days to verify the fact that all water meets the
Water Specification as set out in Part 3 of Exhibit 9.
11.2.3 MORILA shall ensure that the Operator carries out tests on
all lube oil supplied to the Facility prior to such lube oil
being discharged into the lube oil tanks or used in the
Facility to verify the fact that all lube oil meets the Lube
Oil Specification as set out in Part 4 of Exhibit 9.
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11.2.4 MORILA shall ensure that the Operator provides not less than
monthly copy test certificates relating to each and every
delivery of Fuel and lube oil and relating to the water to
both MORILA and Mopps.
11.3 FAILURE OF TESTS
11.3.1 In the event that the test certificates provided pursuant to
Section 11.2.4 indicate that a delivery of Fuel does not
satisfy the Fuel Specification then MORILA shall reject the
same. If it shall fail so to do or if the Fuel tanks are
filled or replenished with Fuel which has not been tested in
accordance with Section 11.2.1, then until the out of
specification Fuel shall have been removed and the Fuel
tanks flushed and cleansed, Mopps shall be relieved, to the
extent to which it is reasonable, of all obligations
relating to Availability, Fuel Efficiency Rate and Lube Oil
Consumption Rate of the Plant and shall be entitled to
continue to receive payments in accordance with Section 12.
11.3.2 In the event that the test certificates provided under
Section 11.2.4 indicate that the water does not satisfy the
Water Specification then to the extent that continued
operation of one or more Units would not be in accordance
with Good Utility Practice, Mopps shall, to the extent to
which it is reasonable, be relieved of all obligations
relating to Availability, Fuel Efficiency Rate and Lube Oil
Consumption Rate of the Plant and shall be entitled to
continue to receive payments in accordance with Section 12.
11.3.3 In the event that test certificates provided pursuant to
Section 11.2.4 indicate that a delivery of lube oil does not
satisfy the Lube Oil Specification then MORILA shall reject
the same. If it shall fail to do so or if the lube oil tanks
are filled or replenished with lube oil which has not been
tested in accordance with Section 11.2.3, then until the out
of specification lube oil shall have been removed and the
lube oil tanks flushed and cleansed, Mopps shall, to the
extent to which it is reasonable, be relieved of all
obligations relating to Availability, Fuel Efficiency Rate
and Lube Oil Consumption Rate of the Plant and shall
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be entitled to continue to receive payments in accordance
with Section 12.
11.4 WASTE
MORILA shall be responsible for the disposal of the sludge from the
centrifuge or other Fuel cleansing equipment and for the disposal of
the waste lube oil and other used consumables and Mopps shall not be
required to provide as part of the Plant facilities for the retention
or disposal of the same.
SECTION 12
ACCOUNTING
12.1 BALANCE OF PLANT AND EXISTING FACILITY ACCOUNT
12.1.1 In each month during the period up to and including the
month in which the last Relevant Commercial Operations Date
in time occurs MORILA shall submit monthly accounts to Mopps
in respect of the Balance of Plant procured by MORILA in
respect of payments made by MORILA to Contractors up to a
total aggregate not exceeding US$4.5 million.
12.1.2 In the event that the aggregate of the monthly accounts
submitted by MORILA in accordance with Section 12.1.1 exceed
the figure referred to in Section 12.1.1, the amount by
which such aggregate exceeds the said figure shall be borne
by MORILA with no recourse to Mopps.
12.1.3 On the last Relevant Commercial Operations Date in time
Mopps shall owe to MORILA a sum equal to the Consideration,
such amount being the EF Debt as between the Parties. Unless
this Agreement shall be terminated pursuant to Section 16
(in which case the consequences shall be dealt with in
accordance with Section 16.16) then the EF Debt shall be
redeemed only in accordance with Part 5 of Exhibit 10. Each
month Mopps shall invoice MORILA an amount equal to 1/120 of
the Consideration.
12.2 FACILITY AND SPARES
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In each month of the Deferred Payment Period and following a Relevant
Commercial Operations Date, Mopps shall submit to MORILA by the
seventh day of that month an invoice expressed in US Dollars showing
the amounts due:
12.2.1 in respect of the Plant, the Plant Payment calculated in
accordance with Part 1 of Exhibit 10; and
12.2.2 in respect of the BOP, the BOP Payment calculated in
accordance with Part 2 of Exhibit 10; and
12.2.3 in respect of Spare Parts which are dependent on hours run,
the Spare Parts Payment calculated in accordance with Part 3
of Exhibit 10; and
12.2.4 in respect of the Existing Facility, the Existing Facility
Payment calculated in accordance with Part 5 of Exhibit 10;
12.2.5 in respect of Spare Parts which are not dependent on hours
run, the Fixed Spare Parts Payment Payment calculated in
accordance with Part 6 of Exhibit 10; and
12.2.6 in respect of the incentive payments calculated pursuant to
Section 10 (either as an amount due from MORILA to Mopps or
as an amount due from Mopps to MORILA) calculated in
accordance with Part 4 of Exhibit 10.
12.3 SETTLEMENT OF INVOICE
Any invoice delivered pursuant to Section 12.2 shall show amounts due
net of tax and MORILA shall settle such invoice delivered in
accordance with Section 12.2 or any undisputed part of such invoice
within 30 days of the date of its receipt.
12.4 INTEREST
Without prejudice to Mopps's right to receive payment on the due
date, if and to the extent that payment is not received on the due
date, interest shall accrue on any sum due and payable to Mopps and
outstanding from the due date for payment until receipt of such
payment at the Rate of Interest (or such other rate
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as may be specified in this Agreement in respect of such payment)
calculated on a daily basis and on the basis of a 365 day year.
12.5 BUSINESS DAY
Where a payment falls to be made on a day which is not a Business
Day, it shall be paid on the next following Business Day.
12.6 TAXATION
All amounts payable under this Agreement by MORILA to Mopps shall be
paid free and clear of any assessment under Mali law to tax
deductions or withholdings unless the assessment to tax deduction or
withholding is required by law, in which event the amount payable by
MORILA shall be increased so as to ensure that the net amount
received by Mopps will equal the full amount which it would have
received had the benefit had no such assessment, deduction or
withholding been made or incurred.
12.7 DISPUTED INVOICES
If MORILA wishes to dispute any amount (or any part of an amount) set
out in an invoice delivered pursuant to Section 12.2, MORILA shall
notify Mopps in writing of the existence of such dispute within 14
days of receipt of the relevant invoice. The dispute shall be
resolved in accordance with the provisions of Section 17 and all
amounts subsequently agreed or determined to be due and payable
including interest at the Rate of Interest shall be payable within
seven days of resolution or determination of such dispute.
12.8 STATEMENT ERRORS
In the event that either Party becomes aware of an error in a
statement such Party shall as soon as reasonably practical after the
discovery of the error notify the other Party of such error and Mopps
or MORILA (as the case may be) shall pay any amount due to the other
without the addition of any interest in respect of such error within
ten (10) Business Days of such notification, provided that no
adjustment shall be made in respect of any statement in respect of
which notification is given more than two years after the date of
such statement.
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12.9 PLACE, TIMING AND CURRENCY OF PAYMENT
12.9.1 Notwithstanding anything to the contrary in this Agreement,
all payments to be made by either Party under this
Agreement, however denominated, shall be payable in US
Dollars in accordance with this Section 12.9.
12.9.2 Any payment that becomes due and payable on a day that is
not a Business Day shall if not paid on the preceding
Business Day be paid on the next succeeding Business Day
12.10 RECORDS
Unless otherwise provided herein, either Party shall have the right,
upon reasonable prior written notice to the other Party, to either
examine or make copies or both (as the case may be) of the records
and data of the other Party relating to this Agreement at any time
during normal business hours during the period such records and data
are required to be maintained. All such records and data shall be
maintained for a minimum of two (2) years after the creation of such
records or data and for any additional time period required under
Applicable Law.
SECTION 13
INSURANCE
13.1 INSURANCES REQUIRED
13.1.1 MORILA shall, at its own cost and expense obtain and
maintain, or cause to be obtained and maintained from the
date of this Agreement the policies of insurance, the
minimum requirements of which are set out in Exhibit 5, in
the amounts specified and during the period or periods
mentioned in Exhibit 5. Mopps shall be named as one of a
number of insureds with a severable interest on any such
insurance procured by MORILA.
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13.1.2 MORILA shall be free at any time to increase the amounts of
cover above the amounts therein specified, but MORILA shall
not reduce such amounts without the prior written consent of
Mopps.
13.1.3 MORILA shall not be in breach of its obligations hereunder
if and to the extent that any particular insurance is
unavailable to it under commercially reasonable terms except
where such non-availability shall be due to the act or
neglect of MORILA.
13.1.4 If and to the extent an Insurable Event ceases to be
insurable at reasonable commercial terms then the Parties
shall meet to discuss methods of addressing the issue and
unless the reason for the insurance no longer being so
available shall arise out of the act or neglect of MORILA
then until insurance shall be so available at commercial
terms the previously Insurable Event shall be deemed to be a
Non-Insurable Event.
13.2 MORILA shall cause its insurers or agents to provide to Mopps copies
of the insurance policies, certificates of insurance evidencing
such policies and endorsements listed above. Failure by MORILA to
obtain the insurance coverage or certificates of insurance required
by this Section 13 shall not in any way relieve or limit its
obligations and liabilities under any provision of this Agreement. If
MORILA shall fail to procure or maintain any insurance required
pursuant to this Section 13, then Mopps shall have the right to
procure such insurance in accordance with the requirements of
Exhibit 5 and shall be entitled to recover the premiums paid for
such insurance from MORILA on demand.
13.3 Each Party shall provide to the other Party and the Operator any
underwriters' reports or other reports received by either Party from
any insurer; provided that neither Party shall disclose such reports
to any other person without the relevant underwriter's consent.
13.4 The proceeds of any insurance claim in respect of physical loss or
damage to the Facility as a result of an Insurable Event shall be
paid into an account in the name of Mopps and shall be applied
towards the remedy of such loss or damage as soon as reasonably
possible or, to the extent that either Party has already incurred
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reasonable costs in the remedy of such loss or damage, such proceeds
shall be applied towards the reimbursement of such Party's reasonable
costs. Any dispute in relation to the application of such proceeds
shall be resolved in accordance with Section 17.
13.5 MORILA shall ensure that the policies of insurance for which it is
responsible shall not be invalidated as regards the respective rights
and interests of MORILA and Mopps and that the insurers will not seek
directly or indirectly to avoid any liability under any of the
policies to MORILA or Mopps because of any act, neglect, error or
omission made by any other insured under the policy concerned
(whether occurring before or after inception of the policy),
including, without limitation, any failure by any such other insured
to disclose any material fact, circumstance or occurrence, any
misrepresentation by any such other insured, any breach or
non-fulfilment by any such other insured whether or not any such
fact, neglect, error or omission could, if known at the time, have
affected any decision by the insurers to grant the policy, to agree
any particular term or terms to the policy (including without
limitation this provision) and the amount in relation to the policy
or to liability which might arise thereunder.
SECTION 14
INSURABLE/NON-INSURABLE EVENTS
14.1 OBLIGATION TO NOTIFY
14.1.1 If by reason of an Insurable or Non-Insurable Event a Party
claims that it is wholly or partially unable to carry out
its obligations under this Agreement, the affected Party
shall:
(a) give the other Party notice of the event(s) as soon as
practicable, but in any event, not later than
forty-eight (48) hours after the affected Party becomes
aware of the occurrence of that event or those events
or, if the means of providing such notice within such
period is not available, not later than six (6) hours
after the resumption of the means of providing such
notice;
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(b) give the other Party a second notice, describing that
event or those events in reasonable detail and, to the
extent that it can be reasonably determined at the time
of the second notice, providing a preliminary
evaluation of the obligations affected, a preliminary
estimate of the period of time that the affected Party
will be unable to perform the obligations, and other
relevant matters as soon as practicable, but in any
event, not later than seven (7) days after the initial
notice of the occurrence of the Insurable or
Non-Insurable Event(s) is given by the affected Party;
and
(c) when appropriate or when reasonably requested to do so
by the other Party, shall provide further notices to
the other Party more fully describing the event or
events and its cause or causes and providing or
updating information relating to the efforts of the
affected Party to avoid and/or to mitigate the effect
or effects thereof and estimates, to the extent
practicable, of the time that the affected Party
reasonably expects it will be unable to carry out any
of its affected obligations due to that event or those
events.
14.1.2 The affected Party shall also provide notice to the other
Party of (i) with respect to an ongoing Insurable or
Non-Insurable Event, the cessation of that event, and (ii)
the affected Party's ability to recommence performance of
its obligations under this Agreement, as soon as practicable
after becoming aware of each of (i) and (ii) above, but in
any event (and subject to the accommodation in Section
14.1.1 which shall apply, mutatis mutandis, where means of
providing such notice within such period is not available),
not later than seven (7) days after becoming so aware.
14.1.3 Failure by the affected Party to give notice of an Insurable
or Non-Insurable Event to the other Party within the periods
required by Section 14.1.1 shall not prevent the affected
Party from giving such notice at a later time; provided
however, that in such case, the affected Party shall
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not be excused from any failure or delay in complying with
its obligations under or pursuant to this Agreement until
the notice required by Section 14.1.1 has been given. If
such notice is given within the forty-eight (48) hour period
or six (6) hour period as required by Section 14.1.1, then
unless the provisions of Section 14.2 apply, the affected
Party shall be excused from such failure or delay pursuant
from the date of commencement of the relevant event provided
that no Insurable Event or Non-Insurable Event shall excuse
the late payment of money when due.
14.2 MITIGATION
The Parties shall discuss what steps are reasonably required to
restore the affected Party's ability to perform its obligations under
this Agreement which are affected by an Insurable or Non-Insurable
Event and shall endeavour to reach agreement as to how the effects of
the Insurable or Non-Insurable Event may best be mitigated.
14.3 PRIOR TO OPERATIONAL PHASE
14.3.1 In the event of the occurrence of an Insurable or
Non-Insurable Event prior to the delivery of Plant ex works
in accordance with Section 4.1, subject to Section 14.1.3,
Mopps shall not be liable for any failure or delay in
performing its obligations (other than an obligation to make
a payment) under or pursuant to this Agreement to the extent
that such failure or delay in performance has been caused or
contributed to by one or more Insurable or Non-Insurable
Events or its effect or their effects or by any combination
thereof.
14.3.2 In the event of the occurrence of an Insurable Event or
Non-Insurable Event prior to the Relevant Commercial
Operations Date but after the delivery of the relevant Plant
ex works in accordance with Section 4.1 then unless the same
was caused by the neglect or wilful default of Mopps, MORILA
shall pay to Mopps from each Relevant Target Commercial
Operations Date:
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(a) the Plant Payment calculated in accordance with Part 1
of Exhibit 10;
(b) the BOP Payment calculated in accordance with Part 2 of
Exhibit 10;
(c) the Spare Parts Payment calculated in accordance with
Part 3 of Exhibit 10;
(d) the Existing Facility Payment calculated in accordance
with Part 5 of Exhibit 10; and
(e) the Fixed Spare Parts Payment calculated in accordance
with Part 6 of Exhibit 10.
14.3.3 In respect of physical loss or damage occurring to the
Facility or a relevant part thereof in the event of the
occurrence of an Insurable Event prior to the Relevant
Commercial Operations Date but after the delivery of the
relevant Plant ex works in accordance with Section 4.1:
(a) MORILA shall procure the replacement or repair of
either or both any Balance of Plant and Existing
Facility so lost or damaged and the provisions of
Sections 5.3 and 5.4 shall have effect as if the
replacement or repair of the Balance of Plant was its
initial procurement;
(b) Mopps shall be responsible for the replacement or
repair of any Plant so lost or damaged;
(c) the provisions of Section 13.4 shall apply,
(d) Mopps shall bear the deductible under the relevant
policies of insurance unless the damage shall have been
caused by MORILA or persons for whom MORILA shall be
responsible and subject thereto Mopps shall pay to
MORILA out of the account referred to in Section 13.4
the reasonable costs properly incurred in carrying out
its obligations under Section
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14.3.3(a) up to the amount of the insurance proceeds
received in respect of either or both the Balance of
Plant and Existing Facility, and
(e) MORILA shall pay to Mopps from the Relevant Target
Commercial Operations Date the amounts appearing in
paragraphs (a) to (e) inclusive of Section 14.3.2.
14.3.4 Subject to Section 14.3.2, in the event of the occurrence of
a Non-Insurable Event prior to a Relevant Commercial
Operations Date but after the delivery of Plant ex works in
accordance with Section 4.1, MORILA shall have the option to
terminate this Agreement in accordance with Section 16.14.
14.4 DURING OPERATIONAL PHASE
14.4.1 In the event of the occurrence of a Non-Insurable Event
after a Relevant Commercial Operations Date being a
breakdown (including a machinery or equipment breakdown) of
that part of the Facility which is the subject of the
Relevant Commercial Operations Date and which shall not have
been caused by any of the intervening act of a third party
(which for this purpose shall exclude the Operator), the
occurrence of an Insurable Event, or the act or default of
MORILA:
(i) if the breakdown (including machinery or equipment
breakdown) shall relate to the Plant, Mopps shall not
be relieved of its obligations under this Agreement;
and
(ii) if the breakdown (including machinery or equipment
breakdown) shall relate to the Balance of Plant,
MORILA shall be entitled to apply any proceeds of the
BOP Warranties, if any, towards its reasonable costs
properly incurred in procuring the replacement or
repair of the Balance of Plant; and
(iii) if the breakdown (including machinery or equipment
breakdown) shall relate to the Existing Facility,
MORILA shall be entitled to apply any proceeds of the
Existing Facility
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Warranties, if any, towards its reasonable costs
properly incurred in procuring the replacement or
repair of the Existing Facility.
14.4.2 Subject to Section 14.4.1, in the event of the occurrence of
an Insurable or Non-Insurable Event following a Relevant
Commercial Operations Date, MORILA shall pay:
(a) the Plant Payment calculated in accordance with Part 1
of Exhibit 10;
(b) the BOP Payment calculated in accordance with Part 2 of
Exhibit 10;
(c) the Spare Parts Payment calculated in accordance with
Part 3 of Exhibit 10;
(d) the Existing Facility Payment calculated in accordance
with Part 5 of Exhibit 10; and
(e) the Fixed Spare Parts Payment calculated in accordance
with Part 6 of Exhibit 10.
14.4.3 In respect of physical loss or damage occurring to the
Facility or the relevant part thereof in the event of the
occurrence of an Insurable Event following a Relevant
Commercial Operations Date:
(a) MORILA shall procure the replacement or repair of
either or both any Balance of Plant and Existing
Facility so lost or damaged and the provisions of
Sections 5.3 and 5.4 shall have effect as if the
replacement or repair of the Balance of Plant was its
initial procurement;
(b) Mopps shall be responsible for the replacement or
repair of any Plant so lost or damaged;
(c) the provisions of Section 13.4 shall apply; and
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(d) Mopps shall bear the deductible under the relevant
policies of insurance unless the damage shall have been
caused by MORILA or persons for whom MORILA shall be
responsible and subject thereto Mopps shall pay to
MORILA, out of the account referred to in Section 13.4,
the reasonable costs properly incurred in carrying out
its obligations under Section 14.4.3(a), up to the
amount of the insurance proceeds received in respect of
either or both the Balance of Plant and the Existing
Facility.
14.4.4 Subject to Section 14.4.2, in the event of the occurrence of
a Non-Insurable Event following a Relevant Commercial
Operations Date, MORILA shall have the option to terminate
this Agreement in accordance with Section 16.14.
14.4.5 Without prejudice to the provisions of this Section 14, in
the event of the occurrence of an Insurable Event or
Non-Insurable Event at any time prior to the Final Payment
date, MORILA may elect to accelerate payment pursuant to
Section 15.3.
SECTION 15
FINAL PAYMENT
15.1 Subject to Section 15.3, MORILA shall pay the Final Payment to Mopps
on the Final Payment Date, at which point title in the Plant, Balance
of Plant and the Existing Facility shall pass to MORILA, provided
that MORILA has performed all of its obligations under this Agreement
in relation to any matters which are then the subject of an
arbitration, dispute or any other form of proceedings.
15.2 MORILA may, subject to extending the term of the Energy Support
Agreement for a like period, no earlier than 6 months prior to the
Final Payment Date and no later than 2 months prior to the Final
Payment Date, give notice to Mopps that it wishes to extend this
Agreement by a further period of up to 5 years and if Mopps is so
willing, the Parties shall endeavour to agree the terms for such
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extension in substantially the same form as this Agreement and if
they do so agree, incorporating those terms in a supplemental
agreement.
15.3 At any time before the Final Payment Date MORILA may elect to
accelerate payment pursuant to this Agreement upon giving two months'
prior notice and upon payment to Mopps of the amount set out in Part
8 of Exhibit 10.
15.4 Following the passing of title in the Plant, Balance of Plant and the
Existing Facility pursuant to Section 15.1, Mopps shall be released
from all obligations under or in connection with this Agreement
except for those in relation to any matters which are then the
subject of an arbitration, dispute or any other form of proceedings.
SECTION 16
TERMINATION
16.1 Subject to this Section 16, this Agreement may only be terminated by
either Party on the expiry of the Deferred Payment Period pursuant to
Sections 15.1, 15.2 or 15.3 as the case may be.
16.2 This Agreement may be terminated by Mopps prior to the expiry of the
Term on the occurrence of any of the following:
16.2.1 a failure by MORILA to satisfy any of the Suspensive
Conditions set out in Section 2.1 by the Cut-off Date;
16.2.2 a MORILA Termination Event; and
16.2.3 a MORILA Event of Default, in accordance with Section 16.8.
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16.3 FAILURE TO MEET SUSPENSIVE CONDITIONS
16.3.1 Subject to Section 16.3.2, if MORILA fails to satisfy or
procure the satisfaction of any of the conditions set out in
Section 2.1 prior to the Cut-off Date, Mopps shall be
entitled to:
(a) terminate this Agreement by giving notice to MORILA and
such termination shall take effect immediately on
delivery of such notice; and
(b) recover the Fixed Default Amount from MORILA.
16.3.2 If a date other than the Cut-off Date is agreed between the
Parties as contemplated by Section 2.2, Mopps shall be
entitled to terminate this Agreement in accordance with
Section 16.3.1 on such other date as is agreed between the
Parties.
16.4 MORILA TERMINATION EVENT
The occurrence of any of the following events, unless such event shall
have occurred solely as a result of a breach by Mopps of its
obligations under this Agreement, shall constitute a "MORILA
Termination Event":
16.4.1 Abandonment of the Mine or a substantial part of the
operations thereof;
16.4.2 MORILA is declared insolvent, or an application is made for
the insolvency of MORILA;
16.4.3 MORILA applies for suspension of payment, whether
provisionally or otherwise;
16.4.4 MORILA is unable to pay its debts as they fall due or admits
its inability to pay its debts as they fall due;
16.4.5 MORILA stops, suspends, or threatens to stop or suspend
payment of all or any part of its debts or makes an
arrangement with or for the
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benefit of any creditor or creditors in respect of or
affecting all or a material part of its indebtedness, or any
step (including any proposal or convening of any meeting) is
taken with a view to such an arrangement;
16.4.6 MORILA is dissolved or a notice or application for the
dissolution of MORILA, whether by the relevant companies
registration authority or otherwise, is made;
16.4.7 a general meeting of the shareholders of MORILA is convened
for the purpose of considering any resolution for the
dissolution, for an application for the insolvency or for an
application for suspension of payment, whether provisional
or otherwise, of MORILA, or an event occurs which leads to
the dissolution of MORILA according to its articles of
association;
16.4.8 a material part of the assets of MORILA is seized and such
seizure is not discharged within three days;
16.4.9 there occurs in relation to MORILA any event under the laws
applicable to MORILA which corresponds with or is analogous
to any of those mentioned in Sections 16.4.1 to 16.4.8
(inclusive);
16.4.10 the control over the business of MORILA is directly or
indirectly changed other than involving an Affiliate and
only for so long as such company shall remain an Affiliate
of MORILA, or other than involving the restructuring of the
JCI and Randgold groups of companies as announced 30th April
1999 and published in "Business Day" in South Africa, or any
of the shares in MORILA are sold, transferred or otherwise
disposed of or purported to be disposed of or changed or
otherwise encumbered (other than in accordance with the
financial arrangements consented to by Mopps in accordance
with Section 18) and such sale, transfer or other disposal
or purported disposal or encumbrance result in a change of
control of MORILA. In the event that control over the
business of MORILA is intended to be so changed or any of
the shares are intended to be sold, transferred or otherwise
disposed of and such sale, transfer or other disposal or
purported
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disposal or encumbrance result in a change of control of
MORILA, MORILA shall seek the consent of Mopps, such consent
not to be unreasonably withheld or delayed. In the event
that any of the shares are sold, transferred or otherwise
disposed of, any change in control over the business of the
party receiving the shares shall amount to a MORILA Event of
Default
16.5 MOPPS RIGHT TO TERMINATE FOR MORILA TERMINATION EVENT
Upon the occurrence of a MORILA Termination Event, Mopps may
terminate this Agreement immediately by giving notice to MORILA of
the occurrence of the relevant MORILA Termination Event and stating
that this Agreement is accordingly terminated and such termination
shall take effect immediately upon delivery of such notice.
16.6 MORILA EVENT OF DEFAULT
The occurrence of any of the following events, unless any such event
shall have occurred solely as a result of a breach by Mopps of its
obligations under this Agreement, shall constitute a "MORILA Event of
Default":
16.6.1 any default by MORILA in the performance of its obligations
under this Agreement;
16.6.2 any breach by MORILA in the performance of its obligations
under any other agreement to which MORILA is a party to the
extent that such breach might, in the reasonable opinion of
Mopps, have a material adverse effect on the ability of
MORILA to comply with its obligations under this Agreement;
16.6.3 any representation or warranty of MORILA made to Mopps which
is or proves to be incorrect when made or repeated in any
respect which Mopps reasonably considers to be material;
16.6.4 a failure by MORILA to make payments in accordance with
Section 12 and Exhibit 10 for one month;
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16.6.5 refusal by MORILA to allow Mopps or the Operator access to
the Site or any other act or omission on the part of MORILA
which prevents the Plant being used in accordance with Good
Utility Practice;
16.6.6 in the event that the control over the business of MORILA is
directly or indirectly changed (excluding, for the avoidance
of doubt, as a result of any exercise of step-in rights by
the Agent pursuant to the Step-In and Acknowledgement
Agreement), or any of the shares in MORILA are sold,
transferred or otherwise disposed of or encumbered and such
sale, transfer, disposal or encumbrance results in a change
in control over the business of MORILA, a failure by MORILA
to procure that the party, or parties, which then have
control over the business of MORILA enter into a form of
guarantee in substantially the same terms as are set out in
Exhibit 1,
MORILA shall notify Mopps immediately upon becoming aware of the
occurrence of any Termination Event or any MORILA Event of Default.
16.7 NOTICE PERIOD AND REMEDIAL ACTION BY MORILA
16.7.1 Upon Mopps becoming aware of the occurrence of a MORILA
Event of Default, Mopps may give notice to MORILA
specifying the relevant MORILA Event of Default and
requiring MORILA, at MORILA's option, either:
(a) to remedy or otherwise overcome each MORILA Event of
Default specified in such notice within 21 days of
delivery of such notice; or
(b) other than in the case of an event under Section 16.6.4
(in which case only paragraph (a) above shall apply) to
propose in writing, within 14 days of receipt of such
notice, a reasonable programme for the remedying of or
otherwise overcoming each MORILA Event of Default
specified in such notice.
16.7.2 If MORILA shall propose such a programme in accordance with
Section 16.7.1(b), Mopps shall within 28 days of receipt of
such programme,
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notify MORILA that it either accepts or does not accept the
programme as being capable of remedying or otherwise
overcoming each relevant MORILA Event of Default. If Mopps
shall fail to give notice within such 28 day period, it
shall be deemed to have accepted such programme. If Mopps
shall notify MORILA that it does not accept such programme,
the Parties shall endeavour in good faith to agree any
necessary amendments to the programme. Any dispute shall be
resolved in accordance with Section 17. MORILA shall,
immediately following acceptance by Mopps of the relevant
programme (or resolution of any dispute relating to such
programme), implement such programme.
16.8 ENTITLEMENT FOR MOPPS TO TERMINATE
If:
16.8.1 any MORILA Event of Default notified in accordance with
Section 16.7.1 shall not have been remedied or otherwise
overcome before expiry of the period referred to in Section
16.7.1(a); or
16.8.2 MORILA shall have proposed a programme pursuant to Section
16.7.1(b) which has been accepted by Mopps or has been
established in accordance with Section 17, but MORILA shall
have failed to remedy or overcome to the reasonable
satisfaction of Mopps the relevant MORILA Event of Default
or otherwise carry out the appropriate course of action to
the satisfaction of Mopps in accordance with such
programme; or
16.8.3 where MORILA shall have submitted a programme for the
remedy of or otherwise overcoming of the relevant MORILA
Event of Default in accordance with Section 16.7.1(b), such
programme is not accepted or agreed by Mopps in accordance
with Section 16.7.2 and the outcome of any dispute
resolution in accordance with Section 17 does not find
against such non-acceptance; or
16.8.4 MORILA shall have failed to remedy in accordance with
Section 16.7.1 any MORILA Event of Default notified to
MORILA by Mopps pursuant to Section 16.7.1 before the
expiry of the period referred to in
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such notice or MORILA shall have failed to provide a
programme, in accordance with Section 16.7.1(b), acceptable
to Mopps before the expiry of the period referred to in such
notice, or, where MORILA has provided a programme for
remedying or otherwise overcoming such MORILA Event of
Default acceptable to Mopps, MORILA shall have failed to
remedy or otherwise overcome the MORILA Event of Default in
accordance with such programme,
Mopps may terminate this Agreement by giving notice to MORILA and
such termination shall take effect immediately upon service of such
notice by Mopps or upon such later date as may be specified in the
notice.
16.9 MOPPS TERMINATION EVENT
The occurrence of any of the following events, unless such event
shall have occurred solely as a result of a breach by MORILA of its
obligations under this Agreement, shall constitute a "Mopps
Termination Event":
16.9.1 Abandonment of the Facility or a substantial part of the
operations thereof;
16.9.2 Mopps is declared insolvent, or an application is made for
the insolvency of Mopps;
16.9.3 Mopps applies for suspension of payment, whether
provisionally or otherwise;
16.9.4 Mopps is unable to pay its debts as they fall due or
admits its inability to pay its debts as they fall due;
16.9.5 Mopps stops, suspends, or threatens to stop or suspend
payment of all or any part of its debts or makes an
arrangement with or for the benefit of any creditor or
creditors in respect of or affecting all or a material part
of its indebtedness, or any step (including any proposal or
convening of any meeting) is taken with a view to such an
arrangement;
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16.9.6 Mopps is dissolved or a notice or application for the
dissolution of Mopps, whether by the relevant companies
registration authority or otherwise, is made;
16.9.7 a general meeting of the shareholders of Mopps is convened
for the purpose of considering any resolution for the
dissolution, for an application for the insolvency or for an
application for suspension of payment, whether provisional
or otherwise, of Mopps, or an event occurs which leads to
the dissolution of Mopps according to its articles of
association;
16.9.8 a material part of the assets of Mopps is seized and
such seizure is not discharged within three days;
16.9.9 there occurs in relation to Mopps any event under the laws
applicable to Mopps which corresponds with or is analogous
to any of those mentioned in Sections 16.9.1 to 16.9.8
(inclusive);
16.9.10 the control over the business of Mopps is directly or
indirectly changed other than involving an Affiliate and
only for so long as such company shall remain an Affiliate
of Mopps, or more than 50% of the shares in Mopps are sold,
transferred or otherwise disposed of or purported to be
disposed of or changed or otherwise encumbered and such
sale, transfer or other disposal or purported disposal or
encumbrance result in a change of control of Mopps. In the
event that control over the business of Mopps is intended to
be so changed or more than 50% of the shares are intended to
be sold, transferred or otherwise disposed of and such sale,
transfer or other disposal or purported disposal or
encumbrance result in a change of control of Mopps, Mopps
shall seek the consent of MORILA, such consent not to be
unreasonably withheld or delayed. In the event that any of
the shares are sold, transferred or otherwise disposed of,
any change in control over the business of the party
receiving the shares shall amount to a Mopps Event of
Default
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16.10 MORILA'S RIGHT TO TERMINATE FOR MOPPS TERMINATION EVENT
Upon the occurrence of a Mopps Termination Event, MORILA may
terminate this Agreement immediately by giving notice to Mopps of the
occurrence of the relevant Mopps Termination Event and stating that
this Agreement is accordingly terminated and such termination shall
take effect immediately upon delivery of such notice.
16.11 MOPPS EVENT OF DEFAULT
The occurrence of any of the following events, unless any such event
shall have occurred solely as a result a breach by MORILA of its
obligations under this Agreement, shall constitute a "Mopps Event of
Default":
16.11.1 any material default by Mopps in the performance of
any of its material obligations under this Agreement;
16.11.2 failure of the Plant to achieve Guaranteed Contracted
Capacity for a period of 9 consecutive months, unless such
event shall have occurred as a result of the occurrence of:
(a) a MORILA Event of Default; or
(b) an Insurable Event; or
(c) a Non-Insurable Event.
16.11.3 any representation or warranty of Mopps made to MORILA which
is or proves to be incorrect when made or repeated in any
respect which MORILA considers to be material;
Mopps shall notify MORILA immediately upon becoming aware of the
occurrence of any Mopps Event of Default.
16.12 NOTICE PERIOD AND REMEDIAL ACTION BY MOPPS
16.12.1 Upon MORILA becoming aware of the occurrence of a Mopps
Event of Default, MORILA may give notice to Mopps
specifying the relevant
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Mopps Event of Default and requiring Mopps, at Mopps's
option, either:
(a) to remedy or otherwise overcome each Mopps Event of
Default specified in such notice within 21 days of
delivery of such notice; or
(b) other than in a case of failure by Mopps to make
payment (in which case only paragraph (a) above shall
apply) to propose in writing, within 14 days of receipt
of such notice, a reasonable programme for the
remedying of or otherwise overcoming each Mopps Event
of Default specified in such notice.
16.13 If Mopps shall propose such a programme in accordance with Section
16.12.1(b), MORILA shall within 28 days of receipt of such programme,
notify Mopps that it either accepts or does not accept the programme
as being capable of remedying or otherwise overcoming each relevant
Mopps Event of Default. If MORILA shall fail to give notice within
such 28 day period, it shall be deemed to have accepted such
programme. If MORILA shall notify Mopps that it does not accept such
programme, the Parties shall endeavour in good faith to agree any
necessary amendments to the programme. Any dispute shall be resolved
in accordance with Section 17. Mopps shall, immediately following
acceptance by MORILA of the relevant programme (or resolution of any
dispute relating to such programme), implement such programme.
16.14 ENTITLEMENT FOR MORILA TO TERMINATE FOR MOPPS EVENT OF DEFAULT
If:
16.14.1 any Mopps Event of Default notified in accordance
with Section 16.12.1 shall not have been remedied or
otherwise overcome before expiry of the period referred to
in Section 16.12.1(a); or
16.14.2 Mopps shall have proposed a programme pursuant to Section
16.12.1(b) which has been accepted by MORILA or has been
established in accordance with Section 17, but Mopps shall
have failed to remedy or overcome to the reasonable
satisfaction of MORILA the relevant Mopps
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Event of Default or otherwise carry out the appropriate
course of action to the satisfaction of MORILA in accordance
with such programme; or
16.14.3 where Mopps shall have a submitted a programme for the
remedy of or otherwise overcoming of the relevant Mopps
Event of Default in accordance with Section 16.12.1(b), such
programme is not accepted or agreed by MORILA in accordance
with Section 16.12.2 and the outcome of any dispute
resolution in accordance with Section 17 does not find
against such non-acceptance; or
16.14.4 Mopps shall have failed to remedy in accordance with Section
16.12.1 any Mopps Event of Default notified to Mopps by
MORILA pursuant to Section 16.12.1 before the expiry of the
period referred to in such notice or Mopps shall have failed
to provide a programme, in accordance with Section
16.12.1(b), acceptable to MORILA before the expiry of the
period referred to in such notice, or, where Mopps has
provided a programme for remedying or otherwise overcoming
such Mopps Event of Default acceptable to MORILA, Mopps
shall have failed to remedy or otherwise overcome the Mopps
Event of Default in accordance with such programme,
MORILA may terminate this Agreement by giving notice to Mopps and
such termination shall take effect immediately upon service of such
notice by MORILA or upon such later date as may be specified in the
notice.
16.15 UNECONOMIC EFFECT
If pursuant to either or both Sections 14.3.2 and 14.4.2 MORILA is
obliged to make payments for a period exceeding 24 months then it may
give one month's notice to Mopps terminating this Agreement.
16.16 ENERGY SUPPORT AGREEMENT
Mopps shall be entitled to terminate this Agreement in the event that
the Energy Support Agreement is terminated or if the same is
terminated through the default of the Operator and a replacement
contract is entered into by MORILA with an operator which is not
acceptable to Mopps (such acceptance not to be
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unreasonably withheld or delayed in the case of a proposed operator of
international repute), by giving notice to MORILA stating that this
Agreement is accordingly terminated and such termination shall take
effect immediately upon delivery of such notice.
16.17 CONSEQUENCES OF TERMINATION
16.17.1 If this Agreement is terminated by Mopps pursuant to
Sections 16.5 or 16.8, or by MORILA pursuant to Section
16.14, Mopps shall be entitled to recover from MORILA the
Termination Prices calculated in accordance with Parts 8 and
10 respectively of Exhibit 10;.
16.17.2 If this Agreement is terminated by MORILA pursuant to
Section 16.10 or 16.13 then MORILA shall pay to Mopps the
Termination Prices calculated in accordance with Part 9 of
Exhibit 10 save that if paragraph (iv) of Section 10.2.4
shall apply then the amount paid shall be the CTF
Termination Price;.
16.17.3 If this Agreement is terminated by Mopps pursuant to
Section 16.15:
(i) due to a default by the Operator, Mopps shall be
entitled to recover from MORILA the Termination Prices
calculated in accordance with Part 9 of Exhibit 10;
(ii) due to the occurrence of a Non-Insurable Event, Mopps
shall be entitled to recover from MORILA the
Termination Prices calculated in accordance with Part
10 of Exhibit 10;
(iii) under any other circumstances within Section 16.15,
Mopps shall be entitled to recover from MORILA the
Termination Prices calculated in accordance with Part
8 of Exhibit 10.
16.17.4 Upon full payment of the amounts payable under Sections
16.16.1 or 16.16.3 above to Mopps the provisions of Section
15 shall have effect as if the same were the Final Payment;
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16.17.5 If this Agreement is terminated pursuant to this Section 16,
the EF Debt will be deemed to be fully redeemed and title in
the Existing Facility shall revert to MORILA.
SECTION 17
DISPUTE RESOLUTION
17.1 SENIOR MANAGEMENT
17.1.1 Each Party shall notify the other Party of a member of
senior management who shall be authorised to resolve any
dispute on its behalf.
17.1.2 If a dispute arises that cannot be settled by the Parties
through informal discussions, either Party may (but shall
not be compelled to) refer the dispute to the Persons
designated pursuant to Section 17.1.1 for further
consideration and attempted resolution within thirty (30)
days after the dispute has been referred to such Persons (or
such longer period as the Parties may agree).
17.2 ARBITRATION
17.2.1 In the event of any dispute arising under this Agreement it
shall be settled under the Rules of Conciliation and
Arbitration of the International Chamber of Commerce.
17.2.2 In all cases of arbitration:
(a) arbitration shall take place in London (or such other
place as the Parties may agree);
(b) the language of the arbitration shall be English; and
(c) the costs of the arbitration shall be borne by the
losing Party.
17.2.3 Arbitration shall be conducted by a sole arbitrator
appointed by mutual agreement of the Parties. This
arbitrator unless the parties shall agree otherwise shall be
of a nationality other than that of the Parties and shall
have extensive experience in the electricity industry.
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17.2.4 In the event that the Parties cannot agree on the choice of
arbitrator, arbitration shall be conducted by three
arbitrators named in accordance with the rules and
regulations of the International Chamber of Commerce.
17.2.5 The Parties agree that the decision or award of the
arbitrators shall be final and binding and agree to execute
the decision rendered by the arbitrators without delay and
hereby waive any rights of appeal. The execution of the
decision may be carried out by any tribunal having
jurisdiction.
17.2.6 Provided that if the dispute to be referred to arbitration
under this Agreement raises issues which are substantially
the same as or connected with issues raised in a related
dispute between MORILA and the Operator under the Energy
Support Agreement and if the related dispute has already
been referred for determination to an arbitrator, MORILA and
Mopps hereby agree that the dispute under this Agreement
shall be referred to the arbitrator appointed to determine
the related dispute and the provisions of this Section 17
shall apply.
17.3 NO IMMUNITY; ENFORCEMENT; COSTS AND EXPENSES
As to all disputes between the Parties under this Agreement, each of
MORILA and Mopps unconditionally and irrevocably:
17.3.1 agrees, to the extent that such Party may now or hereafter
be entitled in any jurisdiction to claim for itself or its
property, assets or revenues immunity (whether by reason of
sovereignty or otherwise) in respect of its obligations
under this Agreement from service of process, suit,
jurisdiction of any court, judgment, order, award,
attachment (before or after judgment or award), set-off,
execution of a judgment or other legal process, and to the
extent that in any such jurisdiction there may be attributed
to such Party or any of its property, assets or revenues
such an immunity (whether or not claimed), not to claim and
hereby irrevocably waives such immunity to the fullest
extent permitted by the laws of such jurisdiction;
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17.3.2 consents generally in respect of the enforcement of any
judgment against it in any such proceedings in England
and/or the Republic of Mali and to the giving of any relief
or the commencement of any process in connection with such
proceedings (including, without limitation, the making,
enforcement or execution against or in respect of any
property whatsoever irrespective of its use or intended
use); and
17.3.3 consents that all costs and expenses related to any judicial
proceeding to enforce any arbitration award shall be paid by
the Party that resists the enforcement of such award.
17.4 APPOINTMENT OF AGENTS FOR SERVICE OF PROCESS
With respect to any proceedings for enforcement of an award pursuant
to Section 17.3 against assets of either Party brought in any court of
competent jurisdiction in England or the Republic of Mali:
17.4.1 each Party shall appoint, before the Relevant Commercial
Operations Date, an agent to receive for and on its behalf
service of process in such jurisdiction in any such
enforcement proceedings;
17.4.2 each Party agrees to maintain in the Republic of Mali duly
appointed process agents (or appoint replacement agents and
promptly notify the other Party of such replacement
agents); and/or
17.4.3 each Party agrees that failure by any such process agent to
give notice of any process to it shall not impair the
validity of such service or of any judgment based thereon.
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SECTION 18
TRANSFER OF RIGHTS AND OBLIGATIONS
18.1 Except as expressly provided in this Agreement, no rights or
obligations under this Agreement may be transferred by either Party
in whole or in part, without the prior written consent of the other
Party as it may in its absolute discretion and upon such terms as it
may in its absolute discretion determine save that where such
transfer is to an Affiliate such consent shall not be unreasonably
withheld or delayed, provided that either Party may assign its rights
and obligations under this Agreement to an Affiliate if such
Affiliate: (i) agrees in writing to assume all obligations and
liabilities of the assigning Party under, and to be bound by all of
the terms, conditions and provisions of, this Agreement, (ii) has
provided the non-assigning Party with evidence to the reasonable
satisfaction of the non-assigning Party that such Affiliate has the
creditworthiness and operational ability to perform the assigning
Party's obligations under this Agreement; and
18.2 After any assignment contemplated by Section 18.1 above, the
assigning Party shall have no further obligations or liabilities
under this Agreement. Unless expressly agreed to by the other Party,
no assignment (other than an assignment under Section 18.1 above),
whether or not consented to, shall relieve the assignor of its
obligations hereunder in the event its assignee fails to perform.
18.3 Save as expressly provided in this Agreement, MORILA shall not create
any security right or other interest over any of its rights under
this Agreement without the prior written consent of Mopps in its
absolute discretion and upon such terms as it may in its absolute
discretion determine. Where Mopps agrees to the creation of a
security right or other interest it will be prepared to enter into a
step-in and acknowledgement agreement with MORILA's Lenders or an
agent thereof in substantially the same terms set out in Exhibit 14.
SECTION 19
ADJUSTMENT DUE TO CHANGE IN LAW
19.1 ADJUSTMENT DUE TO CHANGE IN LAW, IMPORT TAXES, INCENTIVES AND
BENEFITS
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19.1.1 If the direct or indirect cost of the design, construction,
Commissioning and completion of the Facility, or of the
supply of Spare Parts therefor as a result of a Change in
Law, or the economic benefit to Mopps, or any relevant
incentive to Mopps, under this Agreement changes as a result
of a Change in Law, the payments under this Agreement (as
appropriate) shall be adjusted to compensate for the direct
or indirect cost, loss or saving or increase (as the case
may be) in economic benefit resulting from such Change in
Law from the date it was effective. Mopps shall submit to
MORILA a certificate setting forth in reasonable detail the
basis of, and the calculations for, such adjustments.
19.1.2 Within twenty (20) Days after the date of such certificate,
MORILA shall notify Mopps whether it disagrees with any of
the calculations in the certificate. If MORILA notifies
Mopps of its disagreement the Parties agree to meet within
twenty (20) Days and negotiate in good faith alternative
adjustments to the payments as appropriate to protect the
economic value of the Agreement to the Parties.
19.1.3 In the event that MORILA agrees with the certificate or
fails to notify its disagreement within the period
specified in Section 19.1.2 above, this Agreement shall be
amended promptly by the Parties in accordance with Section
21.1 to reflect such adjustments.
19.1.4 The Parties shall attempt to resolve any dispute regarding
adjustments pursuant to this Section 19.1 as expeditiously
as possible in accordance with Section 17.1. If the Parties
are unable to resolve the dispute in this manner, the
dispute shall be resolved in accordance with the procedures
described in remainder of Section 17.
19.1.5 In the event that MORILA fails to pass to Mopps any economic
benefit or incentive referred to in Section 19.1.1, the
payments under this Agreement (as appropriate) shall be
adjusted to reflect either or both such taxes paid and the
benefit of such incentives not received by Mopps.
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SECTION 20
INTELLECTUAL PROPERTY
Mopps shall make available and to the extent that it is able so to do
through prudent commercial practices cause its suppliers to make
available to MORILA free of charge for use by MORILA solely in
relation to the exploitation of the Mine a non-exclusive licence or
sub-licence for the use of design data (other than proprietary data
relating to machinery and equipment and retained by the relevant
manufacturer for commercially confidential reasons) developed for the
Project.
SECTION 21
MISCELLANEOUS
21.1 AMENDMENT
This Agreement may be amended only by a supplemental agreement to this
Agreement signed by both Parties.
21.2 NO WAIVER
21.2.1 Save as otherwise expressly provided in this Agreement,
nothing done or omitted to be done by Mopps or any of
Mopps's representatives whether for the purposes of this
Agreement or otherwise shall relieve MORILA of any of its
obligations under this Agreement.
21.2.2 No delay or forbearance by either Party in exercising any
right, power, privilege or remedy under this Agreement shall
operate to impair or be construed as a waiver of such right,
power, privilege or remedy. Any single or partial exercise
of any such right, power, privilege or remedy shall not
preclude any other right, power, privilege or remedy.
21.3 LIABILITY
21.3.1 Without prejudice to the provisions of Section 16 or Exhibit
10, neither Party shall be liable to the other Party in
contract, tort, warranty, strict
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liability, or any other legal theory for any indirect,
consequential, incidental, punitive or exemplary damages,
nor shall either Party be liable to the other Party for any
fines and penalties incurred by that other Party. Neither
Party shall have any liability to the other Party for breach
of this Agreement except as expressly provided in this
Agreement; provided, however, that this provision is not
intended to constitute a waiver of any rights of one Party
against the other with regard to matters unrelated to this
Agreement or to any activity not contemplated by this
Agreement.
21.3.2 Mopps' liability (whether in contract, tort or otherwise)
arising out of or in connection with this Agreement shall
not exceed US$5 million in any one year or US$20 million
during the Term.
21.4 SURVIVAL
The expiry or early termination of this Agreement shall not
relieve the Parties of obligations which by their nature
should survive such expiry or termination. including,
without limitation, the following:- Section 1, Section 6,
Section 8.5, Section 11, Section 12, Section 15, Section 16,
Section 17, Section 18, Section 20 and this Section 21.
21.5 FURTHER ASSURANCE
Each Party agrees to execute and deliver all such further instruments
and do and perform all such further acts and things as shall be
necessary or expedient for the carrying out of the provisions of this
Agreement.
21.6 NOTICES
21.6.1 All notices under this Agreement shall be in writing and all
certificates, notices or written instructions to be given
under the terms of this Agreement shall be served, in timely
fashion, by sending the same by registered post with
confirmation of receipt, facsimile or by leaving the same at
the addresses specified in Exhibit 11.
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21.6.2 Either Party may change its nominated postal address,
facsimile number by prior notice to the other Party. Notices
given by registered post shall be effective upon the earlier
of (i) actual receipt and (ii) 7 days after mailing. Notices
given by facsimile shall be deemed to have been received
where there is confirmation of uninterrupted transmission by
a transmission report and where there has been no telephonic
communication by the recipient to the sender (to be
confirmed in writing) that the facsimile has not been
received in legible form either (a) within 2 hours after
sending if sent on a Business Day and between the hours of 9
a.m. and 4 p.m.; or (b) by 11 a.m. on the next following
Business Day if sent after 4 p.m. on a Business Day but
before 9 a.m. on that next following Business Day. In each
case the reference to time shall be in respect of the local
time at the place of receipt of the notice.
21.7 CONFIDENTIALITY
Each Party shall hold in confidence all commercially and technically
sensitive documents and information in relation to this Agreement and
the carrying out of the obligations thereunder and shall not publish
or otherwise disclose the same except:-
21.7.1 with the other Party's prior written consent;
21.7.2 as may necessarily be required by law, any relevant stock
exchange or other competent regulatory authority;
21.7.3 as Mopps may require for the purpose of the design,
construction, Commissioning or completion of the Plant in
the event of termination of this Agreement;
21.7.4 that which is in or enters the public domain other than as a
result of a breach of the obligations imposed by this
Section 21.7; or
provided that the provisions of this Section 21.7 shall not restrict
either Party from either or both passing such documents and
information to its professional advisers or associates who have first
agreed in writing to be bound by the provisions of this Section 21.7
and each Party may, subject to appropriate
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confidentiality restrictions, pass to actual or proposed lenders such
documents and other information as is reasonably required by the
actual or proposed lenders in connection with the raising of finance
for the either or both the gold mine concession or the Project. Any
Party making documents or information available to a third party
pursuant to this Section 21.7 shall procure that such third party
shall first enter into a written confidentiality agreement in respect
of such documents or information in substantially the same terms as
those contained in this Section 21.7.
21.8 NON-BINDING PROVISIONS
If any one or more of the provisions of this Agreement shall become or
shall prove to be illegal, unenforceable or non-binding, the other
provisions of this Agreement shall remain in force and the Parties
shall enter into negotiations in good faith to replace any such
illegal, unenforceable or non-binding provisions by provisions which
are legal, enforceable and binding and which deviate as little as
possible, having regard to the purpose and objects of this Agreement,
from the intent of such illegal, unenforceable or non-binding
provisions. If the Parties shall be unable to agree, within 90 days of
becoming aware that a provision is illegal, unenforceable or
non-binding, on the replacement of that provision, the matter shall be
referred for resolution in accordance with Section 17.
21.9 ENTIRE AGREEMENT
This Agreement supersedes any previous agreement, arrangement or
understanding between the Parties in relation to the matters dealt
with in this Agreement and represents the entire understanding between
the Parties in relation to such matters as of the date hereof.
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21.10 APPLICABLE LAW
This Agreement shall be governed and construed in accordance with the law of
England and Wales.
IN WITNESS WHEREOF the Parties have executed this Agreement in the presence of
the Witnesses by their duly authorised representative on the day and year first
written above.
SIGNED by )
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇ )
................................................. )
Name:-▇▇▇▇ ▇. ▇▇▇▇▇
Title:-Vice President
for and on behalf of:
MOPPS
WITNESSED BY )
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
1. By..........................................
Name:- ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title:-Director
SIGNED by )
)
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ )
................................................. )
Name:-▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title:-Director
for and on behalf of:
MORILA
WITNESSED BY
/s/ CJ Pensloo ) /s/ ▇. ▇▇▇▇▇
1. By.......................................... 2, By..................
Name:-CJ Pensloo Name:-▇. ▇▇▇▇▇
Title:-Commercial Manager Title:-Legal Counsel
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EXHIBIT 1
FORM OF RANDGOLD GUARANTEE
DEED OF GUARANTEE, dated as of day of (as amended, supplemental or
otherwise modified from time to time in accordance with the terms hereof) this
"Guarantee Agreement" between Randgold Resources Limited, having its registered
office at La Motte ▇▇▇▇▇▇▇▇, St Helier, Jersey, JE1 BJ and Randgold &
Exploration Company Limited, having its registered office at ▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ (each a "Guarantor" and together the
"Guarantors") and Mopps having its registered office at [ ] (the "Project
Company").
WHEREAS
(A) MORILA, a majority owned subsidiary of Randgold Resources Limited,
and the Project Company have entered into the Deferred Terms
Agreement.
(B) This guarantee is given in satisfaction of Clause 2.1 of the Deferred
Terms Agreement and it is a condition of the Project Company entering
into the Deferred Terms Agreement that the Guarantors enter into this
Guarantee Agreement.
NOW, THEREFORE, it is agreed as follows:
Section 1. Definitions
Unless expressly defined herein or the context requires otherwise, capitalised
terms shall have the same meanings as set out in the Deferred Terms Agreement.
The following capitalised terms shall have the meanings herein specified, and
shall include in the singular number the plural and in the plural number the
singular:
"Deferred Terms Agreement" the agreement dated [ ] between the Project Company
and MORILA for the supply of electrical capacity and energy to a mine in Morila,
Republic of Mali.
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"Guaranteed Obligations" shall mean all of the obligations and liabilities of
MORILA under the Deferred Terms Agreement.
Section 2. Guarantee
(a) Subject to this Section 2, each Guarantor severally, and also jointly with
the other Guarantor, hereby absolutely, irrevocably and unconditionally
guarantees the due and punctual payment of all the Guaranteed Obligations and
hereby agrees that in the event that MORILA shall fail to make due and punctual
payment of any Guaranteed Obligation not disputed in good faith in an aggregate
amount exceeding five thousand US dollars ($5,000) properly payable under or
arising from or with respect to the Deferred Terms Agreement, the Guarantors
shall pay to the Project Company such sums within twenty one (21) Business Days
of a written demand from the Project Company the Guarantors are entitled to all
benefits, limitations and defences in respect of the Guaranteed Obligations
afforded to MORILA under the Deferred Terms Agreement.
(b) The Guarantee Agreement shall be a continuing guarantee and shall remain
operative and in full force and effect until all of the Guaranteed Obligations
have been performed in full.
(c) This Guarantee Agreement and the liability of the Guarantors hereunder shall
remain in full force and effect and shall in no way be affected or impaired by,
and no notice to the Guarantors shall be required, in respect of:
(i) any compromise, waiver, settlement, release, renewal, extension, indulgence,
change in or modification of any of the obligations and liabilities of MORILA
under the Deferred Terms Agreement, except to the extent that MORILA has been so
relieved (except that this Guarantee Agreement and the liability of the
Guarantors hereunder shall not extend to any additional or increased obligations
and liabilities of MORILA under the Deferred Terms Agreement as a result of any
such compromise, waiver, settlement, release, renewal, extension, indulgence,
change in or modification unless the prior written consent thereto of the
Guarantors, expressly referring to this Guarantee Agreement, shall have been
obtained in connection therewith);
(ii) the enforcement or absence of enforcement of the Deferred Terms Agreement
or any security or any release of security
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(iii) the winding-up (or equivalent) of MORILA or the Guarantors or any other
person or any step being taken for any such winding-up or dissolution (or
equivalent); or
(iv) the material illegality, invalidity or unenforceability of or any material
defect in any provision of the Deferred Terms Agreement.
(d) Notwithstanding anything to the contrary herein contained, the Guarantors
shall not be obliged to perform any of the Guaranteed Obligations hereunder
until a demand by the Project Company shall have been made upon the Guarantors
specifying in detail each of the Guaranteed Obligations which shall not have
been performed by MORILA and five (5) Business Days shall have elapsed after
receipt by the Guarantors of such demand.
(e) If the Project Company having received any payment from the Guarantors
pursuant to any of its obligations hereunder, should receive, after the making
of such payment by the Guarantors, any payment or distribution with respect
thereto, the Project Company shall remit such payment to the Guarantors
promptly, but in any event within five (5) business Days after receipt thereof.
Section 3. Guarantors' Representations
Each Guarantor severally, and also jointly with the other Guarantor, represents
and warrants to the Project Company as of the date hereof that:
(a) each Guarantor is a [public limited company] duly organised, validly
existing under the laws of [ ] and has full power, authority and legal rights to
execute and deliver, and to perform its obligations under, this Guarantee
Agreement;
(b) each Guarantor has taken all necessary corporate and legal action to
authorise the guarantee hereunder on the terms and conditions of this Guarantee
Agreement and to authorise its execution, delivery and performance of this
Guarantee Agreement.
(c) this Guarantee Agreement has been duly executed and delivered by each
Guarantor, and constitutes the legal, valid and binding obligation of each
Guarantor, enforceable against each Guarantor, except as such enforcement may be
limited by (i) applicable bankruptcy, insolvency, reorganisation, moratorium or
other laws affecting the rights of creditors generally, and (ii) general
principles of equity.
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Section 4. Merger or Consolidation
If the Guarantors are party to a merger or consolidation in which the Guarantors
are not the surviving corporations, or sell all or substantially all of their
assets, then the Guarantors shall procure that the surviving corporation or
corporations or the person to which such sale has been made, as the case may be,
shall have assumed all of the Guarantors' obligations hereunder, to the extent
the same shall not have occurred by the operation of law.
Section 5. Costs of Enforcement
The Guarantors agree to hold the Project Company harmless from and against any
and all loss, liability or expense (including, without limitation, the
reasonable fees and disbursements of counsel for the Project Company) which may
be sustained or incurred by or on behalf of the Project Company in enforcing any
obligation of the Guarantors hereunder.
Section 6. Successors and Assigns
The Guarantee Agreement shall be binding upon and inure to the benefit of the
Guarantors and the Project Company and their respective successors and permitted
assigns. This Guarantee Agreement shall not be deemed to create any right in any
person, nor be construed in any respect to be a contract, in whole or in part,
for the benefit of any person, except the parties hereto and their respective
successors and permitted assigns. This Guarantee Agreement may not be assigned
by either party without first having obtained written consent of the other.
Section 7. Termination
Unless earlier terminated pursuant to Section 2(b) and 4, this Guarantee
Agreement shall automatically terminate upon the performance in full of all the
Guaranteed Obligations.
Section 8. Miscellaneous
(a) Except as expressly otherwise provided herein, all notices, requests,
demands, consents, instructions or other communications to or upon the parties
hereto shall be deemed to have been duly given or made only when delivered in
writing or by telecopy to
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the party to which such notice, request, demand, consent, instruction or other
communication is required or permitted to be given or made hereunder, at the
addresses or telecopy numbers of the parties, and to the attention of the
person, specified below, or to such other addresses, telecopy number or
attention as either party may hereafter specify to the other in writing:
(i) If to the Guarantors:
Address: ▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
Attention:
Facsimile: [ ]
(ii) If to Project Company:
Address:
Attention:
Facsimile: [ ]
Any notice or other communication referred to herein given in accordance with
this Section 8 shall be deemed to be delivered (i) if sent by hand delivery when
received, (ii) if sent by mail, seven days after such communication is deposited
in the mail with first-class postage prepaid, addressed or aforesaid, (iii) if
sent by facsimile, when such facsimile is transmitted and oral or electronic
receipt of confirmation is obtained by the sender (iv) in the case of delivery
by an internationally recognised express courier service, two Business Days
after delivery to such service, or (v) if sent by other means, when received at
the addresses notified in this Section 8.
(b) The rights and remedies herein expressly provided are cumulative and not
exclusive of any rights or remedies which the Guarantors of the Project Company
would otherwise have. No waiver of any of the terms and conditions of this
Guarantee Agreement, and no notice to or demand on the Guarantors or the Project
Company in any case shall entitle the Guarantors or the Project Company, as the
case may be, to any other
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or further notice or demand in similar or other circumstances, or constitute the
waiver of the rights of the Guarantors or the Project Company to any other or
further action in any circumstances without notice or demand.
(c) This Guarantee Agreement and the rights and obligations of the parties
hereunder shall be construed in accordance with, and governed by, the laws of
England and the parties hereby submit to the exclusive jurisdiction of the
English courts.
(d) This Guarantee Agreement may not be changed orally but only by an instrument
in writing signed by the Guarantors and the Project Company, and obligations
hereunder may not be waived except by an instrument in writing executed and
delivered by the party granting such waiver.
(e) The headings of the several sections of this Guarantee Agreement are
inserted for convenience only and shall not in any way affect the meaning or
construction of any provision of this Guarantee Agreement.
(f) Any provision of this Guarantee Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provisions in any
other jurisdiction.
This Guarantee Agreement may be executed in any number of counterparts, and by
the different parties hereto on separate counterparts, each of which, when so
executed and delivered, shall be an original, but all of which together shall
constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have caused this Guarantee Agreement to be duly
executed and delivered as a deed by their duly authorised officers or
representatives as of the date first above written.
Signed as a deed by [Guarantor]
acting by [ ] and
[ ]
Director:
Director/secretary:
Signed as a deed by [Guarantor]
acting by [ ] and
[ ]
Director:
Director/secretary:
Signed as a deed by [Project Company]
acting by [ ] and
[ ]
Director:
Director/secretary:
-74-
EXHIBIT 2
OFFSHORE ACCOUNT ARRANGEMENTS
The Offshore Account Arrangements shall comply with the following:
1. Mopps shall, unless paid from another source, be paid all sums
properly due and owing under this Agreement out of the Offshore Bank
Account as defined in the Tri-Partite Agreement between Mopps, MORILA
and Randgold Resources Limited a copy of which appears in the
annexure to this Exhibit 2.
2. The Parties together with Randgold Resources Limited shall execute
the Tri-Partite Agreement a copy of which appears in the annexure to
this Exhibit 2.
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TRI-PARTITE AGREEMENT
This Tri-Partite Agreement is dated as of ........... day of .............. 1999
(this "Tri-Partite" Agreement) between ROLLS-ROYCE POWER VENTURES LIMITED
("Mopps") registered in and in accordance with the laws of [ ] under number
[ ]; SOCIETE DES MINES DE MORILA ("MORILA") a subsidiary of Randgold Resources
Limited registered in and in accordance with the laws of the Republic of Mali
under number [ ]; and RANDGOLD RESOURCES LIMITED having its registered office
at La Motte ▇▇▇▇▇▇▇▇, St Helier, Jersey JE1 BJ ("RRL").
WHEREAS this Tri-Partite Agreement is entered into pursuant to the Deferred
Terms Agreement made between MORILA and Mopps.
NOW THEREFORE it is agreed as follows:
1. DEFINITIONS
Unless expressly defined or the context requires otherwise,
capitalised terms shall have the same in meanings as set out in the
Deferred Terms Agreement save that the following capitalised terms
shall have the meanings herein specified, and shall include in the
singular number the plural and in the plural the singular:
DEFERRED TERMS AGREEMENT the agreement dated [ ] between MORILA and Mopps for the
sale and purchase of generating and other equipment together
with the supply of spare parts and other assistance as
therein set out.
LOAN AGREEMENT means the Loan Agreement, dated [ ] November 1999, among
Societe des Mines de Morila SA, as the Borrower, Randgold
Resources Limited, Randgold and Exploration Company Limited
and Randgold Resources (Morila) Limited, as the Completion
Guarantors, various banks and
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other financial institutions, as the Lenders, NM Rothschild
& Sons Limited and Standard Bank London Limited, as the
Co-Arrangers, and NM Rothschild & Sons Limited, as the Agent
for the Lenders.
OFFSHORE BANK ACCOUNT means the "Operating Account" as defined in the Loan Agreement.
STATEMENT OF CASH
CASHCADE - STAGE I means the statement appearing in Appendix 1 to this Tri-Partite
Agreement.
STATEMENT OF CASH CASCADE
- STAGE II means the statement of appearing in Appendix 2 to this Tri-Partite
Agreement.
2. OFFSHORE ACCOUNT
RRL will give full details of the Offshore Bank Account to Mopps
immediately upon the opening of such account. RRL and MORILA shall
operate and maintain the Offshore Bank Account in accordance with the
Statement of Cash Cascade - Stage I from the date such account is
opened until and including the date of repayment until and including
the date of repayment in full of all Obligations (as defined in the
Loan Agreement) pursuant to the Loan Agreement and each other Loan
Document. MORILA shall notify Mopps in writing immediately upon the
occurrence of such date of full repayment. After such date, RRL and
MORILA shall operate and maintain the Offshore Bank Account in
accordance with the Statement of Cash Cascade - Stage II.
3. PAYMENTS FROM THE OFFSHORE BANK ACCOUNT
MORILA and RRL hereby confirm that payments to Mopps pursuant to the
Deferred Terms Agreement are Project Costs (as defined in the Loan
Agreement) for the purposes of the Loan Agreement and MORILA and RRL
hereby agree to supply to Mopps written confirmation that such
payments are Project Costs (as
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defined in the Loan Agreement) from NM Rothschild & Sons Limited as
Agent for the Lenders.
4. CHARGING OF THE OFFSHORE BANK ACCOUNT
In the event that either or both MORILA and RRL permit any party to
take a charge by way of security or shall grant any pledge or
otherwise encumber the Offshore Bank Account, other than in
accordance with the Loan Agreement dated [ ] November 1999 as amended
from time to time, then and in any such case either or both MORILA
and RRL (as the case may be) shall issue such authorisations as shall
be appropriate and shall secure that the holder or holders of such
security shall so permit to the intent that Mopps shall receive from
the Offshore Bank Account as an operational expense of the Mine such
amount or amounts as are properly due and owing under this
Tri-Partite Agreement.
5. TERMINATION
This Tri-Partite Agreement shall expire on the expiration of the term
or on receipt by Mopps of all sums properly payable in the event of
the earlier termination of the Deferred Terms Agreement.
6. PROPER LAW
This Tri-Partite Agreement and the rights and obligations of the
parties hereunder shall be governed by and construed in accordance
with the Laws of England, the parties hereby submit to the
non-exclusive jurisdiction of the English Courts and MORILA hereby
irrevocably appoints RRL to accept service of all proceedings on its
behalf.
7. SERVICE
The address for service for Mopps shall be as appears in the Deferred
Terms Agreement or such other address as may be notified in
accordance with its terms. The address for services of RRL shall be
at its registered office from time to time copied to ▇▇ ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇.
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IN WITNESS WHEREOF the parties have caused the Tri-Partite Agreement to be duly
executed and delivered as a deed by their duly authorised Officers or
representatives as of the date first above written.
SIGNED by
.....................................................
for and on behalf of ROLLS-ROYCE POWER VENTURES LIMITED
SIGNED by
.....................................................
for and on behalf of SOCIETE DES MINES DE MORILA
SIGNED by
.....................................................
for and on behalf of RANDGOLD RESOURCES LIMITED
-79-
APPENDIX 1
STATEMENT OF CASH CASCADE - STAGE I
1. The gold is to be purchased ex Mine by NM Rothschilds and payment
shall be made within 2 Business Days of delivery into the Offshore
Bank Account.
2. Payments may only be made out of the account in accordance with the
mandate requiring any authorisation to be signed by authorised
persons who are employed by MORILA. Any change in signatory can only
be with the consent of the existing signatories.
3. MORILA is only entitled under its current arrangements with the Mali
Government and in accordance with Mali law to hold two bank accounts,
one onshore Mali and the other offshore. The onshore account will
receive funds from the Offshore Bank Account which will be used to
discharge local liabilities of MORILA. MORILA hereby warrants that
any change to its current arrangements with the Mali Government shall
accord with the provisions of the Loan Agreement in relation to the
structure, operation and maintenance of the Operating Account and
Debt Service Account (as defined in the Loan Agreement).
4. In addition to payments to the onshore account, the Offshore Bank
Account shall be utilised only in accordance with the terms of the
Loan Agreement.
5. Payments to MORILA shall be to the Offshore Bank Account.
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APPENDIX 2
STATEMENT OF CASH CASCADE - STAGE II
1. Following notification by MORILA to Mopps of the occurrence of the
date of repayment in full of all Obligations (as defined in the Loan
Agreement) pursuant to the Loan Agreement and each other loan
document, in the event that the Offshore Bank Account shall not, or
shall cease to, be held in accordance with the Statement of Cash
Cascade - Stage I, then RRL shall cause a substitute bank account to
be opened at a bank of international repute outside the Republic of
Mali. The provisions of this Tri-Partite Agreement shall apply to
such substitute account as if it were the Offshore Bank Account and
the account shall be operated and maintained in accordance with this
Appendix 2.
2. Payments may only be made out of the Offshore Bank Account in
accordance with the mandate requiring any authorisation to be signed
by authorised persons who are employed by Randgold Resources Limited.
Any change in signatory can only be with the consent of the existing
signatories.
3. MORILA is only entitled under its arrangements with the Mali
Government and in accordance with Mali law to hold two bank accounts,
one onshore Mali and the other offshore. The onshore account will
receive funds from the Offshore Bank Account which will be used to
discharge local liabilities of MORILA.
4. In addition to payments to the onshore account, the Offshore Bank
Account shall be utilised to:
4.1 discharge trade creditors;
4.2 discharge, unless discharged out of other funds of Randgold Resources
Limited, the debt service to MORILA's Lenders
4.3 pay management and other fees properly payable to Randgold Resources
Limited; and
4.4 discharge inter-company debts.
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5. Payments to Randgold Resources Limited are made either to its rand
bank account in South Africa or to a bank account held in Jersey,
Channel Islands, with National Westminster Bank plc.
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EXHIBIT 3
PARTS 1, 2 AND 3
PLANT, BALANCE OF PLANT AND EXISTING FACILITY
Parts 1, 2 and 3 appear as the final three columns in the tables below.
Those items marked with "*" are to be Sourced by Mopps in accordance with
Section 5.3.
SECTION DESCRIPTION QTY PLANT SUPPLY BALANCE OF EXISTING
BY MOPPS - PLANT SUPPLY FACILITY-
PART 1 BY MORILA PART 3
PART 2
A. POWER GENERATION
A1 GENERATING SET
A1.1 Engine (With Base Plate)
Diesel Engine: ▇▇▇▇▇ 5012; 750 5 5
RPM; 6,300 kWb (ISO)
A1.2 Generator (With Base Plate)
Generator: 11,000 Volt; 50Hz 5 5
A1.3 Coupling, Flywheel
Flexible coupling 5 5
Flywheel cover 5 5
A1.4 Fixing Rails And Anchor Bolts
Anchor bolts (set) for engine and 5 5
generator
Epoxy grouting 5 5
A1.5 Flexible Connections
Flexible connections (set) 5 5
A1.6 Platforms
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SECTION DESCRIPTION QTY PLANT SUPPLY BALANCE OF EXISTING
BY MOPPS - PLANT SUPPLY FACILITY-
PART 1 BY MORILA PART 3
PART 2
Engine maintenance platform 5 5
prefabricated
A2 AUXILIARY SYSTEMS
A2.1 Fuel Oil System
A2.1.1 Gas oil (GO) Fuel System (for black
start sets and back-up)
Piping, pumps and valves GO fuel 1 1
system (lot) (from GO
storage/treatment tank to common
treatment module)
GO storage/treatment tank 1 1
Treated GO service tank 1 1
GO pump and filters 1 1
A2.1.2 Distillate Diesel Oil (DDO) Fuel
System - New
DDO fuel unloading meter 1 1
DDO fuel unloading pump unit 1 1
DDO fuel storage tanks (2,000,000 1 1
litres) - supplied as rolled plate
and fabricated on site
DDO fuel transfer pump unit 2 2
Piping, pumps and valves DDO fuel 1 1
system (lot) (from DDO storage tank
to DDO treatment module)
DDO Treatment Tank 1 1
Fuel Oil Centrifuge (set) 1 1
Treated DDO service tank 1 1
DDO pump and filters 1 1
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SECTION DESCRIPTION QTY PLANT SUPPLY BALANCE OF EXISTING
BY MOPPS - PLANT SUPPLY FACILITY-
PART 1 BY MORILA PART 3
PART 2
DDO Fuel Heaters - Tank 1 1
DDO Fuel Heaters - Engine 5 5
Engine fuel oil module 5 5
Piping, pumps and valves for engine 5 5
fuel oil system
A2.2 Lubricating Oil System
A2.2.1 Engine Lubricating Oil System
Lubricating Oil cooler module 5 5
Lubricating Oil priming pump 5 5
Lubricating Oil filter unit 5 5
Lubricating Oil thermostatic three 5 5
way valve
Piping, pumps and valves for engineer 5 5
Lubricating Oil system (lot)
A2.2.2 Plant Lubricating Oil System
Lube. Oil storage tank 1 1
Service tank 1 1
Piping, pumps, valves ad filters - 1 1
plant lubricating oil system (lot)
A2.3 COMPRESSED AIR SYSTEM
Starting air unit 2 2
Starting air bottle 5 5
Control air dryer and filter unit 1 1
Piping and valves compressed air 1 1
system (lot)
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SECTION DESCRIPTION QTY PLANT SUPPLY BALANCE OF EXISTING
BY MOPPS - PLANT SUPPLY FACILITY-
PART 1 BY MORILA PART 3
PART 2
Air receiver 1 1
A2.4 COOLING SYSTEM
A2.4.1 Jacket Water Cooling System
Radiator cooler packages 5 5
Preheating unit 5 5
Thermostatic valve high temperature 5 5
system
Piping, pumps and valves engine 1 1
cooling system (lot)
Header/Expansion tank 1 1
First fill of chemicals 1 1
A2.4.2 SECONDARY COOLING WATER SYSTEM
Radiator cooler packages 5 5
Preheating unit 5 5
Thermostatic valve high temperature 5 5
system
Piping, pumps and valves engine 1 1
cooling system (lot)
Header/Expansion tank 1 1
First fill of chemicals 1 1
A2.5 CHARGE AIR SYSTEM
Charge air inertial filter stage 5 5
Charge air intake filter 5 5
Charge air intake silencer 5 5
Bellows for charge intake air system 5 5
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SECTION DESCRIPTION QTY PLANT SUPPLY BALANCE OF EXISTING
BY MOPPS - PLANT SUPPLY FACILITY-
PART 1 BY MORILA PART 3
PART 2
Ducting charge intake air system 5 5
A2.6 EXHAUST SYSTEM
Exhaust gas silencer 5 5
Engine exhaust system bellows 5 5
Ducting exhaust gas system 5 5
Insulation exhaust gas ducting 5 5
(inside Power House)
Bellows in exhaust system 5 5
Exhaust gas vents 5 5
A2.7 STATION SUPPORT SYSTEM
A2.7.1 Fire Fighting System
Fire fighting water tank 1 1
Fire water pump 2 2
Fire fighting hose reel 2 2
Mobile foam unit 2 2
Fire detection and alarm system 1 1
Piping and valves fire fighting 1 1
system (lot)
CO(2) or dry powder extinguisher 7 7
A2.7.2 Sludge And Waste Oil System
Engine fuel oil drain tank 1 1
Engine fuel oil drain piping, pumps 1 1
and valves
Oil/water separator 1 1
Drainage pumps 2 2
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SECTION DESCRIPTION QTY PLANT SUPPLY BALANCE OF EXISTING
BY MOPPS - PLANT SUPPLY FACILITY-
PART 1 BY MORILA PART 3
PART 2
Sludge transfer pump unit 1 1
Sludge tank 1 1
Piping and valves sludge and water 1 1
oil system (lot)
A2.7.3 Treated Water System
Piping and valves potable water 1 1
system (lot)
Water treatment plant for engine 1 1
cooling system
Piping, pumps and valves for water 1 1
treatment system (lot)
A2.7.4 Auxiliary Diesel Generator Set
Caterpillar Diesel generator sets, 2 2 2
x 720kW (black-start and back-up)
A2.8 STEEL STRUCTURES
Steel structures for charge air duct 1 1
support (lot)
Steel structures for exhaust duct 1 1
support (lot)
Steel structure to support tanks (lot) 1 1
Steel structure outside building (lot) 1 1
-88-
SECTION DESCRIPTION QTY PLANT SUPPLY BALANCE OF EXISTING
BY MOPPS - PLANT SUPPLY FACILITY-
PART 1 BY MORILA PART 3
PART 2
A3 ELECTRICAL SYSTEM
A3.1 MAIN SWITCH GEAR
Generator incomer cubicles 5 5
Bus section cubicles 1 1
Outgoing feeder cubicles 2 2
Station transformer cubicles 2 2
Neutral earthing cubicle 1 1
Generator cubicle cables set 5 5
Neutral earthing cables set 1 1
Cable racking and supports (lot) 1 1
A3.2 ENGINE SERVICES SYSTEM
MCC (set) 5 5
Low voltage cables (set) 5 5
Local control panels 5 5
Local low voltage cables 5 5
Cable racking and supports (lot) 1 1
A3.3 STATION SERVICES SYSTEM
Station auxiliary transformer 2 2
Low voltage switchboard 1 1
Cable racking and supports (lot) 1 1
Low voltage MCC (set) 1 1
A3.4 DC SYSTEM
DC system for power plant control 1 1
Cable (set) 1 1
Cable racking and supports (lot) 1 1
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SECTION DESCRIPTION QTY PLANT SUPPLY BALANCE OF EXISTING
BY MOPPS - PLANT SUPPLY FACILITY-
PART 1 BY MORILA PART 3
PART 2
A3.5 EARTHINGS
Safety earthing 1 1
Neutral Earthing resistor 1 1
Neutral Earthing contactors 5 5
Neutral Cables (set) 1 1
Cable racking and supports (lot) 1 1
A4 INSTRUMENTATION, CONTROL AND
MONITORING
A4.1 CONTROL SYSTEM
PC Central Control System 1 1
A4.2 INSTRUMENTATION
Engine instruments and meters 5 5
Generator instruments and sensors 5 5
Fiscal meters for electricity, fuel 1 1
(both GO & DDO (set))
Engine water meters 1 1
A4.3 Cables And Accessories
Engine control and instrumentation 5 5
cables
Cables for meters (set) 1 1
A5 TOOLS
Engine maintenance tools (set) 1 1
Tools for turbo charger (set) 1 1
Special tools for mechanical 1 1
equipment (set)
Special tools for electrical 1 1
equipment (set)
Facilities for analysing Fuel, water 1 1
and lube oil
-90-
SECTION DESCRIPTION QTY PLANT SUPPLY BALANCE OF EXISTING
BY MOPPS - PLANT SUPPLY FACILITY-
PART 1 BY MORILA PART 3
PART 2
B SITE FACILITIES
B1 BUILDINGS
Power House including engine hall,
auxiliaries area, control,
medium voltage switchgear &
low voltage switchgear room. 1 1
Plumbing and sanitary installation in 1 1
power house
Lighting 1 1
Lightning protection 1 1
Furniture for office, document store, 1 1
workshop and store
Shelves system (in store) 1 1
Lockers/cabinets for tools etc 1 1
Overhead crane 1 1
Air conditioning for office, toilets 1 1
and workshop
Fuel treatment house (if required) 1 1
Office 1 1
Air conditioning for control, medium 1 1
voltage switchgear & low voltage
switchgear room
Fire fighting pump shelter 1 1
B2 FOUNDATION
Foundation power house and generator 1 1
(sets)
Foundation DDO Storage Tanks 1 1
Foundation cooling radiators 5 5
Foundation exhaust gas silencers 5 5
Foundation fire water tank (if 1 1
-91-
SECTION DESCRIPTION QTY PLANT SUPPLY BALANCE OF EXISTING
BY MOPPS - PLANT SUPPLY FACILITY-
PART 1 BY MORILA PART 3
PART 2
necessary)
Foundation fuel treatment house 1 1
B3 SITE MISCELLANEOUS
B3.1
Bund for DDO fuel storage (Storage 1 1
tanks)
Bund for fuel treatment area 1 1
B3.2 Roads
Road inside the power station fence 1 1
Parking area 1 1
Unloading pad for fuel trucks 1 1
B3.3 Utilities
Sewage system inside power station 1 1
fence
Rain water drainage system inside 1 1
power station fence
Telephone equipment for connection to 1
mine system 1
B3.4 Security Systems
Fence around Facility 1 1
Fence around DDO storage tanks 1 1
B4 MATERIALS
B4.1 Materials for Civil and Building 1 1
Works, e.g. formworks, reinforcement
bar, fabric, cement, sand, aggregate,
epoxy grout, bricks, septic tanks,
furniture (lot).
B5.2 Materials for Mechanical Works, e.g. 1 1
welding rods, nuts, bolts, steel
sections.
-92-
SECTION DESCRIPTION QTY PLANT SUPPLY BALANCE OF EXISTING
BY MOPPS - PLANT SUPPLY FACILITY-
PART 1 BY MORILA PART 3
PART 2
B5.3 Materials for Electrical and C&I 1 1
Works, e.g. cable lugs, core numbers,
LV and HV cable, insulation tape,
cable ties.
-93-
PART 4
TECHNICAL REQUIREMENTS
1- INTRODUCTION
This Exhibit 3, Part 4 describes the Facility and the associated technical
details as follows.
2- DESCRIPTION OF THE FACILITY
2.1- GENERAL
The Facility shall be located in the area designated by MORILA for the operation
of the Facility, which shall operate under the following conditions:
Altitude: 300 metres above sea level
Maximum ambient temperature 45(degree)C
Minimum ambient temperature 10(degree)C
Design ambient temperature 37(degree)C
Minimum ground bearing capacity 150 kPa
All contracted and guaranteed levels of Availability, Fuel Efficiency Rate and
electrical limits are quoted at the Site, which includes the average ambient
temperature of 37(degree)C and a minimum power factor of 0.8.
Generally, the Facility shall be designed and built according to the industry
standards, incorporating harmonised European Standards, British Standards and
Codes of Practice relevant to the Works.
The Facility shall include the following:
Perimeter fence;
Road and access area within the Facility Site boundary;
Drainage;
-94-
Earthing grid;
Fire detection tank and hydrant system;
Main Facility building (including engine & auxiliaries)
Bulk Distillate Diesel Oil (DDO) storage facilities;
Lubricating oil storage facilities;
Radiators;
Annex to the main building including office, mess room, shower & toilet room,
control and electrical room, workshop and dedicated storage area.
Any works inside the Facility boundary.
Engines (▇▇▇▇▇ 5012) together with associated 11kV;
Engine auxiliaries including: lube-oil treatment module, cooling module, fuel
modules;
Starting air system;
Electrical MV system;
Electrical LV system;
DC and control system;
Intercom system;
Facilities for analysing Fuel, water and lube oil;
Mechanical and electrical building services lighting, small power, ventilation
and AC, plumbing and sanitary facilities, fire alarm system;
High speed diesel generator set with a capacity of 1.4MW at the Site.
The Facility specifically excludes:
All roads outside the Facility Site boundary;
The provision of services: water, sewage;
The provision and maintenance of housing for the staff of Mopps and the
Operator;
Any works outside the Facility site boundary;
A list of equipment supplied as part of the Facility is given in Parts 1, 2 and
3 of this Exhibit.
-95-
3- INTERCONNECTION POINTS
3.1- WATER
POTABLE WATER
MORILA shall supply potable water within the Facility. Such water shall be for
domestic usage. The estimated daily usage by the Facility is 2m3/day and such
supply shall be through a 50mm pipe at a minimum pressure of 7bar(g). The
interface point shall be at the Facility boundary at a flange the size of which
shall be specified by Mopps.
SAND-FILTERED WATER
MORILA shall supply sand-filtered raw river water within the Facility for the
Cooling system filling and top up; turbocharger water washing; and firefighting.
The estimated daily usage by the Facility is 2m3/day.
Such supply shall be through a 100mm pipe at a minimum pressure of 4bar(g) and
the interface point shall be the inlet flange of the Facility water treatment
tank.
FIRE SYSTEM WATER
The Facility fire hydrant systems shall be connected to the MORILA fire system
at a flange and pressure specified by Mopps at the Facility boundary.
3.2- SEWAGE AND DRAINAGE
The Facility sewage and drainage system shall be connected to the Mine's systems
at the Facility boundary.
The Facility drainage system shall incorporate an interceptor trap to normal
industrial standards.
3.3- DDO FUEL
The point of supply of the DDO fuel shall be the inlet valve of the bulk fuel
storage tanks. Metering of the DDO fuel for the purpose of Guaranteed Fuel
Efficiency calculations shall occur at the outlet of the fuel treatment module.
-96-
3.4- GO FUEL
Morila - the point of supply of GO fuel shall be at the inlet valve of the GO
fuel storage tank within the Facility boundary.
3.5- LUBE-OIL
MORILA shall supply the lubrication oil necessary for the Facility at the inlet
valve of the bulk lubrication oil storage tank. The Lube Oil Specification is
included in Part 4 of Exhibit 8.
3.6- ROADS
This point of interface of the Facility roads with the incoming roads to the
Facility is at the Facility boundary.
3.7- ELECTRICAL
The electrical interface shall be as follows:
Morila - 11kV Outgoing feeders:
The electrical interconnection points shall be at the 11kV terminals of the two
outgoing 11kV feeders circuit breakers. The feeder panels, included in the
Facility shall incorporate export meters (accuracy: + / 0.5%).
3.8 - EARTHING
The 11kV system shall be earthed at one point only through one of two neutral
earthing resistors. These shall be arranged such that at one time, only one
running generator neutral shall be earthed. The only exception to this is if the
11kV system is split and in this case, two neutrals shall be earthed.
The earthing connection between the Mine and the Facility shall be supplied,
installed and maintained by MORILA (including supply and installation of
necessary cables, trays, supports, glands, lugs and termination kits). The
interface with the Mine earth system shall be at the Facility border.
-97-
3.9 - OIL WASTE AND SLUDGE
The interconnection point for the removal of oil waste and sludge from the
Facility shall be the outlet flange of the sludge drain pump within the Facility
boundary.
3.10 - TELEPHONE.
MORILA shall install a complete phone system to the Facility that operates on
the same system as MORILA with 2 lines for international dialling.
4- ELECTRICAL LIMITS
ELECTRICAL REQUIREMENT
- The Facility includes 5 medium speed diesel generators.
- The installed capacity shall be 27.5 MW at Site conditions.
- The Facility shall be designed to provide the Guaranteed Contracted
Capacity.
- Each medium speed generating set shall be able to deliver 5.7MW, at
the generator terminals, at a Site temperature of 37(degree)C.
FACILITY ELECTRICAL DESIGN:
- Generally, the electrical equipment incorporated in the facility
shall comply with IEC standards / regulations.
- Voltage: 11kV +/ 5% (steady state) at Facility bus-bar.
- Frequency: 50hz.+/- 2.5% (steady state) at Facility bus-bar.
- 2 x 100% feeders rating 1250A each.
- Facility bus-bar design 2000A - Fault level 25kA (assuming a maximum
8kA fault level contribution from the Mine).
-98-
STARTING REQUIREMENTS:
- The Facility shall start any load having the starting profile
enclosed in paragraph 5 of this Part of this Exhibit.
- The voltage dip at the Facility bus-bar during start up of the load
described by the curves in paragraph 5 of this Part of this Exhibit
shall be limited to 10% with a recovery time within an average of 3
seconds. (Based on starting a mill with an existing running load of
up to 12MW utilising 4 engines on start up.)
- The frequency dip at the Facility bus-bar during start up of the load
described by the curves in paragraph 5 of this Part of this Exhibit
shall be limited to 5% below the nominal frequency (50hz.) with a
recovery time of 1 second based on starting a mill with an existing
running load of up to 12 MW. The power factor of the mill motors at
start up shall be assumed to be 0.87.)
EFFECT OF SUDDEN LOAD SHED OF 12.5MW.
- The voltage variation at the Facility bus-bar terminals will be
limited to 8% with a recovery time of 1 second.
- The frequency variation at the Facility bus-bar terminals shall be
limited to 8% with a recovery time of 5 seconds.
5- LOAD PROFILE
The Facility is designed to operate within the limits set in Paragraph 4 when
starting loads as follows:
-99-
p
EXHIBIT 4
PART 1
SHIPMENT SCHEDULE
1.1 Mopps shall arrange for shipment of Plant in accordance with the
following Shipment Schedule. For the purpose of this Part 1 of
Exhibit 4, the Base Date shall be 14 days following satisfaction of
the Suspensive Conditions.
MORILA
------------------------------------------------ -----------------------------------------------
ITEM OF PLANT LATEST DATE OF SHIPMENT (WEEKS AFTER BASE
DATE)
------------------------------------------------ -----------------------------------------------
Unit 1 and its associated auxiliaries 8
------------------------------------------------ -----------------------------------------------
Unit 2 and its associated auxiliaries 9
------------------------------------------------ -----------------------------------------------
Unit 3 and its associated auxiliaries 12
------------------------------------------------ -----------------------------------------------
Unit 4, its associated auxiliaries and station 18
common systems
------------------------------------------------ -----------------------------------------------
Unit 5 and its associated auxiliaries 34
------------------------------------------------ -----------------------------------------------
-100-
PART 2
SPARE PARTS SCHEDULE
PART DESCRIPTION REQUIRED EVERY ... HOURS EX-WORKS DELIVERY IN
WEEKS
FUEL OIL FILTER 1000 1
LUBE OIL FILTER 1000 1
INJECTOR OVERHAUL PACK 6000 4
CRANKCASE DOOR KIT 6000 4
N01 INTER SERVICE JOINTS (12 CYLINDER) 6000 4
CRANKCASE VALVE JOINTS 6000 4
CYLINDER HEAD FITTING PACK 12000 4
PISTON RING PACK 12000 4
LARGE END BEARING 12000 4
T/C SPARES KIT 12000 6
INJ PUMP OVERHAUL PACK 12000 10
PISTON & LINER FITTING PACK 12000 6
L.O. PUMP OVERHAUL PACK 12000 10
WATER PUMP OVERHAUL PACK 12000 10
N02 INTER SERVICE JOINTS (12 CYLINDER) 12000 10
EXHAUST VALVE 24000 10
INLET VALVE 24000 6
VALVE GUIDE 24000 6
EXH VALVE SEAT 24000 6
INL VALVE SEAT 24000 6
MAIN BEARING 24000 10
THRUST BEARING 24000 10
▇▇▇▇ ▇▇▇ BOLT 24000 4
▇▇▇▇ ▇▇▇ NUT 24000 4
▇▇▇▇ ▇▇▇ STUD 24000 4
▇▇▇▇ ▇▇▇ NUT 24000 4
VALVE SPRING 24000 10
VALVE COLLET 24000 10
TAPPET ASSEMBLY 24000 10
VALVE ROTATOR 24000 10
EXHAUST BELLOWS 24000 6
VEE CLAMP 24000 6
AIR INLET BELLOWS 24000 6
MAJOR OVERHAUL JOINT KIT (12 CYLINDER) 24000 10
▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ 6
CAMSHAFT ▇▇▇▇ 36000 6
CAMSHAFT THRUST RING 36000 6
GEAR ▇▇▇▇ 36000 6
VALVE LEVER ▇▇▇▇ 36000 6
PRESSURE RELIEF VALVE 36000 6
START AIR VALVE 36000 6
INTERM GEAR ▇▇▇▇ 36000 6
ROLLER 36000 6
-101-
PART DESCRIPTION REQUIRED EVERY ... HOURS EX-WORKS DELIVERY IN
WEEKS
ROLLER PIN 36000 4
FUEL PUMP ROLLER 36000 6
FIXED TAPPET 36000 6
-102-
PART 3
SPARE PARTS INVENTORY
PART DESCRIPTION
QTY
6 CYLINDER HEAD C/W INL & EXH VALVE
3 VALVE LEVER BRACKET
3 VALVE LEVER ASSEMBLY
3 CROSSHEAD ASSEMBLY
3 VALVE LEVER SHAFT
3 CYLINDER HEAD RELIEF VALVE
4 INDICATOR VALVE
4 START AIR VALVE
6 CYLINDER HEAD FITTING
6 PISTON ASSEMBLY
6 PISTON RING PACK
6 PISTON PIN
6 CYLINDER LINER
6 PISTON & LINER FITTING PACK
6 CONNECTING ROD
6 LARGE END BEARING
6 MAIN BEARING
2 THRUST BEARING
12 FUEL INJECTORS
12 INJECTOR PIPE
6 INJECTION PUMP
12 INJECTION SEAL PACK
6 PUSH ROD
3 EXHAUST BELLOWS
3 V BAND CLAMP
3 GUIDE BRACKET ASSEMBLY
3 START AIR DISTRIBUTOR
12 MAIN BEARING STUD
12 MAIN BEARING NUT
24 CYLINDER HEAD STUD
24 CYLINDER HEAD NUT
2 TURBOCHARGER COMPLETE
2 LUBE OIL PUMP COMPLETE
2 WATER PUMP COMPLETE
12 DOOR SEAL KIT
1 DIGITAL GOVERNOR & EQUIPMENT
-103-
PART 4
ORDER FORM
Order on printed paper from Operator
Order form
Date:
Order number:
SUPPLIER INFORMATION
name:
address:
contact person:
telephone number:
facsimile number:
------------- --------------- ---------------------------- ------------ -------------- ---------- ------------
ITEM PART NUMBER DESCRIPTION QTY REQUIRED BY UNIT TOTAL PRICE
DATE PRICE
------------- --------------- ---------------------------- ------------ -------------- ---------- ------------
------------- --------------- ---------------------------- ------------ -------------- ---------- ------------
------------- --------------- ---------------------------- ------------ -------------- ---------- ------------
------------- --------------- ---------------------------- ------------ -------------- ---------- ------------
------------- --------------- ---------------------------- ------------ -------------- ---------- ------------
------------- --------------- ---------------------------- ------------ -------------- ---------- ------------
------------- --------------- ---------------------------- ------------ -------------- ---------- ------------
------------- --------------- ---------------------------- ------------ -------------- ---------- ------------
Signature
..........................................
..........................................
Date
-104-
EXHIBIT 5
INSURANCES
In this Exhibit capitalised terms not defined in the Agreement shall bear the
meaning understood within the London Insurance Market.
1. INSURANCE TO BE OBTAINED AND MAINTAINED BY MORILA
1.1 Insurance of the Plant whilst in Transit ex works for replacement value;
Policy Form: MAR 91 or similar policy form
Insured Parties: 1. MORILA
2. Mopps
3. Metallurgical Design & Management (Pty)
Ltd
4. N. M. Rothschild & Sons Ltd
Insured Property: All goods and/or merchandise and/or interests
appertaining to the Insured's business
including all packing materials, receptacles,
labels and the like when necessary for
commercial purposes, and consisting
principally of but not limited to:
Building materials of all descriptions
including cement, steel reinforcing,
machinery and spares, mining equipment,
chemicals (hazardous and non hazardous),
electricity generators and ancillary
equipment, plant crushing equipment, cooling
systems, tools, batch plant, laboratory
equipment, surveying instruments, heavy duty
vehicles, tubing and piping, caterpillar
trucks, electrical goods and cables.
Conditions of Cover: SHIPMENT UNDER DECK - Against all risks of
loss or damage to the subject matter insured
in terms of Institute Cargo Clauses (A).
-105-
SHIPMENT ON DECK (OTHER THAN IN CONTAINER)
LOADS/GOODS SHIPPED LOOSE/UNPROTECTED -
Against loss or damage to the subject matter
insured in terms of Institute Cargo Clauses
(A) excluding rust, oxidisation,
discolouration and water damage.
CONTAINER LOAD SHIPMENTS - Against all risks
of loss or damage to the subject matter
insured in terms of Institute Cargo Clauses
(A).
AIRFREIGHT CONSIGNMENTS - Against all risks
of loss or damage to the subject matter
insured in terms of Institute Cargo Clauses
(Air).
POSTAL SENDINGS - Against all risks of loss
or damage to the subject matter insured in
terms of Institute Cargo Clause (A).
Institute Clauses: The following Institute Clauses apply:
Institute Cargo Clauses (A) 1.1.1982 (Clause
No. 252)
Institute Cargo Clauses (B) 1.1.1982 (Clause
No. 253)
Institute Cargo Clauses (Air) 1.1.1982
(Clause No. 259)
Institute Classification Clause 13.04.1992
(Clause No. 354)
Institute Replacement Clause 01.01.1934
(Clause No. 161)
Institute Strikes Clauses (Cargo) 1.1.1982
(Clause No. 256)
Institute Strikes Clauses (Air Cargo)
1.1.1982 (Clause No. 260)
Institute War Clauses (Cargo) 1.1.1982
(Clause No. 255)
Institute War Clauses (Air Cargo) (excluding
Sendings by Post) 1.1.1982 (Clause No. 258)
-106-
Institute War Clauses (Sendings by Post)
1.1.1982 (Clause No. 257)
Institute War Cancellation Clause (Cargo)
01.12.1982 (Clause No. 271)
Institute Location Clause 26.03.1980 (Clause
No. 66)
Institute Malicious Damage Clause 01.08.1982
(Clause No. 266)
Institute Theft, Pilferage and Non-delivery
Clause 01.12.1982 (Clause No. 272)
Institute Radioactive Contamination Exclusion
Clause 1.10.1990 (Clause No. 356)
The "Standard" S.A.I.A. Exceptions
Important Clause
First Loss Clause
Limit of Indemnity: Maximum per Conveyance and/or Vessel and/or
Aircraft:
Rand 20,000,000 (or the maximum individual
declared shipment value).
Maximum per Location:
Rand 40,000,000
Valuation Basis: Delivery Cost plus 10%.
In the event of total loss prior to landing,
the basis of valuation shall be:
The prime cost of the goods plus expenses of
and incidental to shipping the freight for
which the Insured is liable and the charges
of insurance
-107-
Also to pay duty and/or VAT and/or landing
and similar charges, if incurred in
anticipation of arrival.
The Insured agrees to take all reasonable
steps to obtain a refund of such charges and
return the net amount to underwriters.
Voyages: From the time that the Insured Property is
first moved for commencement of transit
within contractors' or suppliers' or
sub-contractors' premises anywhere in the
world, including temporary storage in the
ordinary course of transit, to delivery to
final contract site situated at Morila mine,
Mali and/or vice versa.
Including all loading and unloading risks.
Policy Period: Continuous open cover, until cancelled, to
accept all shipments and/or sendings for the
full amount as declared on or after 30th
June 1999.
Conveyances: Conveyances and vessel and/or vessels of any
type and/or air and/or post and/or rail
and/or road conveyances.
Subject to the Institute Classification
Clause or held covered.
The terms of the Classification Clause shall
not prejudice any claims hereunder when
presentation of claims to Underwriters is the
first indication that transhipment was
effected on a vessel not covered by the
Institute Classification Clause; the
appropriate additional premium will be paid
if required.
Deductibles: Rand 10,000 will apply each and every loss.
Exclusions: Per Institute Cargo Clauses (A), Institute
Cargo Clauses (B), Institute Strikes Clauses
(Cargo) and Institute War Clauses (Cargo)
-108-
Electrical and Mechanical Derangement unless
caused by an insured peril
Extensions: The policy wording to include but not be
limited to:
- Brand Names/Trade Marks
- Returned Goods Clause
- General Average and Salvage Charges
Payable in Full
- Insolvency Exclusion Clause (JC 93)
- Deck Cargo shipped on Under Deck
▇▇▇▇ of Lading
- Contribution Clause
- Debris Removal Costs Clause
- Duty of Insured Clause
- Letter of Credit Clause
- Concealed Damage (30 days)
- Cover after Discharge (120 days -
sea, 60 days - Air)
- Hijacking Clause
- Labels Clause
- Repairers Clause
- Replacement Clause
- Apportionment of Recoveries
- Destruction of Salvage
- Shippers Protection Clause
- First Loss Clause
- CIF Shipments Clause (Imports)
-109-
1.2 Construction All Risks insurance during the Construction Phase;
Insured Parties: 1. MORILA
2. Mopps
3. The Operator
4. Metallurgical Design & Management (Pty)
Ltd
5. N. M. Rothschild & Sons Ltd
6. All other contractors and sub-contractors
of any tier.
Project: The erection of a new mine in Mali West
Africa including the construction, erection,
testing, commissioning and maintenance of a
27.5 MW diesel engine power station situated
at Morila.
Insured Property: All property and interests of every
description intended for the Project
including permanent and temporary works and
materials, plant and equipment for
incorporation therein.
Indemnity: During Transit, Construction, Erection,
Testing and Commissioning
"All Risks" of loss, destruction or damage to
the Insured Property arising from any cause
(not otherwise excluded) whilst on or about
the Site of the Project and elsewhere in Mali
including whilst in transit (other than by
sea or air) or during any trans-shipment,
storage or deviations en route and including
loading and unloading.
During Defects Liability or Maintenance
Period.
Loss, destruction or damage to the Insured
Property occurring whilst the Contractor is
carrying out his
-110-
responsibilities during the Defects Liability
Period specified in the Contract.
Period: From date 01 September 1999 to 31 August 2000
annually renewable for construction/erection,
on site testing and commissioning (plus 12
months defects liability after completion).
Limit of Indemnity: US$22,000,000 being the full contract sum for
the Power Plant only (including an allowance
for variations and any free supplied items).
Deductibles: The first US$50,000 of each and every
occurrence
Deductibles to be paid by the party
contractually responsible for the occurrence.
Extensions: The policy wording to include:
Automatic Reinstatement of Sum Insured Clause
without additional premium for losses up to
US$150,000
Cost Escalation Clause - 20%
Professional Fees and Debris Removal Clauses
Local Authorities Clause
Free Issue Material Clause
Expediting Expenses Clause
50:50 Marine Loss Sharing Clause
Loss Prevention Expenses Clause
Plans, Specifications and Computer Records
Clause
Financial Interest of Other Parties Clause
Testing and Commissioning Clause - 3 months
(90 days)
-111-
Seventy Two Hour Clause.
Exclusions: The policy wording may exclude, but not be
limited to:
Design, plan, specification, materials,
workmanship clause (however resultant
damage to be included)
Wear, tear, gradual deterioration, etc.
Unexplained Shortages
Loss of Cash, etc.
Liquidated Damages, Penalties or any
Consequential Loss not specifically included
War risks etc.
Radioactive Contamination, etc.
Transit by sea or air
Constructional plant, equipment, tools,
tackle, site huts and contents
1.3 Third Party Liability insurance during the Construction Phase;
Insured Parties: 1. MORILA
2. Mopps
3. The Operator
4. Metallurgical Design & Management (Pty)
Ltd
5. N. M. Rothschild & Sons Ltd
6. All other contractors and sub-contractors
of any tier
Project: The erection of a new mine in Mali West
Africa including the construction, erection,
testing, commissioning and
-112-
maintenance of a 27.5 MW diesel engine power
station situated at Morila.
Indemnity: The legal liability of the Insured to pay
damages, costs and expenses as a result of:-
- death of or bodily injury to or illness
or disease contracted by any person
- loss of or damage to property
- interference to property or the enjoyment
of use thereof by obstruction, trespass,
loss of amenities, nuisance or any like
cause, arising out of and in connection
with the project.
Limit of Indemnity: US$5,000,000 any one occurrence or series
of occurrences arising from one event but
in the aggregate in respect of sudden,
unintended and unexpected pollution in
respect of the Power Plant only and
US$2,500,000 for the balance of the Project.
Territorial Limits: Worldwide
Deductibles: The first US$5,000 of each and every
occurrence in respect of third party
property damage only.
Period: From date 01 September 1999 to 31 August 2000
annually renewable for construction/erection,
on site testing and commissioning (plus 12
months defects liability after completion).
Extensions: The policy wording to include but not be
limited to:
- Costs Clause
- Cross Liability Clause.
Exclusions: The policy wording may exclude, but not be
limited to:
-113-
- the Insured Parties' own employees
- use of mechanically propelled vehicles
licensed for road use, aircraft and
watercraft
- loss, destruction or damage to property
which was inevitable
- pollution or contamination unless caused
by a sudden, unintended and unexpected
incident (aggregate limit of indemnity).
1.4 Third Party Liability Policy during the Operational Phase;
Insured Party: MORILA
Insurance Cover: All sums which the Insured shall become
legally liable to pay as damages or
compensation consequent upon Personal Injury
or Property Damage and other contingencies
arising out of an Occurrence during the
Period of Insurance in connection with the
Business by reason of liability imposed upon
the Insured by law or assumed by the Insured
under any written contract or agreement.
The Business: The Company undertakes exploration worldwide
and manages the Syama and Morila Gold Mines
in Mali West Africa which includes
electricity generation through ownership
and/or operation and/or maintenance of the
power station at Morila mine, Mali and all
ancillary and associated activities of The
Insured.
-114-
Period of Insurance: (a) from 1 September 1999 to 31 August
2000 (both days inclusive)
(b) any subsequent period for which the
Insurer may accept payment for the
renewal of this Policy.
Territorial Limits: Worldwide.
Limits of Liability:
Public Liability: UK(pound)50,000,000 any one occurrence in
respect of claims made during the Period
of Insurance
Pollution Liability: UK(pound)50,000,000 any one occurrence and
UK(pound)50,000,000 in the aggregate in
respect of claims made during the Period of
Insurance
Excess Provision: Rand 75,000 in respect of each and every
incident of property damage.
Main Exclusions:
EMPLOYEES: Personal injury to employees, for this purpose including all
persons self-employed, hired, loaned, acquiring work experience and all
labour supplied by and/or hired from and/or through others.
VEHICLES: Injury or third party property damage arising from the
ownership possession or use of aircraft, waterborne craft and mechanical
vehicles. This exclusion does not apply to mechanical vehicles being used
as a tool of trade.
POLLUTION: Other than caused by the sudden identifiable unintended and
unexpected incident which takes place in its entirety at a specific time
and place during the Period of Insurance anywhere in the world other than
North America or where such claim is brought anywhere in the world other
than in a Court of Law in North America.
DEFECTIVE DESIGN: Claims arising out of advice, design or specification
given for a separate and specific fee
-115-
CARE CUSTODY OR CONTROL: Damage to property belonging to the Insured or
in the care custody or control of the Insured other than
(a) Employees', directors' and/or visitors' property (including
vehicles and contents)
(b) Premises (including their contents), plant, equipment and all
other property not owned by or leased or rented to the Insured at
or on which the Insured is undertaking work in connection with
the Business.
(c) Premises leased or rented to the Insured (including landlords
fixtures and fittings) except where legal liability has been
assumed under a tenancy or other agreement and would not have
attached in the absence of such agreement.
PRODUCTS SUPPLIED: legal liability for the cost of repairing damage to
and/or costs of recall, removal, repair, alteration, replacement or
reinstatement of any products supplied and/or contract works executed by
The Insured, caused or necessitated by any defect therein or
unsuitability thereof for its intended purpose.
General war, radioactivity, sonic boom and penalty and delay standard
exclusions
Main Extensions:
1. Director's Indemnity
2. Project Facilities Indemnity
3. Legal fees and expenses
4. Cross Liabilities Clause
5. Data Protection Act
6. Defective Premises Act.
Subject to Policy Terms, Conditions and Exceptions.
1.5 Material Damage Insurance (All Risks) during the Operational Phase;
-116-
Insured: 1. MORILA
2. Mopps
3. N. M. Rothschild & Sons Ltd
Cover: Section I
Damage to power station property from any
cause not excluded by policy terms,
exceptions, definitions and conditions
Section II
Business interruption arising from Damage
insured under Section I Damage to the Insured
Property from any unexcluded cause during the
Insurance Period arising out of or in the
course of or in connection with the execution
of The Business.
Business: Mining and gold extraction activities
including electricity generation through
ownership and/or operation and/or maintenance
of the power station at Morila mine and all
ancillary and associated activities of The
Insured.
Premises: Morila mine, Mali
Period: From 1 September 1999 to 31 August 2000 (both
days inclusive) and any subsequent period for
which the Insurer may accept payment for the
renewal of this Policy.
Sum Insured Section I US$22,000,000 (Power Plant Only)
Section II US$4,000,000 (Power Plant Only)
-117-
Indemnity Period: Six (6) months beginning after the time
exclusion during which the results of
the Business shall be adversely affected
in consequence of the Damage.
Excess: US$500,000 per event - combined both Sections
Exclusions: All Sections
DEFECTS: latent defects, defective materials or workmanship or of the
Insured's own faulty design, plan or specification, other than resulting
in insured damage.
WEAR AND TEAR: wear and tear, wasting, wearing out or away or other
gradual deterioration, rust, oxidation, wet or dry rot, shrinkage,
evaporation, loss of weight, dampness, dryness, marring, scratching,
vermin or insect damage other than resulting in insured damage.
CONSEQUENTIAL LOSS: liquidated damages, penalties for delay or
detention or in connection with guarantees of performance or
efficiency or any other consequential loss unless specifically
provided for by this Policy.
VEHICLES: damage to any mechanically propelled vehicle licensed for
road use, other than mechanical plant in transit or on or about the
situation or other working or storage area.
POLLUTION: other than arising from sudden, unexpected and unforeseen
cause.
Standard war, radioactivity, terrorism, sonic boom, money and securities,
wear and tear, penalty and delay, vessels/aircraft, inventory and date
recognition exclusions.
-118-
Extensions: Section I
1. Property abroad
2. Money - limit US$50,000
3. Computer equipment maintenance warranty
4. Professional Fees and Debris Removal
5. Expediting Costs
6. 50:50 Marine Loss Sharing
7. Documents and Computer Records - limit
US$250,000
8. Local Authorities
9. Financial Interest of other Parties
10. Reinstatement
11. Temporary Repairs
12. Electrical/mechanical breakdown in so far as
it is insurable and available at
commercially reasonable terms
Section II
1. Alternative Premises
2. Property away from the Premises
3. Prevention of Access
4. Utility Suppliers Extension
5. Suppliers and Customers Extension (Limit -
as per Section II Sum Insured)
All Sections
1. Several Liabilities
2. Financial Interest of other Parties
3. Contractual Liability
-119-
EXHIBIT 6
PART 1
REUSABLE
For the purpose of this Agreement, unless otherwise provided herein, the
following plant and equipment shall be deemed to be "Reusable". This list is
non-exhaustive and is subject to variation at the entire discretion of Mopps:
----------------------------------------------------- -------------------------
ENGINE
----------------------------------------------------- -------------------------
5012 Engine 5
----------------------------------------------------- -------------------------
Turbo-chargers 5 pairs
----------------------------------------------------- -------------------------
ANCILLARIES
----------------------------------------------------- -------------------------
Engine Flexibles 5 sets
----------------------------------------------------- -------------------------
Exhaust transition pieces 5
----------------------------------------------------- -------------------------
Air intake transition pieces 5
----------------------------------------------------- -------------------------
Fuel treatment module 1
----------------------------------------------------- -------------------------
Oil treatment trolley 1
----------------------------------------------------- -------------------------
Support steel (lot) 1
----------------------------------------------------- -------------------------
Platforms and ladders 5
----------------------------------------------------- -------------------------
ENGINE SYSTEMS
----------------------------------------------------- -------------------------
Oil mist detector 5
----------------------------------------------------- -------------------------
AC Generator 5
----------------------------------------------------- -------------------------
COMPRESSED AIR SYSTEM
----------------------------------------------------- -------------------------
Motor driven compressor 2
----------------------------------------------------- -------------------------
Starting Air Receiver 5
----------------------------------------------------- -------------------------
Strainer assemblies 5
----------------------------------------------------- -------------------------
Filter/drier assembly 2
----------------------------------------------------- -------------------------
LUBE OIL SYSTEM
----------------------------------------------------- -------------------------
Lube oil filter cooler module 5
----------------------------------------------------- -------------------------
Fill valve assembly 5
----------------------------------------------------- -------------------------
Lube oil flowmeter 5
----------------------------------------------------- -------------------------
-120-
----------------------------------------------------- -------------------------
DISTILLATE FUEL OIL SYSTEM
----------------------------------------------------- -------------------------
Diesel transfer pump 2
----------------------------------------------------- -------------------------
Flowmeter assembly 2
----------------------------------------------------- -------------------------
Distillate fuel module 5
----------------------------------------------------- -------------------------
Hydraulic system sub module 5
----------------------------------------------------- -------------------------
EXHAUST SYSTEM
----------------------------------------------------- -------------------------
Exhaust Silencer 5
----------------------------------------------------- -------------------------
Exhaust flexibles 10
----------------------------------------------------- -------------------------
Exhaust flexibles 5
----------------------------------------------------- -------------------------
CHARGE AIR SYSTEM
----------------------------------------------------- -------------------------
Charge air filter, site mounted 5
----------------------------------------------------- -------------------------
Charge air silencer 5
----------------------------------------------------- -------------------------
Charge air flexibles 10
----------------------------------------------------- -------------------------
COOLING SYSTEM
----------------------------------------------------- -------------------------
Jacket water thermostat 5
----------------------------------------------------- -------------------------
Secondary cooling water thermostat 5
----------------------------------------------------- -------------------------
Jacket water heating module 5
----------------------------------------------------- -------------------------
Air blast cooler 5
----------------------------------------------------- -------------------------
TOOLS AND SPARES
----------------------------------------------------- -------------------------
Special engine tools 1
----------------------------------------------------- -------------------------
ELECTRICAL
----------------------------------------------------- -------------------------
Medium voltage switchboard 1
----------------------------------------------------- -------------------------
Generator neutral earthing contactor 1
----------------------------------------------------- -------------------------
Generator neutral earthing resistor 2
----------------------------------------------------- -------------------------
MV/LV Auxillary Transformer 2
----------------------------------------------------- -------------------------
LV Engine Auxillary MCC 5
----------------------------------------------------- -------------------------
Station MCC 1
----------------------------------------------------- -------------------------
CONTROL SYSTEMS
----------------------------------------------------- -------------------------
Control Panels 1 Set
----------------------------------------------------- -------------------------
-121-
PART 2
SALVAGE
For the purpose of this Agreement, unless otherwise provided herein that part of
the Facility which is not classified as Reusable in accordance with Part 1 of
this Exhibit 6 shall be Salvage. This is subject to variation at the entire
discretion of Mopps.
-122-
EXHIBIT 7
PART 1
FACILITY DESIGN PROGRAMME
For the purposes of this Exhibit 7, the Base Date shall be 14 days following
satisfaction of the Suspensive Conditions.
----------------- -------------------------------------------- ---------------------------------------------
ITEM DESIGN DESCRIPTION DESIGN SUBMISSION DATE (WEEKS AFTER BASE
DATE)
----------------- -------------------------------------------- ---------------------------------------------
1. Basic Design 2
----------------- -------------------------------------------- ---------------------------------------------
2. Bulk earthworks design 2
----------------- -------------------------------------------- ---------------------------------------------
3. Roads, drainage & fencing design 2
----------------- -------------------------------------------- ---------------------------------------------
4. Building GA 2
----------------- -------------------------------------------- ---------------------------------------------
5. Architectural 3
----------------- -------------------------------------------- ---------------------------------------------
6. Main steelwork 2
----------------- -------------------------------------------- ---------------------------------------------
7. Engine foundations design 2
----------------- -------------------------------------------- ---------------------------------------------
8. Building and ancillary foundation 4
----------------- -------------------------------------------- ---------------------------------------------
9. Electrical procurement and installation 3
package
----------------- -------------------------------------------- ---------------------------------------------
10. Ventilation procurement and installation 3
package
----------------- -------------------------------------------- ---------------------------------------------
11. Fire hydrant system procurement and 4
installation package
----------------- -------------------------------------------- ---------------------------------------------
12. Fire alarm system procurement and 3
installation package
----------------- -------------------------------------------- ---------------------------------------------
13. Plumbing procurement and installation 3
package
----------------- -------------------------------------------- ---------------------------------------------
14. Piping procurement and installation package 4
----------------- -------------------------------------------- ---------------------------------------------
-123-
----------------- -------------------------------------------- ---------------------------------------------
15. In-station tanks procurement and 4
installation package
----------------- -------------------------------------------- ---------------------------------------------
16. Bulk tanks procurement and installation 4
package
----------------- -------------------------------------------- ---------------------------------------------
17. Ducting procurement and installation 5
package
----------------- -------------------------------------------- ---------------------------------------------
18. Cables procurement and installation package 5
----------------- -------------------------------------------- ---------------------------------------------
19. Earthing procurement and installation 5
package
----------------- -------------------------------------------- ---------------------------------------------
-124-
EXHIBIT 8
PART 1
GUARANTEED CONTRACTED CAPACITY
The Guaranteed Contracted Capacity under this Agreement shall increase during
the Construction Phase such that MORILA and Mopps can commission their
respective plant up to full capacity. Mopps shall use all reasonable endeavours
to ensure that available generation capacity for the station demand will be
increased during the Construction Phase up to the limits below:
For the purposes of this Part 1 of Exhibit 8, the Base Date shall be 14 days
following satisfaction of the Suspensive Conditions.
-------------------------------- ----------------------------- ----------------------- -----------------------
RELEVANT TARGET COMMERCIAL INSTALLED CAPACITY FOR GUARANTEED AT 100% GUARANTEED AT 95%
OPERATIONS DATE (WEEKS AFTER COMMISSIONING (MW) AVAILABILITY (MW) AVAILABILITY (MW)
BASE DATE)
-------------------------------- ----------------------------- ----------------------- -----------------------
22 5.5 0 0
-------------------------------- ----------------------------- ----------------------- -----------------------
26 16.5 0 5
-------------------------------- ----------------------------- ----------------------- -----------------------
30 22 0 10
-------------------------------- ----------------------------- ----------------------- -----------------------
34 22 0 11
-------------------------------- ----------------------------- ----------------------- -----------------------
39 22 0 15
-------------------------------- ----------------------------- ----------------------- -----------------------
45 27.5 16.5 22
-------------------------------- ----------------------------- ----------------------- -----------------------
-125-
PART 2
FUEL EFFICIENCY RATE
1. FUEL EFFICIENCY RATE
1.1 GUARANTEED FUEL EFFICIENCY RATE
The Guaranteed Fuel Efficiency Rate ("GFE") at Site shall be 210.3g/kWh
delivered to MORILA for the first year following the last Relevant Commercial
Operations Date.
The conditions for the above guaranteed Efficiency rate are:
i) Average Site ambient conditions in accordance with Part 4 of
Exhibit 3.
ii) Distillate Diesel Oil in accordance with Part 2 of Exhibit 9.
iii) Fuel Calorific Value 42,700 kJ/kg (LHV).
iv) Fuel specific gravity 0.8825 kg/l.
v) MORILA's demand of between 16.5 and 22.0MW utilising only the medium
speed generating sets.
vi) Test to be carried out after a running in period in accordance with
BS 5514.
1.2 FUEL EFFICIENCY TESTING PROCEDURES
Within 10 days following each Quarter Day, MORILA shall ensure that the Operator
carries out a Spot Fuel Efficiency Test in accordance with the following
procedure:
(a) MORILA and the Operator shall jointly undertake the Spot Fuel
Efficiency Test.
(b) The Spot Fuel Efficiency Test shall be undertaken using DDO over a
period of 24 hours and MORILA shall endeavour to provide conditions
as close as possible to those stated in paragraph 1.1 above with
respect to items i and v.
(c) MORILA shall obtain full analysis of the Fuel during the Spot Fuel
Efficiency Test and this shall be agreed with Mopps.
(d) The Metering Equipment shall be read jointly by the Parties before
and after the Spot Fuel Efficiency Test.
-126-
(e) The Spot Fuel Efficiency shall be calculated as follows:
SFE = FC/PD x CFf x CFT
Where:
SFE = Spot Fuel Efficiency (g/kWh)
FC = Fuel Consumed in g = FM x SG x 1,000
Where:
FM = Fuel used measured in cubic metres during the test.
SG = The specific gravity of the Fuel (kg/m3)
PD = Power Delivered in kWh during the test.
CFT = the value of CFT calculated according to the following
table:
Ambient Temperature(oc)CFT
10-29 1.007
30 1.007
31 1.006
32 1.005
33 1.004
34 1.003
35 1.002
36 1.001
37 1.000
38 0.999
39 0.998
40 0.997
41 0.996
42 0.995
-127-
43 0.994
44 0.993
45 0.992
46-50 0.992
CFf = Correction factor for fuel calorific value.
Where:
CFf = ACV/42,700
Where:
ACV = Actual Calorific Value of fuel measured LHV kJ/kg
(f) If MORILA is not able to provide the conditions under paragraph 1.1
or if prevailing conditions differ significantly then MORILA and
Mopps shall agree any such other factors as may be necessary.
(g) In comparing the Spot Fuel Efficiency with the Guaranteed Fuel
Efficiency a measurement tolerance of +/-5% shall be used.
(h) Part 4 of Exhibit 10 shall be applied.
1.3 GUARANTEED FUEL EFFICIENCY RATE REVISION
On the first Quarter Day following the end of the first year following the last
Relevant Commercial Operations Date, and every fourth Quarter Day thereafter,
the results of the Spot Fuel Efficiency Test carried out pursuant to paragraph
1.2 shall be used to modify the value of GFE as follows:
If GFEn < 0.95 x SFE,
GFEn+1 = 0.95 x SFE
If GFEn > 1.05 x SFE,
GFEn+1 = 1.05 x SFE
-128-
In all other cases,
GFEn+1 = GFEn
Where:
GFEn = The value of GFE for the year preceding the date of the
Quarter Day just prior to the date of the Spot Fuel
Efficiency Test
GFEn+1 = The value of GFE for the year following the date of the
Quarter Day just prior to the date of the Spot Fuel
Efficiency Test
-129-
PART 3
LUBE OIL CONSUMPTION RATE
1. LUBE OIL CONSUMPTION RATE
1.1 GUARANTEED LUBE OIL CONSUMPTION RATE
The Guaranteed Lube Oil Consumption Rate ("GLC") at Site shall be 0.66g/kWh
delivered to MORILA for the first year following the last Relevant Commercial
Operations Date.
The conditions for the above guaranteed consumption rate are:
i) Average Site ambient conditions in accordance with Part 4 of Exhibit 3.
ii) Lube Oil in accordance with Part 4 of Exhibit 9.
iii) Lube Oil specific gravity 0.90 Kg/l.
iv) MORILA's demand of between 16.5 and 22.0MW utilising only the medium
speed generating sets.
v) Test to be carried out after a running in period in accordance with
BS 5514
1.2 LUBE OIL CONSUMPTION TESTING PROCEDURES
Within 10 days following the first Quarter Day following the end of the first
year following the last Relevant Commercial Operations Date, and every fourth
Quarter Day thereafter, MORILA shall ensure that the Operator carries out a Spot
Lube Oil Consumption Test in accordance with the following procedure:
(a) MORILA and the Operator shall jointly undertake a Lube Oil Consumption
Test.
(b) The Test shall be undertaken over a period of 7 days and MORILA shall
endeavour to provide conditions as close as possible to those stated in
paragraph 1.1 above with respect to items i and iv.
(c) MORILA shall obtain full analysis of the lube oil during the Part 3.
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(d) The Electrical Metering Equipment shall be read jointly by the Parties
before and after the Spot Lube Oil Consumption Test.
(e) The Lube Oil Consumption shall be calculated as follows:
SLC = LC/PD
Where:
SLC = Spot Lube Oil Consumption (g/kWh)
LC = Lube Oil Consumed in g = LM x SG x 1,000
Where:
LM = Lube Oil used measured in cubic metres during the test
SG = The specific gravity of the Lube Oil kg/m3
PD = Power Delivered in kW during the test.
(f) If MORILA is not able to provide the conditions under paragraph 1.1 or if
prevailing conditions differ significantly then MORILA and Mopps shall
agree any such other factors as may be necessary.
(g) In comparing the Spot Lube Oil Consumption with the Guaranteed Lube Oil
Consumption a measurement tolerance of +/- 10% shall be used.
(h) Part 4 of Exhibit 10 shall be applied.
1.3 GUARANTEED LUBE OIL CONSUMPTION REVISION
On the first Quarter Day following the end of the first year following the last
Relevant Commercial Operations Date, and every fourth Quarter Day thereafter,
the results of the
-131-
Spot Lube Oil Consumption Test carried out pursuant to paragraph 1.2 shall be
used to modify the value of GLC as follows:
If GLCn < 0.90 x SLC,
GLCn+1 = 0.90 x SLC
If GLCn > 1.10 x SLC,
GLCn+1 = 1.10 x SLC
In all other cases,
GLCn+1 = GLCn
Where:
GLCn = The value of GLC for the year preceding the date of the
Quarter Day just prior to the date of the Spot Lube Oil
Efficiency Test
GLCn+1 = The value of GLC for the year following the date of the
Quarter Day just prior to the date of the Spot Lube Oil
Efficiency Test
-132-
EXHIBIT 9
PART 1
COMPLETION TESTS
In order for each of the Units to be tested to prove its ability to contribute
to providing the Guaranteed Contracted Capacity at 37(degree)C at Site, MORILA
shall provide sufficient load from the Mine to use the power produced by the
Units that have already undergone Completion Tests as well as the additional
power produced by the Unit being tested. In the event that the load available is
not enough, the Units shall be configured in such a way as to allow the Unit
being tested to be tested as close as possible to an output of 5.5MW.
The Completion Test of each Unit shall consist of a reliability run to
demonstrate the ability of the Unit to generate power for 48 hours, 24 hours of
which shall be consecutive, provided the Mine load is suitable for such a
consecutive period. The requirement of a unit to generate electricity for 24
hours consecutively will fall away as a condition precedent to pass the
Completion Test should the Mine not be able to provide continuous load for that
period.
Before the Completion Test starts, appropriate tests and checks shall be
conducted on the Facility related to each Unit, including:-
- tests relevant to civil construction work including checks on setting
out, material tests, concrete tests, alignment checks on structures,
proof testing of overhead crane and the like;
- hydrostatic tests on all pipework, tanks and pressure vessels;
- alignment checks on all equipment;
- loop checks, insulation resistance, high voltage and other routine
tests on cables and electrical equipment prior to energising;
- all equipment shall be subject to functional tests to demonstrate
correct working and readiness for service;
-133-
- electrical protection relays shall be subject to injection tests to
verify settings in accordance with an agreed settings schedule; and
- the Unit shall be subjected to tests to demonstrate the correct
working of all controls and protection to ensure that the generating
set and associated auxiliaries and common equipment are properly
protected and ready for service.
-134-
PART 2
FUEL SPECIFICATION
DDO FUEL SPECIFICATION
--------------------------- --------------- ------------------- -------------------------- --------- -------------------
CHARACTERISTIC UNIT VALUES METHOD FREQUENCY OF TEST
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
MIN MAX AFNOR ASTM OTHER
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Mass/Vol at 15(degree)C Kg/l 0.835 0.93 T60 101 D 1298 Each delivery
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Kinematic Viscosity at Cst 5.9 25 T60 100 D445 Each delivery
37.8(degree)C
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Pour Point (degree)C 15 T60 105 D97 If required
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Sulphur % by mass 1.5 M07 025 Quarterly
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Ash % by mass 0.01 M07 045 D482 EN7 Quarterly
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Flash Point (degree)C 66 M07 019 D93 Quarterly
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Water %vol 1.00 T60 113 D95 Each delivery
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Sediment % by mass 0.1 M07 010 IP53 Quarterly
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Total acidity mgkoh/g 3.0 T60 112 D974 Each delivery
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Carbon Aromacity 850 T60 116 Quarterly
index
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Sodium mg/kg 10 Quarterly
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Aluminium + Silicon mg/kg 10 Quarterly
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
Vanadium mg/kg 30 Quarterly
--------------------------- --------------- --------- --------- ------------ ------------- --------- -------------------
-135-
GASOIL (GO) SPECIFICATION
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
CHARACTERISTIC UNIT VALUES METHOD FREQUENCY OF TEST
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
MIN MAX AFNOR ASTM OTHER
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Mass/Vol at 15(degree)C Kg/l 0.82 0.88 T60 101 D 1298 Each delivery
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Kinematic Viscosity Cst 1.6 5.9 T60 100 D445 Each delivery
at 37.8(degree)C
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Copper corrosion 1b M07 015 Quarterly
index
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Cloud Point (degree)C 5 T60 105 If required
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Sulphur % by mass 1.0 M07 025 D1552 Quarterly
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Ash % by mass 0.01 M07 045 D482 EN7 Quarterly
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Flash Point (degree)C 61 M07 019 D93 Quarterly
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Water %vol 0.05 T60 113 D95 Each delivery
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Sediment % by mass 0.01 M07 010 IP53 Quarterly
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Total acidity mgkoh/g 1.0 T60 112 D974 Each delivery
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Carbon Aromacity 825 T60 116 Quarterly
index
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Sodium mg/kg 0 Quarterly
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Aluminium + Silicon mg/kg 0 Quarterly
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
Vanadium mg/kg 0 Quarterly
--------------------------- ------------- --------------------- ------------------------------- ---------- ------------------
-136-
PART 3
WATER SPECIFICATION
--------------------------------------- --------------------------- -------------------- -------------------
TEST UNITS SPECIFICATION LIMIT
--------------------------------------- --------------------------- -------------------- -------------------
Turbidity 15 Max
--------------------------------------- --------------------------- -------------------- -------------------
pH value 7.3-10 Both
--------------------------------------- --------------------------- -------------------- -------------------
Conductivity @ 25(degree)C Micro ohm/cm 600 Max
--------------------------------------- --------------------------- -------------------- -------------------
Total hardness mg/l as CaCO3 200 Max
--------------------------------------- --------------------------- -------------------- -------------------
Calcium (Ca) mg/l 2 Max
--------------------------------------- --------------------------- -------------------- -------------------
Magnesium (Mg) mg/l 2 Max
--------------------------------------- --------------------------- -------------------- -------------------
Iron (Fe) mg/l 5 Max
--------------------------------------- --------------------------- -------------------- -------------------
Chloride (CI-) mg/l 200 Max
--------------------------------------- --------------------------- -------------------- -------------------
Sulphate (SO4-) mg/l 100 Max
--------------------------------------- --------------------------- -------------------- -------------------
Silica (SiO2) mg/l 100 Max
--------------------------------------- --------------------------- -------------------- -------------------
Ammonium (NH4+) mg/l 10 Max
--------------------------------------- --------------------------- -------------------- -------------------
Hydrogen Sulphide (H2S) mg/l 10 Max
--------------------------------------- --------------------------- -------------------- -------------------
Total residual on evaporation mg/l 800 Max
--------------------------------------- --------------------------- -------------------- -------------------
-137-
PART 4
LUBE OIL SPECIFICATION
The lubrication oil shall conform to the following minimum standards:
o lubrication oil grade SAE40 viscosity
o must meet the minimum performance of API CD
o for fuel oil with less than l% sulphor, the TBN requirement is 15-20
o minimum TBN retention of 10
-138-
EXHIBIT 10
PART 1
PLANT PAYMENT
PPn = PPo x GCC/22 x AFn x (CPIn/CPIo)
Provided always that (CPIn/CPIo) shall not be less than 1.025y
Where:
PPn = The applicable Plant Payment for the relevant
month n.
PPo = US$272,920
CPIn = The value determined for the month three
months prior to month n.
CPIo = The base value used for the indexation
calculation determined, which shall be the
value of the CPI for the month three months
prior to the date of this Agreement.
GCC = Guaranteed Contracted Capacity at 95%
Availability as specified in Part 1 of
Exhibit 8.
y = Number of years (to the nearest whole number)
from the date of this Agreement to the date
of the calculation
AFn = Adjustment factor according to values below:
AF0 = 1.00
AF1 = 1.50
AF2 = 1.45
AF3 = 1.35
AF4 = 1.30
AF5 = 1.25
AF6 = 1.20
-139-
AF7 = 1.05
AF8 = 0.80
AF9 = 0.50
AF10 = 0.744
AF1 - 10 shall apply in the relevant year of the Term.
AF0 shall apply up to the occurrence of the last Relevant Commercial Operations
Date in time.
If the first and last month are partial months only then a pro rata calculation
of the Fixed Payment shall be made as below:
PPn(pr) = PPn x (Mr/Mt)
Where
PPn(pr) = The applicable pro-rata Fixed Payment for the
relevant month.
Mr = The number of days of operation since the
Relevant Commercial Operations Date to the
end of the month or from the beginning of the
month to the end of the Term.
Mt = The total number of days in the relevant
month.
-140-
PART 2
BOP PAYMENT
BOPPn = BOPPo x GCC/22 x (CPIn/CPIo)
Provided always that (CPIn/CPIo) shall not be less than 1 .025y
Where:
BOPPn = The applicable BOP Payment for the relevant
month n.
BOPPo = US$37,500
CPIn = The value determined for the month three
months prior to month n.
CPIo = The base value used for the indexation
calculation determined, which shall be the
value of the CPI for the month three months
prior to the date of this Agreement.
GCC = Guaranteed Contracted Capacity at 95%
Availability as specified in Part 1 of
Exhibit 8.
y = Number of years (to the nearest whole number)
from the date of this Agreement to the date
of the calculation.
If the first and last month are partial months only then a pro rata calculation
of the Fixed Payment shall be made as below:
BOPPn(pr) = BOPPn x (Mr/Mt)
Where:
BOPPn(pr) = The applicable pro-rata Fixed Payment for the
relevant month.
Mr = The number of days of operation since the
Relevant Commercial Operations Date to the
end of the month or from the beginning of
the month to the end of the Term.
-141-
Mt = The total number of days in the relevant
month.
-142-
PART 3
SPARE PARTS PAYMENT
MORILA shall pay Mopps a Spare Parts Payment each month in arrears. It shall be
payable from the end of the first month following the Relevant Commercial
Operations Date. It shall be escalated each three months in accordance with the
Consumer Price Index ("CPI") in accordance with the following formula:
SPARE PARTS PAYMENT
SPPn = SPn x PD x (CPIn/CPIo)
Provided always that (CPIn/CPIo) shall not be less than 1 .025y
Where:
SPPn = Spare Parts Payment for the relevant month n.
PD = The Power Delivered by the Facility to MORILA
(measured in kilowatt Hours kWh);
SPn = US$0.00674/kWh
CPIn = The value determined for the month three
months prior to month n
CPIo = The base value used for indexation
calculation determined, which shall be the
value of CPI for the month three months prior
to the date of this Agreement.
y = Number of years (to the nearest whole number)
from the date of this Agreement to the date
of the calculation.
-143-
PART 4
PAYMENT ADJUSTMENTS
1. Availability Adjustment Payment for Guaranteed Contracted Capacity at
100% of Availability
From the Relevant Commercial Operations Date Mopps shall pay MORILA
liquidated damages at the end of each month for the shortfall in
Availability of the Guaranteed Contracted Capacity pursuant to
Section 10.
A shortfall in Availability of the Guaranteed Contracted Capacity
shall occur when either:
a) there is an interruption to the power supply due to the failure of
the Facility to operate at the Guaranteed Contracted Capacity;
b) the Operator instructs MORILA to load shed due to unavailability of
the Guaranteed Contracted Capacity.
The liquidated damages shall be calculated in accordance with the following
formula:
TLDn = LD x SFH x (CPIn/CPIo)
Provided always that (CPIn/CPIo) shall not be less than 1 .025y
Where:
TLDn = Total liquidated damages payable in month n.
LD = US$ 415.00 per hour
SFH = Number of whole hours of shortfall in
Availability of the Guaranteed Contracted
Capacity.
CPIn = The value determined for the month three
months prior to month n
-144-
CPIo = The base value used for indexation
calculation determined, which shall be the
value of CPI for the month three months prior
to the date of this Agreement.
y = Number of years (to the nearest whole number)
from the date of this Agreement to the date
of the calculation.
2. Availability Adjustment Payment for Guaranteed Contracted Capacity
at 95% of Availability
Mopps shall pay MORILA liquidated damages at the end of each
Agreement Year for the shortfall in Availability of the Guaranteed
Contracted Capacity pursuant to Section 10.
Shortfall Event shall mean a period during which Mopps is unable to
provide MORILA with the Guaranteed Contracted Capacity and shall
occur when either:
(a) there is an interruption to the power supply due to the failure of
the Facility to operate at the Guaranteed Contracted Capacity; or
(b) the Operator instructs MORILA to load shed due to unavailability of
Guaranteed Contracted Capacity.
A Shortfall Event shall mean a period during which the Facility is
unable to provide the Guaranteed Contracted Capacity and shall occur
when either:
(i) there is an interruption to the power supply due to the failure of
the Facility to operate at the Guaranteed Contracted Capacity; or
(ii) Mopps instructs MORILA to load shed due to unavailability of
Guaranteed Contracted Capacity.
MORILA shall notify Mopps of the start of the Shortfall Event. The shortfall in
Availability shall be calculated in accordance with the following formula:
---m 100
Where: SFn = \ (SFDy)x-------------- - AUA
/ 22x(8760)
---y=1
-145-
SFn = Shortfall in % Availability in any Year n,
expressed as a %.
SFDy = Shortfall in available electrical capacity
in an hour measured in MW which shall be the
difference between the Guaranteed Contracted
Capacity of 22MW and the actual average
capacity available to MORILA in such hour.
m = The number of hours in the period n in
which a Shortfall Event occurs less the
period (in hours) of outages due to the
occurrence of an Insurable or Non-Insurable
Event except to the extent that Section
14.4.1 applies.
AUA = is the agreed proportion of a contract year
during which the Parties agree that Mopps is
excused from its obligation to make capacity
available (whether such unavailability be due
to maintenance outage or a forced outage).
AUA shall equal 5%.
The liquidated damages payable shall be calculated in accordance with the
following formula:
TLDn = LD x SFn x (CPIn/CPIo)
Provided always that (CPIn/CPIo) shall not be less than 1 .025y
Where:
TLDn = Total liquidated damages payable in year n.
LD = US$25,000 per %.
CPIn = The value determined for the month three
months prior to year n.
CPIo = The base value used for indexation
calculation determined, which shall be the
value of CPI for the month three months prior
to the date of this Agreement.
-146-
y = Number of years (to the nearest whole number)
from the date of this Agreement
to the date of the calculation.
3. Limit of Liability to pay Liquidated Damages for Availability
In no case, shall TLDn be greater than US$380,000 per year.
4. Fuel Efficiency Adjustment Payment
From the Relevant Commercial Operations the Fuel Efficiency
Adjustment Payment shall be calculated as follows:
FEAPn = 0.5 x FEDn x PDn x FC/10(6)
Where:
FEAPn = Fuel Efficiency Adjustment Payment for the relevant three
month period n
IF GFE < 0.95 x SFE,
FEDn = GFE - (0.95 x SFE)
If GFE > 1.05 x SFE,
FEDn = GFE - (1.05 x SFE)
In all other cases,
FEDn = 0
PDn = Power delivered in kilowatt hours in the three month
period n
FC = $200 per tonne
-147-
If FEAPn is negative, Mopps shall pay MORILA FEAPn. If FEAPn is positive,
MORILA shall pay Mopps FEAPn
5. Limit of Liability to pay Liquidated Damages for Fuel Efficiency
In no case, shall FEAPn be greater than US$380,000 per year.
6. Lube Oil Consumption Adjustment Payment
From the Relevant Commercial Operations the Lube Oil Consumption
Adjustment Payment shall be calculated as follows:
LOAPn = 0.5 x LCDn x PDn x LC/10(6)
Where:
LOAPn = Lube Oil Consumption Adjustment Payment for the relevant
three month period n
If GLC < 0.90 x SLC,
LCDn = GLC - (0.90 x SLC)
If GLC > 1.10 x SLC,
LCDn = GLC - (1.10 x SLC)
In all other cases,
LCDn = 0
PDn = Power delivered in kilowatt hours in the three month
period n
-148-
LC = $1000.00 per tonne
If LOAPn is negative, Mopps shall pay MORILA LOAPn. If LOAPn is
positive, MORILA shall pay Mopps LOAPn.
7. Limit of Liability to pay Liquidated Damages for Lube Oil Consumption
In no case, shall LOAPn be greater than US$80,000 per year.
8. Limit of Liability to pay Liquidated Damages for Availability, Fuel
Efficiency and Lube Oil Consumption
In no case, shall the sum of TLDn plus FEAPn plus LOAPn be greater
than US$500,000 per year.
-149-
PART 5
EXISTING FACILITY PAYMENT
1. On receipt of an invoice from Mopps for an amount equal to 1/120 of
the Consideration in accordance with Section 12.1.3, MORILA shall
reduce the EF Debt by the EF Debt Repayment.
-150-
PART 6
FIXED SPARE PARTS PAYMENT
MORILA shall pay Mopps a Fixed Spare Parts Payment each month in arrears. It
shall be payable from the end of the first month following the Relevant
Commercial Operations Date. It shall be escalated each three months in
accordance with the Consumer Price Index ("CPI") in accordance with the
following formula:
FIXED SPARE PARTS PAYMENT
FSPn = FSPo x GCC/22 x (CPIn/CPIo)
Provided always that (CPIn/CPIo) shall not be less than 1.025^y
Where:
FSPn = The Fixed Spare Parts Payment for the
relevant month n.
FSPo = US$20,833
CPIn = The value determined for the month three
months prior to month n.
CPIo = The base value used for the indexation
calculation determined, which shall be the
value of the CPI for the month three months
prior to the date of this Agreement.
GCC = Guaranteed Contracted Capacity. at 95%
Availability as specified in Part 1 of
Exhibit 8.
y = Number of years (to the nearest whole number)
from the date of this Agreement to the date
of the calculation
If the first and last month are partial months only then a pro-rata calculation
of the Fixed Spare Parts Payment shall be made as below:
FSPn(pr) = FSPn x (Mr/Mt)
-151-
Where:
FSPn(pr) = The applicable pro-rata Fixed Spare Parts
Payment for the relevant month.
Mr = The number of days of operation since the
Relevant Commercial Operations Date to the
end of the month or from the beginning of the
month to the end of the Term.
Mt = The total number of days in the relevant
month.
-152-
PART 7
PAYMENT MECHANISM
SAMPLE ONLY
On Mopps printed invoice paper
TAX INVOICE
Date: 05.04.02
Invoice number: 25
Societe des Mines de Morila SA
Randgold House
Bamako
Mali
----------------------------- ------------------------ ---------------------
DATE KWH
----------------------------- ------------------------ ---------------------
Last reading 01.03.02 1,000,000
----------------------------- ------------------------ ---------------------
This reading 01.04.02 11,000,000
----------------------------- ------------------------ ---------------------
Total for this period 10,000,000
----------------------------- ------------------------ ---------------------
------------------- --------------------------------- --------------- -------------- -----------------------
ITEM DESCRIPTION TOTAL IN US$
------------------- --------------------------------- --------------- -------------- -----------------------
1 Plant Payment 420,296.80
------------------- --------------------------------- --------------- -------------- -----------------------
2 BOP Payment 27,500.00
------------------- --------------------------------- --------------- -------------- -----------------------
3 Fixed Spare Parts Payment 22,916.30
------------------- --------------------------------- --------------- -------------- -----------------------
4 Spare Parts Payment 74,140.00
------------------- --------------------------------- --------------- -------------- -----------------------
5 Existing Facility Payment 10,000
------------------- --------------------------------- --------------- -------------- -----------------------
6 Payment adjustment for quarter 8,080.50
ending 30 September 2000
------------------- --------------------------------- --------------- -------------- -----------------------
7 VAT 0% 0
------------------- --------------------------------- --------------- -------------- -----------------------
-153-
------------------- --------------------------------- --------------- -------------- -----------------------
8 Total for this invoice 562,933.60
------------------- --------------------------------- --------------- -------------- -----------------------
9 Less EF Debt Repayment -10,000
------------------- --------------------------------- --------------- -------------- -----------------------
10 TOTAL PAYMENT DUE 552,933.60
------------------- --------------------------------- --------------- -------------- -----------------------
SAMPLE CALCULATIONS
Agreement executed 01.09.99
Date of calculation 01.04.02 (therefore y = 2)
CPIo (01.06.99) = 100
CPIn (01.01.02) = 110
CPIn/CPIo = 110/100
= 1.10 (which is larger than 1.025^2
therefore use 1.10)
Last Relevant Commercial
Operations Date = 30.07.00
AFn = 1.40
PD = 10,000,000 kWh
SFE = 197.7 g/kWh
No. of hours below
16.5MW Available Capacity = 3
kWh in Quarter = 35,000,000kWh
PLANT PAYMENT
PPn = PPo x GCC/22 x AFn x CPIn/CPIo
= 272,920 x 22/22 x 1.40 x 1.10
-154-
= US$420,296.80
BOP PAYMENT
BOPPn = BOPPo x GCC/22 x AFn x CPIn/CPIo
= 25,000 x 22/22 x 1.10
= US$27,500.00
SPARE PARTS PAYMENT
SPPn = SPPo x PD x CPIn/CPIo
= 0.674/100 x 10,000,000 x 1.10
= US$74,140
PAYMENT ADJUSTMENTS
100% AVAILABILITY
TLDn = LD x SFH x CPIn/CPIo
= 415 x 3 x 1.10
= US$1,369.50
95% AVAILABILITY
Not calculated this month.
-155-
FUEL EFFICIENCY
SFE = 197.7g/kWh
FEDn = 210.3 - 1.05 x 197.7
= 2.7
FEAPn = 0.5 x FEDn x PDn x FC/10^6
= 0.5 x 2.7 x 3,500,000 x 200/10^6
= US$945.00
LUBE OIL CONSUMPTION
Not calculated this month
TOTAL PAYMENT ADJUSTMENT = 1,369.50 + 9,450.00
= US$8,080.50
FIXED SPARE PARTS PAYMENT
FSPn = FSPo x GCC/22 x CPIn/CPIo
= 20,833 x 22/22 x 1.10
= US$22,916.30
EXISTING FACILITY PAYMENT
EFP = US$10,000.00
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PART 8
TABLE OF TERMINATION PRICES WHERE MORILA DEFAULT OR
WHERE MORILA ACCELERATES PAYMENT IN ACCORDANCE WITH
SECTION 15.3
TERMINATION DATE (FROM RELEVANT US$ (000S)
COMMERCIAL OPERATIONS DATE)
Start of year 1 25,526
End of year 1 21,128
End of year 2 19,141
End of year 3 17,137
End of year 4 14,932
End of year 5 12,499
End of year 6 9,791
End of year 7 7,098
End of year 8 4,766
End of year 9 3,019
End of year 10 0
The above amounts shall be adjusted in accordance with the following formula:
TTPn = TP x (CPIn/CPIo)
Provided always that (CPIn/CPIo) shall not be less than 1.025^y
Where
TTPn = Total Termination Price payable in year n.
TP = Termination Price from relevant year as per table above.
CPIn = The value determined for the month three months to year n.
CPIo = The base value used for indexation calculation
determined, which shall be the value of CPI for the month
three months prior to the date of this Agreement.
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y = Number of years (to the nearest whole number) from the date
of this Agreement.
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PART 9
TABLE OF TERMINATION PRICES WHERE MOPPS DEFAULT
TERMINATION DATE (FROM RELEVANT COMMERCIAL US$ (000S)
OPERATIONS DATE)
Start of year 1 18,423
End of year 1 16,893
End of year 2 15,228
End of year 3 13,563
End of year 4 11,745
End of year 5 9,756
End of year 6 7,569
End of year 7 5,409
End of year 8 3,564
End of year 9 2,232
End of year 10 0
The above amounts shall be adjusted in accordance with the following formula:
TTPn = TP x (CPIn/CPIo)
Provided always that (CPIn/CPIo) shall not be less than 1.025^y
Where
TTPn = Total Termination Price payable in year n.
TP = Termination Price from relevant year as per table above.
CPIn = The value determined for the month three months to year n.
CPIo = The base value used for indexation calculation
determined, which shall be the value of CPI for the month
three months prior to the date of this Agreement.
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y = Number of years (to the nearest whole number) from the
date of this Agreement.
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PART 10
TABLE OF TERMINATION PRICES WHERE NO DEFAULT
TERMINATION DATE (FROM RELEVANT COMMERCIAL US$ (000S)
OPERATIONS DATE)
Start of year 1 21,744
End of year 1 19,719
End of year 2 17,586
End of year 3 15,462
End of year 4 13,221
End of year 5 10,836
End of year 6 8,298
End of year 7 5,859
End of year 8 3,807
End of year 9 2,331
End of year 10 0
The above amounts shall be adjusted in accordance with the following formula:
TTPn = TP x (CPIn/CPIo)
Provided always that (CPIn/CPIo) shall not be less than 1.025^y
Where
TTPn = Total Termination Price payable in year n.
TP = Termination Price from relevant year as per table above.
CPIn = The value determined for the month three months to year n.
CPIo = The base value used for indexation calculation determined,
which shall be the value of CPI for the month three months
prior to the date of this Agreement.
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y = Number of years (to the nearest whole number) from the date
of this Agreement.
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PART 11
CTF TERMINATION PRICE
TERMINATION DATE (FROM RELEVANT COMMERCIAL US$ (000S)
OPERATIONS DATE)
Start of year 1 5,460
End of year 1 5.085
End of year 2 4,654
End of year 3 4,195
End of year 4 3,665
End of year 5 3.035
End of year 6 2,295
End of year 7 1,575
End of year 8 1,030
End of year 9 765
End of year 10 0
The above amounts shall be adjusted in accordance with the following formula:
TTPn = TP x (CPIn/CPIo)
Provided always that (CPIn/CPIo) shall not be less than 1.025^y
Where
TTPn = Total Termination Price payable in year n.
TP = Termination Price from relevant year as per table above.
CPIn = The value determined for the month three months to year n.
CPIo = The base value used for indexation calculation
determined, which shall be the value of CPI for the month
three months prior to the date of this Agreement.
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y = umber of years (to the nearest whole number) from the date
of this Agreement.
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EXHIBIT 11
NOTICES
The address for the delivery of notices and other communications to each Party
and the respective telephone and facsimile numbers are as follows:
(a) For Mopps:
▇▇▇▇ ▇▇▇▇▇
Rolls-Royce Power Ventures Limited
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
(b) For MORILA:
Managing Director
Societe des Mines de Morila SA
▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
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EXHIBIT 12
KEY MILESTONES AND KEY MILESTONE DATES
For the purposes of this Exhibit 12, the Base Date shall be 14 days following
satisfaction of the Suspensive Conditions.
----------------------------------------------------- --------------------------
KEY MILESTONE KEY MILESTONE DATE (WEEKS
AFTER BASE DATE)
BALANCE OF PLANT
----------------------------------------------------- --------------------------
Unit 1 installation complete* 16
----------------------------------------------------- --------------------------
Unit 2 installation complete* 17
----------------------------------------------------- --------------------------
Unit 3 installation complete* 20
----------------------------------------------------- --------------------------
Unit 4 installation complete* 26
----------------------------------------------------- --------------------------
Unit 5 installation complete* 42
----------------------------------------------------- --------------------------
*installation complete means the date on which Mopps is satisfied that the
following was achieved:
FOR THE RELEVANT PLANT OR BALANCE OF PLANT ASSOCIATED WITH THE CORRESPONDING KEY
MILESTONE:
- the relevant Plant or Balance of Plant shall be placed, aligned,
levelled, secured and grouted in position;
- the relevant Plant or Balance of Plant shall be reassembled where
appropriate;
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- the relevant Plant or Balance of Plant shall be lubricated/greased;
- the relevant Plant or Balance of Plant movement checks shall be carried
out under No-Load Conditions.
FOR THE PIPING/DUCTING ASSOCIATED WITH THE CORRESPONDING KEY MILESTONE:
- the pipework shall be installed, connected, secured & earth linked where
applicable;
- the pipework shall be cleaned (by pickling/flushing as appropriate) to
required level;
- the pipework shall be pressure tested as appropriate;
- the pipework shall be lagged as appropriate.
FOR THE CABLING ASSOCIATED WITH THE CORRESPONDING KEY MILESTONE:
- the cabling shall be installed and terminated;
- Continuity shall be checked.
FOR THE TANKS ASSOCIATED WITH THE CORRESPONDING KEY MILESTONE:
- the tanks shall be fabricated, placed, secured and grouted in position;
- the tanks shall be pressure tested;
- the tanks shall be painted/lagged as appropriate.
FOR THE MISCELLANEOUS ITEMS ASSOCIATED WITH THE CORRESPONDING KEY MILESTONE:
- all floorplating shall be in place;
- the alternator shall be dried out;
- all guarding shall be installed.
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FOR THE STATION COMMON SYSTEMS/SERVICES ASSOCIATED WITH THE RELEVANT KEY
MILESTONE:
- the earthing system shall be proven;
- the water supply and inhibitors/antifreeze shall be available;
- the lubricating oil shall be available and engine sumps filled;
- the lubricating greases shall be available;
- the Fuel shall be available and transfer pumps operational;
- the commissioning labour shall be available;
- the ventilation systems shall be in operation.
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EXHIBIT 13
FIXED DEFAULT AMOUNT
The Fixed Default Amount shall include actual proven costs in respect of design,
development, and equipment cancellation plus the value of equipment notified to
MORILA by Mopps as being ready for collection ex works in accordance with
Section 4.2.
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EXHIBIT 14
STEP-IN AND ACKNOWLEDGEMENT AGREEMENT
IN RELATION TO THE MORILA MINING PROJECT
THIS STEP-IN AND ACKNOWLEDGEMENT AGREEMENT (this "Agreement") is made on 1999
BETWEEN:
(1) Societe des Mines de MORILA SA ("MORILA");
(2) Rolls-Royce Power Ventures Limited ("Mopps"); and
(3) NM Rothschild & Sons Limited, as Agent pursuant to the Loan
Agreement (the "Agent")
WHEREAS:
(A) MORILA has entered into the Deferred Terms Agreement with Mopps for
the purposes of acquiring on deferred terms generating and other
equipment in connection with the Morila Mining Project.
(B) The Lenders have agreed to provide finance for the Mining Project,
and the Agent has agreed to act as agent for the Lenders upon the
terms and subject to the conditions set out in the Loan Agreement.
(C) Mopps has agreed to enter into this Agreement in order to provide
certain assurances to the Agent and the Lenders in connection with
the Deferred Terms Agreement.
IT IS AGREED as follows:-
In this Agreement, unless the context otherwise requires:
"Agreement" is defined in the preamble;
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"Deferred Terms Agreement" means the agreement, dated [ ] 1999 made between
MORILA and Mopps in connection with the provision of generating and other
equipment for the Mining Project;
"Lenders" means those banks and financial institutions who are defined as
Lenders in the Loan Agreement;
"Loan Agreement" means the loan agreement, dated [ ] November 1999, among
Societe des Mines de Morila SA, as the Borrower, Randgold Resources Limited,
Randgold and Exploration Company Limited and Randgold Resources (Morila)
Limited, as the Completion Guarantors, various banks and other financial
institutions, as the Lenders, NM Rothschild & Sons Limited and Standard Bank
London Limited, as the Co-Arrangers, and NM Rothschild & Sons Limited, as the
Agent for the Lenders;
"Mining Project" means the Morila gold mining project at Morila, Republic of
Mali;
"Security Agreement" means the debenture, dated 1999, between MORILA and the
Agent;
"Step-in Date" means the date specified in the Step-in Notice as the date for
assumption of obligations of MORILA under the Deferred Terms Agreement;
"Step-in Notice" means a written notice served by the Agent on Mopps pursuant to
Section 4.1;
"Step-in Period" means the period from (and including) the Step-in Date to (and
excluding) the Step-out Date;
"Step-out Date" has the meaning provided in Section 4.5;
"Substitute Entity" means the person appointed by the Agent for the purposes of
assuming the rights and obligations of MORILA under the Deferred Terms
Agreement;
"Suspension Period" has the meaning provided in Section 4.1;
"Termination Action" has the meaning provided in sub-section (a) of Section 3.1;
"Termination Notice" means a written notice served by Mopps on the Agent
pursuant to sub-section (a) of Section 3.1.
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p2.1 Consent to Security
Mopps hereby:
(a) acknowledges that this Agreement shall constitute notice in
writing to it of the security created or to be created by
the Security Agreement (including the assignment
thereunder) in favour of the Agent (for the rateable
benefit of the Lenders) over the right, benefit and
interest of MORILA under the Deferred Terms Agreement;
(b) consents for purposes of the Deferred Terms Agreement to
the creation and subsistence of such security and the
exercise by the Agent of all its rights and remedies with
respect to such security; and
(c) without in any way limiting the consent in paragraph (b),
further consents to any assignment by MORILA to the Agent
of its rights and interest in the Deferred Terms Agreement.
2.2 No Liability
Mopps agrees and acknowledges that, notwithstanding anything to the
contrary contained in this Agreement, MORILA will remain liable to
observe and perform all of MORILA's obligations under the Deferred
Terms Agreement and, except during the Step-in Period, neither the
Agent nor any of the Lenders will be under any obligation or
liability with respect to those obligations by any reason of or
arising out of this Agreement. Except during the Step-in Period
neither the Agent nor any of the Lenders will be required in any
manner to perform or fulfil any obligations of MORILA under the
Deferred Terms Agreement, or to make any payment under the Deferred
Terms Agreement.
2.3 Termination of Deferred Terms Agreement
Each of MORILA and Mopps acknowledges and agrees that no termination
by MORILA under the Deferred Terms Agreement shall be valid or
effective without the prior written consent of the Agent having first
been produced by MORILA to Mopps.
3.1 Notice of Termination
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Mopps undertakes to the Agent that:
(a) in relation to an event governed by Section 16.6 of the
Deferred Terms Agreement it will not exercise or seek any
right of termination of, or discontinue the performance of
any of its obligations under, the Deferred Terms Agreement
(any such action being referred to as "Termination
Action"), without first copying to the Agent a notice under
that Section of the Deferred Terms Agreement; or
(b) in respect to an event governed by Section 16.4 of the
Deferred Terms Agreement for a period of fifteen days
following receipt by the Agent of a Termination Notice by
Mopps that a Termination Event under that Section 16.4 has
occurred, it will not take any Termination Action.
3.2 Amendments to the Deferred Terms Agreement
Mopps will not amend or agree with MORILA any amendments to any of
the terms of the Deferred Terms Agreement without the prior written
consent of the Agent.
3.3 Assignment of the Deferred Terms Agreement
Mopps will not assign, transfer or otherwise dispose of any of its
rights or obligations under the Deferred Terms Agreement without
obtaining the prior written consent of the Agent other than assigning
its rights for the purposes of raising financing for the Facility as
defined by the Deferred Terms Agreement and provided always that
nothing shall prevent Mopps from sub-contracting its obligations
under that agreement or from assigning its rights or obligations to
an Affiliate as defined by that Agreement in accordance with Section
18.1 of the Deferred Terms Agreement.
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3.4 Payments to MORILA
Provided that the same shall not increase the liability of Mopps to
tax in any jurisdiction Mopps undertakes to pay to such account at
such bank as the Agent may from time to time notify to it all moneys
due and payable by it to MORILA under or in connection with the
Deferred Terms Agreement.
3.5 Information
Mopps shall provide the Agent with the following information either
promptly upon the occurrence of the event in question or promptly
following a request for such information from the Agent:
(a) details of any breach by MORILA of any terms of the
Deferred Terms Agreement;
(b) notice of, and details of the occurrence of any event or
circumstance that makes or is likely to make it impossible
for Mopps to perform any of its obligations under the
Deferred Terms Agreement in accordance with its terms.
4.1 Exercise of step-in rights
At any time during the period under Section 16.7 of the Deferred
Terms Agreement for remedying a default by MORILA or within the
period of 15 days referred to in Section 3.1(b) (collectively or
singularly the Suspension Period) the Agent may give a Step-in Notice
to Mopps:
(a) requiring Mopps to continue to perform its obligations
under the Deferred Terms Agreement;
(b) acknowledging that the Agent, or the Substitute Entity, as
provided for in Section 4.2, notified to Mopps is to become
a joint and several obligor with MORILA from the date of
such Step-in Notice in respect of the obligations of MORILA
under the Deferred Terms Agreement; and
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(c) undertaking to Mopps to discharge all payments then due to
Mopps under the terms of the Deferred Terms Agreement
within thirty (30) days.
4.2 Operation of step-in rights
Instead of the Agent being the joint and several obligor under
Section 4.1(b) it may request that a Substitute Entity be appointed,
provided that Mopps shall be satisfied as to the financial strength
and technical competence of such proposed Substitute Entity it shall
accept such request in writing, such acceptance not to be
unreasonably withheld.
During the Step-in Period the Agent or the Substitute Entity, as the
case may be, shall enjoy all rights of MORILA under the Deferred
Terms Agreement and shall be jointly and severally liable with MORILA
for the performance of all the obligations of MORILA under the
Deferred Terms Agreement which arise during the Step-in Period and
for payment of any sums which arise before the Step-in Period but, as
between MORILA and the Agent or the Substitute Entity, as the case
may be, the latter alone (to the exclusion of MORILA) shall have the
authority to deal with Mopps and exercise the powers and discretions
available to MORILA under the Deferred Terms Agreement and MORILA
shall not be released, nor shall its liability be affected or
impaired, as a result of the exercise by the Agent or the Substitute
Entity, as the case may be, alone of any such authority, powers or
discretions or by any other act or omission on the part of, or
indulgence or release granted to, the Agent or the Substitute Entity,
as the case may be, whether or not with the knowledge or consent of
MORILA.
4.3 Termination Action during Step-in Period
During the Step-in Period any grounds for Mopps to terminate the
Deferred Terms Agreement through the grounds stated in Sections 16.5
or 16.7 of the Deferred Terms Agreement arising before and
outstanding on the Step-in Date, shall be deemed not to have effect
provided that no further grounds for Mopps to terminate the Deferred
Terms Agreement caused by an act or default of the Agent or the
Substitute Entity, as the case may be, shall arise during the Step-in
Period.
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4.4 Mopps' obligations during Step-in Period
During the Step-in Period, Mopps shall owe its obligations,
liabilities and duties with respect to the performance of the
Deferred Terms Agreement to MORILA and the Agent or the Substitute
Entity, as the case may be, jointly but receipt of, or the
performance by Mopps in favour of, either of them shall be a good
discharge.
4.5 Step-out rights
The Agent or the Substitute Entity, as the case may be, on giving
Mopps not less than 30 (thirty) days' prior written notice, may
terminate its obligations, liabilities and duties to Mopps under this
Agreement and the Deferred Terms Agreement (but without affecting the
continuation of MORILA's obligations towards Mopps under the Deferred
Terms Agreement) and, from the date on which the Agent's or the
Substitute Entity's, as the case may be, notice takes effect (the
"Step-out Date"), the Agent or the Substitute Entity, as the case may
be, shall be released from all obligations, liabilities and duties
under this Agreement and the Deferred Terms Agreement towards Mopps
other than those that arose during the Step-in Period but have not
been fully performed.
4.6 Additional step-in rights
Notwithstanding that, as between MORILA and Mopps, the latter's right
of termination of the Deferred Terms Agreement may not have arisen,
the provisions of Sections 3.1, 4.1 and 4.2 shall nevertheless apply
if the Agent gives notice to Mopps and MORILA and the Agent or, as
the case may be, the Substitute Entity complies with the requirements
on its part under Section 4.1.
5.1 Law
This Agreement is governed by English law.
5.2 Courts of England
The courts of England shall have jurisdiction to settle any disputes
which may arise out of or in connection with this Agreement.
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SIGNED by the parties on the date first set forth above.
[Societe des Mines de MORILA]
By: ______________________________
Name Printed: ____________________
Title: __________________________
[Rolls-Royce Power Ventures Limited]
By: ______________________________
Name Printed: ____________________
Title: __________________________
NM Rothschild & Sons Limited
in its capacity as the Agent
By: ______________________________
Name Printed: ____________________
Title: __________________________
By: ______________________________
Name Printed: ____________________
Title: __________________________
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EXHIBIT 15
SITE
MORILA
Site layout: drawing no.: 274-GA-002
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